Legal Updates

– Kailash Ram, Associate The Indian real estate sector has faced significant turbulence, marked by numerous stalled projects, developer defaults, and the plight of homebuyers left with uncertain investments. Prior to 2016, resolving such distress was fragmented and protracted. The enactment of the Insolvency and Bankruptcy Code, 2016, marked a watershed moment, providing a consolidated, time- bound framework aimed at resolving insolvency, maximizing asset value, and balancing the interests of all stakeholders, including the long-neglected homebuyers. The IBC operates alongside the Real Estate (Regulation and Development) Act, 2016, which primarily focuses on project regulation and buyer protection, while the IBC addresses the financial distress and insolvency of the developer entity itself. Auto-renewal clauses are contractual provisions that facilitate the automatic renewal of services for a subsequent term unless terminated by the consumer within a specified period. These clauses are typically drafted to favour. Unique Challenges Addressed by IBC in Indian Real Estate The IBC framework had to grapple with sector-specific complexities: The IBC Framework and Real Estate Insolvency The IBC introduced the Corporate Insolvency Resolution Process (CIRP), a structured mechanism applicable to distressed real estate companies: Empowerment of Homebuyers under IBC: A Landmark Shift Perhaps the most significant impact of the IBC on real estate has been the empowerment of homebuyers: Innovative Resolution Mechanisms Evolving under IBC Recognizing that a ‘one-size-fits-all’ approach doesn’t work for real estate, the IBC framework has seen significant evolution through regulations and judicial interpretation: Ongoing Challenges Despite significant progress, challenges persist: Conclusion The Insolvency and Bankruptcy Code, 2016, has fundamentally reshaped the landscape for resolving distress in India’s real estate sector. By granting homebuyers the status of financial creditors and fostering innovative, sector- specific solutions like project-wise resolution and Reverse CIRP, the IBC framework, guided by judicial interpretation and regulatory adaptation, strives to move beyond mere liquidation towards viable project completion and stakeholder value maximization. While challenges in implementation remain, the IBC provides a dynamic and evolving legal tool critical for addressing insolvency crises and restoring confidence in the Indian real estate market.

Introduction Emergency Arbitration is swiftly gaining traction as a preferred route for urgent interim relief in high-stakes international disputes. It offers a fast-track mechanism for parties seeking to preserve their rights before the full constitution of an arbitral tribunal. However, in the Indian context, the legal enforceability of Emergency Arbitrators’ orders has historically resided in a grey zone. This presentation delves into the evolving judicial approach in India, the legislative lacunae under the Arbitration and Conciliation Act, 1996, and how recent landmark judgments are reshaping the enforcement landscape. Understanding Emergency Arbitrators Emergency Arbitrators (EAs) are specially appointed by arbitral institutions to grant interim relief in urgent cases—typically before the arbitral tribunal is formally constituted. This mechanism is widely recognised and utilised under institutional rules of arbitral bodies such as the Singapore International Arbitration Centre (SIAC), the International Chamber of Commerce (ICC), and the London Court of International Arbitration (LCIA). EAs empower parties to prevent irreparable harm and maintain status quo in time-sensitive disputes. Nevertheless, because they derive authority solely from institutional rules and not domestic statutes, their recognition in municipal legal systems like India’s remains limited and contested. Legal Gap in Indian Arbitration Law The Arbitration and Conciliation Act, 1996, as it currently stands, does not make any express provision for Emergency Arbitrators or the enforceability of their decisions. Indian law allows for interim relief under Section 9 (courts) and Section 17 (arbitral tribunals), but since EAs operate before a tribunal is formally constituted, their jurisdiction falls outside these provisions. This legal vacuum has posed a long-standing barrier to the seamless adoption of Emergency Arbitration in India, especially when it comes to domestic arbitrations or ad hoc proceedings. Amazon v. Future Retail – A Precedent A watershed moment in India’s Emergency Arbitration jurisprudence came in the Amazon.com NV Investment Holdings LLC v. Future Retail Ltd. case. The dispute arose when SIAC’s Emergency Arbitrator issued an interim order restraining Future Retail from proceeding with a deal with Reliance. Amazon sought to enforce the order in India, sparking a legal battle that reached the Supreme Court. Both the Delhi High Court and the Supreme Court upheld the enforceability of the emergency award, recognizing it under Section 17(1) of the Arbitration and Conciliation Act. The case underscored judicial willingness to honour party autonomy and institutional rules, thus signalling a paradigm shift in India’s approach to Emergency Arbitration. Supreme Court’s Recognition of EAs In its 2021 decision, the Supreme Court firmly established that orders issued by Emergency Arbitrators are enforceable under Section 17(1) of theArbitration Act. The Court highlighted the importance of party autonomy—the freedom of parties to select institutional rules that permit Emergency Arbitration— as a cornerstone of modern arbitration. It clarified that there is no statutory embargo preventing courts from recognising and enforcing such orders. This judgment marked a turning point by bringing Emergency Arbitration out of the legal shadows and into the realm of enforceable interim mechanisms under Indian law. Remaining Challenges and Ambiguities While judicial recognition is a welcome