Who is an investor in a company?

investor in a company

Introduction

Every modern enterprise needs capital to start its business, therefore an investment is the best way to run and for the betterment of the enterprise. It is an asset which is purchased to generate income in the future. It is also important for a business to expand, though, even the inflows from the business can fund that. Capital is essentially obtained in two forms, equity, which is popularly termed as an investment, and, debt, which is the loan that a company takes to start a business. A company has various options that it can exercise to raise capital. The reason attributable to this is the structure. A potential investor would usually repose more faith in a business that is structured as a company, than in other forms, such as sole proprietorship or a limited liability partnership.

With this basic background in mind, it becomes pertinent to explore the area of types of investment to understand how capital is raised in a company.

Who can be an Investor in a Company?

Anyone can be an investor in the Company. An Investor is the one who invests in the company by allocating the capital for the profit in the future. The following can be an investor in the Company:

An individual

Individual purchases small amounts of securities, as opposed to an institutional investor, called as Retail Investor or Small Investor. An Investor can invest in any company such as Sole Proprietorship, Public Company, Private Company, Limited Liability Company, Partnership or any other Company.

A Shareholder of the Company

A shareholder is the one who invests in the company who buys a stock in the Company.

Other Companies

Any other companies can invest in the other company to secure the future earnings. Investing will create partnerships and form relationships with companies relating to their products and services.It is a strategic attempt to gain specific assets.

Foreign Investor

A foreign individual can also invest in the company of India. It is considered as Foreign Direct Investment (FDI) where investment is made in equity shares, fully and mandatorily convertible preference shares and fully and mandatorily convertible debentures with the pricing being decided upfront as a figure or based on the formula that is decided upfront.

Objectives of Investment

Every investor has certain objectives behind the investment which may be monetary/financial in character. There are three financial objectives:

  1. Safety and Security of the fund invested, i.e., Principal Amount.
  2. Profitability, which is through interest, dividend and Capital Appreciation.
  3. Liquidity which is convertible into cash when required.

Period of Investment

There are three terms of the period for the investment:

  • Short-Term- It is up to one year.
  • Medium-Term- It is from 1 year to 3 years.
  • Long-Term- It is of 3 years and above.

Types of Investment

Debt Investment

Debt investment is, as the name suggests, in the form of a debt to the company. In this setup, a person basically loans the money to a limited liability company in the form of money in exchange for the promise of interest income on the principal amount and an eventual repayment of the principal amount. Debt capital is most often provided either in the form of direct loans with regular amortization or the purchase of bonds issued by the business, which provide semi-annual interest payments mailed to the bondholder.[1]

Features of Debt Capital

  • The striking feature of debt capital, amongst others, is that since it is in the form of a loan, the person lending it becomes the creditor of the company and thus, naturally holds a privileged place in the capitalization structure.
  • The basic implication of this would be that if the company goes bankrupt, and the liquidation process must take place, it would mean that the assets of the company would first be utilized to pay off the secured creditors of the company, in this case, a person advancing debt capital would become a secured creditor. This essentially puts them on a higher pedestal than the equity investors.
  • The highest level of debt is a first mortgage secured bond that has a lien on a specific piece of valuable property or an asset, such as a brand name.[2]

For an instance, would be that if someone loans a certain amount of money to a departmental store and is given a lien on the real estate and building, he/she would be eligible to foreclose upon it in the event the company goes south. However, it may take a certain amount of time, effort and money, but they ideally they will be able to recover the loan from the proceeds of the sale that they make of the confiscated property.

Debenture

Another way of investment would be a debenture. This is understood as the lowest level of debt. This is essentially a debt that is not backed by a lien, which means that it is not secured by any specific asset but, rather, but the company’s goodwill and credit.

Strategic Investment

Strategic investments are usually made by cash-rich giants, such as corporations with huge capital to invest in smaller and younger companies. This is essentially done as a business strategy to develop a business synergy. This works as a related industry, investing into another related industry, which is usually running in cohorts with the bigger giant.

Purpose of the Strategic Investment

  • The basic intention behind such investments is using the investee company to increase the profits of the investor company.
  • Another purpose that this sort of investment solves is that it preempts competition from achieving higher efficiency through profitable business synergy or synergies.
  • They essentially want control over the management, however, more often than not, it is in the form of an indirect control. The usual business practice is that the investor company acquires a controlling stake in the investee company, or alternatively, they merge into the investee company. Due to this basic difference, they reap exponentially larger benefits than the financial investors.
  • Another popular method includes forming a joint venture company, wherein they incorporate a third entity to carry out the proposed business. They keep the investor and investee business separate and thus, the investee company doesn’t have control over the investor company. However, the investor company may exercise direct or indirect control in the joint venture company.

Financial Investment

Financial investments are made with the expectation of making only financial returns in terms of cash flow from which investment is made. It would essentially boil down to the dividends that the investor gets from the profits of the company. Investor here looks forward to much more.

Some financial Investors in a company

  1. Venture Capitalists

Venture capitalists, angel investors and private equity investors are essentially financial investors in a company. They are the money managers who make high-risk, high-return investments.[3] Venture Capitalists essentially raise a fund in millions of dollars from private and institutional investors and thereafter invest those funds in a company, usually termed as “portfolio companies”, in expectation of a substantial return. They are rewarded in various ways. Venture Capitalists are paid a percentage of the fund’s value as a management fee and also have a “carried interest” in the company. This means that they get a percentage of profits above a certain pre-decided point.

  1. Angel Investor

An angel investor (also known as a business angel, informal investor, angel funder, private investor, or seed investor) is an affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity.[4] A small but increasing number of angel investors invest online through equity crowdfunding or organize themselves into angel groups or angel networks to share research and pool their investment capital, as well as to provide advice to their portfolio companies.[5]

Purpose of the Financial Investment

  • The sole purpose of financial investments is that they want the dividends from their shareholding and the value of their shareholding to increase over the years.
  • They are generally not interested in running the business unless the business is running profitably. They, therefore, rely on the existing management for running the affairs of the company. However, they might appoint professionals to run the business rather than taking it over themselves.
  • They are also interested in the controlling stake in the business, which is generally at more than fifty percent of the stake. Along with that, they inject funds into the company by investing into freshly allotted shares.
  • They usually specify the number of years in which they would want to exit from the company, for instance, venture capitalists want to exit in five to six years of their investment. When that happens, they recover the amount invested, along with a portion of the profits.

Recent Activities

For entrepreneurs, this is the perfect time period to engage in startup and start a business of their own.

  • The country has committed itself to reducing the red-tapism to a minimum, much of which was flaunted by our Prime Minister Shri Narendra Modi in Davos recently.
  • This has been reflected in the increasing rank of the country in World Bank’s Ease of Doing Business. The Prime Minister’s vow to encourage startups by opening avenues for emerging business by way of Foreign Direct Investments (FDIs) and Make in India campaign, has made the financial environment of growing market for investments.
  • The updation of the Company Law via the amendment in 2013 has been an effort towards this goal. Along with that, the passing of the Insolvency and Bankruptcy Code, 2016, is also a brilliant effort towards this. The changes in the Double Taxation Avoidance Agreement with Mauritius are also one of them.This has led to a general trend that Angel Investors are naturally keen to invest in startups.

With the advent of an increase of use of apps and especially in this technological era, there are more opportunities to start a business with less capital. It is thus an exciting time to weigh options and invest.

Laws Governing Comparative Advertisements in India

Introduction

Every Company wants to promote their products, services, and brands in different styles. Advertising is the most crucial step in determining product’s future prospects. It is the most advantageous way to catch the attention of the consumers in the market. Speaking legally, there are multiple players in the market focusing on increasing their advertisements and many times in order to gain attention and pecuniary gain they use some tactics which land them in trouble. Comparative advertisements is one such unfair trade practice.

Comparative Advertisements

Comparative Advertisements means such practice where one goods or services is compared with another belonging to one of the same field , speaking legally through an advertisement. The comparison is made on the basis of price, quality by referring the alternative brand’s name, visual illustrations, and other distinctive attributes. This type of advertisements is mostly more attention-grabbing and have high rate than non-comparative advertisements. Such type of advertisements creates confusion in the mind of consumers. It mainly affects the goodwill and reputation of the competitors whose products are comparing in such a manner.

Reckitt & Colman v. Kiwi TTK[1]

The Delhi High Court stated that an advertiser can compare his goods by stating it better than the goods of the competitor but he cannot state the competitor’s goods as bad, this would amounts to defamation. Court has the power to grant an injunction in this regard.

Conditions

Comparative Advertising shall be permitted when the following conditions are met

  1. It should not misleading.
  2. There is a comparison between the goods and services which is for same needs and the same purpose.
  3. It compares those goods and services where there are relevant features, which may include price.
  4. It does not create any confusion in the market between the advertiser and a competitor or between the advertiser’s trademarks, trade names, other distinguishing marks, goods or services and those of a competitor.
  5. In the reputation of trademarks of a competitor, there is no unfair advantage.

Classification of Comparative Advertisements

  • Direct Comparative Advertising: This type of advertisement deals with the competing products either are explicitly named or can be precisely identified (by photos, images or trademark).
  • Indirect Comparative Advertising:It does not directly refer to competing brand names.

Objectives of Comparative Advertisements

There are some objectives behind the comparative advertisements:

  • Evaluation of brand performance,
  • To degrade the competitor’s brand on the basis of value proposition the competitive brand is offering,
  • To increase consumer’s information about alternative brands.
  • To convince the users of competing brands to switch to the sponsored brand.

