BIMONTHLY LEGAL TABLET
Volume 3, Issue 6
November 05, 2013
“If you’re a litigating attorney, always discuss tactics with the client at the trial. Not only will this surprise your adversary but your client as well.”
Arthur Greebler, American Lawyer
Contents
- Law & Policy
- Notifications & Circulars (September – October 2013)
- Bills Update for the Extended Monsoon Session of Parliament of India
- Legal Pronouncements
- Supreme Court of India Judgements
- Trademark, Copyright & Design
- Legal News
LAW & POLICY
Notifications, Circulars (September – October 2013)
RBI – A.P. (DIR Series) Circular No. 30 dated September 04, 2013
The Reserve Bank of India clarified that all financial commitments made on or before August 14, 2013 under the earlier limit of 400% of net worth of the Indian Party under the automatic route would continue to be allowed and would not require unwinding or RBI approval.- Existing overseas investments remain protected
- No unwinding requirement
- 400% net worth limit retained
- Applies to eligible ECB-funded commitments
External Commercial Borrowings from Foreign Equity Holder
A.P. (DIR Series) Circular No. 31
Eligible borrowers were permitted to avail ECB under the approval route from foreign equity holders with a minimum average maturity period of seven years.- Minimum 25% paid-up equity must be held by lender
- Funds cannot be used for prohibited purposes
- No on-lending to group companies
- Repayment begins only after seven years
- No prepayment before maturity
Risk Management and Inter Bank Dealings
Circular No. 36
The RBI provided operational flexibility for exporters and importers to hedge foreign exchange risk.- Exporters can cancel and rebook up to 50% of forward contracts
- Importers can cancel and rebook up to 25% of forward contracts
- Applicable to contracted exposures
FDI Transactions – Bank Guarantees
Circular No. 37
Authorized Dealer Category-I Banks were permitted to issue bank guarantees on behalf of non-residents acquiring shares through open offers, delisting and exit offers without prior RBI approval.- Must comply with SEBI SAST Regulations
- Guarantee must be backed by international bank counter guarantee
- Validity co-terminus with offer period
FDI Policy – Definition of Control
Press Note No. 4 (2013 Series)
The Government revised the definition of the term “Control”.“Control shall include the right to appoint a majority of the directors or to control management or policy decisions through shareholding, management rights, shareholders agreements or voting agreements.”
BILLS UPDATE
Important Bills Passed During Monsoon Session
- The Prohibition of Employment as Manual Scavengers and their Rehabilitation Bill, 2012
- The Pension Fund Regulatory and Development Authority Bill, 2011
- The Securities and Exchange Board of India (Amendment) Bill, 2013
- The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Bill, 2013
- The National Food Security Bill, 2013
- The Companies Bill, 2011
LEGAL PRONOUNCEMENTS
Pinakin Mahipatray Rawal v. State of Gujarat
MANU/SC/0916/2013
The Supreme Court examined whether an extra-marital affair amounts to cruelty under Section 498A of the Indian Penal Code.- Mere intimacy with another person is insufficient
- Cruelty must be grave in nature
- Conduct should be capable of driving spouse to suicide
Hill Properties Ltd. v. Union Bank of India
MANU/SC/0921/2013
The Supreme Court held that flat owners have transferable and heritable rights over their flats.- Owners can sell flats
- Owners can mortgage flats
- No permission required from builder
- Society may have charge for outstanding dues
A.C. Narayanan v. State of Maharashtra
MANU/SC/0934/2013
The Supreme Court held that complaints under Section 138 of the Negotiable Instruments Act may be filed through a Power of Attorney holder.- Power of Attorney complaints are valid
- Attorney holder can depose before Court
- Attorney holder may verify complaint on oath
M/s Larsen & Toubro Ltd. v. State of Karnataka
MANU/SC/0985/2013
The Supreme Court clarified the taxation of building contracts.- Building contracts are works contracts
- Tax applies where agreement is entered before completion
- No works contract where completed property is sold
Kulja Industries Ltd. v. BSNL
MANU/SC/1014/2013
The Supreme Court observed that blacklisting by State authorities is subject to judicial review.- Blacklisting is a penalty
- Decision must be fair and reasonable
- Quantum of blacklisting can be reviewed by courts
TRADEMARKS & COPYRIGHT
Trademark & Copyright Updates
- Justice K.N. Basha appointed Chairman of IPAB
- Ecuador denied registration of ARROZ GANDHI trademark
- Registration opposed due to misuse of Mahatma Gandhi’s name
- West Bengal approved anti-piracy ordinance with stricter penalties
Nirmal Industrial Controls Pvt. Ltd. v. Nirma Chemical Works Pvt. Ltd.
IPAB Decision – 13.09.2013
The Intellectual Property Appellate Board removed the NIRMA trademark under Class 6 due to non-use.- Trademark registered on proposed-to-be-used basis
- No evidence of actual use
- Registration removed from trademark register
Salim Khan v. Sumeet Prakash Mehra
The Bombay High Court held that producers of the original film possessed rights to remake the movie Zanjeer.- Producer is first owner of copyright
- Rights pass to legal heirs
- Compensation sought prevented grant of injunction
Bajaj Auto Ltd. v. JA Entertainment Pvt. Ltd.
The Bombay High Court restrained the defendants from using the title “HAMARA BAJAJ” for a movie.- BAJAJ is a registered trademark
- Use in movie title restrained
- Protection granted to famous brand identity
LEGAL NEWS
Major Legal Developments (September–October 2013)
- National Food Security Bill passed and received Presidential assent
- PFRDA Bill passed by Lok Sabha
- Companies Act 2013 draft rules released
- FDI policy notified under FEMA regulations
- Telangana State approved by Union Cabinet
- Supreme Court ruled illegally obtained evidence can be admissible
- CCI continued investigations into Google search practices
- Aadhaar declared optional by Government before Supreme Court
- NCLT expected to become operational
- Supreme Court directed fixed tenures for bureaucrats
Disclaimer
Doc ID: 10NOVBT42 The contents of this publication are for information purposes only and should not be construed as legal advice.- Privileged and Confidential
- Private circulation only
- Copyright protected
- Authors and Firm disclaim liability arising from use of information
