ALAYA LEGAL BULLETIN
Arbitration and Litigation
The Arbitration Act, 1940 | 30-day limitation period starts when objector becomes aware of award, not upon formal notice
The Hon’ble Supreme Court examined the issue of whether or not the 30-day limitation period for filing objections to an arbitral award under the Arbitration Act, 1940, shall commence from the respondent’s knowledge of the award, even if the formal notice of the award was received on a later date.
The Hon’ble Supreme Court allowed the appeal and held,“The formal date of notice of filing of the award on the respondents, that is, 18.11.2022 holds no significance as they were made sufficiently aware of the award’s filing on 21.09.2022 itself. The court directing the respondents to clear the fees was a clear intimation about its filing. Holding otherwise would not only be departing from precedents of this Court, but also allowing the respondents to take advantage of their own inaction.”
High Court's interference under Article 226/227 is permissible only if the Arbitral Tribunal's order is patently perverse
The question for consideration before the Hon’ble Supreme Court was whether or not the High Court had correctly exercised its supervisory jurisdiction under Article 227 of the Constitution of India in granting the respondent/claimant one more opportunity to cross-examine appellant/respondent’s witness, despite the Arbitral Tribunal rejecting such a prayer.
The Hon’ble Supreme Court examined the other parts of the order of the High Court of Delhi to see if the High Court had in fact found any perversity in the decision of the Tribunal and found none.
The Hon’ble Supreme Court observed that the High Court has not bothered to indicate under what circumstances the order passed by the Tribunal is perverse. All that the High Court has said is that cross-examination is one of the most valuable and effective means of discovering the truth.
The Hon’ble Supreme Court allowed the appeal holding that, “the only enquiry required was whether there is denial of opportunity for an effective cross-examination of the witness. There is absolutely no discretion about this aspect of the matter, except to say that in the facts and circumstances of the case and as an exceptional circumstance as well, the request of the respondent/claimant is excessive.”
No bar to avail remedy under section 9 of the Arbitration and Conciliation Act, 1996? even against non-parties to the subject matter of dispute
In a matter before the Delhi High Court, the Plaintiffs argued that Defendant Nos. 1 to 3, not being parties to the Family Settlement, could not be subject to arbitration, and therefore, they sought relief through a commercial suit.
Defendants, however, opposed the suit, arguing that the dispute was under arbitration and that the Plaintiffs should have approached the National Company Law Tribunal under the Companies Act, 2013, or gone through pre-institution mediation as per Section 12A of the Commercial Courts Act, 2015.
Without referring to other objections, the High Court observed that “even though Defendant Nos.1 to 3 may not be a party to the Family Settlement but because the Subject properties are the subject-matter of adjudication to which Defendant Nos.4 to 7 are a party, there is no bar to avail the remedy under Section 9 of the Arbitration and Conciliation Act, 1996 even against Defendant Nos.1 to 3.”
The Delhi Family Courts (Amendment) Rules, 2024
The Lt. Governor of the National Capital Territory of Delhi, after consultation with the High Court of Delhi, has notified the Delhi Family Courts (Amendment) Rules, 2024 to further amend the Delhi Family Court Rules, 1996.
Among other things, the Rules add new chapters on protecting the privacy of parties or persons and affidavits of assets, income, and expenditure in all matrimonial cases.
Corporate and Commercial
Vicarious liability of directors/officials not automatic; specific statutory provision and personal involvement needed
An appeal arose from the judgment passed by the High Court of Punjab and Haryana. Vide said judgment, the High Court rejected the petition filed by the appellants invoking Section 482 of the Code of Criminal Procedure,1973 for the purpose of quashing the complaint lodged by the Range Forest Officer under Section 4 of the Punjab Land Preservation Act, 1900 for the alleged offence of uprooting trees.
The persons who were actually found at the site felling the trees not were arrayed as accused in the complaint, instead, a complaint against the officers of the company was lodged.
The Hon’ble Supreme Court observed that the Courts below proceeded on the erroneous assumption that the three appellants being responsible officers of the company are liable for the alleged offence. While a company may be held liable for the wrongful acts of its employees, the liability of its directors is not automatic.
The Hon’ble Supreme Court allowed the appeal and held that “It is the cardinal principle of criminal jurisprudence that there is no vicarious liability unless the statute specifically provides so. Thus, an individual who has perpetrated the commission of an offence on behalf of a company can be made an accused, if the statute provides for such liability and if there is sufficient evidence of his active role coupled with criminal intent.”