Categories

There are following categories of Comparative Advertisements:

  1. These types of advertisements are done to declare that they are better than others in the market with or without referring to any other particular competing products.
  2. Advertising confers that they are better than other particular class or categories of products.
  3. Advertisement asserting the measurable features of the products or services to make an objective comparison.
  4. Advertisements referring to the competitor’s product with a blurred trademark.
  5. It directs claims that they are better than any single products/ competitor.

Role of Communication in advertising

To increase the strategy of advertising, communication plays a vital role. With the help of print media (newspapers, articles, journals, etc.), audio-visual media (television, internet, movies, etc.), or audio (FM/AM radio), an advertisement can reach to a customer.

Statutory Provisions in India

MRTP Act

The Monopolies and Restrictive Trade Practices Act was enacted to prevent monopolies and restrictive trade practices in the economy. Under the MRTP Act, any representation which gives false information or disparages the goods and services of other person is considered as unfair practices in comparative advertisements. Matters relating to untrue and misleading advertisements were adjudicated upon by the MRTP Commission, constituted under the Monopolies and Restrictive Trade Practices Act, 1969. Section 36A of MRTP Act, 1969 listed with ‘Unfair Trade Practices’.

MRTP Act deals with only three aspects of the market:

  1. Monopolistic
  2. Restrictive
  3. Unfair Trade Practices

Unfair Trade Practices: This practice adopts an unfair method, unfair or deceptive practices for promoting the sales of goods and services. Following are the practices which make it unfair:

  1. Provide false information or facts about goods and services.
  2. Unfair practices of making any statement, whether orally or in writing or by visible representation.

However, MRTP Act was repealed by section 66 of the Competition Act, 2002. The provision on unfair trade practices had a life for two years under the MRTP Act. A consumer needs protection not only from defective goods and deficient services but also from unfair trade practices. The provisions on unfair trade practices were copied from the MRTP Act into the Consumer Protection Act.The definition of ‘Unfair trade practices’ was incorporated under section 2(1)(r) of the Consumer Protection Act, 1986.

  1. Balasundaram v. Jyothi Laboratories[2]

An advertisement of Ujala blue showed that 2-3 drops were sufficient to bring striking whiteness of clothes while several spoons of other brands were required but no label of any brand was shown. In the advertisement, a lady holding a bottle of Ujala was looking down on other bottle and exclaiming, chi, chi, chi! in a disgusting manner. The manufacturer of Regaul, a competing brand, approached the MRTP Commission that the advertisement was disparaging its goods. The Commission was of the view that mere claim to superiority in the quality of one’s product by itself is not sufficient to attract section 36(1)(x) of the MRTP Act. The Commission was of the opinion that it could not be a case of disparagement of goods.

New Pepsodent v. Colgate

Hindustan lever ltd. advertised it’s toothpaste, ‘New Pepsodent’ claiming that it’s toothpaste i.e., ‘New Pepsodent’ is better than the leading toothpaste. The Commission was of the view that the word toothpaste has become synonymous with Colgate over the years. In addition, the Commission noted that the jingle in the background was a familiar one. Thus, it was a case of comparative advertisement where a claim could be made of disparagement of Colgate’s product.

Use of Trademark in Comparative Advertisements

Trademark Act, 1999 is enacted to guarantee protection to national and international brand owners, in conformity with the TRIPS Agreement. It regulates Unfair Trade Practices in comparative advertising and prevents trademark infringement in India.

To identify the products and services, the holder of a trademark has the exclusive rights. Sometimes these exclusive rights can be used in comparative advertisements. A registered trademark is infringed by a person if he exploits such registered trademark, as his trade name or part of his trade name, or the name of his business concern dealing in goods or services in respect of which trademark is registered. Trademark Act has made the grounds for such infringement. Section 29(8) and 30(1) deals with comparative advertisements.

Section 29(8) of the Act outlines the situations in which there is the use of another’s trademark in advertising which amounts to infringement. It is considered to be the unification of laws of unfair competition and unfair trade practices that have set considerations for the use of trademarks in comparative advertisements.[3] According to this section, a registered trademark is infringed where an advertisement:

  1. Is harmful to the trademark’s reputation,
  2. Is destructive to the trademark’s distinctive character,
  3. Takes unfair advantage or considered to be contrary to honest practice.

Section 30(1) provides with an exception when such use of marks is done according to the “Honest Practices” in industrial and commercial matters. When there are comparative advertisements then it might lead to dilution, tarnishment of the trademark of the competitors

The Act permits Comparative Advertisements in three ways:

  1. If there is a bonafide use of Trademark,
  2. If in accordance with the honest practices,
  3. If it does not take an unfair advantage of the reputation of the mark.

Pepsico. Inc. and Ors. v. Hindustan Coca-Cola Ltd. and Anr.[4]

The concept of disparagement was explained by Delhi High Court where it was stated that ‘a manufacturer can make a statement for making his goods at best level and he also makes statement for puffing of his goods and the same will not give a cause of action to the other traders or manufacturers of similar goods to institute proceedings. In doing so, there is no disparagement of the manufacturer’s goods. A manufacturer is not entitled to say the competitor’s goods are bad as to puff and promote his goods. Thus, it was concluded that comparative advertising cannot be permitted which denigrates the trade name or trademark of the competitor.

Reckitt Benckiser (India) Ltd. v. Hindustan Unilever Ltd.[5]

The court held that the advertisement showed between the defendant’s product “Lifebuoy” and the petitioner’s product “Dettol” was a violation of Section 30(1) of the Trademarks Act, 1999. The Court stated that a trader is allowed to declare his goods as the best but the defendant showed the comparison between the two products in his ad and crossed the thin line between puffery and disparagement.

Tata Press Ltd. v. Mahanagar Telephone Nigam Ltd.[6]

According to the Supreme Court, the information available through the advertising must be for the benefit of the public. The law relating to trademarks is also for the protection of public interests only.

Advertising Standards Council of India (ASCI) and Comparative Advertisements

It is a self-regulating voluntary organization of the Indian advertising industry. It was established for protecting the interests of the consumers while observing and guiding the commercial communications.

ASCI has adopted a Code for Self-Regulation (ASCI Code) which applies to all involved in the commissioning, creation, placement, or publishing of advertisements to scrutinize advertising in India. Chapter IV of the code deals with the form and manner of comparative advertising. Advertisements containing comparisons with competing manufacturers and sellers are permissible in the interests of vigorous competition and free dissemination of information. There are following requirements being to be satisfied are:

  1. Advertiser’s product is being compared with the aspects of competitor’s product.
  2. The comparison should not take place in a way which confers an artificial advantage upon the advertiser and should not suggest falsely that advertiser’s product is better.
  3. A Consumer should not mislead due to the comparison.
  4. The advertising does not unfairly denigrate attack or discredit other products, advertisers or advertisements directly or by implication.

The above mentioned principles ensure the advertising activities are conducted in a fair manner, with the interests of all associated groups being secured. These guidelines do not have the force of law there are merely recommendatory in nature.

Consumer Complaints Council (CCC)

The CCC is constituted by ASCI where a person can complain to the ASCI if there is an objectionable advertising. The CCC consists of eminent persons from the industry and well-known persons from the civil society. CCC hears the facts of the complaint and if it finds that the advertisement in question violates ASCI Code or any other law, then it can suggest that the advertisement is voluntarily either withdrawn or modified.

How to Lodge Complaint against Comparative Advertisements

There are three types of Complaints:

Complaints from General Public which includes Government regulators and consumer groups.

  1. Intra Industry Complaints (When an advertiser lodges a complaint against another advertiser)
  2. Suo Moto

Procedure for Complaint

The Complaint may be submitted by letters at the postal address which is provided on the website, visit https://ascionline.org/index.php/how-to-complaint.html

  1. The Complaint can be submitted through the online form, visitwww.ascionline.org and you can also contact through the telephone in 1-800–22-2724 (toll-free) and also through Whatsapp in +91-7710012345.
  2. No fee required for complaints except in case of Intra Industry complaint which is lodged under the Fast Track Complaint Redressal Scheme where the decision is delivered within 7 days and a fee of INR 75,000 is charged for complaint.
  3. If the complaint is complete, the decision will be taken by ASCI’s Consumer Complaints Council (CCC) within a period of one month (approximately).
  4. On receipt of a complaint, the Secretariat acknowledges the complaint and requests the advertiser or agency to provide comments in respect of the complaint.
  5. Within the period of 4 to 6 weeks, the CCC decides upon the complaints.
  6. If the complaint is upheld, then the advertiser and its agency are informed of the CCC decision within 5 working days.
  7. To comply with the CCC decision, the advertiser is given the time of 2 weeks.

Via: blog.ipleaders.in/blog/

How To Set Up a Microfinance Company

Introduction

Microfinance company also known as Micro Finance Institution is a type of institution which provides a small amount of loan up to INR 50,000 primarily in rural and semi-rural areaswhere other banking facilities are not easily accessible.

In India, only Non-Banking Finance Companies are allowed to do finance business, but some other institutions are also given the leverage to do such activities to an extent.

Modes to register a microfinance company

  • Through NBFC- It requires a minimum capital of INR 5 crore.
  • Through Section 8 of Companies Act, 2013- No minimum capital is required.

But not all of the NBFCs are allowed to take deposits from the people. To have the taking deposits status, a different application has to be filed with the RBI.

Registration through NBFC

To start a microfinance company as NBFC, one has to get a license from the Reserve Bank of India under Section 45I(a) of the RBI Act, 1934 and this whole process may take months to complete.

