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Law firms and the Covid-19 pandemic: Lessons and notes

A major impact of the lockdown and Covid-19 has been, one that most shy away from admitting, the cash flow crunch.

Ajay Bhargava

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The novel coronavirus has resulted in people being locked down in their homes. Notwithstanding the widespread health concerns attached with Covid-19, it has been able to instil, in the minds of people, fear. The world is panicking at a rate faster than the spread of the virus. These unprecedented times have not only brought the world closer, more rapidly than the modern means of communication and technology, but have also unified the world, in a way not seen or heard of before, in its fight against the novel virus.

The virus has not discriminated, and its impact has been felt by one and all, businesses and individual alike, across the globe–mentally, emotionally, physically and financially. There is no right or wrong way of dealing with the present situation and each entity is doing its level best to manage the circumstances for its own preservation and those it is responsible for. When it comes to a law firm, clients and resources are quintessential. The wellbeing of a law firm’s clients and its resources is paramount and in dealing with the impacts of Covid-19, the wellness of the clients and resources is central.

In order to understand the means adopted by a law firm to survive, and ultimately, thrive from the present situation, one needs to understand and acknowledge the impact of the novel virus on the legal industry. A major impact of the lockdown and Covid-19 has been, one that most shy away from admitting or at least explicitly acknowledging, the cash flow crunch. Cash flow may not necessarily be a direct consequence of the pandemic but, in most cases, a subsequent one.

For a lawyer, and on a larger scale, a law firm, apart from issuing advisory and opinions to clients for the various activities undertaken by the client, there is also involvement in the dispute resolution process of the disputes that have arisen out of the transactions undertaken by the clients. Dispute resolution has been on a backfoot with the courts only taking up matters being urgent in nature, which most often than not do not include matters involving disputes between parties at a personal/ commercial level.

Moreover, with businesses shut due to the lockdown and only bare minimum and essential activities being allowed by the governments, the opinions sought by the clients have also declined. Resultantly, the incoming work has been restricted leading to lower revenue generation and along with outstanding invoices. Another major impact for the industry has been the morale level of the individuals. A law firm is only as good as its representatives.

In other words, if the overall morale of those responsible for running the various dayto-day affairs of the firm is not high, the natural consequence of the same would be lower morale of the firm. Therefore, tackling with the affected morale of the members has been a key challenge for law firms. Yet another challenge faced by law firms has been simply coping with the prevalent situation caused by the pandemic. There has been a lot said and spoken about the present times being to tackle and deal with a pandemic and not a “productivity contest”.

However, what people do not realise is, for an entity in the service sector, it has to live up to the expectations of the client, providing them with full support and catering to their requirements during the harshest of times and those who are able to do so, are the ones who are distinguished and leave a mark, for it is only a select few that meet the phrase “when the going gets tough, the tough get going”. In order to combat the situation caused by the rampant spread of Covid-19 various steps and measures have been implemented by law firms.

A major policy decision has been to ensure the health and safety of all members of the firm. Khaitan & Co has been in the forefront of ensuring that its members are protected from the virus and stay safe. It is one of the first few firms to set in place a “100% Work From Home Policy” which was enforced in letter and in spirit. This was a pre-emptive measure adopted by the firm, notably days before the national lockdown announced by the Central government.

Another major step taken by the firm was imposition of travel restrictions, for both client and personal travels, which was initially for international travel and later extended to domestic travel. Client engagement and interaction has been another important aspect during the lockdown, by sending regular updates, personal phone calls and conducting webinars.

A law firm has a wide client database and to prevent loss of business, it is imperative to periodically touch base with that database. Instead of shooting out generic emails about the various developments taking place with regard to Covid-19, which are already floating in abundance, the clients should be sent more personal emails updating them with those facets that influence and impact their business.

One more means of client engagement is reaching out to clients, to check up on them and enquire about any difficulty they might be facing and providing specific solutions to those. A common way of doing this has been conducting webinars on latest developments and client specific industry to converse, update and address queries of the clients. With the change and shift in the needs of the clients, firms have to be on their toes to address the concerns of the client and provide them with crisis management advisory.

