Experts & Views
10: 30 Hello and welcome to the first MPL Live Blog of this season. We are going to take you through the final day of the NLIU - Juris Corp National Corporate Law Moot being held at Bhopal, India.
10:40 The preliminary rounds of the moot saw a clash of 44 teams out of which 16 qualified for the Octo-finals which concluded late last night. The fixtures for the quarterfinal rounds which just began a while back are as follows:
GLC Mumbai v. NALSAR Hyderabad
Symbiosis Noida v. NUJS
Sastra University, Thanjavur, Tamil Nadu v. NLSIU, Bangalore
Court Room 4 -
Nirma University, Ahmedabad v. Amity Law School, IP University, Delhi
10:45 The moot problem is based on corporate and securities law and revolves around the recent SEBI - Sahara controversy relating to the jurisdiction of SEBI with regard to unlisted public companies, the issue of securities by an unlisted public company and the director's responsibility in such circumstances. A copy of the moot problem can be viewed here.
11:27 Aditi Verghese, moot organiser from NLIU Bhopal says that apart from the intense mooting over the last two days, there have also been other activities on campus. Manisha Garg, a Teach For India fellow 2011, gave an inspiring talk on the ways in which the Teach for India movement works towards bridging the educational divide in the country. The lively discussion enjoyed a good turn out, she says.
11:45 Since the moot saw a fairly large participation of 44 teams, the organisers worked out the format for the moot in such a way that no two teams faced each other more than once and no team faced a particular judge more than once. Further, all teams were given an equal amount of time before their rounds. Also, before the preliminary rounds, all teams were seeded according to their memorandum marks. The organisers also ensured that the top eight teams in the quarters did not face each other eariler in the preliminary rounds.
12:40 Results of the quarter final rounds:
Court Room 1 - GLC Mumbai defeat prevailing MPL champions Nalsar Hyderabad
Court Room 2 - NUJS Kolkata get past newcomers Symbiosis Noida
Court Room 3 - NLSIU Bangalore beat Sastra University, Thanjavur
Court Room 4 - Amity Law School, IP University, Delhi win over Nirma University, Ahmedabad
The semifinal match-ups are as follows:
Court Room 1-
NLSIU Bangalore (Petitioners) v. GLC Mumbai (Respondents)
Court Room 2-
NUJS Kolkata (Petitioners) v. Amity Law School, IP University, Delhi (Respondents)
12:47 Akshay Amritanshu, a moot organiser watching the first semis tells me says that the second speaker from NLS Bangalore is currently arguing on whether the issue of bonds was a private placement or not. The judges in that court room are Ms. Veena Sivaramakrishnan, Parter, Juris Corp, Prof. Keshav Rao from Ambedkar Law College, Andhra Pradesh and Mr. Udayaditya Banerjee, Associate, LKS. The judges ask if the counsels have met their clients. And the speaker is a little hesitant.
The speaker now moves on to the next issue on whether the Memorandum of Private Placement is a Prospectus or not for the purposes of the Companies Act.
12:55 The NLS team have finished their arguments and the judges request the GLC team to start the arguments on behalf of the Respondent. Mr. Krishnendu from GLC Mumbai begins his arguments and the judges interrupt and tell him to address the entire bench (consisting of two males and one female) as 'ladyship'. The counsel suggests to the Bench that addressing them as ladyship would sound a bit humorous. The judges seem angry and the counsel seeks an apology and goes on with his arguments.
13:10 In the other court room where NUJS Kolkata is facing Amity Delhi, NUJS speakers began their arguments a while back. The judges in this round are Prof. (Dr.) Ghayur Alam, Ministry of HRD Professor of IP Law at NLIU Bhopal, Ms. Neha Vijaywargiya, Senior Associate, Juris Corp & NLIU alumnus and Ms. Krati Somani, Associate at LKS.
Aditi Verghese, a moot organiser watching the round, says that the first speaker Adrija was calm and clear and argued that hybrid securities were not included under SCRA. She further argued that the company in question never intended to be listed. The judges asked if the instruments at issue could be said to be debentures but the speaker argued that hybrid instruments were substantially different from pure debentures.
13:19 The Amity speaker is questioned on the legal requirement to prohibit the transfer of bonds and is grilled on the definition of 'securities' and the related legislative intent. The speaker moves on to the next issue dealing with the doctrine of alternative remedy. Amity second speaker Sambit begins by explaining Section 67(3) and the difference between public issue and private placement. He explained the meaning of 'calculated' as used in the provision and cited the commentary on Company Law written by Ramaiya as an authority to say that 'calculated' means a planned method to circumvent the provisions of law; to make a public issue look like a private placement. Sambit is fluent and confident and is linking the facts to the law, seemingly to the satisfaction of the three judges on the bench.
Meanwhile, in the other court room the first GLC speaker requested the bench to amend his written submissions, but the bench politely rejected his request. The second speaker Uttara is currently arguing on whether there was a private placement or not.
13:28 Amity speaker Sambit argues that the issue in question was a public issue and the judges enquire if the company could have put restrictions on transferability. Sambit retorts that under Section 111A, there is free transferability but it is not absolute. However, he's unable to back his argument with precedents. Sambit further argues that the restriction on transfer is required only until the listing is done.
13:40 Albin George Thomas, a moot organiser who's watching the NUJS v. Amity semis along with co-organiser Aditi Verghese says that the Amity second speaker Sambit quoted the celebrated case of Salomon v. Salomon while arguing on corporate veil. The judges ask for an Indian precedent, but the counsel pleaded ignorance and argued that the principle of piercing of corporate veil applied in the present case.
