Overview: In a recent landmark judgment by the Hon’ble Supreme Court of India in the case of Gayatri Balasamy v. M/s. ISG Novasoft Technologies Limited and other connected appeals, the Court addressed the contentious issue of whether courts exercising jurisdiction under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996 ("Arbitration Act") have the power to modify arbitral awards. This decision resolves conflicting judicial precedents and clarifies the scope of judicial intervention in arbitration, emphasising the balance between limited judicial oversight and the need to prevent protracted litigation while adhering to the legislative framework of the Arbitration Act. Brief Background of the Case: The case arose from multiple appeals challenging the scope of judicial powers under Section 34 of the Arbitration Act, which provides for setting aside arbitral awards on specified grounds but is silent on modification. A three-judge Bench referred the matter to a five-judge Constitution Bench to resolve inconsistencies in prior judgments, such as Project Director, NHAI v. M. Hakeem (2021), which held that courts lack modification powers, and others like Vedanta Limited v. Shenzhen Shandong Nuclear Power (2019), where awards were modified. The core issue was whether courts could modify awards to achieve justice without overstepping the statutory limits of Section 34. Issues: The Supreme Court framed the following questions for consideration: i. Whether courts under Sections 34 and 37 of the Arbitration Act have the power to modify an arbitral award? ii. If modification is permissible, whether such power is limited to cases where the award is severable, and only a part can be modified? iii. Whether the power to set aside an award under Section 34, being a broader power, includes the power to modify, and if so, to what extent? iv. Whether the power to modify can be read into the power to set aside under Section 34? v. Whether the judgment in M. Hakeem (2021), followed in subsequent cases, lays down the correct law, given conflicting decisions where awards were modified? Ruling: The Supreme Court, in a detailed judgment, held that courts under Section 34 do not have a general power to modify arbitral awards, except in limited circumstances. The key findings are: 1. No General Power to Modify: The Court reaffirmed that Section 34 restricts judicial intervention to setting aside awards on specified grounds, such as incapacity, invalid arbitration agreements, procedural irregularities, or violations of public policy. Modification, except in specific cases, would amount to exercising appellate powers, which is contrary to the Arbitration Act’s framework and the UNCITRAL Model Law. 2. Severability and Partial Setting Aside: The Court recognised the power to partially set aside awards under the proviso to Section 34(2)(a)(iv), where decisions on non-arbitrable matters can be severed from arbitrable ones, provided the valid and invalid portions are legally and practically separable. This power is inherent in the authority to set aside and does not extend to modifying the substance of the award. 3. Limited Exception for Errors: Courts can correct computational, clerical, typographical, or similar errors under Section 34, based on the principle of actus curiae neminem gravabit (an act of the court shall prejudice no one). Such corrections do not involve merit-based evaluation and are akin to powers under Section 152 of the Code of Civil Procedure, 1908. 4. Remand as an Alternative: Where modification is inappropriate due to uncertainty or complexity, courts may remand the matter to the arbitral tribunal under Section 34(4) to cure defects, such as inadequate reasoning or procedural issues, provided the defect is curable and does not require rewriting the award. 5. Interest Awards: The Court held that interest rates cannot be modified by Section 34 courts. If interest awards are excessive, inadequate, or beyond the agreement, the matter must be remanded to the tribunal under Section 34(4) for reconsideration. 6. Suo Moto Exercise of Section 34(4): The Court clarified that the power to remand under Section 34(4) can be exercised suo motu or on an oral request, overruling Kinnari Mullick v. Ghanshyam Das Damani (2018), which required a written application. 7. New York Convention and Doctrine of Merger: The Court rejected arguments that modifications would complicate enforcement under the New York Convention, noting that domestic law governs the validity of awards at the seat of arbitration. The doctrine of merger was deemed inapplicable, as modifications do not merge with the original award. 8. Hakeem Upheld with Exception: The Court upheld M. Hakeem (2021) as correctly interpreting Section 34, except for the limited exception allowing correction of computational, clerical, or typographical errors. The judgment was not per incuriam, as it aligned with the statutory framework and distinguished prior cases like Oil and Natural Gas Corporation v. Western GECO (2014). Highlights of the Judgment: 1. Limited Judicial Role: The Court emphasized the Arbitration Act’s intent to minimize judicial interference, restricting courts to setting aside awards or remanding them for correction, except for minor error corrections. 2. Severability Principle: The power to sever invalid portions of an award is inherent and applies when claims are independent, ensuring valid parts are preserved without affecting the award’s integrity. 3. Error Correction: Courts can rectify manifest errors (e.g., computational or typographical) without engaging in merits review, aligning with the principle that court actions should not prejudice parties. 4. Remand Mechanism: Section 34(4) serves as a “safety valve” to preserve awards by allowing tribunals to address curable defects, exercisable suo motu or on request, enhancing arbitration efficiency. 5. Uniform Interpretation: The Court rejected differential interpretations for statutory or commercial arbitrations, ensuring a consistent application of Section 34 across all cases. 6. International Compliance: The ruling aligns with the New York Convention, as modifications are limited and do not affect the enforceability of awards abroad. MHCO Comments The Hon’ble Supreme Court’s judgment is a significant step toward clarifying the scope of judicial intervention in arbitration under the Arbitration Act. By upholding the restrictive framework of Section 34 while allowing limited error corrections and severability, the Court strikes a balance between arbitration’s autonomy and the need for equitable outcomes. The emphasis on remand under Section 34(4) as a primary remedy for curable defects promotes efficiency and reduces litigation costs, reinforcing arbitration as a viable alternative dispute resolution mechanism.

