Earlier this year, the Securities and Exchange Board of India (“SEBI”) amended the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”), to structure the unregulated compensation and profit sharing arrangements/agreements between shareholders/third parties with the employees, including the key managerial personnel, directors and promoters of listed investee companies (“Regulation 26(6)”). These arrangements were widely used by private equity investors to not only incentivize the promoters/key employees/directors but to accelerate the growth of the company and its consequent valuation to benefit the investors and other shareholders at large. But, from SEBI’s view point, these arrangements were a breeding ground for corporate governance issues and unfair trade practices. We have in our earlier article1, discussed the implications of the above SEBI amendment. While the Listing Regulations were amended to incorporate Regulation 26(6) vide its notification dated January 4, 2017, certain ambiguities related to interpretation of the Regulation 26(6) persist.
Compensation Agreements with Employees of Subsidiaries of Listed Indian Entities Within the Ambit of SEBI Listing Regulations
Security interests over movable property can be created by way of mortgage, pledge, hypothecation, lien and charge.However, mortgage is usually a method of creating security interest over immovable properties, and its only in certain specified cases that it is coupled with a mortgage on moveable properties thereon. This article provides a brief introduction to some of the more commonly used security interests for moveable properties (being pledge, hypothecation, lien and charge).
ICCA recognizes Ms. Seema Jhingan as one of India’s Trusted Corporate Lawyers in its publication – ‘The Vanguards’
We are pleased to announce that Ms. Seema Jhingan, has been recognized as one of India’s Trusted Corporate Lawyers of 2017 by the Indian Corporate Counsel Association (ICCA) in its publication – ‘The Vanguards’ (as attached together with her published profile), with forwards from the Department of Legal Affairs, Ministry of Law and Justice and the Department of Commerce, Ministry of Commerce and Industry.
India has increasingly attracted global brands to establish their franchise arrangements in the country to benefit from the ever-expanding Indian market. Indian enterprises have also adopted franchise business models to expand in to the vast Indian territories. Typically, under a franchise model the franchisees benefit from the established business systems of the franchisors under a licensing arrangement with the right to use the trade mark and brand of the franchisors, and open franchise outlets for distribution of the products/services of the franchisor, in consideration of payment of franchise fees and/or royalties to the franchisor.
Employees resigning and ceasing to report to work without due notice and employers facing issues due to lack of proper handover and replacements is a common concern of employer companies. In an earlier article1, we had assessed the issue of deduction of wages of employees of a corporate office in Delhi, upon their failure to serve the required notice period. As a follow up, this article seeks to examine the legality of deduction of wages by employers due to lack of notice by a resigning employee, employed in a factory.
The ‘workers’ employed in a factory in Delhi are governed under the provisions of the Factories Act, 1948 (“Factories Act”). The term “workers” under the Factories Act, has been defined in a wide manner to mean any “person employed, directly or by or through any agency (including a contractor) with or without the knowledge of the principal employer, whether for remuneration or not, in any manufacturing process, or in cleaning any part of the machinery or premises used for a manufacturing process, or in any other kind of work incidental to, or connected with, the manufacturing process, or the subject of the manufacturing process but does not include any member of the armed forces of the Union”.
Judgment: M/s Annapurna Infrastructure Private Limited and Another (“Appellants”) vs. M/s. SORIL Infra Resources Limited (“Respondent”).
Forum: The National Company Law Appellate Tribunal (“NCLAT”).
Act/Law: The Insolvency and Bankruptcy Code, 2016 (“IB Code”) and the Arbitration and Conciliation Act (“A&C Act”).
A common and regular concern faced by employers is the practice of resignation without notice by their employees and consequent disassociation without providing adequate time for due and proper handover. The question which the employers then face is, do we have the right to deduct amounts as payment in lieu of the unserved notice period from the outstanding wages of such employees?
An assessment as to the ability of an employer to deduct outstanding salary in lieu of unserved notice period is a mixed question of fact and law. First of all, it requires an assessment of whether the employee is employed in a corporate office or in a factory or in any other industrial establishment, as that determines the applicability of the relevant legislations. This assessment is also based on determination of the role and responsibility of the concerned employee, his/her salary, place of employment and several other related factors.
The Indian e-commerce boom coupled with the recent demonetization drive by the Indian Government has put the online payment systems to the forefront as a means of easy e-payments. While cash continues to be the predominant and most preferred mode of payment, the prepaid payment instruments (“PPIs”) such as e-wallets etc. are growing in popularity. As a consequence, the Reserve Bank of India has re-assessed the extant regulations as applicable to the PPIs to make the non-cash payment modes safe, secure and KYC compliant for better risk mitigation and customer protection.
With the intent to enable minorities to protect and preserve their language, culture and religion and also to promote and provide education to minorities in general, Article 30 of the Constitution of India (“CoI”) grants minorities the right to establish and administer educational institutions/schools of their choice. Minority status educational institutions enjoy several rights/liberties and a much higher level of administrative and operational freedom as compared to non-minority institutions. The obligations of a non-minority institution is further compounded by the provisions of the Right of Children to Free and Compulsory Education Act, 2009 (“RTE Act”), which inter alia requires admission to students of weaker sections and economically deprived community constituting 25% of the total strength of students, an obligation which is not applicable to minority institutions1. Post implementation of the RTE Act, the applications seeking minority status has seen significant increase for the obvious reasons.