Professional and personality development of the members of the firm has been another step taken to survive and get past the present situation. This has a two-fold benefit, the members are able to hone their skills and, at the same time, are occupied. Keeping members of the firm occupied in discussions on current and important legal topics and asking them to attend webinars on a variety of themes and subjects, apart from carrying out the usual work, helps in maintaining sanity and a healthy mental state.

Further, intra-team interactions and HR engagements to redress any concerns members of the firm might be facing have also turned out to be fruitful. To stay abreast with the present times, one has to be technologically advanced. Most law firms already have a dedicated IT team and a decent technological infrastructure. This existing basic or intermediate IT infrastructure has allowed law firms to operate remotely. The ability to work remotely, owing to the incapacity of working from office, has aided, and continues to aid, in serving the clients through this phase of the national lockdown.

Alongside, the firm has been able to improve, enhance and transform upon its IT infrastructure with the IT team working relentlessly through remote access. A strong and advanced IT infrastructure will go a long way in achieve the object of digitisation. Additionally, owing to the virtual hearings being conducted and it being anticipated that a certain category of hearings may continue to be held through virtual courts, law firms, lawyers and clients are required to have adequate and sufficient technology in place.

Furthermore, for appearing before the virtual courts, the conferences with senior counsels and clients are also being held through video conferences. Lawyers and clients, alike, are adapting to the current system of justice dispensation and keep themselves adept with the guidelines and standard operating procedures issued by the courts from time to time. Apart from these, law firms are periodically amending and introducing policies to tackle the pandemic and the diverse consequences it has brought with it.

One such measure has been the introduction of a dedicated Covid-19 resource centre on their websites. By means of this Covid-19 resource centre, law firms are regularly updating and posting about legal, regulatory, statutory developments. Various articles and information are also being posted to provide the clients and other visitors on the websites with a view on the key developments and the responses to the Covid-19 pandemic. The evolutionary theory propagated by Charles Darwin spoke of “survival of the fittest”.

The present times have demonstrated and showcased a different scenario. The key qualities being talked of and required for emerging from the present circumstances are: resolve, resilience, return, reimagine and reform. Turning over a challenging situation, like the present one, requires innovation, a cohesive team, and leadership (both in those managing and those implementing).

The lockdown has given an opportunity to halt for a moment to rethink, realign, strategise and prioritise the adoption of an inclusive approach that focuses along with professional growth, on the overall and personal growth of the entity in order to become leaner, agile, and adaptable. It is these measures that have supported the survival and will ultimately provide a base for blossoming.

Ajay Bhargava is a Senior Partner of the Dispute Resolution Team at Khaitan & Co, specialising in civil, criminal and corporate litigation. His fora of practise include Supreme Court, High Courts, Arbitration (International and Domestic) and various quasi-judicial tribunals.

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AN ASSOCIATION OF CORPORATE BODIES CAN ESTABLISH A CAPTIVE POWER PLANT PRIMARILY FOR THEIR OWN USE UNDER THE ELECTRICITY ACT: SUPREME COURT

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The Supreme Court in the case Chhattisgarh State Power Distribution Company Ltd. vs Chhattisgarh State Electricity Regulatory Commission observed that a captive power plant primarily for their own use can be established by an association of corporate bodies.

The requirement would be that the consumption of SBIPL and SBMPL together should not be less than 51% of the power generated. Admittedly, the joint consumption by SBIPL and SBMPL is more than 51% and under the provisions of the said Act, the use of electricity by it would be for captive use only even an association of corporate bodies can establish a power plant. Since SBMPL holds 27.6% of the ownership, the requirement of not less than 26% of shares is fulfilled by SBMPL as SBMPL holds 27.6% equity shares in SBPIL.

The fourth proviso to sub­section (2) of Section 42 of the said Act would also reveal that surcharge would not be leviable in case open access is provided to a person who has established a captive generating plant for carrying the electricity to the destination of his own use and under Section 9 of the said Act, could be an individual or a body corporate or association or body of individuals, whether incorporated or not, it is clear that the person will get benefit even an association of corporate bodies can establish a captive power plant it has been seen. The definition of “person” is wide enough to include any company or body corporate or association or body of individuals, whether incorporated or not, or artificial juridical person it should be primarily for the use of the members of such co­operative society or association is the requirement, the Bench observed while referring to the provisions of the Electricity Act.