What are the requirements for registration with RBI?

A company desirous of commencing the business of non-banking financial institution should comply with the following:

  1. It should be a company registered under section 3 of the Companies Act, 2013.
  2. It should have a minimum net owned fund of INR 2 Crore.

The following steps are involved in the registration 

#STEP 1: REGISTRATION

The first step to start a microfinance company is to register the company as a private or public company under the Companies Act. Initially, the company can be registered with INR 1 Lakh.

#STEP 2: CAPITAL

The minimum net worth required to register an NBFC is INR 2 Crore. So the next step is to raise the share capital both authorized and paid up up to the required amount.

#STEP 3: FIXED DEPOSIT

The next step is to get to deposit the sum of INR 2 crore in the Fixed Deposit in a freshly opened account and get a ‘no lien’ certificate from the bank. This certificate is needed when the application is filed with RBI.

#STEP 4: DOCUMENTS REQUIRED FOR ONLINE APPLICATION

To fill the online application available on the RBI website, the following documents are required-

  • Duly certified Copies of Certificate of Registration.
  • Certified copies of only the main object clause in the MOA relating to the financial business.
  • Copy of Board resolution along with the self-declaration on behalf of the company that applicant company shall follow all the rules, regulations and notifications issued by RBI.
  • A copy auditor’s report of Fixed deposit receipt & bankers certificate of lien indicating balances in support of Net Owned Funds (NOF).
  • Bankers Report for applicant company, group companies.
  • Certified copies of the highest educational and professional qualifications of all the directors of the applicant company.

#STEP 5: ONLINE APPLICATION

  • Go to the provided link https://cosmos.rbi.org.in.
  • Click on the “CLICK HERE” for company registration on the registration page.
  • A window will be displayed showing the excel application available for download.
  • Download the suitable application form (NBFC or SC/RC).
  • Fill up the application form.
  • Upload it to the same website.

The company would then be issued a Company Application Reference (CoA) Number for the application filled online.

#STEP 6: SUBMIT THE HARDCOPY TO REGIONAL OFFICE

Once the application has been filed online, the hard copy of the application indicating the online CoA number along with the supporting documents shall be submitted to the concerned Regional Office by the applicant company.The company can always track the status of the application form by logging into the above-mentioned address using the CoA Number.

Total Cost for Registration

The total cost for NBFC registration is around INR 4-5 lakhs including professional fees and RBI fees.

Who Can Borrow Loan From MFI (Microfinance Institutions)

An individual borrower with a total annual income not exceeding INR 1,00,000 in rural areas or INR 1,60,000 in urban and semi-urban can take loans up to INR 1 Lakh from two MFIs at the most. MFIs, in the first cycle of the loan, can disburse up to INR 60,000.

*** Documents Required initially to start the Business

If you are willing to register a Private Limited Company for NBFC registration, then you shall need at least two persons to start with. The minimum documents required for registration are as follows:

  • Copy of PAN CARD
  • ID Proof (Driving License, Passport, Aadhaar Card, Voter ID) – anyone
  • Address Proof (Bank Statement, electricity bill, Mobile Bill, Telephone Bill) –anyone
  • Passport Size photo

Apart from the above, we need the following documents for registered office registration:

  • Rent agreement or ownership documents
  • Electricity bill
  • A copy of No Objection Certificate (NOC) from the owner.

REGISTRATION THROUGH SECTION 8

The second way is to register a section 8 company & apply for central government licenses features of which are as follows:

    • Maximum INR 50,000 can be given for the business purpose and INR 125,000 for the residential dwelling.
  • No minimum net owned fund requirement.
  • No RBI approval is required since RBI has exempted such companies from registration.

The registration procedure can be divided into 7 steps. Let us read the process in detail:

#STEP 1: APPLY FOR DSC AND DIN

This is the first step towards initiating the section 8 company registration. One can go to this website http://www.mca.gov.in MCA services DSC Services/ DIN Services.

DSC– An applicant who wants to get his Digital Signature Certificate(DSC) issued can go to the Certifying Authorities directly with the required documents in original and self-attested copies of the same. Some CAs also provide Aadhar eKYC based authentication also.

DIN

  1. Any person who intends to apply for DIN shall have to make an application in eForm DIR-3 and should attach the following documents along with the form-
  • Photograph and the scanned copy of supporting documents which are required.
  • Verification by the applicant containing the name, father’s name, date of birth, present address, a text of declaration and physical signature of the applicant.
  • Digital signature.
  1. The eForm shall be uploaded on the MCA21 portal and shall be digitally signed.
  2. Once the form has been uploaded, the fees for the DIR-3 form shall be paid through electronic means only (i.e. Netbanking/ Credit Card).
  3. After successful payment of the fees, the applicant should register himself/herself on the MCA21 portal page. By using the login id given, log in to the same page and upload the eForm DIR-3 on ‘eForm upload’
  4. Once the form is uploaded and payment is made, approved DIN shall be generated and if the details are identified as potential duplicate, Provisional DIN shall be generated. In such cases, the MCA DIN cell will examine the eForm DIR-3 and same shall be disposed of within one or two days.

#STEP 2: APPLY FOR NAME APPROVAL

This is the second step towards registering the section 8 company. The name may end with the words like Sanstha, foundation etc. Microcredit can also be used in the company name. One has to provide minimum 3 different names and maximum 6 names. Additionally, the name must be suggestive of company’s work. Fill INC-1 form available on the same website to register the name.

#STEP 3: MOA and AOA

After the name has been approved, draft the MOA (Memorandum of Association) and AOA(Articles of Association) and then file them along with the following documents in eForm INC 12 for the issuance of license-

  1. INC-13 Memorandum of Association
  2. Article of Association
  3. INC-15 Declaration by each Subscriber to MOA (On Non- judicial stamp paper of INR 100/- and duly notarized).
  4. A statement describing an estimate of Income & Expenditure for the next three years and it should be signed by the proposed promoters.
  5. List of proposed Promoters and Directors of the Company.
  6. The Subscribers page (AoA & MoA), handwritten by the subscribers and witness.

Once the Form INC 12 has been approved, a license under section 8 of the Companies Act,2013 will be issued in Form INC-16.

#STEP 4: FILING OF INCORPORATION FORMS ON MCA PORTAL

After the license has been issued, the applicant is required to fill the following forms-

I.Form No. INC – 7 (Application for incorporation of the Company) along with the following attachments:

  1. Memorandum of Association
  2. AoA Declaration in Form No. INC-8
  3. An affidavit from the subscribers to the memorandum in Form No.INC-9
  4. Proof of residential address of Subscribers
  5. Specimen Signature in Form No. INC-10
  6. Proof of Identity of Subscribers (NOC in case there is a change in the promoters after name approval).
  7. PAN card.

II. Form No. INC – 22 (notice of situation of registered office) along with the following attachments:

1.Conveyance/Lease Deed/ Rent Agreement (Proof of ownership)

  1. Electricity Bill Not older than 2 months.
  2. No Objection Certificate.

III. Form No. DIR – 12 ( for the appointment of directors of the company) along with the following attachments:

1.DIR-2 (consent to act as Directors)

2.Affidavit by the Directors for Not accepting Deposits (On Non- judicial stamp paper of INR 100/- and duly notarized).

  1. INC-9 Declaration by each Subscriber to Memorandum of Association (On Non- judicial stamp paper of INR 100/- and duly notarized).

#STEP 5: CERTIFICATE OF INCORPORATION

A Certificate of Incorporation is issued by the Registrar of Companies along with a unique Company Identification Number (CIN) if the Concerned ROC is satisfied with the incorporation forms.

#STEP 6: PAN and TAN

Nowadays, the PAN and TAN are allotted once the company is formed. The physical copy of PAN card is sent via speed post at the registered office of the company.

8 Legal Compliances You Cannot Miss Out On If You Are A Startup

Startup Compliances

Regulation and compliance are two words that haunt every entrepreneur. Statutory compliances are meant to ensure that there is uniformity in conformation with a rule, specification, policy or standard mandated by law. Due to an increasing number of startups, the need for operational transparency has also seen a significant hike in the past decade. To combat this, startups are adopting consolidated checklists of compliance controls.

If you have a startup, or you are coming up with one, a  comprehensive checklist will help you with your viability,  traction of investors and avoid any legal mishap.

In a report by NASSCOM in the year 2014, India was projected as the fastest growing startup platform in the world. India was also ranked third globally as a startup hub with as many as 4200 startups. With nearly 3 to 4 startups being incorporated every day, they have seen an unprecedented rise. However, this is also indicative of the fact that there is a steep increase in the number of non-compliant startups. A survey by Taxmantra revealed that:

  • Every 2nd startup gets Income Tax Notice for tax demands or for non-compliance
  • 3 out of 7 startups finds a place on the defaulter list of Registrar of Companies due to non-compliance
  • 2 out of 4 startups incur unnecessary pay-out by way of interests and penalties.
  • 7 out of 10 startups shut down their business within first 3 years of their operations

While it might seem petty in the beginning, however, the consequences of non-compliance can be far-reaching. Needless to say, it can range from penalties, prosecutions and fines to various other issues that may lead to a close down of your company. Companies like, Buysellbitco.in and Shotpitch, are some examples of startups that had to close their shop because of non-compliances.

