Contributors: Ms Shreya Dalal, Associate Partner Mr Divyang Salvi, Associate The Union Cabinet has approved a relaxation of Foreign Direct Investment (“FDI”) norms applicable to investments from countries sharing land borders with India, amending the framework introduced under Press Note 3 (2020 Series) issued by the Department for Promotion of Industry and Internal Trade (“DPIIT”). The decision, taken at a Cabinet meeting chaired by the Prime Minister, signals a potential shift in India’s approach towards investments originating from neighbouring jurisdictions that were previously subject to heightened regulatory scrutiny. Introduction Press Note 3 of 2020 was introduced in the backdrop of geopolitical tensions and concerns regarding opportunistic acquisitions of Indian companies during the COVID-19 pandemic. The policy required any entity from a country sharing a land border with India, or any investment where the beneficial owner was situated in such a country, to obtain prior Government approval before investing in India. The rule applies to seven neighbouring jurisdictions, namely China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan, and effectively moved such investments from the automatic route to the government approval route across sectors. The Cabinet’s recent decision indicates a calibrated relaxation of these restrictions, with the objective of balancing national security considerations with investment facilitation and economic engagement. Background and Regulatory Context Following the introduction of Press Note 3 in 2020, investments from land-bordering countries were subjected to enhanced regulatory scrutiny. The measure was widely viewed as a safeguard against potential strategic or opportunistic takeovers of Indian companies during a period of economic vulnerability. Subsequent geopolitical developments further reinforced the cautious regulatory approach towards investments from certain neighbouring jurisdictions. During this period, India also imposed restrictions on several digital platforms and applications originating from such jurisdictions, reflecting broader policy concerns relating to national security and economic sovereignty. MHCO Comment The Cabinet’s decision to ease certain restrictions under the Press Note 3 framework signals a calibrated policy shift aimed at facilitating cross-border investment while continuing to safeguard strategic interests. While detailed amendments and implementation guidelines are awaited, the move may improve investor sentiment and provide greater clarity to foreign investors from neighbouring jurisdictions. At the same time, given the sensitivities surrounding investments from land-bordering countries, regulatory scrutiny and approval mechanisms are likely to continue playing an important role in India’s investment regime.

Contributors: Mr Bhushan Shah, Partner On 4 February 2026, the Securities and Exchange Board of India (SEBI) issued a Consultation Paper proposing amendments to the “fit and proper person” criteria under Schedule II of the SEBI (Intermediaries) Regulations, 2008 (“Intermediaries Regulations”). These criteria apply to intermediaries and to their key managerial personnel, promoters, and persons in control. Following the Consultation Paper, SEBI approved the proposed amendments in its Board Meeting held on 23 March 2026. Amendments to the existing provisions One of the most significant changes relates to Clauses 3(b)(i) and 3(b)(ii) of Schedule II of the Intermediaries Regulations. Under the existing provisions, the mere pendency of a criminal complaint or FIR filed by SEBI, or the filing of a charge sheet by enforcement agencies in relation to economic offences, resulted in automatic disqualification. SEBI has now approved that these shall not be the primary grounds for disqualification. At the same time, SEBI has strengthened the framework in cases where wrongdoing is established. Under the existing Clause 3(b)(v) of the Intermediaries Regulations, the disqualification was based on a conviction for an offence involving moral turpitude. This has now been expanded to include convictions for any economic offence or any offence under securities laws. Further, Clause 3(b)(vi) of Schedule II of the Intermediaries Regulations previously treated both the initiation of winding-up proceedings and an order of winding up as grounds for disqualification. SEBI has now narrowed this provision. Only an order of winding up will be treated as a ground for disqualification, while the mere initiation of such proceedings will no longer be considered a ground. SEBI has also revised the consequences of being declared not “fit and proper.” Under the existing Clause 4 of the Intermediaries Regulation, where no specific period was prescribed in a not “fit and proper person” Order issued by SEBI, a default prohibition of five years applied from making a fresh application for registration. This default rule has now been removed, and the prohibition will apply only for the period specified in SEBI’s order. In addition, Clause 5 of the Intermediaries Regulation has been narrowed. Previously, if a Show Cause Notice (“SCN”) had been issued under Sections 11(4) or 11B of the SEBI Act, 1992, the application for registration would not be considered for one year. SEBI has now limited this restriction to SCNs under Sections 11(4) and 11B(1), and reduced the period of non-consideration from one year to six months. New insertions to the existing provisions SEBI has also introduced important procedural provision and compliance obligations through new insertions. First, the insertion of Clause 3A under Schedule II of the Intermediaries Regulations provides that where any person falls within the grounds of disqualification specified under Clause 3(b), such occurrence must be reported to SEBI within 15 (fifteen) working days. Second, Clause 3B under Schedule II of the Intermediaries Regulations has been introduced to provide that no person shall be declared not “fit and proper” without being given a reasonable opportunity of being heard. MHCO Comment The amendments represent SEBI’s attempt to simplify and rationalise the “fit and proper