The BPIL, the respondent contended and supported the impugned judgment that no permission is required from the Commission for supply of electricity for its own use. Thereafter the appellant Company contended that unless SBPIL consumes 51% of the aggregate electricity generated by it, it will not be entitled to get the benefit under Section 9 of the said Act, in an appeal filled before the Apex Court.

An appeal was dismissed by the Appellate Tribunal for Electricity filed by the Company further The Commission held that SBPIL was entitled to supply electricity to its sister concern SBMPL and the same would qualify to be treating as own consumption and within the ambit of Section 9 read with Section 2(8) of the Electricity Act, 2003 and Rule 3 of the Electricity Rules, 2005 SBPIL submitted a petition for providing open access and wheeling of power through the transmission system of the Chhattisgarh State Power Distribution Company Ltd (Company) for captive use by SBMPL to the Chhattisgarh State Electricity Regulatory Commission, the commission. A Captive Generation Plant is established by SBPIL, and is a sister concern of SBPIL Shri Bajrang Power and I spat Ltd and Shri Bajrang Metallics and Power Ltd, SBMPL.

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Where the crime was committed the remission or premature release policy of the state has to be considered: Supreme Court

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The Supreme Court in the case Radheshyam Bhagwandas Shah, Lala Vakil vs State of Gujarat observed that where the crime was committed has to be considered in the remission or pre­mature release in terms of the policy which is applicable in the State.

While allowing the writ petition the court observed and contended that Once the crime was committed in the State of Gujarat, after the trial been concluded and judgment of conviction came to be passed, all further proceedings have to be 6 considered including remission or pre­mature release in terms of the policy which is applicable in the State of Gujarat where the crime was committed and not the State where the trial stands transferred and concluded for exceptional reasons under the orders of this Court, as the case may be. The court further stated that under Section 432(7) CrPC the appropriate Government can be either the Central or the State Government but there cannot be a concurrent jurisdiction of two State Governments.

the appropriate Government in the ordinary course would be the State of Gujarat. But the case was transferred in exceptional circumstances by this Court for limited purpose for trial and disposal to the neighboring State i.e., the State of Maharashtra by an order dated 06.08.2004. ordinarily, the trial was to be concluded in the same State and in terms of Section 432(7) CrPC as the crime in the instant case was admittedly committed in the State of Gujarat, observed by the Apex Court.

he application for pre­mature release has to be filed in the State of Maharashtra and not in the State of Gujarat, as prayed by the petitioner by judgment impugned dated 17.07.2009 As His petition filed in the High Court of Gujarat was dismissed taking note of Section 432(7) CrPC on the premise that since the trial has been concluded in the State of Maharashtra. Thereafter He had filed his petition for pre­mature release under Sections 433 and 433A of the Code of Criminal Procedure, 1973 stating that he had undergone more than 15 years 4 months of custody.

The bench comprising of Justice Ajay Rastogi and the justice Vikram Nath observed and noted that under Section 432(7) CrPC can be either the Central or the State Government but there cannot be a concurrent jurisdiction of two State Governments of the appropriate Government.

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Adopt roster based reservation for preferential candidates as followed by JIPMER: Supreme Court directs all AIIMS institutes

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The Supreme Court in the case Students Association AIIMS Bhopal And Or’s. v. AllMS and Or’s observed and directed all AIIMS Institutes to adopt roster-based reservation followed by Jawaharlal Institute of Postgraduate Medical Education and Research, Pondicherry (JIPMER) as a plea was filled in the Court seeking direction to AIIMS to have a defined criteria for arriving at seat matrix for institutional preference candidates in INI-CET examination.

the order of the Apex Court in the case AIIMS Students’ Union v. AIIMS And Or’s, would not be applicable if It emphasized that if the roster-based system is implemented the actual roster points for AIIMS would be different from JIPMER as the same would depend on the percentage of seats decided to be allocated to the preferential candidates but It stated that the reservation would be similar to the one adopted by JIPMER AIIMS New Delhi was willing to provide a roster-point based reservation for its institutional preference candidates, by way of an affidavit 20th January 2022 the Bench was apprised that pursuant to a meeting held on 28th June 2020 as prescribed the relevancy:

It shall not be too wide with the one for the general category candidate, that the margin of difference between the qualifying marks for the Institute’s candidate.