Section 21 Code of Civil Procedure, 1908 (CPC) - Objections to the place of suing cannot be allowed unless taken in court of first instance at the earliest opportunity
The Hon’ble Supreme Court overturned the Calcutta High Court's decision, which had set aside the National Company Law Tribunal’s (NCLT) order rejecting a recall application related to the admission of Punjab National Bank's (PNB) insolvency petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC).
The NCLT had admitted the petition based on the company's registered office being in Kolkata, despite the company’s address change to Cuttack. Respondent No. 2 later sought to recall the NCLT's admission order, arguing jurisdiction issues, but the NCLT dismissed this. The Calcutta High Court, however, allowed the recall, prompting PNB to approach the Hon’ble Supreme Court.
The Hon’ble Supreme Court observed that objections to jurisdiction should be raised promptly under Section 21 of the CPC and that failure to inform PNB about the address change precluded the respondent from raising jurisdictional objections at a later stage.
The Hon’ble Supreme Court opined that the High Court remained oblivious to the limited role and jurisdiction of superintendence in exercising power under Article 227 of the Constitution of India as well as in not fully examining the apparent facts as well as consequences of setting aside the order of admission under the IBC.
'IBC A Complete Code': The Hon’ble Supreme Court sets aside the High Court order exercising writ jurisdiction to interdict the Corporate Insolvency Resolution Process (CIRP)
The Hon’ble Supreme Court recently set aside a Karnataka High Court order that interrupted a CIRP under the Insolvency and Bankruptcy Code, 2016 (IBC).
The Hon’ble Supreme Court noted that the High Court committed an error in entertaining the writ petition and allowed the appeal holding that, “the High Court should have noted that Insolvency and Bankruptcy Code is a complete code in itself, having sufficient checks and balances, remedial avenues and appeals. Adherence of protocols and procedures maintains legal discipline and preserves the balance between the need for order and the quest for justice. The supervisory and judicial review powers vested in High Courts represent critical constitutional safeguards, yet their exercise demands rigorous scrutiny and judicious application. This is certainly not a case for the High Court to interdict CIRP proceedings under the Insolvency and Bankruptcy Code.”
领英推荐
Master Direction - Reserve Bank of India (Non-resident Investment in Debt Instruments) Directions, 2025
The Reserve Bank of India has issued the Master Direction on Non-resident Investment in Debt Instruments, 2025, consolidating regulations under the Foreign Exchange Management Act, 1999, and the Reserve Bank of India Act, 1934.
It defines key terms and outlines investment routes for non-residents, including the General Route, Voluntary Retention Route (VRR), Fully Accessible Route (FAR), and International Financial Services Centre (IFSC) schemes.
Non-residents can invest in government and corporate debt securities, subject to specified limits on maturity, short-term investments, and concentration. These directions are effective immediately.
Energy and Sustainability
Appellate Tribunal for Electricity (APTEL) failed to consider larger public interest for disposal of huge quantity of waste generated in Delhi: Supreme Court upholds MCD’s tariff adoption process for Waste-To-Energy Project
The APTEL Judgment had set aside the orders of the Delhi Electricity Regulatory Commission (DERC). The DERC had dismissed the Petition filed by Waste to Energy Research & Technology Council (WTERT) challenging the authority of the Municipal Corporation of Delhi (MCD/Appellant) to issue the tariff-based bid and Request for Proposal for setting up the Waste to Energy (WTE) project at Narela Bawana, Delhi.
The Hon’ble Supreme Court had to determine whether or not the application under Section 63 of the the Electricity Act, 2003 (the Act) could have been made by the MCD which is a ‘local authority’ within the meaning of Section 2(41) of the Act.
The Hon’ble Supreme Court held that “The reasoning given by the APTEL, that if the application of the Appellant-MCD for the adoption of the tariff was held to be tenable, then it would amount to permitting any stranger to apply under Section 63 of the Act, is factually not correct. The APTEL failed to take into consideration that the Appellant-MCD was establishing the said Project to perform its statutory obligations.”??
Karnataka High Court strikes down the Electricity (Promoting Renewable Energy Through Green Energy Open Access) Rules 2022 (Rules) and regulations framed by the Karnataka Electricity Regulatory Commission, says It lacks legislative competence.