development, Emergency Arbitration still faces several hurdles in India. The absence of express statutory recognition continues to cast doubt on the enforceability of emergency orders, particularly in domestic arbitrations. Different High Courts have adopted varying interpretations, and procedural inconsistencies persist due to the lack of uniform legislative guidance. Questions around the binding nature of EA orders, appeal mechanisms, and their place in the Indian legal hierarchy remain unresolved. A formal legislative amendment acknowledging Emergency Arbitrators and clearly outlining their powers and limits would help harmonise practice and boost investor confidence. Implications for Commercial Contracts For commercial entities—especially those engaged in high-value, cross-border transactions—incorporating institutional arbitration rules that support Emergency Arbitration is increasingly advisable. Well-drafted arbitration clauses referencing bodies like SIAC or ICC can provide access to rapid interim relief mechanisms and facilitate smoother enforcement within India. However, until India’s legislative framework evolves, the enforceability of such orders will depend largely on judicial discretion, party cooperation, and the jurisdictional alignment of the dispute. Legal teams must proactively structure contracts and arbitration strategies to navigate these complexities and maximise the utility of Emergency Arbitration.

The evolution of money from paper-based to digital forms is now entering a transformative phase with the advent of Central Bank Digital Currencies (CBDCs). As sovereign-backed digital currencies gain traction globally, legal systems are grappling with the implications of this paradigm shift. While CBDCs promise efficiency, financial inclusion, and real-time settlements, they also introduce a spectrum of legal and regulatory challenges. The potential for disputes—ranging from privacy concerns to cross-border jurisdictional issues—raises critical questions about how legal systems must adapt to manage the risks associated with this digital evolution. The Emergence of CBDCs CBDCs are digital versions of a country’s sovereign currency, issued and regulated by the central bank. Unlike cryptocurrencies such as Bitcoin, which operate on decentralized networks, CBDCs are centralized and backed by government authority. Several countries—including China, India, and the Eurozone—are piloting or actively developing their own CBDCs to modernize payment systems, combat illicit financial flows, and maintain monetary sovereignty in the face of private digital currencies. Legal Risks in the Rise of CBDCs 1. Data Privacy and Surveillance Concerns One of the most pressing legal challenges surrounding CBDCs is the potential erosion of financial privacy. Since transactions are recorded on centralized ledgers, governments may gain unprecedented access to citizens’ spending behavior. This raises constitutional concerns, especially in democracies where the right to privacy is protected, such as under Article 21 of the Indian Constitution post Puttaswamy v. Union of India. Balancing transparency for regulatory oversight with the protection of individual privacy rights will be a key legal battleground. 2. Jurisdiction and Cross-Border Disputes CBDCs could radically alter cross-border transactions, potentially bypassing the SWIFT network and conventional correspondent banking systems. This introduces complex legal questions regarding jurisdiction, enforceability of contracts, and conflict of laws. Disputes may arise where transactions involve parties in multiple countries with differing legal frameworks for digital currencies. There is a pressing need for international consensus or treaties to regulate CBDC interoperability and dispute resolution. 3. Consumer Protection and Legal Recourse With CBDCs, the interface between users and the digital currency system may be managed by intermediaries such as commercial banks or fintech platforms. In the event of system failure, fraud, or erroneous transactions, liability may become a legal grey area. Consumers must be afforded adequate protection, including clear mechanisms for redressal and compensation. Legislatures will need to update existing consumer protection laws or create specialized frameworks for digital finance. 4. Cybersecurity and Operational Risks Given that CBDCs are built on digital infrastructure, they are vulnerable to hacking, technical glitches, and systemic cyber threats. Any breach can have significant implications for financial stability and national security. Legal frameworks must therefore mandate stringent cybersecurity standards and allocate responsibility in cases of breach or service outage, especially when such incidents affect public trust and economic continuity. 5. Monetary Policy and Legal Autonomy CBDCs may also disrupt traditional monetary policy tools. For example, if the public begins to hold CBDCs instead of commercial bank deposits, it could reduce banks’ ability to lend, affecting credit creation. Legal questions about the role of central banks, the autonomy of monetary policy, and the permissible scope of direct financial intervention will arise. Legislatures must delineate clear mandates for central banks in a CBDC-driven economy. Conclusion The rise of Central Bank Digital Currencies marks a historic juncture in the evolution of money. However, alongside the potential benefits lie significant legal risks that cannot be ignored. For CBDCs to function effectively and equitably, a comprehensive legal framework is imperative—one that harmonizes innovation with constitutional rights, international cooperation with national sovereignty, and economic efficiency with legal accountability. As jurisdictions like India move forward with digital rupee pilots, the legal community must proactively engage in shaping policies and regulatory responses to ensure that the digital future of money is not only efficient but also just and secure.