The one who has secured marks at the common entrance PG test less than the one secured by any other candidate belonging to reserved category enjoying constitutional protection such as SC, ST etc. cannot be the AIMS graduate the last student to qualify for admission.

appearing on behalf of AIIMS, Advocate, Mr. Dushyant Parashar, New Delhi was asked to get instructions from AIIMS, Bhubaneswar and Jodhpur so that the Court can pass appropriate orders on the next date of hearing. As that apart from AIIMS, Bhubaneswar and AIIMS, Jodhpur, all other AIIMS before the Apex Court has agreed to implement the roster-based reservation system followed by JIPMER Puducherry for their institutional preference candidates, the Court was informed at the last date of hearing.

the petition had been filed seeking direction to AIIMS to disclose how the seats for institutional preference candidates are to be allotted in the view of the same the petitioners claim that in the INI-CET examination conducted in July, 2021, only 4 seats (1.87%) in AIIMS, New Delhi were allotted to institutional preference candidates. Rivetingly, the petitioners note that no seats were allocated to any other AIIMS for admission of institutional preference candidates.

the Bench comprising of Justice L. Nageswara Rao and the justice A.S. Bopanna observed and noted that to record in the order that the roaster system would be applicable from this year. Mr. Parashar informed it that since new software is to be put in place for counselling, it might cause some delay. The bench further stated that the court will order it to apply this year but in case of delay AIMS can come later.

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‘The crime committed has to be considered in the remission or premature policy of the state’

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The Supreme Court in the case Radheshyam Bhagwandas Shah, Lala Vakil vs State of Gujarat observed that where the crime was committed has to be considered in the remission which is applicable in the State and the pre­mature release in terms of the policy

The Court noted while hearing the writ petition that in terms of the policy which is applicable in the State of Gujarat where the crime was committed and not the State where the trial stands transferred and concluded for exceptional reasons under the orders of this Court once the crime was committed in the State of Gujarat, after the trial been concluded and judgment of conviction came to be passed, all further proceedings have to be 6 considered including remission or pre­mature release, as the case may be, in the instance case. under Section 432(7) CrPC, there cannot be a concurrent jurisdiction of two State Governments, can be either the Central or the State Government of the appropriate government.

in terms of Section 432(7) CrPC, the trial was to be concluded in the same State and ordinarily in the State of Gujrat the crime in the instant case was admittedly committed. by an order 06.08.2004., the case was transferred in exceptional circumstances by this Court for limited purpose for trial and disposal to the neighbouring State i.e., the State of Maharashtra, observed by the bench of Apex Court.

As mentioned by the petitioner in the plea that by judgment impugned dated 17.07.2019., the application for pre­mature release has to be filed in the State of Maharashtra and not in the State of Gujarat and His petition filed in the High Court of Gujarat was dismissed taking note of Section 432(7) CrPC on the premise that since the trial has been concluded in the State of Maharashtra. under Sections 433 and 433A of the Code of Criminal Procedure, 1973, the petition was filled by the petitioner for premature release further the petitioner stated that that he had undergone under the custody of more than 15 years 4 months.

Section 302, 376(2) (e) (g) and reading it with Section 149 IPC, Shah was found guilty for the offence, the offence committed by him in the State of Gujrat.

The bench comprising of Justice Ajay Rastogi and the justice Vikram Nath observed that under Section 432(7) CrPC can be either the Central or the State Government but there cannot be a concurrent jurisdiction of two State Governments of that appropriate government.

The bench comprising of Justice Ajay Rastogi and the justice Vikram Nath observed that under Section 432(7) CrPC can be either the Central or the State Government but there cannot be a concurrent jurisdiction of two State Governments of that appropriate government.