SEBI Update: Amendments to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 The Securities and Exchange Board of India (SEBI) introduced significant amendments to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 LODR Regulations on April 14, 2025. These amendments, primarily effective from April 1, 2025, strengthen corporate governance frameworks, with a particular focus on entities with high-value listed non-convertible debt securities, i.e., High-Value Debt Listed Entities (HVDLEs). The changes aim to enhance transparency, protect debenture holders, and align with global sustainability and governance standards. Expansion of the Scope of Corporate Governance for HVDLEs The changes address the need for robust governance in entities with significant debt obligations, ensuring protection for debenture holders and alignment with global standards. Under Regulation 15 and the newly introduced Chapter V-A of the LODR Regulations, the governance framework for HVDLEs now includes the following key provisions, summarized below: Increased Debt Threshold: The threshold for non-convertible debt securities triggering governance requirements is raised from ₹500 crore to ₹1,000 crore. Board Composition: Mandates a balanced board with at least one woman director, 50% non-executive directors, and independent directors based on the chairperson’s status. Audit Committee Oversight: Requires approval for related party transactions (RPTs), with conditions for omnibus approvals. Stakeholders Relationship Committee: Addresses debenture holder grievances, including issues related to charge creation, interest/principal payments, and covenant maintenance. RPT Approvals: Mandates No-Objection Certificates from Debenture Trustees for material RPTs, followed by shareholder approval. Subsidiary Governance: Ensures independent director representation and financial oversight for material unlisted subsidiaries. Secretarial Audit: Requires annual secretarial audits and compliance reports within 60 days of the financial year-end. Independent Director Norms: Sets strict rules for appointment, tenure, liability, and mandatory annual performance review meetings. Key Managerial Vacancies: Mandates filling critical roles like CEO and CFO within three to six months. Risk Management Committee: Requires assessment of financial and operational risks. Vigil Mechanism: Mandates a whistleblower policy to report unethical practices. Modifications to Existing Provisions 1. Regulation 3(2)(b) of the LODR Regulations now requires listed entities to assess or assure compliance with prescribed sustainability criteria, replacing the earlier requirement of submitting a report. 2. Regulation 34(2)(f) of the LODR Regulations clarifies that Environmental and Sustainable Governance (ESG) disclosures involve assessment or assurance of prescribed criteria, aligning with sustainability goals. Deferred Compliance Timeline Post-amendment, a new proviso under Regulation 15 of the LODR Regulations allows HVDLEs exceeding the ₹1,000 crore threshold to comply with governance provisions within six months, with reporting in the immediate next quarterly corporate governance report. Debenture Holder Protections As per the new provisions under Regulation 62K of Chapter V-A of the LODR Regulations, material RPTs require No-Objection Certificates from Debenture Trustees and approval from debenture holders holding more than 50% of the debentures in value, ensuring enhanced investor protection. MHCO Comments: The amendments to the LODR Regulations expanding the scope of corporate governance for HVDLEs underscore SEBI’s focus on enhancing transparency and accountability in India’s capital markets. By introducing stringent governance norms, robust RPT oversight, and a strong emphasis on ESG compliance, SEBI signifies its commitment to a regulatory framework that adapts to evolving market dynamics. Further, the harmonization of governance requirements with global sustainability standards ensures consistency, reducing ambiguity for listed entities in meeting their obligations.

