Deals of the Year 2019

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India Business Law Journal reveals the most significant deals and disputes of 2019 and the law firms that worked tirelessly to bring them to fruition

The best transactions for the past year in India came against a backdrop of economic gloom, with a defiant government attempting to ward off negative business sentiment while simultaneously singing the praises of a vibrant and rewarding place to do business.

To shore up resolve in the private sector, the government cut the corporate tax rate to 22% and moved to decriminalize offenses under the Companies Act.

But it was always going to be a difficult sell. The view from international organizations was a negative one and the International Monetary Fund (IMF) in January 2020 cut its economic growth estimate for India’s 2020 fiscal year to 4.8%, while the Asian Development Bank (ADB) lowered its forecast to 5.1% around the start of 2020. In contrast, the Organisation for Economic Co-operation and Development (OECD), which is normally seen as one of the more pessimistic on the Indian economy, forecast a higher rate of 5.9% growth last September.

Declines were especially apparent in the auto and real estate sectors. The auto sector has seen the steepest drop in 20 years, while the property sector faced challenges due to an increase in unsold inventory in major cities and a liquidity crisis that has stalled many projects.

The Insolvency and Bankruptcy Code, 2016 (IBC), one of the most promising laws in recent years, won some important successes in the courtroom, including the Essar Steel verdict, which will see banks recover more than 90% of the debt owed to them. The Supreme Court in the Swiss Ribbons matter upheld the constitutional validity of the IBC and also laid several issues pertaining to the code to rest.

However, the IBC remains far from reaching its objective of preserving corporate debtors as a going concern, and of their resorting to liquidation as a last resort. Of the 2,542 companies admitted in the corporate insolvency process as of September 2019, 156 ended with the approval of a resolution plan, while 587 companies ended in liquidation.

Deal values fell to US$73 billion in 2019 from a 2018 high of US$121 billion, as M&A values sank back to 2017 figures, according to PwC. At the ground level, deal tracking website Acuris noted a drop of about 50% in deal values on work done by many of the country’s largest law firms over the previous year, while deal numbers remained consistent.

And yet, despite the gloom, India remains a place where billion-dollar deals are common. The M&A space saw promising deals including the US$12 billion merger of Gruh Finance and Bandhan Bank, and UPL Corporation’s US$3 billion acquisition of Arysta LifeScience. The year also saw law firms submit many interesting deals to India Business Law Journal, especially in the white-collar crime and IP dispute areas. Due to the constraints of this article we must shortlist the submissions.

METHODOLOGY

India Business Law Journal selected 50 landmark deals and disputes that were completed between November 2018 and November 2019, following intensive research and consultation. The deals and cases were chosen subjectively based on transactional data, submissions received from Indian and international law firms, and interviews with India-focused legal and corporate professionals.

In deciding the winning deals and cases, our editorial team evaluated the significance of all shortlisted contenders from a legal and regulatory standpoint. Deals were chosen not only for their size, but for the novelty and complexity of the transaction or case, and for any precedents that may have been established. The same criteria were applied in choosing the star deals.

Capital marketsDisputesInsolvencyJoint venturesMergers & AcquisitionsOther

Capital Markets

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Vodafone Idea’s ₹250 billion rights issue

VALUE	PRINCIPAL LAW FIRMS
US$3.5 billion	Cyril Amarchand Mangaldas S&R Associates Sidley Austin

Vodafone Idea raised ₹250 billion (US$3.5 billion) in one of the largest rights issues in the country. This was Vodafone Idea’s first capital raising after the merger of Vodafone India and Idea Cellular in August 2018.

Vodafone offered about 20 billion equity shares at ₹12.50 per equity share. The issue was covered about 1.08 times. Vodafone Idea had 32% of the revenue market share as of December 2018, and 387 million subscribers. The promoter shareholders, Vodafone Group and Aditya Birla Group, picked up ₹110 billion and ₹72.5 billion worth of shares, respectively.

S&R Associates advised Vodafone India, Cyril Amarchand Mangaldas acted as Indian legal counsel to bookrunning lead managers Kotak Mahindra Capital, DSP Merrill Lynch, Morgan Stanley India, HDFC Bank and SBI Capital Markets. The Singapore and New York offices of Sidley Austin acted as special US counsel to the lead managers.

Bharti Airtel’s rights issue

VALUE	PRINCIPAL LAW FIRMS
US$3.5 billion	AZB & Partners Shardul Amarchand Mangaldas & Co

Indian telecoms company Bharti Airtel raised ₹250 billion (US$3.5 billion) from one of the largest rights issues in the country. The mobile operator issued 1,133,591,075 equity shares at ₹220 per share, aggregating to about ₹249 million.

This deal was one of the largest public equity capital-raising exercises in India to date. The deal involved many complexities because of the size of the issue including complex structuring, corporate and tax matters, litigation of the issuer and its multiple subsidiaries, and discussions on different Securities and Exchange Board of India (SEBI) regulations.