Some of the major consequences that you can face due to non-compliance are

i) Difficulty In Securing Funding

Most startups thrive on funding. It is needed at some point or the other unless they are self-sufficient. However, the bare minimum standard for securing funding is the status of tax payments and other regulatory compliances. A company which hasn’t paid much attention to complying with the laws regulating their industry might not even be able to survive through the term sheet phase. Think of it as an investor, would you invest in a company which does not conform to the laws? Even if your startup manages to secure funding, wouldn’t you be answerable to the investor for additional dues that you are bound to incur because of the delay in meeting statutory compliance?

ii) Cancellation of Bank Loan and Government Tenders

If you fail to get an investor on board, you are most likely to turn to the banks seeking a business loan. Now, there would be a list of documents that a bank would require. For example, audited financials, auditor’s report, a certificate by a CA for the last 3 years, etc. These are certain compliances which are mandatory and cannot be circumvented. In addition, banks have their own verification mechanisms which ensure adherence to compliances for any company seeking a loan. In case of non-compliance, securing a loan from the bank becomes impossible. This also applies when startups seek Government Tenders.

iii) Status of a Dormant Company

In case of a non-filing history of 3 years or more, the Ministry of Corporate Affairs is going to term you a ‘dormant’ company. A dormant company is likely to receive demand notice by the RoC and are not eligible to seek any government/institutional assistance.

iv) Closing Down

A lot of young entrepreneurs believe that closing down the startup could be an easy option, however, that is not the case. Remember the time you were required to register for DIN? As per the Companies Act, 2013, the DIN of a director of a company which has failed to file its income tax returns for 3 consecutive years, is blocked. Which means you will be disqualified from becoming a director of any other company in the future.

Registration of the company is merely the first step towards compliance with law. There is a list of compliances you need to meet pre and post incorporation to be able to function effectively.

Here is a compliance list you ought to follow if you want yourself out of the vicious circle of non-compliance penalties:

#1 Opening A Bank Account

This is the first, and easiest of all compliances. To be able to be a function, the very first requirement is to open a ‘Current’ Bank Account in your company’s name. The fundamental requirement to open a bank account is a PAN Card registered in the name of your company and a copy of a Board Resolution authorising opening a bank account in the name of the company. Here are few noteworthy tips that no one will tell you:

  1. There are a number of banks which provide “special privilege accounts” to startups. You should try to get such an account in order to avail additional benefits.
  2. In case your PAN Card is still in process, PAN card application challan or the PAN mentioned in your Incorporation Certificate is sufficient to open a bank account.
  3. Do not just stick to one bank account, try to open a minimum of two accounts. In case one bank account falters on any occasion, the other account can come to your rescue.

#2 Share Capital Deposition In The Bank Account

Within 60 days of the incorporation of the company, every shareholder is required to deposit their contribution to the dedicated bank account. It is necessary that such transfer is done through the personal accounts of the shareholders to the bank account of the company. It is mandatory that every shareholder who holds share worth Rs. 20,000 or more, deposit the money only by way of a cheque or via internet transaction. Although, the shareholders holding lesser than Rs. 20,000 can deposit the money through cash, however, it is recommended that such transfer is done through a cheque or an online transfer so that the amount is accounted for.

#3 GST Registration

GST registration is mandatory for all startups to avail various benefits under the GST Composition Scheme. Currently, the startups generating less than INR 20,00,000 in India (and INR 10,00,000 in the North Eastern States) are exempted from GST registration. It is important to note that if your startup is supplying goods outside the State in which you are located (Inter-State Trade) you are required to register yourself, irrespective of your turnover. This also applies if you are an online service provider.

#4 Income Tax Return Filing

Income tax returns are statements furnished by the company which includes the details of the company’s earnings, details of tax liable to be paid and tax paid, and any claims or refunds to be credited by the government. Filing of income tax return is mandatory even if the company has made no significant income or no income at all in a financial year. A case of non-compliance can attract a penalty, prosecution, and investigation by the Income Tax Department.

#5 Issuance Of Share Certificates To Shareholders

A share certificate is the proof of the stake any shareholder possesses in the organization. It is imperative for a company to issue share certificates within 2 months of its incorporation.  Non-compliance can add up to a penalty ranging from Rs. 50,000 to Rs. 5,00,000. Directors can be held independently liable for a penalty ranging anywhere from Rs. 10,000 to Rs. 1,00,000, depending on the size and nature of the startup.

#6 Disclosure Of Shareholding By The Directors

In the first board meeting after incorporation of the company, the directors are required to give full disclosure of their ownership status in the company. Every director is required to give the status of his interest, i.e., ownership/shareholding in the company. He is also required to disclose if he holds any such position in any other company or LLP. This is one of the most important compliances as it helps in bringing in transparency of decisions and ensures that third party compliances are duly met.

#7 Maintenance Of Statutory Registers

A company is necessarily required to maintain a record of Minutes of Meetings and various statutory registers like the register of directors, register of members, etc., which need to be filed with the Registrar of Companies from time to time. These registers act as a document of evidence for the decisions taken up by the company. A case of non-compliance can range from Rs. 50,000 to Rs. 3,00,000 and an additional fine of Rs. 1000 per day for continuous default.

#8 Annual Return Filing

In a recent state of affairs, the Ministry of Corporate Affairs has closed down 1 lakh companies for non-compliance with this provision. As per the Companies Act, 2013, every company is required to file its annual returns (in Form MGT-7) with the Registrar of Companies within 60 days of the Annual General Meeting (AGM). The returns are required to be filed in this manner :

  1. The financials including Profit and Loss Account and Balance Sheet are required to be filed within 30 days of the AGM
  2. The appointment of auditor needs to be filed within 15 days of the AGM

Penalties for non-compliance are massive. The penalty imposed for non-compliance is usually 12 times the cost of filing these statements. However, an additional filing can range anywhere from Rs. 50,000 to Rs. 5,00,000. In addition to this, a director in fault can be independently liable for an imprisonment of 6 months or with a fine ranging from Rs. 50,000 to Rs. 5,00,000 or both.

Apart from these compliances, there is a range of compliances which need to keep in mind. These are compliances such as trademark registration, the procedure for maintaining the books of accounts, the procedure to be followed in an annual general meeting, etc. It is extremely important that all of these legal compliances are duly met.

I have heard the CEO of our company often say, “A company can never survive if the people at the top do not have a 360-degree view of every process that’s involved in it’s making.” It is understandable for you to not have enough legal acumen to ensure that your company is complaint and risk-free. However, it is crucial that you update yourself, so that in future you can tackle with any mishap or even prevent it from happening. For this, you can take up a course like this, which will give you a practical insight on everything you need to know to ensure that there is no holding your startup back.

Law of Sedition in India

Law of sedition

In this article, Sudarshna Thapa of Law College Dehradun, Uttaranchal University discusses the enforceability of law of sedition in India.

Introduction

Every citizen has been given freedom to speak and express their views under Article 19(1)(a) of the Indian Constitution. However, this freedom is not absolute and some reasonable restrictions have been imposed on freedom of speech and expression under Article 19(2). But when a person does an act by his words, signs or representation which is held to be contemptuous towards the Government of India, then such act is punishable under section 124-A of Indian Penal Code, 1860. Sedition is an offence that criminalizes speech that is regarded to be disloyal to or threatening to the state.

The provision of Section 124A is very wide and it covers the act of defamation of the Government excluding any criticism in good faith of any particular measures or acts of administration.

Law of Sedition

The term ‘Sedition’ means “conduct or speech which results in mutiny against the authority of the state”. Law of Sedition deals with section 124A of IPC, 1860, is considered as a reasonable restriction on freedom of speech. It was drafted by Thomas Macaulay and introduced in 1870.

The following points describe the origin of sedition law:

  • Origin of Sedition law in India is connected to the Wahabis Movement of the 19th century.
  • This was an Islamic revivalist movement and was led by Syed Ahmed Barelvi.
  • Since 1830, the movement was active but in the wake of 1857 revolt, it turned into armed resistance, a Jihad against the British.
  • The British termed Wahabis as rebels and carried out military operations against Wahabis.

History

In British Era, Section 124A was not a part of Indian Penal Code, 1860. But this Section was inserted into IPC by the IPC (Amendment) Act, 1870. By an amending act of 1898, this provision was later replaced by Section 124A. According to the British Era Law, under the old IPC, “Exciting or attempting to excite feelings or disaffection was considered as Sedition”.

Meaning of Sedition under Section 124A of IPC, 1860

Whoever, by words, either spoken or written, or by signs, or by visible representation, or otherwise, brings or attempts to bring into hatred or contempt, or excites or attempts to excite disaffection towards the Government shall be punishable with Life Imprisonment”.[1]

Explanation I to the Section defines the scope of disaffection and in Explanation II and III indicate what under the English Law is not considered seditious intention.

What are the activities that are Seditious in nature?

In India, what constitutes as ‘Sedition’ is highly debated. As per the Indian Penal Code, for an act to be called “seditious”, it should have the following components:

  1. Any words, which can be either written or spoken, or signs which include placards/posters (visible representation)
  2. Must bring hatred/contempt/disaffection against the Indian Government
  3. Must result in ‘imminent violence’ or public disorder.[2]

As per the interpretation of the Court on Section 124-A of the Indian Penal Code, 1860 the following acts have been considered as “seditious”

  • Raising of slogans against the government – example – “Khalistan Zindabad” by groups. Raising of slogans by individuals casually once or twice was held not to be seditious. [3]
  • A speech made by a person must incite violence / public disorder for it to be considered as seditious [4]. Subsequent cases have gone to further interpret it to include “incitement of imminent violence”.
  • Any written work which incites violence and public disorder.