person” criteria by moving away from rigid disqualifications toward a more proportionate framework in compliance with the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018 and SEBI (Depositories and Participants) Regulations, 2018. The earlier position, where mere pendency of an FIR or charge sheet was the primary ground for automatic disqualification, effectively imposed consequences without adjudication, leading to significant reputational and commercial harm. Similarly, holding initiation of insolvency proceedings, as well as an order of winding up, as grounds for disqualification failed to recognise that the corporate debtor may survive the liquidation process; therefore, limiting disqualification to cases of actual winding-up orders corrects this imbalance. The introduction of Clauses 3A and 3B strengthens procedural fairness by mandating the timely disclosure of disqualifying events and expressly guaranteeing an opportunity to be heard. The removal of the default five-year prohibition and the narrowing of SCN-based restrictions further reinforce the principle of proportionality. In conclusion, these changes align the framework with principles of fairness, consistency, and enforcement, without diluting investor protection. The views expressed in this update are personal and should not be construed as legal advice. Please contact us for any assistance.

Contributors: Akash Jain, Associate Partner Sanjana Salvi, Associate The Lok Sabha on 12 August 2025 had introduced the Insolvency and Bankruptcy (Amendment) Bill, 2025 which signified a crucial advancement in India's continuous endeavour to fortify its insolvency and restructuring ecosystem. The Bill was introduced in response to both practical insights gained since the original enactment of the Insolvency and Bankruptcy Code, 2016 (IBC) and the evolution of international best practices, the IBC Amendment Bill 2025 is intended to address longstanding challenges and close critical loopholes that have affected the efficiency, fairness and predictability of the Insolvency and Bankruptcy Code, 2016 (“IBC”). On 6th April 2026 the Insolvency and Bankruptcy (Amendment) Act, 2026 came into force thereby implementing the  amendment bill. Background: The IBC from the time of its enactment has significantly strengthened credit discipline and recovery mechanisms. However, persistent challenges, particularly delays in admission and resolution, litigation hurdles, and value erosion of stressed assets necessitated legislative intervention. The Insolvency and Bankruptcy Code (Amendment) Act, 2026 (“IBC amendment Act”) introduces wide-ranging structural and procedural reforms aimed at improving efficiency, predictability, and stakeholder confidence. The IBC amended act pays particular attention to issues flagged by courts and practitioners, the complexities arising in group and cross-border insolvency, and the misuse of withdrawal and moratorium provisions by promoters and other stakeholders. Key Amendments: 1. Strict Timelines The amendments ensure that each form must be filed within stipulated timelines (generally within 10 days of the relevant event or reporting period), ensuring contemporaneous disclosures. 2. Mandatory Admission of Application The Adjudicating Authority (“AA”) is now required to admit an application within fourteen days of receipt, upon satisfaction of the existence of default and compliance with statutory requirements. In cases of rejection or delay beyond the stipulated period, the AA must record reasons in writing. This amendment ensures consistency, transparency, and expeditious commencement of insolvency proceedings. Under the new amended provision, the Adjudicating Authority (AA) shall within a period of 14 days of receipt of the application, admit applications on satisfaction of default and compliance with Insolvency Bankruptcy Code 2016 (“IBC”). The AA can reject the application in case the requirements are not met and must record the reason in writing for delay beyond 14 days. 3. Interim Resolution Amendment to section 10 restricts the Corporate debtors from nominating the IRP, reducing risk of bias or undue influence. A restriction is also imposed on the AA to record  the delay  in writing for not passing an order within a period of 14 days. 4. Withdrawal Restrictions Amendment to section 12 provides for a Post-admission withdrawal of insolvency applications permitted only after constitution of the Committee of Creditors (“CoC”) and requires approval of 90% voting share. Withdrawal is prohibited after the invitation of resolution plans and must be disposed of within thirty days. 5. Clarification of Moratorium As per amendment to section 14, subrogation rights of corporate/surety guarantors cannot be enforced against the corporate debtor during the moratorium period in CIRP. Guarantors cannot ask the company to pay them back if they cover any of its debts until the insolvency process is over. 6. Supervisory power to CoC to oversee liquidation Amendment to section 21 provides for supervisory power to the CoC to supervise the conduct of the liquidator in the process of the liquidation and the board may appoint class or classes of creditors to attend meetings of creditors 7. Transfer of guarantor assets into CIRP The CoC is vested with supervisory authority over the conduct of the liquidator during liquidation proceedings. The Board may also permit representation of specific classes of creditors in such oversight mechanisms. 8. Minimum payout for dissenting creditors As per amendment of section 30, the Bill stipulates that a resolution plan must ensure that a dissenting financial creditor receives an amount not less than the lower of the amount– (i) the liquidation value of such creditor or (ii) its entitlement under the resolution plan based on the liquidation waterfall mechanism. 9. Two-stage approval for resolution plan Amendment to section 31 ensure that on an application filed by the resolution professional (RP), the AA can initially approve the implementation plan for handing over and managing the business of the corporate debtor and then, the AA separately approves distribution to stakeholders within a 30-day window. The amendment also proposes to clarify that once AA approves the resolution plan, the company gets a fresh start (i.e. a clean slate) meaning all old claims against the company are extinguished, except those specifically allowed to continue. 