Case BriefsTribunals/Commissions/Regulatory Bodies

Securities and Exchange Board of India: The Board comprising G. Mahalingam as  Whole Time Member, allowed Oil India’s application seeking exemption/relaxation from strict enforcement of the requirement contained under Regulation 24(i)(e) of the Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018.

The aforesaid application was necessitated on account of the transfer of 333,20,401 equity shares held by the promoter of the company, i.e., Government of India to the Asset Management Company (AMC) of Central Public Sector Enterprise Exchange Traded Fund (CPSE–ETF). This activity was carried out as a part of the government’s disinvestment process.

Oil India submitted that the proposed buy–back inter alia will help in optimizing its capital structure and improve its key financial ratios and would also lead to a reduction in outstanding shares, improvement in earnings per share and enhanced return on invested capital.

The Board noted that as per Regulation 28 of the Buy–back Regulations, SEBI may, in the interest of investors and the securities market, relax the strict enforcement of any requirement of aforesaid Regulations except the provisions incorporated from the Companies Act, if it is satisfied that the requirement is procedural in nature or the requirement may cause undue hardship to investors.

It opined that the strict enforcement of Regulation 24(i)(e) of Buy–Back Regulations against Oil India, at this point in time, may result in undue hardship to investors including shareholders of the company who may seek to participate in the proposed buyback. In view thereof, the exemption/relaxation sought for by Oil India was allowed.[Buy-back of securities in Oil India Ltd., In re, WTM/GM/CFD/87/2018–19, Order dated 31-01-2019]

Foreign LegislationLegislation Updates

G.S.R. 581 (E).—In exercise of the powers conferred by sub-section (1) of Section 156 of the Customs Act, 1962 (52 of 1962), read with clauses (n) and (u) of sub-section (2) of Section 11 of the said Act, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby makes the following rules to amend the Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007, notified by the Government of India in the Ministry of Finance (Department of Revenue), Notification No. 47/2007-CUSTOMS (N.T.), dated the 8th May, 2007, published in the Gazette of India, Extraordinary, Part II, Section 3, sub-section (i), vide number G.S.R. 331 (E), dated the 8th May, 2007, except as respects things done or omitted to be done before such amendment, namely:

1 (i) These rules may be called the Intellectual Property Rights (Imported Goods) Enforcement Amendment Rules, 2018.

(ii) They shall come into force on the date of their publication in the Official Gazette.

2. In the said rules,

(A) in Rule 2, –

(i) in clause (b), the words and figures “patent as defined in the Patents Act, 1970,” shall be omitted;

(ii) in clause (c), the words and figures “the Patents Act, 1970,” shall be omitted;

(B) in Rule 5, after condition (b), the following conditions shall be inserted, namely:

“(c) the right holder or his authorised representative shall inform the Commissioner of Customs at the time of giving notice about any amendment, cancellation, suspension, or revocation of the Intellectual Property Right by the authorities under the Intellectual Property Laws or any Court of Law or Appellate Board, subsequent to its registration with the authorities under the Intellectual Property Law and in case of any such amendment, cancellation, suspension or revocation of the Intellectual Property Right during the validity of the notice registered under Rule 4, the same shall be brought to the notice of the Commissioner of Customs by the right holder within a period of one month of the date of communication of any such amendment, cancellation, suspension or revocation of the Intellectual Property Right to the right holder or any person authorised by him in this regard;

(d) in the event of any amendment, cancellation, suspension or revocation of the Intellectual Property Right by the authorities under the Intellectual Property Law or by any Court of Law or Appellate Board, the Commissioner of Customs may accordingly amend, suspend or cancel the notice and the corresponding protection.”.

[F. No. 394/04/2018-Cus.(AS)]

Note: The Notification No. 47/2007-CUSTOMS (N.T.), dated the 8th May, 2007, was published in the Gazette of India, Extraordinary, vide number G.S.R. 33l (E), dated the 8th May, 2007.

Ministry of Finance

[Notification No. 56/2018 – Customs (N.T.)]

Case BriefsHigh Courts

High Court of Delhi: In a petition filed by a Switzerland based company for the enforcement of a foreign arbitral award against the respondent rendered by a Tribunal constituted under London Court of International Arbitration, a Single Judge Bench comprising Vibhu Bakhru, J. accepted the claims of petitioner and refused to decline the enforcement of the award.

The dispute between the two parties was with respect to an agreement to supply of coal of Indonesian origin by petitioner to the respondent which the respondent had breached by refusing to accept deliveries of subsequent consignments. The respondents argued that acceptance of delivery of shipments depended on the quality of the initial consignments and since the quality had been compromised, hence the refusal to accept delivery.

The respondents also contended that the award needed to be set aside as per Section 48 of the Arbitration Act, 1996 which provides for conditions for enforcement of foreign awards, since they were unable to present their case on account of the arbitral tribunal refusing their request to produce documents; that the amount of damages was calculated without application of mind; and that the tribunal permitting the petitioner to place documents on record at the pre-hearing stage was opposed to the fundamental policy of Indian law.

The petitioners, on the other hand, stated that these issues were within the domain of the arbitral tribunal and were not amenable to judicial review. The Court in its findings held that the respondent’s request for production of documents had been declined since they were not material and relevant; the damages that had been granted were in compliance with the law in force in UK under the Sale of Goods Act and in India under the Indian Contract Act and a number of judicial decisions. Therefore, the procedure adopted by the tribunal and the damages awarded were upheld. [Glencore International AG v. Dalmia Cement (Bharat) Limited, 2017 SCC OnLine Del 8932, decided on 03.07.2017]