Sedition found in other Laws

The following are some laws which cover Sedition law:

  • Indian Penal Code, 1860 (Section 124A)
  • The Code of Criminal Procedure, 1973 (Section 95)
  • The Seditious Meetings Act, 1911 &
  • The Unlawful Activities (Prevention) Act (Section 2(o) (iii)).

How legal mechanism sets in motion

Sedition is considered as a high-value crime in the Indian Penal Code which is against the sovereignty of the country. It is a cognizable offence which allows arrest without a warrant and police can start the investigation without the permission of the court. There are some legal procedures regarding the charges of Sedition:

  1. Go to the Jurisdictional Police Station

It is the person’s legal right to file a case against the person who is committing an offence against the state such as Sedition. A person can file the complaint with the nearest Police Station where such offence when committed.

Lodging an F.I.R

The First Information Report (F.I.R.) is a written document which is prepared by the police organizations when they receive any information about the cognizable offence. In the case of seditious offence, it is filed by the person who has come to know about such offence and also can be filed by the police officer.

How Police take Cognizance

When any credible information is being registered by the complainant regarding the sedition offence, then it is the duty of Police Officer to take action for such complaint. Police have the right to arrest without warrant for such offence. There are some procedures when Police are able to arrest without warrant:

    1. When the seditious act is going on before the police inspector, District Magistrate or Executive Magistrate, then they can arrest such person without any warrant.
    2. If any information is received from another police officer for the arrest of the person committed a seditious offence, then the other police officer can arrest such person.
    3. F.I.R. when lodged against the person for the seditious offence.
    4. When a person who is being suspected of Sedition, then the police officer may arrest such person for the further investigation.

Investigation

After giving the information to a police officer in charge of a police station, the investigation is initiated. A magistrate can order a police officer in charge to investigate on cognizable offence such as Sedition. A magistrate is empowered to take cognizance upon receiving any complaint or upon a police report or upon information received from any person other than a police officer who is having knowledge of such offence is committed. A police officer may require to take the.. attendance of witnesses in writing.

Charge Sheet

After the completion of the investigation, police submits charge sheet which consists of F.I.R. copy, statement of the complainant, statement of witnesses etc.

Sedition: Disloyalty In Action

“Sedition” has been described as disloyalty in action. The object of sedition law is to induce discontent and insurrection, and stir up opposition to the Government and bring the administration of justice into contempt. Sedition is a crime against the society as it involves all those practices that result in conduct disturbance in the state or to lead to civil war which contempt the sovereign and promotes public disorder.[5]

Defences Available to a Person Charged With Sedition

To get the exemption from Criminal Liability, the following are the defences:

  1. That he did not make the sign or representation or not speak or write the words, or not do any act in question.
  2. He did not attempt into the contempt or attempt disaffection.
  3. Such disaffection should not be towards the Government.

Sedition and Article 19(1)(a) of the Indian Constitution

The Concept of Free Speech has attained global importance and all have supported it as a basic fundamental right of a human being. In India, such rights are provided under Part-III and Article 19 of the Indian Constitution. The said right has no geographical indication because it is the right of the citizen to gather information with others and to exchange thoughts and views within or outside India.

Courts have been given the power to act as guarantors and protectors of the rights of the citizen. Article 19(1)(a) secures the ‘freedom of speech and expression’ but it has been bound by the limitation which has been given under Article 19(2) which states the permissible legislative abridgement of the right of free speech and expression.

In Niharendu Dutt’s case [6], for sedition, the Federal Court had taken chance to interpret the Section 124A of the IPC in alignment with British Law. It had ruled that tendency to disturb public order was an essential element under Section 124A. The Privy Council held that the incitement to violence or a tendency to disturb public order was not necessary under section 124A.

In Tara Singh v. State[7], the validity of Section 124A of the IPC was directly in issue. In this case, it curtailed the freedom of speech and expression, so the East Punjab High Court declared this section void.

By the Constitution (First Amendment) Act, 1951, two changes were introduced relating to freedom of speech and expression, are:

  1. It considerably widened the latitude for restrictions on free speech by adding further grounds;
  2. The restriction imposed on Article 19(1)(a) must be reasonable.

Therefore, the question now arises of whether Section 124A of IPC is in conflict with Article 19(1)(a) or not. It has been reflected by the following points:

  1. Section 124A of the IPC is ultra vires the constitution in as much as it infringes the fundamental right of freedom of speech in Article 19(1)(a) and is not saved by the expression “in the interest of public order”.[8]
  2. As the expression “in the interests of public order” has a wider connotation and should not be confined to only one aspect of public order, then the Section 124A is not void.
  3. Section 124A IPC is partly void and partly valid. In Indramani Singh v. State of Manipur [9], it was held that Section 124A which seeks to impose restrictions on exciting mere disaffection is ultra vires, but the restriction imposed on freedom of speech and expression covered under Article 19(2) can be held intra vires.

In 1959, Allahabad High Court declared that Section 124A was ultra vires to Article 19(1)(a) of the Constitution.

Indian Freedom Fighters who were charged with Sedition during the Freedom Struggle

Mahatma Gandhi was charged with sedition

Gandhiji had written three ‘politically sensitive’ articles in his weekly journal Young India, which was published from 1919 to 1932 so that he was jailed on the charges of sedition. He was sentenced to a six-year jail term.

Three charges were imposed on him:

  1. Tampering with loyalty;
  2. Shaking the manes and
  3. Attempt to excite disaffection towards the British Government.

He wrote the first part of his autobiography during his imprisonment- The Story of my Experiments with Truth- and about the Satyagraha movement in South Africa. He was released after two years as he was suffering from appendicitis.

Bal Gangadhar Tilak was convicted under this [10]

Bal Gangadhar Tilak was charged with sedition on two occasions, are:

  1. Firstly, his speeches that allegedly incited violence and resulted in the killings of two British Officers for which he was charged with Sedition in 1897. He was convicted but got bail in 1898.
  2. Secondly, he was defending the Indian revolutionaries and called for immediate Swaraj or self-rule in his newspaper ‘Kesari’ for which he was convicted under sedition and sent to Mandalay, Burma from 1908 to 1914.

Take on abolishing the law of sedition – Should the Indian legal system abolish the laws punishing seditious activities?

In today’s scenario, the sedition law expects that citizens should not show enmity, contempt towards the Government established by the law.

  • There are some dark areas which lies between actual law and its implementation.
  • Thus the laws need to amend those dark areas.
  • In India, there are so many divisive powers acting together in which such laws are necessary evils in a country like India.
  • It is the need for such law that those activities which are promoting violence and public disorder should be stopped

Disaffection and the State

  • A seminar titled with ‘Azadi, the Only Way’ was organized by the Committee for the release of a Political prisoner in Srinagar.
  • The controversy arises when Sedition was charged against Arundhati Roy, Syed Ali Shah Geelani, Varavara Rao and others who spoke at the said Seminar.
  • Media reported that the Central Government was not in favour of initiating proceedings in this case.
  • There are reports though of cases having been filed in New Delhi.
  • Intimidation of cases being filed in other parts of the country against Roy, Geelani and other who spoke at the seminar.

Famous Trials of Sedition

  1. Jogendra Chunder Bose [11]

Jogendra Chunder Bose was an editor of Bangobasi. He was charged with Sedition for voicing against Age of Consent Bill, 189

Cartoonist Aseem Trivedi

During a rally of Anti-Corruption crusader Anna Hazare in Mumbai, he had been accused of putting up banners mocking the constitution and posting the same on his website. He was charged under Section 124A of IPC, Section 66A of Information Technology Act and Section 2 of Prevention of Insults to National Honour Act.

Kashmiri Students

60 Kashmiri Students were cheering for Pakistan in a Cricket Match against India. So they were charged with Sedition in March 2014.

Folk Singer S Kovan

He was charged with sedition for two songs criticising the state government for allegedly profiting from state-owned liquor shops at the expense of the poor.

Binayak Sen

He was a pediatrician by profession and was allegedly supporting Naxalites. For which he was charged with Sedition by Chhattisgarh Government.

Akbaruddin Owaisi

On December 22, 2012, he purported hate speech at Nirmal. He was slapped with the charge of sedition by the District Police of Karimnagar.

Kanhaiya Kumar, Student of JNU [12]

JNU Student Leader, Kanhaiya Kumar was arrested in February 2016 on the charge of sedition. He was arrested for inciting violence through unlawful speech, allegedly spread not all over India but also across the world. This arrest has raised political turmoil in the country by which academicians and activists protesting against this move by the Government. On March 2, 2016, the videos purporting to show this activity were found to be fake and he was released after three weeks in jail.

Constitutionality of Law of Sedition in India

Kedarnath Singh v. State of Bihar [13]

  • It was held that the law is constitutional and covered written or spoken words that had the implicit idea of subverting the Government by violent means.
  • With an intention to create public disorder, Citizens can criticize the Government as long as they are not inciting people to violence against the Government.
  • Supreme Court upheld the validity of Section 124A, it limited its application to acts involving intention or tendency to create disorder, or a disturbance of law and order, or incitement to violence.

Balwant Singh and Anr v. State of Punjab [14]

  • After the assassination of Prime Minister Indira Gandhi, the accused had raised the slogan “Khalistan Zindabad” outside a cinema hall.
  • It was held that two individuals casually raising slogans could not be said to be exciting disaffection towards the Government. Section 124A would not apply to the circumstances of this case.