Technology has completely reshaped the way litigation is handled, making legal research, case management, and evidence presentation more efficient than ever before. With tools like artificial intelligence (AI), electronic discovery (e-discovery), anddigital communication, lawyers can now work faster and more effectively. But withthese advancements come serious ethical concerns—confidentiality, accuracy, fairness, and professional responsibility are all at stake. Legal professionals need to be mindful of these challenges to uphold justice and preserve the integrity of the legal system. 1. Confidentiality and Data Security Confidentiality is one of the most fundamental principles in legal ethics. With so much client data stored and shared digitally, the risk of security breaches is real. To protect sensitive information, lawyers should: • Use encrypted communication channels and secure cloud storage. • Implement multi-factor authentication to keep unauthorized users out. • Stay compliant with data protection laws like the GDPR and India’s Information Technology Act, 2000. • Educate their teams and clients about cybersecurity best practices. 2. Staying Up to Date with Legal Technology Lawyers have a duty to keep up with the latest technology. This means: • Understanding how AI-powered research tools work and their limitations. • Keeping pace with blockchain, predictive analytics, and digital forensics. • Fact-checking AI-generated legal arguments to ensure accuracy. 3. Digital Evidence and the Risk of Deepfakes Technology has made digital evidence an essential part of many cases, but it also brings new risks. Deepfakes—AI-generated content that manipulates audio, video, or images— could be used to introduce false evidence. To avoid this: • Lawyers need to carefully verify digital evidence before presenting it in court. • Forensic tools should be used to check for alterations or manipulation. • Courts need stricter guidelines on the admissibility of AI-generated content. 4. The Dangers of AI Bias in Legal Decisions AI can help predict case outcomes, recommend sentences, and analyze legal documents, but these systems are only as good as the data they’re trained on. If the data is biased, the results will be too. To ensure fairness: • Lawyers should critically analyze AI-generated legal insights. • Transparency in AI decision-making processes should be prioritized. • AI tools should always be used with human oversight. 5. Ethical Use of Social Media in Litigation Social media is a goldmine for evidence, but lawyers must use it ethically. That means: • Avoiding deceptive tactics, like creating fake profiles to gather information. • Respecting client confidentiality and avoiding public discussions of cases. • Thinking about the potential consequences of online statements. 6. The Risk of Unauthorized Legal Practice Through AI AI-driven legal tools are becoming more common, but there’s a fine line between using technology for assistance and relying on it for actual legal advice. Lawyers should: • Ensure that AI-powered tools don’t cross into unauthorized legal practice. • Make sure clients understand that AI can’t replace a qualified attorney. • Follow all professional regulations regarding legal automation. 7. Ensuring AI-Generated Legal Content is Reliable Lawyers have faced penalties for submitting AI-generated legal documents with fake citations. This highlights the need for: • Verifying all AI-generated legal research before using it. • Cross-checking citations with primary sources. • Being mindful that AI tools are fallible and require human oversight. 8. Maintaining Professional Integrity in Tech-Driven Litigation The duty of candor extends to technology use in legal practice. Lawyers should: • Disclose when AI-generated content is used in court filings if necessary. • Ensure all electronic submissions comply with procedural rules. • Prevent AI misuse that could compromise legal integrity. Conclusion: Technology is transforming litigation in ways that make legal work more efficient and accessible. However, the ethical concerns that come with it—data security, AI bias, deepfake evidence, and more—can’t be ignored. Lawyers have a responsibility to balance technological innovation with professional integrity, ensuring that justice is served without compromising ethical standards. By staying informed, exercising caution, and upholding the core values of the legal profession, they can make the most of legal technology while preserving the integrity of the law.