Background The Maharashtra Real Estate Appellate Tribunal recently passed a significant interim order in Meghna Devang Juthani & Ors v J.P. Porwal Realty & Ors, addressing a dispute involving multiple registrations for a single real estate project. The appellants—legal heirs of a deceased allottee—challenged the actions of the landowners and a new developer who allegedly sought to sidestep the rights of the original purchaser by registering the same project property under a different name and developer, without adhering to the transfer procedures mandated under Section 15 of the Real Estate Regulation and Development) Act 2016 (“RERA Act”). The matter pertains to a shop initially allotted in 2014 under the project “Sambhav Classic”, later renamed and re-registered as “Rajkamal Building” and “Dipti’s Royal Arc”. The core of the dispute lies in the dual project registrations issued by MahaRERA based on the same property and commencement certificate Issues Addressed Whether the landowners, now acting as developers, qualify as "promoters" under RERA and are responsible for obligations arising from the original agreement for sale. Whether two concurrent MahaRERA registrations can exist for the same property. Whether the original agreement executed with the first promoter remains enforceable against subsequent developers. The legality and enforceability of the new project registration undertaken without following the procedure in Section 15 of the RERA Act, 2016.   Judgment Landowner as Promoter: The landowners, by terminating the original development agreement and registering the project themselves, assumed the role of promoters under Section 2(zk) of the RERA Act which defines “Promoter” as inter alia a person who constructs or causes to be constructed an independent building or a building consisting of apartments, or converts an existing building or a part thereof into apartments, for the purpose of selling all or some of the apartments to other persons and includes his assignees. In the present case, the Tribunal noted that the landowners executed a power of attorney in favour of the old developer and by virtue of the development agreement authorized the old developer to construct building/s of flats/ premises to be sold to outsiders which amounts to “causes to be constructed” and hence qualifies him as a “Promoter”. No Parallel Registrations Permitted: The Tribunal further emphasized that two separate registrations for the same property are impermissible. Original Agreement Remains Binding: The Tribunal reiterated that rights under the original agreement remain enforceable even if the agreement predates the RERA Act. Transfer Obligations Under Section 15 Ignored: The Tribunal held that the project transfer without consent and MahaRERA approval was a violation of Section 15 of the RERA Act.   MHCO Comment This ruling serves as a landmark interpretation of promoter liability and reinforces the intent of the RERA Act to protect homebuyers and ensure transparency. The Tribunal’s observations make it clear that once a landowner takes over a stalled project, it inherits the full spectrum of liabilities, including those arising from pre-RERA agreements. Further, the attempt to sidestep Section 15 of the RERA Act by duplicating project registration undermines the regulatory intent and invites scrutiny. The affirmation that the original agreement remains enforceable, coupled with the direction to restrain any third-party transactions regarding the disputed unit, offers significant relief to aggrieved allottees. This decision reinforces that RERA is a buyer-protection statute and cannot be diluted by technical maneuvers. Going forward, developers—including landowners—must exercise strict compliance with both procedural and substantive aspects of the RERA Act, especially when dealing with ongoing or legacy projects. 

Introduction The Ministry of Micro, Small and Medium Enterprises (MSME) has significantly revised the investment and turnover thresholds for MSME classification. The changes have been notified vide Notification S.O. 1364(E) dated 21 March 2025. This amendment supersedes the earlier notification S.O. 2119(E) dated 26 June 2020, issued under the Micro, Small and Medium Enterprises Development Act, 2006. Key Changes The Notification increases the investment and turnover limits for MSMEs. The revised thresholds for MSME are as follows: Enterprise Category Revised Investment Limit Revised Turnover Limit Micro Enterprises Increased from ₹ 1 crore to ₹ 2.5 crore Increased from ₹5 crore to ₹10 crore Small Enterprises Increased from ₹10 crore to ₹25 crore Increased from ₹50 crore to ₹100 crore Medium Enterprises Increased from ₹50 crore to ₹125 crore Increased from ₹250 crore to ₹500 crore Effective Date The revised thresholds shall come into force from 1 April 2025. MHCO Comment The upward revision of thresholds is a welcome move and is expected to benefit a larger number of enterprises, particularly those in the growth stage who were previously at the cusp of losing MSME status due to marginal increases in investment or turnover. With broader criteria, more enterprises will now be eligible for MSME-related incentives such as easier access to credit, priority sector lending, subsidies, and various support schemes offered by the central and state governments.