Romesh Thapar v. State of Madras [15]

  • The petitioner contended before the Supreme Court that the said order of banning his paper ‘Cross Roads’ by the Madras State.
  • It has contravened his Fundamental Right of freedom of speech and expression conferred on him by Article 19(1) of the Constitution.
  • The Supreme Court held that the Article 19(2) where the restriction has been imposed only in the cases where problem to public security is involved. Cases where no such problem could arise, it cannot be held to be constitutional and valid to any extent.
  • Supreme Court quashed the order of Madras State and allowed the application of the petitioner under Article 32 of the Constitution.

The following acts are not considered seditious

  • Improvement or alteration by lawful means with the disapproval of the measures of government.
  • The strong words which are expressing disapprobation of actions of the Government and not encouraging those feelings which generate public disorder by acts of violence.
  • To improve the condition of the people or to secure the alteration of those acts by lawful means without the feelings of enmity and disloyalty which involve excitement to public disorder or the use of violence.

National Crime Records Bureau Statistics on Sedition

When all the crimes are committed against the state or government, it disturbs public order. According to the data from 2014-2016 of NCRB, 165 people were arrested on the charge of sedition. During 2014, 47 cases were reported under sedition. Of the total sedition cases, Jharkhand and Bihar have reported 18 cases and 16 cases respectively. Besides, 5 cases in Kerala, 2 cases each in Andhra Pradesh, Assam, Chhattisgarh and Himachal Pradesh were also reported during 2014.

According to the NCRB, the latest crime data shows the cases of sedition fell from 2014 to 2015. A total of 30 sedition cases were registered in 2015, less than in 2014. Tamil Nadu topped the list for committing the crime against state including sedition. Of the 6,986 cases were registered in 2016, 1,827 cases were reported from Tamil Nadu, followed by U.P. 1,414, Haryana 1,286 and Assam 343 cases. In the last three years across the country, 165 people were arrested on the charge of sedition. According to the reports of NCRB, 111 people were arrested in four state i.e., 68 in Bihar, 15 in Haryana, 18 in Jharkhand and 10 in Punjab.

Parliamentary Privileges and Immunities

In this article, Sheetal Sharma of School of law, KIIT university discusses parliamentary privilege and laws governing parliamentary privileges in India.

Introduction

Parliamentary privileges are defined in Article 105 of the Indian Constitution. The members of Parliment are exempted from any civil or criminal liability for any statement made or act done in the course of their duties. The privileges are claimed only when the person is a member of the house. As soon as he ends to be a member, the privileges are said to be called off. The privileges given to the members are necessary for exercising constitutional functions. These privileges are essential so that the proceedings and functions can be made in a disciplined and undisturbed manner.

The privileges individually enjoyed by the members are

Freedom of speech in parliament

The members of the parliament have been vested with the freedom of speech and expression. As the very essence of our parliamentary democracy is a free and fearless discussion, anything said by them expressing their views and thoughts are exempted from any liability and cannot be tried in the court of law.

The freedom of speech and expression guaranteed to a citizen under Article 19(2) is different from the freedom of speech and expression provided to a member of the parliament. It has been guaranteed under Article 105(1) of the Indian constitution. But the freedom is subject to rules and orders which regulates the proceedings of the parliament.

This right is given even to non-members who have a right to speak in the house. Example, attorney general of India. So that, there is a fearless participation of the members in the debate and every member can put forward his thought without any fear or favour.

Some limitations are also present which should be followed in order to claim immunity

  • Freedom of speech should be in accordance with the constitutional provisions and subject to rules and procedures of the parliament, stated under Article 118 of the Constitution.
  • Under Article 121 of the Constitution, the members of the parliament are restricted from discussing the conduct of the judges of the Supreme Court and the High Court. But, even if this happens, it is the matter of the parliament and the court cannot interfere.
  • No privilege and immunity can be claimed by the member for anything which is said outside the proceedings of the house.

Freedom from arrest

The members enjoy freedom from arrest in any civil case 40 days before and after the adjournment of the house and also when the house is in session. No member can be arrested from the limits of the parliament without the permission of the house to which he/she belongs so that there is no hindrance in performing their duties.

If the detention of any members of the parliament is made, the chairman or the speaker should be informed by the concerned authority, the reason for the arrest. But, a member can be arrested outside the limits of the house on criminal charges against him under The Preventive Detention act, The Essential Services Maintenance Act (ESMA), The National Security Act (NSA) or any such act.

Freedom from appearing as a witness

The members of the parliament enjoy special privileges and are exempted from attending court as a witness. They are given complete liberty to attend the house and perform their duties without any interference from the court.

Privileges enjoyed by the members collectively as part of parliament

Right to prohibit the publication of proceedings

As stated in Article 105(2) of the Constitution, no person shall be held liable for publishing any reports, discussions etc. of the house under the authority of the member of the house. For paramount and national importance, it is essential that the proceedings should be communicated to the public to aware them about what is going on in the parliament.

But, any partial report of detached part of proceedings or any publication made with malice intention is disentitled for the protection. Protection is only granted if it reflects the true proceedings of the house. If any expunged proceedings are published or any misrepresentation or misreporting is found, it is held to be the breach of the privilege and contempt of the house.

Right to exclude strangers

The members of the house have the power and right to exclude strangers who are not members of the house from the proceedings. This right is very essential for securing free and fair discussion in the house. If any breach is reported then the punishment in the form of admonition, reprimand, or imprisonment can be given.

The right to punish members and outsiders for breach of its privileges

The Indian Parliament has the power to punish any person whether strangers or any member of the house for any breach or contempt of the house. When any breach is committed by the member of the house, he/she is expelled from the house.

This right has been defined as ‘keystone of parliamentary privilege’ because, without this power, the house can suffer contempt and breach and is very necessary to safeguard its authority and discharge its functions. This power has also been upheld by the judiciary in most of the cases. The house can put in custody any person or member for contempt till the period the house is in session.

The right to regulate the internal affairs of the house

Each house has a right to regulate its proceedings in the way it deems fit and proper. Each house has its own jurisdiction over the house and no authority from the other house can interfere in regulation of its internal proceedings. Under Article 118 of the Constitution, the house have been empowered to conduct its regulation for proceedings and cannot be challenged in the court of law on the ground that the house is not in accordance with the rules made under Article 118. The Supreme Court has also held that this is general provision and the rule is not binding upon the house. They can deviate or change the rule anytime accordingly.

Punishments prescribed for breach of privileges or contempt of the house

  1. Imprisonment – If the breach committed is of a grave nature the, punishment can be given in the form of the imprisonment of any member or person.
  2. Imposing fine – If in the view of the parliament, the breach or contempt committed is of economic offence and any pecuniary gain has been made from the breach then, the parliament can impose fine on the person.
  3. Prosecuting the offenders – The parliament can also prosecute the one committing the breach.
  4. Punishment given to its own members – If any contempt is committed by the members of the parliament then, he is to be punished by the house itself which could also result in the suspension of the member from the house.

What constitutes parliamentary breach or contempt of the house?

There is no codification to clearly state that what action constitutes a breach and what punishment it entails. Although, there are various acts which are treated by the house as the contempt. It is generally based on the actions which tend to obstruct the proceedings of the house and creates a disturbance for the members. Some of them are briefly discussed.

Giving any misleading statement in the house

The acts which are done solely with the purpose to mislead are considered as the contempt of the house. If the statement is made by a person who believes the information to be true then, there is no breach involved. It has to be proved that the statement was made with an intention to mislead the house.

Disturbance by the outsiders

Any disruption created by shouting slogans or throwing leaflets etc. with the purpose of disturbing the proceedings of the court is regarded as a major contempt by the house. The person is imprisoned by the house for a specified period of time or a warning is given depending on the seriousness of the case.

Any kind of assault on the members

Here, the privilege is available when the member is performing his duties. An assault done by any person on the member of the parliament in the course of performing his duties is treated as contempt of the house.

Writings or speeches about the character of the member

any speech published or libel made against the character of the member is regarded as the contempt of the house. These are regarded to be necessary because it affects the performance and function of the member by reducing the respect for him.

So, clearly, any attack on the privilege of the members by any means is considered as a breach of the privilege and the parliament can take action regarding the same.

Freedom of press and the parliamentary privileges

The parliamentary privileges restrict the freedom of the press, which is a fundamental right. Caution to a great extent has to be taken by the press while publishing any report of the proceedings of the parliament or the conduct of any member. There are instances where the press can be held liable for the contempt of the house

  1. Publishing any matter concerning the character of any member of the parliament
  2. Any pre-mature publication of the proceedings
  3. Misreporting or misrepresenting the proceeding of the house
  4. Publishing the expunged portion of the proceedings

In spite of the fact that the freedom of the press is subject to the parliamentary privileges, certain enactments have been made for the protection of the freedom of the press. If the fundamental right is being violated, there is no meaning of democracy. The freedom of the press has to be protected because we need to be informed about the acts of our representatives. Parliamentary Proceedings (protection of the publication) Act, 1977 protects the rights of the press under certain given circumstances

  1. The reports of the proceedings are substantially true.
  2. The report is made without malice.
  3. The report is made for public good.
  4. The report should not constitute any secret meeting of the house.

Codification of the parliamentary privileges

Our Indian parliament enjoys supreme powers as being a member of the parliament. There is also misuse of the privileges given to them because they do not have many restriction on the rights. They have the power to be the judge of their own proceedings, regulate their proceedings, what constitutes the breach and what punishment should be given for the breach, are solely decided by them.

The power vested in them is too wide as compared to the fundamental rights vested in the citizens. With no codification of the privileges, they have gained an undefined power because there is no expressed provision to state the limitations on their powers. The privilege from any civil arrest 40 days before and after the session and during the session results that they are exempted from arrest for even more than 365 days. No comprehensive law has been till date enacted by the parliament for the codification of the parliamentary privileges.