AZB advised the issuer, Bharti Airtel. Shardul Amarchand Mangaldas & Co acted as Indian counsel to bookrunners Axis Capital, JP Morgan India, Goldman Sachs, HSBC Securities and Capital Markets, and ICICI Securities. Latham & Watkins advised bookrunners on US law.

Axis Bank’s US$1.75bn qualified institutional placement

VALUE	PRINCIPAL LAW FIRMS
US$1.75 billion	AZB & Partners Latham & Watkins Shardul Amarchand Mangaldas & Co

Axis Bank, India’s third-largest private commercial bank in terms of deposits, advances and number of branches, raised US$1.75 billion from a qualified institutional placement in the largest such private sector arrangement and the second-largest qualified institutional placement in India to date. The bank offered 198,728,139 equity shares in the placement and was offering it at a 5% discount to the market price. The books were oversubscribed.

The bank intended to use the net proceeds to enhance its capital adequacy, and for general corporate purposes. Shardul Amarchand advised the issuer, Axis Bank. AZB & Partners and Latham & Watkins were Indian and US counsel to the bookrunners, respectively.

State Bank of India’s dual tranche, senior notes issuance

VALUE	PRINCIPAL LAW FIRMS
US$1.2 billion	Allen & Overy J Sagar Associates Linklaters Shardul Amarchand Mangaldas & Co

The State Bank of India (SBI) became the first Indian issuer in 2019 to make a Rule 144A bond offering. The bank made a US$1.25 billion dual tranche Regulation S/Rule 144A senior notes issuance, which included US$400 million of 4% notes due 2022, and US$850 million of 4.37% notes due 2024. The bonds were listed on the Singapore Stock Exchange and the India International Exchange, GIFT City.

This was the first Rule 144A bond offering by an Indian issuer in 2019, and marked the SBI’s return to US capital markets following its record-setting qualified institutional placement in 2017.

Allen & Overy advised the SBI on US law, while Shardul Amarchand Mangaldas & Co advised the bank on aspects of Indian law. Linklaters Singapore was the adviser to initial subscribers on US and English law, while J Sagar Associates advised them on aspects of Indian law.

The State Bank of India is the country’s largest bank with more than 22,300 branches and 420 million customers.

Greenko’s US$1bn bond offering

VALUE	PRINCIPAL LAW FIRMS
US$1 billion	Ashurst Cyril Amarchand Mangaldas Mayer Brown Shearman & Sterling Talwar Thakore & Associates YKJ Legal

Indian renewable energy company Greenko Energy issued Asia’s largest green bond offering of the year, raising US$950 million. It was the largest high-yield bond issuance from India for 2019. It is the third issuance from the Indian clean energy producer, which has 4.1 gigawatts of operational capacity across wind, solar and hydro power. Greenko’s shareholders include GIC Holdings and the Abu Dhabi Investment Authority.

The notes comprised two tranches – US$500 million 5.55% senior notes due 2025, and US$450 million 5.95% senior notes due 2026. The notes are guaranteed on a senior basis by Greenko Energy Holdings, and secured by a share pledge over the capital stock of Greenko Solar and a first priority security interest in an escrow account of the net proceeds from the sale of the notes, before the release, to lending or subscription of offerings by Greenko’s Indian subsidiaries.

Shearman & Sterling represented Greenko Energy and Greenko Solar (Mauritius). The Shearman team included partner Andrew Schleider and associate Jeremy Wang. Cyril Amarchand Mangaldas was Indian legal counsel to the issuer and YKJ Legal was Mauritius counsel to the issuer.

Ashurst was US counsel and Talwar Thakore & Associates was Indian counsel to the bookrunners. The Ashurst team was led by partner Anna-Marie Slot, assisted by partner Jeffrey Koppele, counsel Natalia Sokolova and Ethan Perry, and senior associates Chin Lee and Robert Thurlow. Mayer Brown was the US counsel to the trustees.

VALUE	PRINCIPAL LAW FIRMS
US$670 million	Clifford Chance Cyril Amarchand Mangaldas Latham & Watkins S&R Associates Simpson Thacher & Bartlett

The Embassy Office Parks IPO in March 2019 was the first listing by a real estate investment trust (REIT) in India. The ₹47.5 billion IPO saw investors bid for about 183.5 million shares, or about 2.57 times the 71.3 million on offer.

The lead managers were Morgan Stanley India, Kotak Mahindra Capital, JP Morgan India, DSP Merrill Lynch, Axis Capital, Credit Suisse Securities (India), Deutsche Equities India, HSBC Securities and Capital Markets (India), IIFL Holdings, JM Financial, and Nomura Financial Advisory and Securities (India).