10. Notice to the CoC for rejection of Resolution Plan Amendment to section 31 requires the AA to give a notice to the CoC to rectify any defects in the resolution plan before rejecting the same. 11. Liquidation and Corporate Insolvency Resolution Process (CIRP) Restorative Reform As per amendment to section 33-36, 38-42, 54, Moratorium expanded to cover all proceedings during liquidation; allows restoration of CIRP from liquidation (one time, up to 120 days, under exceptional circumstances with 66% CoC voting) 12. Role of CoC in liquidation Amendment to section 35,36,38-4 enhances the CoC’s role in the insolvency of a corporate debtor, it is proposed that the CoC oversee the liquidation process, similar to the CIRP, possibly including other creditors as non-voting members, unlike the current framework where the liquidator consults a stakeholder consultation committee without being bound by its advice. Decisions such as replacement of liquidator, action against fraud shall require 66 %approval of the CoC. 13. Fixed liquidation timelines Amendment to Sections 35, 36, 38–42, 54 enforces that the Liquidation must be completed in 180 days, with only one extension (maximum 90 days).  Per amendment to section 33, the AA is required to pass a liquidation order within a period of 30 days from the date of receipt of intimation or application to initiate liquidation process. 14. Expanded look-back periods for avoidance transaction investigations Amendment to Sections 43, 46, 47, 49, 50 has widened the period for reviewing suspicious or wrongful transactions (such as preferential, undervalued or fraudulent transfers). Earlier, this review period was counted only from the date the insolvency process was formally admitted. Now, the look-back period can also cover the time before admission starting from when the insolvency application is filed. Creditors (not just RP/liquidator) may apply for avoidance actions if RP/liquidator fails; related-party asset transfers lose safe harbour. 15. Secured creditor decision timelines Amendment to Section 52–53 entails that if secured creditors want to realise assets outside liquidation, they must decide within 14 days; in case more than one secured creditor has any security interest over assets of the corporate debtor, no secured creditor shall be entitled to release its security interest unless the same is agreed upon by secured creditor representing 66 % of the value of claims of security interest; 16. Redefining security interest Per amendment to section 53 clarifies that where the value of the security interest relinquished by the secured creditor is less than the total debt owed to such secured creditor by the corporate debtor, he shall be a secured creditor to the extent of the value of such security interest, determined in such manner as may be specified, and for the remaining value of such debt, he shall be considered to be an unsecured creditor Security interest shall only exist if it creates a right, title, interest or a claim to a property pursuant to an agreement or arrangement only and not merely through operation of law. The clarification ensures that secured creditors’ rights over company assets are protected and take precedence, promoting greater clarity and confidence 17. Pre-packaged insolvency harmonisation The amendment to Sections 54C, 54F, 54L, 54N sets clear rules for pre-packaged insolvency by using the same definitions and procedures as the regular insolvency process. It updates how pre-pack insolvency starts, when the moratorium applies, how resolution plans get approved and how cases can be withdrawn; 18. Creditor initiated insolvency resolution process Amendment to section 58 K Allows creditors to initiate insolvency for genuine business failures, including an out-of-court mechanism. The amendment provides for procedural discipline, with initiation needing the support of creditors representing a specified threshold (i.e. 51%) of outstanding debt. The process is to be concluded within 150 days, with a possible extension for a period of 45 days. 19. Group insolvency framework Amendment to add Chapter VA whereby the IBC Amendment Bill, 2025 proposes to bring in processes for simultaneous resolution of group companies under common management or ownership. Includes coordination between group entities, common bench and possibility for a shared resolution professional. Designed to address complex corporate structures and value erosion arising from piecemeal resolutions 20. Cross-border insolvency framework Amendment to section 240 proposes to provide a structure drawing on UNCITRAL Model Law principles for a cross-border insolvency framework. Government is empowered to make rules, designate special benches and adapt laws. The framework lays the legal foundation for effective cooperation and coordination between Indian and foreign insolvency proceedings there by to facilitates quicker and more effective recovery of overseas assets, aligning Indian law with global best practices and Increases global investor confidence and asset recovery certainty MHCO Comment The Insolvency and Bankruptcy Code (Amendment) Act, 2026 introduces significant reforms to strengthen India’s insolvency framework by addressing delays, litigation hurdles, and value erosion. It mandates stricter timelines, ensures faster admission of insolvency applications, limits withdrawal after initiation, and enhances the role of the Committee of Creditors (CoC), especially during liquidation. The Bill also introduces provisions for group and cross-border insolvency, expands scrutiny of fraudulent transactions, and clarifies creditor rights. Overall, the amendment aims to improve efficiency, transparency, and investor confidence while aligning India’s insolvency regime with global best practices. The views expressed in this update are personal and should not be construed as legal advice. Please contact us for any assistance.