It is mostly resisted by the members because then it will be subject to the fundamental rights and would be in the purview of judicial review. Justice M.N. Venkatachaliah heading the Constitution Review Commission also recommended to define and delimit the privileges for the free and independent functioning of the legislature. This is based on the apprehension that codification will involve interference of the court as the matters would be presented in the court of law. Non-codification of privileges has led to greater powers being enjoyed by the members. But, now the time has come to codify and define the privileges and actions must be taken so that there is smooth functioning of the parliament without any conflict.

Judicial review of the parliamentary privileges

The Indian judiciary has been vested with the responsibility of the protection of the fundamental rights. Parliament members claim absolute sovereignty over their powers and in any case does not want the judiciary to interfere. But, the judiciary is regarded as the guardian of our Constitution and it cannot sit quietly if any fundamental right of a citizen is violated due to privileges or when there is an escape from any criminal liability.

The judiciary has to take a stand on the wrongs committed by the members who are taking the shelter of the privileges. The Supreme Court in Keshav Singh’s case observed that the privileges conferred on the members are subject to the fundamental rights.

The Supreme Court has also held that any conflict arising between the privileges and the fundamental rights would be resolved by adopting harmonious construction. The judiciary is very well aware of the fact that it does not have jurisdiction over parliamentary matters but it is necessary for the society that any violation should be resolved by the court as it deems fit.

Parliamentary privileges and the principle of natural justice

In a recent judgment by the Supreme Court judges in the case of Algaapural R. Mohanraj v Tamil Nadu Legislative Assembly, it was held that the principle of the natural justice cannot be violated by the privilege committee.

Facts of the case

On 19-02-2015, some members of the Tamil Nadu Legislative Assembly was suspended on the ground of unruly conduct. In furtherance of this, a privilege committee was formed to inquire about the conduct of the members and further proceedings related to breach of privilege. It was found and recommended by the take necessary action against six members for the breach of privilege.

By a resolution dated 31-03-2015, the members were suspended for a period of ten days for the next session. Further it was extended to cutting of their salaries and giving any other benefit till the suspension period. A writ petition was filed by the members in the Supreme Court under Article 32 of the Constitution.

Contentions raised by the members

The contention was raised by the petitioners that their fundamental rights under Article 19(1)(a), 19(1)(g), 14 and 21 of the Constitution have been violated by the said resolution.

Judgment by the court

The court rejected the contention of the petitioners that the resolution violated Article 19(1)(a) and 19(1)(g). It further accepted the contention that the rights was violated under Article 14 of the Constitution. The court observed that the video recording which showed the act of the members amounting to the breach was not presented before the petitioners. If it would have been presented then they might had the chance to explain their conduct. It was further directed by the court to restore the salary and other benefits of the petitioner.

Conclusion

The privileges are conferred on the members for smooth functioning of the parliament. But, these rights should always be in conformity with the fundamental right because they are our representatives and work for our welfare. If the privileges are not in accordance with the fundamental rights then the very essence of democracy for the protection of the rights of the citizen will be lost. It is the duty of the parliament not to violate any other rights which are guaranteed by the constitution. The members should also use their privileges wisely and not misuse them. They should always keep in mind that the powers do not make them corrupt. The parliament cannot adopt every privilege that is present in the house of commons but should adopt only those privileges which accordingly suits our Indian democracy.

Best business structure for incorporating your E-Commerce Business

E-Commerce Business

This article is written by team LegalWiz.

E-commerce industry has achieved remarkable growth since half a decade in India. The step of planning the business is achievable by the promoters in no time because of their proficiency in the field. The business model is when finalised, next step will be to get the business on plot through business registration. The entrepreneurs seek the guidance for establishing their business to commence the activities as legal entity. The article here gives gist on how to register an e-commerce business in India.

  1. Which form of organisation is most suitable for an e-Commerce Business?

Priority concern for the e-Commerce organisation should be limited liability of the promoters as the e-Commerce business inherent higher risk in nature of the business. The corporate organisation structures like Limited Liability Partnership and Companies provide the benefit of limited liability. LLP ensures the entry for the medium scale businesses easy with the scope of business’s business. Further, it also allows working with the flexibility as per agreement of the LLP.

What are the aspects you should consider for choosing the form of organisation for an e-Commerce Business?

Capital requirement:

The introduction of capital will depend on the scale of operations. When the business will operate on large scale, capital will be infused more with the help of capital through private equities or public issues; hence a Company will be preferable for this. However, the business that is to be established to operate at medium scale will require limited capital to be introduced. The limited capital requirements can be gratified through capital of Partners or loans from financial institutions. Here, formation of LLP  will be suitable option.

Ownership and control

In case of Limited Liability Partnership, the ownership share will be divided as per the LLP Agreement and terms thereof. However, if the Companies bring the capital through equities or public, it will divide the ownership rights and control of the operations. Close control over operations and administration will be available in case of Limited Liability Partnership Registration.

Growth Aspects

The business established as Private Companies will be having higher scope of growth compared to Limited Liability Partnership as it will have option to convert the Private Company into Public Company. However, in case the LLP can also be converted into public or private company by following the procedure prescribed. The conversion procedure is also made easy in Companies (Amendment) Act, 2017.

Compliance Cost:

In comparison of both Private Company and Limited Liability Partnership, the cost of incorporation, as well as post incorporation compliance, is less in case of LLP. The LLP will not be required to appoint statutory auditor until crossing the prescribed limit.

  1. Whether the domain should be registered before its registration of business?

The domain name for an e-commerce business is most important to secure as the whole industry will know from its domain name. The domain name should be easy to remember and spell that uniquely represents the activity or characteristic of the business. However, the concern arises while the establishment of business as LLP or company that when should the domain name be secured for registration purpose.

In case the promoters wish to keep both domain name and organisation’s name as same, it is advisable to make the application for name approval first and then secure the domain name. First, the applicant shall make a search for both name availability at MCA portal for LLP and domain name availability. As the approval criteria for the name approval of the LLP is stringent, promoter shall make sure the approval of from MCA.

  1. What will be the next step?

As soon as the promoters receive the Name Approval, they should proceed with the Limited Liability Partnership Registration by filing of application of incorporation. Upon approval of the firm, the promoters can commence the business under this name of the LLP and undertake the business activities. The form for incorporation will be filed in Form 2 and subsequently, LLP Agreement shall be executed and filed within 30 days of formation of LLP in India.

  1. Bank Account and Payment Gateways

After registration of Limited Liability Partnership, a current account at the bank shall be opened to route the transactions of the LLP. Further, as online e-commerce operators, receipts of payments from third parties. The payment gateways will allow accepting the credit card, debit card and internet banking transactions from the third parties. The accumulated payments in the payments gateways will be transferred to the bank account of the LLP within decided period.

  1. Tax and other Registrations

Under GST Regime, it is mandatory for the online platform providers and aggregators to register themselves under GST Law irrespective of their turnover and activities. Hence, registration under Goods and Service Tax will be the step next to opening the Bank Account in name of LLP. If the LLP will indulge in the international market to transact across the country’s boundary, the registration under IEC will also be required. In India, the entities are required to obtain Importer – Exporter Code to indulge in import or export of goods.

  1. Legal Documentation

Legal Documentations will be must for the dealers or service providers under this category. As the organisation will be communicating with the third parties through web portal, disclosures and privacy policies are necessary after LLP registration. Terms and conditions as well as privacy policies customised as per the specified business.

Flexibility and less compliance cost assured by Limited Liability Partnership make it easy for the start-ups to commence and operate as e-Commerce in India. Where formation of Limited Company is more preferable to commence business as e-Commerce, the formation of LLP in India is also a considerable option for this business. Read a comprehensive guide on formation of LLP in India here.

Why Can’t Law Firms Handle Fair Comment and Free Speech

I got another email from a law student asking me to remove the internship experience he had shared on Lawctopus. The law firm had asked him to do so. Why? Because among the 400 good words he had written about the firm, there were 50 not so good words.

This has happened earlier too. Law firms guard the reputations to the hilt, and rightly so. Reputation, like any other good thing in this world, is hard to gain and easy to lose.

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However, being unable to take review & criticism in the right spirit are signs of a malaise. Individuals, societies and professions, scared of criticism, won’t go too far ahead. When you do not have people telling you what’s wrong and all that you want to hear is what fuels your ego, progress becomes impossible.

I might be talking of an ideal here. After all, being open and accepting to critique is an ideal.

The said law firms however go further. They say, “We can’t stand what this intern has written. Take the post down”.

The take it down part is a threat to the intern. It also is a vicious attack on the freedom of speech. And well, when the attack comes from the supposed guardian, it disgusts me.

This attitude won’t change unless the legal industry becomes comfortable with fair criticism. And fortunately, things are changing.

Websites like Legally India too have some stories which do not go well with law firms. Earlier, the law firms used to howl in protest; now, they still howl, but it has mellowed down.

Slowly, the legal industry will get used to fair reviews and fair criticisms. It should be a very healthy thing for the profession and will lead to a change in mindset. A mindset which is open to critique and has the ability to laugh at itself.

Some law students have even been threatened. “This won’t be good for your career”. My reply to the law student always is, “They won’t be able to do much. And if such is the attitude of an employer, better not deal with them in any capacity.”

The argument from the law firms is: “This is the experience of one person. We (generally) provide for better internships”.

Experiences/reviews, of course, are subjective. Someone likes the kebabs, someone finds them too spicy, for some they were bland.