Latham & Watkins represented the lead managers on the deal, while S&R Associates was Indian counsel. Cyril Amarchand Mangaldas and Clifford Chance were legal advisers to the Embassy REIT. Simpson Thacher & Bartlett was international counsel to Blackstone.

“This was a highly complex transaction involving capital markets, competition law, debt financing and M&A aspects,” said an S&R Associates spokesperson. “The transaction set a precedent for the real estate investment trust market in India.”

Transaction approvals were required from several regulators including SEBI, the Competition Commission of India (CCI), special economic zone authorities and local land authorities.

It is Asia’s largest REIT to date in terms of portfolio size and is co-sponsored by the Blackstone group and the Embassy group. The REIT resulted in the pooling of 13 assets owned by Embassy and Blackstone, amounting to ₹32.7 billion.

Capital marketsDisputesInsolvencyJoint venturesMergers & AcquisitionsOther

Disputes

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Moratorium order for ITNL

VALUE	PRINCIPAL LAW FIRMS
US$14 billion	Shardul Amarchand Mangaldas & Co

Shardul Amarchand Mangaldas advised Infrastructure Leasing & Financial Services’ (IL&FS) largest subsidiary, IL&FS Transportation Networks (ITNL), in preparing bid documentation, and assisted the financial and transaction advisers in conducting the sale process of business undertakings and projects of ITNL, both in India and abroad, and on corporate compliance, including listing obligations.

In 2018, IL&FS, one of India’s largest infrastructure financing companies, defaulted on its debt obligations of about US$14 billion, leading to severe disruption in the Indian financial and infrastructure sectors.

One of the challenges in unwinding this debt was that the resolution process prescribed under the IBC was not available, because it is a non-banking finance company.

ITNL has 28 build-operate-transfer infrastructure projects that are being sold as part of the debt unwind plan. It has some of the largest infrastructure projects in India, including the Chenani-Nashri tunnel, which will be India’s longest tunnel. This was a significant deal in the Indian infrastructure sector because of the number, size and importance of ITNL’s projects.

High-profile insolvency of Binani Cements

VALUE	PRINCIPAL LAW FIRMS
US$1.1 billion	Argus Partners L&L Partners

The Binani Cements insolvency case became the first successful big-ticket matter to result in 100% recovery for all creditors. The Supreme Court in November 2018 upheld an order of the NCLAT that approved a ₹79 billion offer by Ultratech Cement to buy Binani. The offer by Ultratech had faced a serious challenge from Dalmia Cements, which was heard before the NCLT, NCLAT, and the Supreme Court.

The NCLAT in its judgment had said: “The first order objective is resolution. The second order objective is maximization of the value of assets of the corporate debtor, and the third order objective is promoting entrepreneurship, availability of credit and balancing the [various] interests. This order of objectives is sacrosanct.”

The Committee of Creditors (CoC) stated that after the deadline for submission of resolution plans it would only engage with the highest resolution applicant, and not others. Dalmia emerged as the highest bidder. However, Ultratech submitted a revised plan after the deadline. The NCLT urged the CoC to consider both plans, and it voted unanimously in favour of Ultratech’s resolution proposal.

Argus Partners advised the CoC on the corporate insolvency resolution process (CIRP). A key element of the case for the firm pertained to the need to weigh the importance of value maximization versus timely completion of the CIRP. Argus negotiated complex resolution plans, in the first instance with Dalmia Cements, and subsequently with Ultratech. It held meetings and discussions with the other bidders for the assets, and the firm’s offices in New Delhi, Mumbai and Kolkata simultaneously worked on the matter.

The team included lead and managing partner Krishnava Dutt, senior partner R Sudhinder, and partners Soorjya Ganguli, Aastha, Adity Chaudhury, Arka Majumdar and Pooja Chakrabarti. L&L Partners advised the resolution professional Vijay Iyer and his team from Deloitte Touche Tohmatsu India.

Zee and Indiabulls dispute over 4 loans

VALUE	PRINCIPAL LAW FIRMS
US$104 million	Trust Legal

Zee Entertainment Enterprises was faced with a litigation while undertaking the country’s largest disinvestment in the media and entertainment sector in the past 25 years. The dispute was with Indiabulls Housing Finance over four loan transactions amounting to US$104 million.

Indiabulls sought a stay against the proposed stake sale. However, the Delhi High Court did not restrain the stake sale, and Indiabulls appointed former chief justice B D Ahmed as an arbitrator in accordance with its loan agreement.

Trust Legal represented Zee Entertainment Enterprises and 16 other entities of Essel Group in the dispute before the Delhi High Court, and the arbitral proceedings. The team included managing partner Sudhir Mishra, partners Ritwika Nanda and Petal Chandhok. Promoter Essel Group has been steadily selling its stake in Zee Entertainment Enterprises to repay lenders more than US$1.6 billion.