– Somya Saxena, Associate The year has seen significant developments in insolvency jurisprudence under the Insolvency and Bankruptcy Code, 2016 (IBC). Both the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT) have played pivotal roles in shaping the interpretation and application of the IBC, ensuring a balance between creditor recoveries, corporate revival, and adherence to procedural fairness. This article exploresthe key trends and landmark rulings by NCLT/NCLAT over the past year and their implications for stakeholders. Strengthening the Creditor-In-Control Framework One of the cornerstones of the IBC is the principle of “creditor in control,” which vests decision-making power with the Committee of Creditors (CoC). NCLT/NCLAT rulings this year have consistently reinforced the supremacy of the CoC in approving resolution plans. Evolving Jurisprudence on Personal Guarantors The liability of personal guarantors to corporate debtors has been a major area of focus this year. With the Supreme Court’s decision in 2021 upholding the validity of personal guarantor provisions under the IBC, the NCLT/NCLAT have dealt with several cases clarifying the extent of personal guarantors’ liabilities. Addressing Delays and Procedural Bottlenecks While the IBC mandates a 330-day timeline for resolution, delays remain a recurring challenge. Over the past year, NCLT and NCLAT have taken a stricter stance against avoidable delays, emphasizing adherence to statutory timelines. Expedited Hearings: Tribunals have proactively prioritized insolvency matters and discouraged adjournments, except in extraordinary circumstances. In Jaypee Infratech Ltd., the NCLAT directed the CoC to ensure timely resolution by actively engaging with resolution applicants, reducing the scope for litigation-induced delays. Accountability for Delays: In cases like Committee of Creditors of Essar Steel v. Satish Kumar Gupta, tribunals highlighted the need for efficient coordination between stakeholders to prevent prolonged litigation. Additionally, rulings encouraged CoCs and resolution professionals (RPs) to streamline processes, such as quicker invitation and evaluation of bids. Cross-Border Insolvency and Group Insolvencies While India is yet to formally adopt the UNCITRAL Model Law on CrossBorder Insolvency, NCLT/NCLAT rulings have shown a growing willingness to address cross-border complexities and group insolvencies. Recognition of Foreign Proceedings: In the case of Jet Airways (India) Ltd., the NCLAT upheld cooperation between Indian and Dutch insolvency professionals, signaling progress toward cross-border insolvency norms. This case exemplifies the potential for harmonizing insolvency frameworks across jurisdictions, even in the absence of formal legislative mechanisms. Group Insolvencies: Tribunals have also dealt with cases involving insolveing corporate groups, where they emphasized the importance of consolidated resolution plans to maximize asset value. For instance, in the insolvency of Amtek Group companies, NCLT encouraged the CoC to develop holistic solutions rather than fragmenting the proceedings, to ensure coordinated recovery for stakeholders. Pre-Packaged Insolvency for MSMEs The introduction of the pre-packaged insolvency resolution process (PPIRP) for micro, small, and medium enterprises (MSMEs) has been a game-changer. NCLT has adjudicated several pre-pack cases this year, streamlining resolutions for distressed MSMEs. Key Approvals: In some landmark approvals, NCLT stressed the importance of faster resolutions under PPIRP while ensuring compliance with transparency and procedural requirements. This has encouraged wider adoption of pre-packs by MSMEs. Increasing Focus on Resolution Professional Accountability The conduct of resolution professionals (RPs) has been under scrutiny, with NCLT/NCLAT emphasizing their fiduciary duty and accountability. Liquidation vs. Revival Another key trend this year has been the tribunals’ nuanced approach toward liquidation cases. While resolution remains the preferred objective, NCLT/NCLAT have allowed liquidation where resolution is unviable. Conclusion The past year’s NCLT/NCLAT rulings highlight a maturing insolvency framework in India. These rulings reflect a consistent effort to uphold the objectives of the IBC while addressing evolving challenges, such as personal guarantor liabilities, cross-border insolvency, and procedural delays. Going forward, stakeholders can expect continued judicial guidance on complex insolvency issues, which will further strengthen the IBC’s role as a robust framework for corporate resolution and restructuring.