Kotak Mahindra AMC, Kirloskar Ferrous, Sonam Wangchuk, PVC Tender & More

“MANDATE FIRST, GAINS LATER; SEBI COMPLIANCE, NEVER FALTER.”

— Supreme Court in its judgment in case against Kotak Mahindra’s Nilesh Shah and others

Supreme Court Minces No Words About Mandatory Nature of Regulatory Norms
A resounding message from the country’s top court on regulatory compliance this week with the top court categorically holding that mandate always comes first! The ruling in the Kotak AMC case sends a strong word out that regulatory compliance in the mutual fund industry cannot be judged solely by investment outcomes.

By rejecting the argument that investors ultimately earned profits, the court reaffirmed that fiduciary duties and SEBI's regulations exist to preserve market integrity, not merely prevent financial loss. One cannot be overridden for the other. The judgment strengthens SEBI's enforcement powers and raises the accountability threshold for asset managers, trustees and senior executives, making it clear that commercial practicality cannot justify departures from prescribed norms.

The court's emphasis on process is likely to reinforce investor confidence by ensuring that fund houses are held to uniform governance standards regardless of the eventual returns. The ruling is expected to impact compliance practices across India's mutual fund industry.

Key Rulings:

• Supreme Court upholds SEBI fine imposed on Nilesh Shah and other executives and Kotak Mahindra AMC, says investor interest cannot waive liability for violating norms
• Supreme Court upholds centre’s rules on calculating royalty on mining while rejecting plea by Kirloskar Ferrous that alleged it was “royalty on royalty”

Courts:  

• Climate activist Sonam Wangchuk fasting in protest against exam paper leaks in India removed from protest site by the police and taken to the hospital; denied interim order from Delhi High Court which held hospitalisation isn’t arbitrary
• PIL filed before the Supreme Court seeking CBI investigation into Reliance in relation to the KG Basin case
• Supreme Court initiates suo moto case over speeding up hearings in cases concerning lifesaving drugs
• Delhi High Court quashes tender process for outsourcing passport, visa, consular services in four missions abroad over lack of transparency in the process; central government appeals before the Supreme Court
• Rules governing airfare are framed and will be placed before the parliament, centre informs the Supreme Court
• Supreme Court declines to stay SAT order exonerating Nusli Wadia and others in fraud case

Quasi Courts:

• Competition Commission dismisses plea alleging collusion between Reliance’s Jio with over 4500 other entities
• In a first, consumer court directs Maruti Suzuki to replace a car which malfunctioned after use of E20 fuel; Maruti says will challenge ruling before appropriate appeals forum
• Competition Commission of India imposes a fine of 1.39 billion rupees on HP for alleged manipulation of government tenders

The Big Listings:

Jul 27: Delhi High Court to hear Anil Ambani’s defamation lawsuit against NDTV

Jul 31: Securities Appellate Tribunal to hear appeal by Jane Street challenging SEBI’s move to allegedly refuse access to important documents to the firm in the case against it

* The dates of hearing can change and a concrete list is prepared just a day before

Legal Moves:

• Amit Kapur joins Cyril Amarchand Mangaldas as Senior Partner
• Shwetank Sharma leaves S&R to join JSA Advocates & Solicitors as partner
• Anupam Prasad joins White & Brief as partner
• Rachana Yadav becomes Director Legal at Whirlpool
• Deepak Singh of Google joins Chandhiok & Mahajan to lead technology practice
• Timothy Franklyn joins Dentons Link Legal as partner
• Amrita Pandey joins Hammurabi & Solomon as partner
• Ganesh Chandru leaves Dua Associates to join Kochhar & Co as senior partner