The Karnataka High Court struck down the Rules and the Karnataka Electricity Regulatory Commission Regulations, 2022, which were framed under the Central Green Energy Open Access Rules, 2022.
The High Court observed that since the power to regulate the transmission, determination and, more specifically, all aspects relating to open access is conferred exclusively on the State Commission under Sections 42(2) and 181 of the Electricity Act, 2003 (‘Act’), it is obvious that all aspects of open access lie within the exclusive domain of the State Commission.
Since the power to administer and monitor open access is conferred on the State Commission, it is obvious that the Central Government does not have the power to frame any Rules. If the impugned Rules framed by the Central Government are accepted, then the aspect of providing open access to renewable sources of energy as specified by the State Commissions stands nullified.
The High Court held that “If Article 253 of the Constitution of India contemplates a law to be made by the Parliament, necessarily, the Parliament has to pass the enactment. The Central Government cannot use the power to frame Rules — which is only a piece of subordinate or delegated legislation — to side-step the Parliament. I am therefore of the view that this argument of the Union also does not merit acceptance.”
Draft Central Electricity Regulatory Commission (Cross Border Trade of Electricity) (Second Amendment) Regulations, 2024
The Central Electricity Regulatory Commission (CERC) has issued the draft CERC (Cross Border Trade of Electricity) (Second Amendment) Regulations, 2024, under the Electricity Act, 2003.
The amendments replace ‘long-term access’ with ‘General Network Access (GNA)’? and introduce temporary general network access for short-term access needs. Key definitions such as ‘cross-border transmission link’ and ‘dedicated transmission system’ have been refined for clarity.
Public notice by Central Electricity Authority (CEA) - Background Note on an alternative mechanism for implementation of Fuel and Power Purchase Adjustment Surcharge (FFPAS) under Rule 14 (Timely Recovery Of Power Purchase Cost By Distribution Licensee) of The Electricity (Amendment) Rules, 2022
The CEA has invited comments/suggestions from the stakeholders on an alternative mechanism for implementation of FFPAS under Rule 14 (timely recovery of power purchase cost by distribution licensee) of the Electricity (Amendment) Rules, 2022.
CEA is desirous of exploring alternative mechanisms to levy uniform FFPAS charges throughout the particular Tariff year to avoid tariff shock to the consumers. Accordingly, enclosed with this notice is a background note on “Alternate Mechanism such as imposing a surcharge along with the tariff, instead of periodical FFPAS”.
The Foreign Exchange Management (Foreign Currency Accounts by a person resident in India) (Fifth Amendment) Regulations, 2025.
The Reserve Bank of India has issued amendments to the Foreign Exchange Management (Foreign Currency Accounts by a Person Resident in India) Regulations, 2015.
This amendment adds a sub-regulation (CA) to regulation 5(C) regarding “opening, holding and maintaining a Foreign Currency Account outside India” under the Foreign Exchange Management (Foreign Currency Accounts by a person resident in India) Regulations, 2015.
The amendment states that the exporters resident in India may open, hold and maintain foreign currency accounts with banks outside India for the realization of full export value and advance remittances.
Funds in these accounts can be used by them for imports or repatriated to India within a period not exceeding the end of the next month from the date of receipt of the funds after adjusting for forward commitments, subject to meeting the realization and repatriation requirements under the Regulation 9 of the Foreign Exchange Management (Export of Goods and Services) Regulations, 2015.
Information Technology and Artificial Intelligence
Draft Digital Personal Data Protection Rules, 2025 (Rules) notified for feedback/comments.
The Ministry of Electronics and Information Technology has notified the Draft Digital Personal Data Protection Rules, 2025 framed under the Digital Personal Data Protection Act, 2023 (DPDP Act), and has invited feedback/comments from the public and stakeholders till 18.02.2025 through the? MyGov platform.
The said Rules seek to protect citizens’ rights in accordance with the DPDP Act while achieving balance between regulation and innovation so that the benefits of India’s growing innovation ecosystem are available to all citizens and India’s digital economy.
The said Rules also seek to address specific challenges like unauthorized commercial use of data, digital harms, and personal data breaches.
If you have any questions regarding any of these developments or would like to reach out to our team for tailored solutions aligned with your vision and growth objectives, contact us today by filling our form: https://alayalegal.com/contact-us/.
Disclaimer: The content provided in this newsletter is intended only for the purposes of general awareness and should not be considered as legal advice. Readers are advised to consult with a qualified legal professional in relation to any specific issues that are mentioned herein.