Nippon Steel trademark dispute

VALUE	PRINCIPAL LAW FIRMS
N/A	Gajria & Co Remfry & Sagar

The Bombay High Court, in the trademark infringement dispute Nippon Steel & Sumitomo Metal Corporation v Kishor D Jain & Anr, awarded the highest recorded amount in India to date. Nippon Steel Company filed a lawsuit against the defendants for selling counterfeit iron pipes made to appear like the plaintiff’s products. The suit for a permanent injunction was based on a complaint by Yanbu Steel Company from Saudi Arabia. Yanbu Steel raised the issue about the quality of carbon seamless pipes for use in oil plants that it had sourced from the defendants, believing the same had been manufactured by Nippon. The pipes supplied by the defendants were accompanied by forged and fabricated certificates purportedly issued by the plaintiff and bearing its trademarks and logos.

Remfry & Sagar filed the lawsuit in question on behalf of Nippon Steel through its solicitors Gajria & Co in Mumbai. The court in March 2019 passed an ex parte ad interim injunction restraining the defendants from infringing on the plaintiff’s registered trademarks. Court receivers then visited the defendants’ premises and seized various branded and unbranded iron pipes, as well as mirror copies of the defendants’ electronic records.

The court noted that the plaintiff’s products are used in extremely sensitive areas, where the quality of apparatus is of utmost importance. It also observed that the defendant’s actions impacted the reputation of the company and the country. Justice SJ Kathawalla awarded costs of ₹50 million at the plaintiff’s behest and directed the defendants to pay the amount to the Tata Memorial Hospital in Mumbai, which is a specialist centre for cancer treatment and research.

The court also directed the defendants to furnish personal undertakings including, addressing communications to every entity to which spurious pipes under the plaintiff’s marks had been supplied to. The verdict indicated the strict approach of the courts to curb misuse, especially where the infringing activity could cause severe harm to consumers.

Cyrus Investments Pvt Ltd & Anr v Tata Sons & Ors

VALUE	PRINCIPAL LAW FIRMS
N/A	Chambers of Jaitley and Bakhshi Karanjawala & Co Makhija & Associates Mulla & Mulla Shardul Amarchand Mangaldas & Co

Certain minority shareholders of Tata Sons, which are owned and controlled by Cyrus Mistry and his family, filed a petition under sections 241, 242 and 244 of the Companies Act, 2013, raising allegations of oppression and mismanagement against the dominant shareholders of Tata Sons, the trustees of Sir Dorabji Tata Trust and Sir Ratan Tata Trust, including Ratan Tata.

Petitioners alleged that the trustees, particularly Tata and Noshir Soonawala, interfered in the affairs of Tata Sons on the strength of certain affirmative/veto rights enshrined in the articles in favour of Tata Trusts. The petition called into question past business decisions allegedly for ulterior ends. The petition also impugned the removal of Cyrus Mistry as the chairman of the board of directors of Tata Sons, and the operating companies of the Tata Group.

The NCLT dismissed the petition, holding that no case for oppression and mismanagement has been made out in respect of any of the allegations levelled by the petitioners. On appeal, the NCLAT quashed the NCLT order and ordered the reinstatement of Cyrus Mistry as chairman of Tata Sons.

Karanjawala & Co represented Tata Sons before the NCLAT, while Mulla & Mulla represented some of the trustees of Sir Dorabji Tata Trust and Sir Ratan Tata Trust. Chambers of Jaitley and Bakshi and Akshay Makhija represented the appellants. Shardul Amarchand Mangaldas & Co advised, acted and represented Tata Sons, Tata and Amit Chandra in the NCLT and the NCLAT.

WS Industries takes on exchanges

VALUE	PRINCIPAL LAW FIRMS
N/A	Bharucha & Partners

The WS Industries (India) Limited v BSE Limited and National Stock Exchange of India Limited dispute before the Securities Appellate Tribunal (SAT) was the first instance where the tribunal clarified how penalties prescribed in the Standard Operating Procedure (SOP) circular should be levied. The Bombay Stock Exchange (BSE) and the National Stock Exchange of India (NSE) had imposed penalties on more than 250 companies for non-compliance with the listing and disclosure requirements of the SEBI since the circular was issued in May 2018.

Both stock exchanges had separately levied a penalty on WS Industries for not appointing a woman director on its board of directors, as per the SEBI rules on the composition of boards. The stock exchanges had also penalized other companies for not appointing a compliance officer and share transfer agent. Other reasons for penalties include not submitting shareholder complaints statements in time, not constituting the nomination and remuneration committee, and the audit committee.

The tribunal, in its September 2019 order, noted that the SOP circular provided stock exchanges with the flexibility to decide whether penalties should be imposed, and deviate from the standard procedure where necessary. The BSE, in its defence, said it had charted out circumstances in its SOP where penalties for companies could be waived or reduced. But the WS Industries case was not among these circumstances. The tribunal noted that the BSE’s SOP was an indicative list of events that was not exhaustive in nature.