Contributors: Ms Meeta Kadhi, Associate Partner  Ms Sanjana Salvi, Associate   Overview: The Supreme Court, vide its judgment dated February 20, 2026 in Parsvnath Developers Ltd. v. Mohit Khirbat (Civil Appeal No. 5289 of 2022 and connected matters), dismissed a batch of appeals filed by the developer challenging orders of the National Consumer Disputes Redressal Commission (NCDRC). The Court affirmed the NCDRC's directions for time-bound completion of construction and payment of compensation at 8% simple interest per annum for delays in delivering flats. The ruling emphasizes the remedial nature of consumer protection laws. Brief Background and Facts: The appeals stemmed from consumer complaints filed before the NCDRC by homebuyers who had booked residential flats in the Parsvnath Exotica project between 2007 and 2011. Under the Flat Buyer Agreements, possession was to be delivered within 36 months from the commencement of construction, with a six-month grace period. Despite the buyers paying nearly the entire sale consideration, possession was not handed over within the stipulated time. The NCDRC, in orders dated July 30, 2018 and November 21, 2019, directed the developer to complete construction, obtain the Occupancy Certificate, hand over possession, and pay 8% interest as compensation. Contentions of the Parties: The Appellant (Parsvnath Developers Ltd.): Argued that the NCDRC exceeded its jurisdiction under Section 14 of the Consumer Protection Act, 1986 by granting reliefs beyond contractual terms. It relied on clauses in the Flat Buyer Agreements limiting claims for delay-related compensation and shifting stamp duty liabilities to buyers. The Respondents (Homebuyers): Contended that the prolonged delays constituted deficiency in service, entitling them to possession and compensation. They highlighted the developer's persistent non-compliance despite court interventions. Court’s Findings: The Bench comprising Justices B.V. Nagarathna and R. Mahadevan made the following key observations: Compensation under the Act: The Court reiterated that "compensation" is expansive, remedial, and protective. It must be fair, reasonable, and proportionate to the loss, deprivation, and hardship suffered by consumers. The 8% interest rate and additional costs imposed by the NCDRC were deemed fair and reasonable by the Court. Deficiency in Service: Failure to obtain an Occupancy Certificate before offering possession amounts to a deficiency in service. The developer cannot not force possession on an "as is where is" basis without statutory approvals. Contractual Clauses: The Court held that contractual stipulations cannot curtail the statutory jurisdiction of a consumer forum. Clauses limiting liability for delays were not absolute barriers to consumer relief, especially given the developer's repeated non-compliance with court orders and undertakings over years. Judgment: The Court dismissed the appeals and affirmed the NCDRC orders. The developer was directed to obtain the requisite Occupancy Certificate and hand over possession to the respondents in Civil Appeals Nos. 5289/2022 and 5290/2022 within six months from the judgment date, while continuing to pay compensation without default. For Civil Appeal No. 11047/2025, compensation at 8% interest was upheld from the agreed possession date until August 14, 2022 (after adjusting paid amounts), with the Occupancy Certificate to be furnished forthwith if not already obtained. MHCO Comment: This judgment reinforces the Supreme Court's consumer-centric approach in real estate disputes, prioritizing homebuyers' rights to timely possession and fair compensation over restrictive contractual clauses. For developers, it underscores the need for strict adherence to timelines and statutory approvals. Overall, the ruling aligns with the protective intent of the Consumer Protection Act, 1986, and may influence ongoing delays in similar projects across India.