Reviews/experiences are subjective, but multiple subjective reviews become indicative, “This restaurant is good; that is bad and that one fabulous” and of course “This is the place to intern; do not intern at that place”.

Also, dear law firms, how you treat one, is (generally) how you treat all.

So well, dear law students, do share your internship experiences here.

You are slowly changing your profession for good!

Can arbitration solve competition law disputes?

In this article, Rajvansh Singh discusses whether arbitration can solve competition law disputes or not.

Today, arbitration is considered to be one of the most popular means of dispute resolution. By adding a midnight clause private parties waive their right to approach national courts. The private nature of arbitration often raises a question that whether issues, which involves public interest, is capable of being settled by arbitration.

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Competition law came into picture to promote fair trade practice and safeguard consumer welfare. Basically, the main concern of any competition law is to promote fair trade practices, which leads to competitive market, which further results in cheap and quality goods, technology development, and results in high living standards of people. Now, both the laws are opposite to each other, competition law involves public interest whereas arbitration law works on party autonomy. Now a question arises whether competition law disputes can be resolved by means of arbitration.

Whether competition law disputes can be resolved by means of arbitration?

Arbitrability refers to whether arbitral tribunal is empowered to rule on a dispute. If the dispute per se is not arbitrable then the award can be set aside. Such an award can be challenged under section 34 and section 48 of Arbitration Act, 1996.

To know the arbitrability of a dispute following points are peculiar –

1) Whether the dispute can be resolved by private body like arbitral tribunal or is exclusively reserved for courts?

2) Whether the dispute is covered by an arbitration clause?

3) Whether in case of dispute parties opt for arbitration. 2nd and 3rd point does not create problem but when it comes to the 1st point it is full of ambiguity and is a matter of debate.

Antitrust issues can be resolved by arbitration

Traditionally, courts were of the opinion that disputes under competition law cannot be resolved by arbitration. The reason being arbitration is a private and consensual method of dispute resolution on the other hand competition law deals with issues, which involves public interest and can only be resolved by courts.

This hostility changed, when the Supreme Court of United States in the landmark case of Mitsubishi Motors Corp v. Soler Chrysler Plymouth[1] held that the antitrust issues could be resolved by means of arbitration. Later, European Court of Justice in the landmark case of Eco Swiss China Time Ltd. v. Benetton international NV[2] held that arbitral tribunal are empowered to hear disputes related to competition law. Most of countries have law, which are arbitration friendly, but Indian courts are yet to decide on the issue.

The Arbitration Act, 1996 does not list any class of dispute as non-arbitrable. Nevertheless, section 2(3) of the act talk about that the act would not affect any other law by virtue of which certain disputes may not be submitted to arbitration. Generally, rights in personam can be submitted to arbitration whereas rights in rem can only be adjudicated by courts[3].

For eg. A criminal case, which is an example of right in rem, can only be heard by courts and not by arbitration. In Kingfisher Airlines Limited v. Prithvi Malhotra Instructor [4]Supreme Court placed a restriction on arbitrability. It held that dispute which involves rights in personam is not arbitrable if it is reserved for public forum as a matter of public policy.

Further, in Natraj Studios Pvt. Ltd. v. Navrang Studios[5], Supreme Court held that arbitral tribunal is not empowered to hear dispute for which special tribunal is made. Thus, from the following cases, it can be concluded that to determine whether a particular issue can be arbitrated two question need to answered. First, whether the subject matter is right in remor right in personam? If the answer to the first question is right in personam then the Second question arises, whether the claim arising under right in personam is reserved by legislature for some special public forum as a matter public policy.

Section 19 (1) of the Competition Act – Filing a complaint with the CCI

  • Section 19 (1) of the competition act empowers any person, consumer and association to file a complaint with the CCI, when the act of a party is in contravention of competition act and involves public interest.
  • On the other hand, section 53 provides remedies only to an aggrieved party and all the claims made under this will only deal with individual party. Hence, claims made under competition law can be both rights in rem as well as rights in personam.
  • Section 19 is associated with right in rem, as a result, there is no scope of arbitration. Whereas Section 53 is associated with right in personam and can be submitted to arbitration but the second question needs to be answered here.
  • Section 18 of the competition act empowers CCI to eliminate anti-competitive practices.
  • Further, section 61 of the competition act declares that civil courts cannot entertain any dispute related to competition act. Thus, it can be concluded that claims (rights in personam) under competition law cannot be submitted to arbitration as CCI has statutory power to hear cases pertaining to competition law.

Union of India v. Competition Commission of India

Union of India v. Competition Commission of India[6] is an important judgement, which needs to be discussed here to know the opinion of court on the issue i.e whether disputes covered under competition law can be arbitrated?

In this case parties entered into an agreement (arbitration clause was present) with Ministry of Railways for operating container trains over rail networks. Parties filed complain before CCI as Railways started to misuse its dominant position through various acts such as not allowing to use the infrastructure.

Railway challenged the jurisdiction of CCI and contended that the dispute should be submitted to arbitration because of the arbitration clause. However, Delhi High Court held that legitimate jurisdiction lies with CCI and the matter cannot be submitted to arbitration.

Simply Put

Thus, it can be concluded that disputes arising under competition cannot be submitted to arbitration. Only CCI has the statutory power to hear case related to competition law.

Today, most of the companies want to settle their dispute by using arbitration instead of litigation because arbitration is the most effective means to resolve disputes. Judicial authorities have given many landmark judgements, which make India an arbitration-friendly nation.

Although disputes regarding competition cannot be submitted to arbitration and can only be heard by CCI, now the time has come to make India a little more arbitration-friendly. My suggestion in this regard is, in case of dispute, parties can go for arbitration and then CCI can give a second look to the arbitral award. If the award is in contravention to the competition law against public policy, CCI can annul the award.

5 Tips For Reading Judgments IN FULL

Judgments make the law.

There is perhaps nothing more important for a lawyer than to have the ability to closely and critically read judgments – often, many of them in a very short time. And ironically, this is not something that is prioritised in law schools: case notes and case summaries are often used as substitutes for reading judgments. This is perhaps because it is quite natural to think that, as long as one knows the holding of a case, one knows the law.

This, however, is a mistake.

You will see it for yourself if you first read the SCC headnotes of a case, then read the judgment itself, and note the difference in your understanding. Reading judgments in full allows you to develop your own unique perspective on the development of the law, as well as giving you a much deeper and clearer analytical grasp of the law as a whole.

[Watch a video on understanding and using judgments as legal authorities. This video is a part of our course on Legal Research.]

Reading judgments is often a thankless task, especially if it involves reading recent judgments of the Supreme Court, which are often very long. There are a few techniques that can make your task easier.

  1. Understand how the case reached the court

The first is to have a clear map in your mind about how the case got to the Supreme Court. Did it begin life as an Article 226 petition before the High Court, and is there a reasoned judgment of the High Court that is being appealed? You may not have time to go back and read the High Court’s judgment itself, but it is important to pay close attention to the Supreme Court’s summary of what the High Court held. Sometimes, the chain will go back even further, beginning in the trial court or a tribunal. In each of these situations, understanding the history of the case will make it far easier for you to grasp what the Supreme Court is doing, and why it’s doing it.

  1. Separate the submissions for the parties (with colours!)

The second thing is something rather more practical: colour-code the document you’re reading, in order to differentiate the submissions of the two sides, and the judicial analysis itself. For example, I highlight the petitioner’s submissions in red, the respondent’s submissions in blue, and the judicial analysis in green. This ensures that you have a clear sense of the structure of the judgment, and its logical flow, especially in cases where the court doesn’t structure its judgments in sequence, but repeatedly moves back and forth between the parties’ submissions, and its own analysis.

  1. Keep statutory provisions handy

Thirdly, keep copies of the laws and statutes that the judgment is referring to with you, either in hard copy, or open in a separate window on your laptop. Normally, judgments will cite the legal provision in full the first time they refer to it, and not after that. Often, however, statutory provisions will be long and complicated, full of “notwithstandings” and “provided that”, and you will not be able to remember them as you go through the judgment. Moreover, many statutes are too complicated to even fully grasp on a first read. So, having them with you, and re-reading them every time the judgment refers back to the statutes, is an excellent way of both following the train of thought in the judgment, as well as allowing yourself to completely grasp – through repeated readings – the nuances and complexities of the laws that the court is dealing with.

  1. Know whether the ruling remains law

Fourthly, when you’re reading a case, it is good to be generally aware of whether the legal position continues to hold. Often, judgments are overruled or reversed by later cases, or overtaken by lawmaking. Case databases often give you tools to help you in this task. For example, SCCOnline will let you know if a judgment has been overruled or reversed. Both Manupatra and IndianKanoon have a particularly useful tool: Manupatra has an icon above the judgment called “Mentioned in”, which gives you a list of all the subsequent cases that have cited the judgment you’re reading. IndianKanoon has a link titled “Cited by”, which does the same. After you finish reading your judgment, it’s a good policy to quickly skim through the list of cases that appears in the “Mentioned in” or “Cited by” column, just to ensure that there has been no fundamental change in the law.

  1. Remember that the court’s analysis is still the most important part of the judgment

And lastly – if your research involves reading recent judgments, you will find them to be of inordinate length, often running into hundreds of pages. This is because the Supreme Court has taken to reproducing the parties’ submissions at length before moving on to its own analysis. In such a situation, the best way out might be to read as much of the submissions as is necessary for you to attain a grasp of the key arguments (on both sides), skim the rest, and then move straight on to the Court’s analysis. It is not ideal, but there is perhaps no other way to do it.