The tribunal also asked the SEBI to consider that stock exchanges should only be able to impose a single penalty for the same violation, instead of separate penalties by the exchanges.

Bharucha & Partners represented WS Industries in the dispute. The team included partner Ajai Achuthan, and associates Mehul Jain and Chirag Chabbra.

“The observations of the SAT in this order will have an impact on Indian listed companies and other intermediaries,” says Achuthan, “since this order streamlines the processes which the stock exchanges must follow while imposing penalties under the SOP circular.” Achuthan added that the challenging aspect for the firm was that there were no precedents that provided clarity on the interplay between listing regulations, the SOP circular and the BSE’s SOP.

VALUE	PRINCIPAL LAW FIRMS
N/A	S&R Associates

McDonald’s Corporation in May 2019 reached an agreement with its estranged business partner, Vikram Bakshi, ending a shareholder’s dispute that lasted six years. McDonald’s acquired 50% of the equity share capital of Connaught Plaza Restaurants Limited (CPRL), which was the former joint venture of McDonald’s in north and east India.

The dispute began in August 2013, when McDonald’s sought the removal of Bakshi as the CPRL’s managing director. The NCLT reinstated him in July 2017, but the following month McDonald’s terminated its franchise relationship with CPRL, which led to the closure of some of its 169 restaurants. The dispute included hearings before the Supreme Court, Delhi High Court, the NCLAT and the London Court of International Arbitration.

S&R Associates represented McDonald’s in the proceedings. The firm’s team included partner Niti Dixit, counsel Abhishek Tewari and associates Raunaq B Mathur and Zahra Aziz. In addition, the firm advised on M&A, corporate, regulatory, employment and competition law matters. Shardul Amarchand Mangaldas & Co represented Vikram Bakshi Holdings.

Big payout for Philips

VALUE	PRINCIPAL LAW FIRMS
N/A	Anand and Anand

The Delhi High Court in April 2019, in the cases of Philips v Amazestore & Ors, and Philips v Amitkumar Kantilal Jain & Ors, awarded one of the highest amounts of damages in a copyright and design infringement case. The court awarded damages of ₹31.5 million against the defendants for imitating the design of Philips’ Advanced Trimmer 3000 series product.

In the case, Philips filed two suits. The first one was for piracy of a registered design and the other was for infringement of copyright, and the court consolidated both suits and passed a permanent injunction.

The defendants in the matter were Nova Manufacturing Industries (manufacturer of the infringing product), Badri Electro Supply and Trading Company (owner of the Nova trademark) and Omni Exim Private Limited (importer of the infringed product).

The court arrived at the amount of damages on the basis of how much the infringing activities of the defendants had cost Philips.

Anand and Anand represented Philips on the matter. According to the firm, the defendants were members of an international criminal syndicate and the quantum of damages awarded far outweighed the profits they would have made.

The court also laid down a set of guidelines to determine the grant of damages in intellectual property infringement cases proportionate to the degree of misconduct. The lawyers from Anand and Anand included managing partner Pravin Anand, partner Vaishali Mittal, managing associate Siddhant Chamola and associate Vrinda Gambhir.

Colgate v John Doe trademark dispute

VALUE	PRINCIPAL LAW FIRMS
N/A	Anand and Anand

Colgate in July 2018 learned through its investigators that a ship from a port in Ningbo, China carrying large quantities of a toothbrush bearing a similar mark, “Coldent”, was making its way to Kolkata.

Colgate approached the Delhi High Court and provided details of the vessel, container numbers, port details and also the similarity between the trade dress of the plaintiff and Coldent.

Section 11(2)(n) of the Customs Act, 1962, gives the government the powers to prohibit the export of goods that are subject to prohibition under the Customs Act, Trademarks Act or Patents Act. Under such circumstances, and hearing the plaintiff’s arguments, the court directed customs officials to immediately freeze the contents of the concerned ship and containers, and to divulge the details of the goods contained, the details of the exporter and importer, and the value and number of goods to the plaintiffs.

The court in April 2019 ruled in favour of Colgate through a settlement agreement with the defendants. The defendants acknowledged the rights of the plaintiffs and made an undertaking not to use the mark Coldent or any other mark similar to those of the plaintiff in the future. The defendants also agreed to co-ordinate with customs officials and destroy the infringing branded toothbrushes.

Anand and Anand represented Colgate, and the firm was represented by managing partner Pravin Anand, partner Dhruv Anand and managing associate Udita M Patro.

