Ergo Update

The Ministry of Corporate Affairs (MCA) has notified the Companies (Corporate Social Responsibility Policy) Amendment Rules 2021 (Amendment Rules) to amend the Companies (Corporate Social Responsibility Policy) Rules 2014 (

The Securities and Exchange Board of India (SEBI) issued a consultation paper on 27 January 2021 on the introduction of provisions relating to the appointment / re-appointment of persons who fail to get elected as Whole Time Directors (WTDs) / Managing Directors (MDs) at the general meeting of a listed entity. This has been done with a view to promoting corporate governance and upholding shareholder supremacy in the functioning of listed entities.

On 22 January 2021, the Competition Commission of India (CCI) published its market study on the Indian telecom sector (Market Study). Initiated by the CCI in January 2020 as part of its advocacy measures, the Market Study aims to analyse competition challenges in the wake of technological innovations, and regulatory changes.

Recently, the Mumbai Bench of the Income Tax Appellate Tribunal (Tribunal) delivered an interesting ruling in the case of Unnikrishnan V S v ITO [ITA Nos. 1200 and 1201/Mum/2018] on taxation of perquisites arising out of equity incentives to a non-resident which were granted in India.

In yet another case involving the real estate sector, the Competition Commission of India (CCI) dismissed allegations of abuse of dominant position by Haryana Urban Development Authority. (HUDA), a statutory urban planning agency.

The Competition Commission of India (CCI) took suo moto cognisance of alleged cartelisation between Romsons Scientific & Surgical Industrial Private Limited (Romsons / OP-1) and BSN Medical Private Limited (now known as Essity India Private Limited) (BSN / Essity / OP-2; along with Romsons, referred to as the OPs) in an open tender for surgical tapes invited by All India Institute of Medical Sciences (AIIMS).

A three-judge bench of the Hon’ble Supreme Court in the case of M/s N.N. Global Mercantile Pvt. Ltd. v. M/s Indo Unique Flame Ltd. & Ors by judgment dated 11.01.2021 expressed a differing view on the issue of invalidity and unenforceability of an arbitration agreement in an unstamped underlying contract and referred the issue to a Constitution Bench in light of the conflicting view it expressed on a well-settled issue.

The Securities and Exchange Board of India (SEBI) vide various circulars in October and November 2020 had substantially streamlined the process of issuance and listing of debt securities. SEBI through its circular dated 03 November 2020 had specified comprehensive guidelines for creation of security and due diligence to be carried out by the debenture trustee (s) in relation to issuance of listed debt securities (Circular).

Adam Smith’s free-market economy pivots around minimal government intervention so that markets can self-regulate and operate optimally. Unfortunately, in many cases, such environments allow the rise of monopolies through organic or inorganic growth. While true monopolies are rare in a free market economy, lack of government intervention often allows the rise of a single large player with many minor players with limited competitive ability. In these situations, the large firm is considered to have “monopoly power”.

In the past we have discussed at length the role played by proxy advisors and the regulatory framework set up by the Securities and Exchange Board of India which can be found here. This update discusses the latest SEBI Circular dated 31 December 2020, which amends the SEBI Circular titled ‘Procedural Guidelines for Proxy Advisors’ dated 3 August 2020.