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Seeking reduction of qualifying the percentile for admission in ayurveda course: A plea in Supreme Court

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The Supreme Court in the Case Amit Kumar v UOI & Or’s observed in Ayurveda course in view of large number of vacancies and for seeking reduction of qualifying percentile for admission, an ayurveda aspirant who appeared in NEET 2021 has approached the Court.

the court had observed that lowering the minimum marks and reducing the percentile for admission to first year BDS Course would not amount to lowing the standards of Education and further the Court directed to lower the percentile mark by 10 percentiles for admission in first year of BDS Course for academic year 2020-2021, with regards to substantive the contentions made by the petitioner by referring the judgement passed in the case in Harshit Agarwal & Or’s v Union of India.

the percentile may also be reduced for Ayurveda programme enabling the Petitioner to take admissions then If percentile is being reduced/considered for reduction for BDS course was further stated by the petitioner in the plea, while referring to an order dated 04.29.2022. Thereafter the top Court had asked Centre to consider lowering the percentile for BDS Courses.

Seeking the Centre’s response in a plea by filing a counter affidavit, noted by the Top Court specifying the above-mentioned information:

after deducting the admission granted for MBBS Courses (BDS Courses), the total number of Candidates.

in All India Quota and State Quota, the totals number of vacant seats.

in government colleges on one hand & private/deemed colleges on the other hand, the number of seats which are remaining.

the petition was filed through AOR Neeraj Shekhar and for the petitioner Advocate Shivam Singh appeared.

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Bank case rejected by Supreme Court against farmer

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The Supreme Court in the case Bank of Maharashtra & Or’s v Mohanlal Patidar observed an order given by the High Courts of directing the bank the OTS proposal given by a farmer who had availed a loan from the bank, the court further pulled up the Bank of Maharashtra for challenging the order.

The Bank shall complete remaining formalities and provide all consequential benefits flowing therefrom to the petitioners, the court further stated that it is needless to emphasize The OTS proposal given by the petitioners in both the cases shall be accepted by the Bank and ‘sanction letters’ be issued forthwith, the court allowed the petitioner plea.

The petitioner not only promptly challenged the said order, it is noteworthy that petitioner never acceded to the unilateral decision dated 25th August 2021 and even otherwise the letter dated 25th August 2021 is held to be illegal by us, clause-7 of policy cannot take away the fruits of OTS benefits, within two months from the date of issuance of order dated 22th September 2021, the petitioner filled the instant petition and further the court directed we are unable to give stamp of approval to the impugned orders and action of the Bank, observed by the bench comprising of Justice Sujoy Paul and the justice Dwarka Dhish Bansal while setting aside the impugned orders of the bank.

In an order dated 03.09.2021 it was stated and it showed that the petitioner was required to pay minimum 10% of the OTS amount within stipulated time and that he had deposited Rs.35,00,000/- out of Rs.36,50,000/- within the stipulated time, it was argued before the court by the counsel.

As full and final settlement of the dues, he will be required to deposit Rs.50.50 lakhs as he was informed by the Asset Recovery Branch of the Bank.

Whole law comes into place when a matter of farmers come as the down payment were also accepted and it was further stated by the bench in an oral remark You don’t file cases against the ones who loot 1000s of crores.

The respondent had obtained a loan and intended to pay it in terms of a One Time Settlement which was quantified as Rs 3650000/-. in furtherance thereof the respondent had deposited Rs 35,00,000 with the bank, in the above-mentioned matter.

The bank had miserably failed to accept the same and on the contrary, decided to enhance the compromise amount to Rs.50.50 lakhs unilaterally which was contrary to the OTS scheme, contended by the counsel further the counsel stated that the bank had miserably failed to accept the same and on the contrary, decided to enhance the compromise amount to Rs.50.50 lakhs unilaterally which was contrary to the OTS scheme.

The bench comprising of Justice DY Chandrachud and the justice Surya Kant observed and remarked while dismissing the plea assailing Madhya Pradesh High Court’s order dated 02.21.2022 Such a litigation in Supreme Court will spoil the families of farmers financially, Go after bigger fish.

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