VALUE	PRINCIPAL LAW FIRMS
N/A	Agarwal Law Associates AZB & Partners Cyril Amarchand Mangaldas Shardul Amarchand Mangaldas & Co Udit Kishan & Associates

In Swiss Ribbons Pvt Ltd & Anr v UOI & Ors, the Supreme Court upheld the constitutional validity of the Insolvency and Bankruptcy Code. The bench, comprising Justice Rohinton F Nariman and Justice Navin Sinha, laid to rest several issues in their judgment in January 2019, which arose due to the departure of the code from previous laws governing insolvency in the country.

The petitions challenging the code raised issues relating to the preamble and approach of the code, classification of financial creditors and operational creditors, powers of the resolution professional, constitution of various benches of the NCLT and the NCLAT, and constitutional validity of section 29A.

The Supreme Court dismissed all the petitions and upheld the code in its entirety. It recognized the legislature’s right to experimentation in the field of economic legislation, and the positive impact of the working of the code, and added that the resolution process was not adversarial to the corporate debtor.

The court said: “The primary focus of the legislation is to ensure revival and continuation of the corporate debtor by protecting the corporate debtor from its own management, and from a corporate death by liquidation. The code is thus a beneficial legislation, which puts the corporate debtor back on its feet, not being a mere recovery legislation for creditors.”

AZB & Partners advised and represented the Reserve Bank of India (RBI) in the proceedings. Agarwal Law Associates, Cyril Amarchand Mangaldas, Udit Kishan & Associates and Shardul Amarchand Mangaldas & Co represented the petitioners.

Dahej petrochemicals’ contract dispute

VALUE	PRINCIPAL LAW FIRMS
N/A	Drew & Napier KL Partners RS Prabhu & Co

The dispute between Daelim Industrial Company Limited, one of Korea’s leading chaebols, and ONGC Petrol Additions Limited (OPAL) arose from the former’s inability to carry out construction of a plant at the Dahej petrochemicals complex. As a result, OPAL cancelled the contract and commenced arbitration proceedings in Singapore. Daelim in its defence stated it was unable to proceed due to its technology partner backing out of the project.

OPAL claimed more than US$200 million in damages. However, the arbitration tribunal in December 2018 rejected the claimant’s claim in respect of more than US$150 million. Thus, Daelim was able to resist more than three-quarters of the claim.

Drew & Napier represented Daelim in the dispute. “[The team] undertook a deep dive into the technical details of the inflated delay claim of US$150 million,” said Mahesh Rai, director, dispute resolution at Drew & Napier. “We uncovered information showing that the delay claim was a sham, as the upstream units of the plant were not ready, and hence any delay by Daelim would have been overshadowed by the larger delays that the plant was facing.” KL Partners were the instructing solicitors for Daelim. RS Prabhu appeared for OPAL.

The Dahej complex, located in Gujarat state, is the largest petrochemicals plant in India, and in Asia.

Copyright infringement suit against Spotify

VALUE	PRINCIPAL LAW FIRMS
N/A	Khaitan & Co

In a copyright infringement matter initiated by Indian music label Saregama against the music streaming website Spotify, the latter informed the Delhi High Court in April 2019 that it would take down more than 100,000 songs belonging to Saregama.

The court accepted the submission of the defendant and bound Spotify to take down the songs within 10 days from its platform. It then disposed of the matter.

Saregama had filed for an injunction to stop Spotify from using its songs. Spotify received Saregama’s music to host on its platform ahead of the website’s launch in India. The discussions began in February 2018, but the licensing agreement could not be finalized.

However, Spotify retained the songs, citing the Copyright Act’s statutory licensing scheme under section 31D. The section allows any broadcasting organization to communicate to the public any previously published musical work or sound recording by invoking a compulsory licence through a unilateral notice, and paying royalty rates determined by the Intellectual Property Appellate Board in the manner prescribed under the Copyright Rules. The amendment was made keeping radio broadcasters in mind, and a 2016 memorandum by the Department for Promotion of Industry included internet broadcasters.

However, it requires that prior notice be given to the publisher about the duration and territorial area of the broadcast, which is not possible in the case of a streaming website. Spotify was embroiled in a similar dispute with Warner Chappel Music on this aspect. Khaitan & Co represented Saregama in the matter.

Monsanto BT cotton patent restored

VALUE	PRINCIPAL LAW FIRMS
N/A	Anand and Anand

In the I. Mahyco Monsanto Biotech (India) Pvt Ltd [MMBL] v Nuziveedu Seeds Ltd dispute, the Supreme Court in January 2019 restored Monsanto’s patent for BT cotton.

Before the case was heard by the Supreme Court, both parties had approached the division bench of the Delhi High Court contesting a decision by a Delhi High Court single judge. Nuziveedu Seeds contested the judge’s decision to uphold the validity of the BT cotton patent, while Monsanto challenged the judge’s decision to reinstate the agreement between the parties and pay Monsanto as per the government fixed tariff.

The division bench held that Monsanto’s patent was invalid, being a non-patentable subject matter under section 3(j) of the Indian Patent Act, which is a provision that prevents patents on plants, animals, parts of these, and seeds.

With regards to the division bench’s decision, the Supreme Court held that summary adjudication of a technically complex suit without expert evidence was neither desirable nor permissible in law. The court set aside the order of the division bench. It also restored the order of the single judge and remanded the case to the single judge for disposal.

The Supreme Court observed that it was satisfied that the nature of the injunctive relief granted by the single judge was in order and merited no interference during the pendency of the suit.

The dispute dates back to 2015, after Nuziveedu Seeds refused to pay licence fees for the patented technology to Monsanto, ending their agreement. Nuziveedu had sought a reduction of the fees but Monsanto had refused.

Anand and Anand represented Monsanto on the matter.

VALUE	PRINCIPAL LAW FIRMS
N/A	Agarwal Law Associates J Sagar Associates Link Legal India Law Services

A Supreme Court bench of Justice Rohinton Nariman and Justice Vineet Saran in April 2019 delivered a landmark judgment in the case of Independent Power Producers Association of India v Union of India, which struck down a circular issued by the Reserve Bank of India.

The circular, titled Resolution of Stressed Assets – Revised Framework, gave defaulting companies with a debt higher than ₹20 billion a time limit of 180 days to reach a resolution plan with their lenders, or be taken to bankruptcy court. The Supreme Court held that the RBI circular was ultra vires section 35AA of the Banking Regulation Act, and that the RBI could not have issued general directions to banking companies under section 35AA. In repealing the circular, banks were able to decide their own course of action for the companies affected by the circular.

Link Legal India Law Services advised and represented the power sector through the Independent Power Producers Association of India (IPPAI) as well as GMR Chhattisgarh Energy and GMR Rajahmundry Energy in its challenge to the RBI circular.

“The key challenge by the IPPAI is that its members are not wilful defaulters,” said Atul Sharma, the managing partner at Link Legal. “The reasons for stressed assets in the power sector were on account of issues such as lack of availability of coal and gas, delays in making payments by discoms [power distribution companies], lack of power purchase agreements offered by states, and contractual/tariff-related disputes, all of which were not attributable to independent power producers and were beyond their control.”

Agarwal Law Associates was also advising GMR Chhattisgarh Energy Limited and GMR Rajahmundry Energy Limited. J Sagar Associates represented the Association of Power Producers, Rattan India, GVK, GMR and Coastal Energen.

Capital marketsDisputesInsolvencyJoint venturesMergers & AcquisitionsOther

Insolvency

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VALUE	PRINCIPAL LAW FIRMS
US$7 billion	Cyril Amarchand Mangaldas L&L Partners S&R Associates Shardul Amarchand Mangaldas & Co

The insolvency proceedings against Essar Steel had been closely watched, as it had been on the RBI’s list of 12 largest non-performing asset accounts for banks in India. The resolution plan submitted by ArcelorMittal was selected by the CoC after seeing challenges before the NCLT, NCLAT and the Supreme Court.

The Supreme Court in November 2019 laid to rest the battle for the acquisition of Essar Steel, which owed US$7 billion to financial and operational creditors.

The resolution was welcomed by the lending community, as with ArcelorMittal’s resolution plan, and banks are expected to recover 92% of the ₹400 billion debt owed to them. State Bank of India is one of the biggest beneficiaries and is expected to receive ₹120 billion.

“This is one of the largest insolvency resolution proceedings in the country,” said a spokesperson from Shardul Amarchand Mangaldas & Co. “It involves some of the most complex and fundamental issues of jurisprudence and litigation with respect to inter se rights among financial creditors.”

The Supreme Court held that all creditors were not entitled to equal recovery under a resolution plan. It said applying a principle of equality may motivate creditors to vote for liquidation instead of revival of a corporate debtor, which was against the spirit of the IBC. The court also said that the financial wisdom of the CoC could not be questioned as long as the objectives of the IBC are met.

Shardul Amarchand Mangaldas & Co was legal counsel to the CoC. S&R Associates and L&L Partners were legal counsel to ArcelorMittal, while Cyril Amarchand Mangaldas acted as legal counsel for the resolution professional.

UVARCL’s resolution plan in Aircel’s insolvency

VALUE	PRINCIPAL LAW FIRMS
US$2.87 billion	Cyril Amarchand Mangaldas L&L Partners Shardul Amarchand Mangaldas & Co

Aircel Group filed for insolvency under the IBC after being unable to repay debts owing to a continuous loss of revenue precipitated by the ongoing telecoms war.

The total admitted debt of Aircel Group was ₹200 billion and the CoC of Aircel group approved the resolution plans submitted by UV Asset Reconstruction Company Limited (UVARCL). L&L Partners assisted UVARCL.

“The telecoms industry is capital intensive and oligopolistic in nature, requiring enormous investments in technology,” said an L&L Partners spokesperson. “The finances of almost all the telecoms players have been destabilized due to a tariff war, and the debt level of telecoms companies.”

“Also, the resolution plan did not entail upfront or guaranteed payment to the creditors, but involves issuance of equity shares and zero coupon optionally convertible debentures, which would be redeemed contingent on monetization of the assets of Aircel Group,” said the spokesperson. The insolvency saw creditors agree to one of the lowest recoveries of the admitted amounts.

Shardul Amarchand Mangaldas & Co was counsel to the resolution professional. Cyril Amarchand Mangaldas was counsel to the CoC. Aircel Group was one of India’s leading innovative mobile service providers with a subscriber base of 87.7 million.

VALUE	PRINCIPAL LAW FIRMS
US$2.74 billion	Cyril Amarchand Mangaldas L&L Partners Shardul Amarchand Mangaldas & Co

Indian steel maker Bhushan Power and Steel (BPSL) was acquired by JSW Steel in a corporate insolvency process for US$2.7 billion, after the NCLT accepted its bid. BPSL has large-scale operations across the country, with a 2.3 million tonnes per annum integrated steel and power plant in Orissa, as well as smaller units in West Bengal and Chandigarh.

The steel maker had received bids from Tata Steel, JSW Steel and Liberty House Group after the insolvency resolution professional had invited bids for resolution plans. The deal was notable because of a protracted legal battle on significant points of law.

One issue of contention in the NCLT was with regard to the late entry of Liberty House Group on the question of whether revised financial offers submitted by the resolution applicants could be considered by the CoC at a late stage. The NCLT observed that the CoC has an absolute right to negotiate better terms with the compliant resolution applicants, and that allowing eligible resolution applicants to revise their financial offers is permissible.

Another matter that came up before the NCLAT was the issue of operational creditors in BPSL, which run into thousands. The NCLAT appointed a single representative on behalf of the operational creditors, who was also authorised to attend CoC meetings where the resolution plans were considered.

Shardul Amarchand Mangaldas & Co was the adviser to BPSL, Cyril Amarchand Mangaldas advised the CoC and L&L Partners advised JSW Steel.

Resolution of Ruchi Soya insolvency

VALUE	PRINCIPAL LAW FIRMS
US$1.7 billion	Athena Legal Cyril Amarchand Mangaldas L&L Partners Vaish Associates Advocates

Ruchi Soya Industries has a wide range of food products that includes cooking oils, nutritional soya foods, top grade vanaspati and bakery fats. However, the company was referred to insolvency proceedings by the NCLT on an application made by its financial creditors. Ruchi Soya had a total debt of about ₹120 billion, which it owed to financial and operational creditors. It was part of the second list of 28 defaulters the Reserve Bank of India had flagged for resolution.

The resolution plan submitted by a consortium headed by consumer goods company Patanjali Ayurved was chosen by the Committee of Creditors. The approval of the CoC came after protracted litigations and more than 16 months since the start of the process.

L&L Partners assisted the CoC in the insolvency matter on the negotiation, strategy, drafting, review and finalization of resolution plans, and provided guidance through the entire insolvency resolution process.

Ruchi Soya’s leading brands include Nutrela, Mahakosh, Sunrich, Ruchi Star and Ruchi Gold. The Patanjali Group is a conglomerate in the field of fast-moving consumer goods (FMCG) products, ayurvedic and medicinal products.

Cyril Amarchand Mangaldas was adviser to the resolution professional of Ruchi Soya. Athena Legal and Vaish Associates Advocates were advisers to Patanjali Ayurved.

Capital marketsDisputesInsolvencyJoint venturesMergers & AcquisitionsOther

Joint ventures

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VALUE	PRINCIPAL LAW FIRMS
N/A	Allen & Overy Clifford Chance Cyril Amarchand Mangaldas Trilegal

French oil and gas company Total and Adani will create a 50:50 JV to build a co-branded retail network of 1,500 service stations over 10 years. These service stations will offer Total’s full line-up of fuels and lubricants, as well as a broad range of other products and services. In addition, the JV will develop liquefied natural gas (LNG) regasification terminals, including Dhamra LNG, on the east coast of India. The acquisition forms the largest foreign direct investment in India’s city gas distribution sector to date.

This transaction marks an important foray by one of the world’s biggest energy and oil companies in India. CAM advised Adani and its promoters on the structure, legal and regulatory issues connected with the transaction under Indian law, and drafting, reviewing and negotiating definitive documents with Total. Clifford Chance also advised Adani. Trilegal acted as the Indian legal advisers to Total and were involved in negotiating and finalizing the transaction documents, providing regulatory advice and conducting due diligence, and Allen & Overy was international legal adviser to Total.

Capital marketsDisputesInsolvencyJoint venturesMergers & AcquisitionsOther

Mergers & Acquisitions

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