In the other court room, the GLC team have finished their arguments and the Rebuttals are currently going on.
13:52 Amity have finished their arguments and the NUJS first speaker addresses the bench for rebuttals. She questions the jurisdiction of the bench and stresses on SEBI's function of investor protection within the framework of the law. She also says that Section 55 of the Companies Act (which states that SEBI has jurisdiction over listed companies and Ministry of Corporate Affairs has jurisdiction over unlisted companies) should be respected.
The rounds have ended in both the court rooms and the teams eagerly await the announcement of the results.
14:01The judges in the NUJS-Amity court room give feedback to the participants. Prof. Alam appreciates the performance of the teams and advises that while citing definitions which form a basis of your argument, the participant should ensure that the definition is mentioned in the memorandum. Ms. Neha Vijaywargiya said that even if the speakers divide the issues to be argued between them, it is better if both the speakers are well versed with all the issues involved in the problem.
The moot organisers say that the results will be announced in about 15-20 mins and that the final rounds are slated to begin in an hour.
14:23 Semifinal results:
Court Room 1 - NLSIU Bangalore beat GLC Mumbai
Court Room 2 - Amity Law School, IP University, Delhi defeat NUJS Kolkata
The final round between NLSIU Bangalore (Petitioners) and Amity Law School (Respondents) is scheduled to begin at 16:00 hours.
The two big upsets of the day were the two top teams of last year's MPL: Nalsar Hyderabad and NUJS Kolkata losing out to GLC Mumbai and Amity Delhi in the quarters and the semis respectively. NLS Bangalore, which is currently placed second in the MPL 3 Season Standings behind NLU Jodhpur, has had a very good start to this season and will look to take the top spot at the end of the day.
16:17 Good evening and welcome the last leg of the blog coverage of the NLIU - Juris Corp moot.
Its NLSIU Bangalore (Petitioner) v. Amity Law School, New Delhi (Respondent) for the grand finale. The NLS team consists of speakers Diwakar and Aditya V.S. along with researcher Akashi. Speakers Sameeksha and Sambit along with researcher Akanksha are representing Amity Law School, IP University, New Delhi.
The following are at stake: 50 grand for the winners, 30 grand for the runners up and 10 grand each for the best speaker, memorandum and researcher. The moot is joint collaboration between NLIU Bhopal and Juris Corp, a Mumbai based law firm.
The participants have arrived at the moot court hall and the rounds will begin shortly. Each team is given 40 minutes to put forward their arguments (20 mins for the first speaker, 17 for the second speaker and 3 for rebuttals).
16:45 The final round just began with the first speaker of the Petitioner team outlining the issues involved and stating that he'll be dealing only with the issue of jurisdiction. He is going to use administrative law principles of non application of mind and violation of principles of natural justice to negate the SEBI Order. He is also going to use the doctrine of alternative remedy. Diwakar is a confident speaker and is taking the bench through the material facts of the case in simple language.
16:56 The bench enquires whether there were going to be separate submissions with regard to jurisdiction for the three different clients and the NLS speaker answers in the affirmative.
The second speaker from NLS Bangalore, Aditya, just began his arguments. He is going to deal with the question of whether the issue was a public or a private issue and whether directors, auditors and promoters are liable under the current law. Aditya first argues that the issue was a private placement and stresses that pre-allotment and not post transfer of bonds was relevant in deciding whether it was public or private placement.
17:10 NLS spekaer Aditya distinguishes the jurisprudence of American and Indian law with respect to restriction of transferability of debentures. He then asserts that the Memorandum of Private Placement is not a Prospectus under the Companies Act. The speaker seems to be heavily relying on the Company Law commentary written by Ramaiya.
17:18 Aditya, who is a little hesitant, argues that there was no contravention of any law by the directors, promoters, officers and auditors of the company. He finishes his arguments and the first speaker of the Amity team, Sameeksha, has begun the respondent's submissions. She is allowed to continue without much interruption from the bench. She is clear and pleasant to listen to.
17:25 Sameeksha from Amity states that the Sahara judgement by the SAT has strong persuasive value and she widely quotes NK Sodhi in the SAT judgement. The bench asks if SEBI has such wide investor protection powers under Sections 11 and 11B that they can exercise jurisdiction regardless of company being listed or unlisted. The bench also grills the speaker on legislative intent stating that there is no amendment in the SCRA, whereas the Companies Act was amended with regard to the definition of securities.
17:30 The bench further questions if the counsel was at a loss to address the bench with regard to harmonious construction of the SCRA and the Companies Act without relying on the SAT judgement. The Amity speaker states that that the private placement was made with mala fide intent and that it was a essentially a public issue in the garb of a private placement. Further, she argues that there was no violation of the principles of national justice as an ex parte interim order does not mean that there was no hearing. She argues that the company was not present only at the time of passing the order.
Further, Sameeksha relies on the Rose Valley real estate case to show that one can go to the forum with the more effective and efficacious remedy in the case of availability of two remedies. She further explains that if the company was held liable, the directors, etc would also be held liable. The bench asks if 'etc' included auditors, to which the Amity speaker replied in the affirmative. Sameeksha ends her submission with as much poise as she began.
17:45 Sambit, the second speaker from Amity Law School, starts by arguing that it is public issue and highlighted the key words in Section 67(3), especially the term 'indirectly'. The bench asks him to explain 'issue house' and looks satisfied with his reply. The bench enquires about the non-application of mind by the SEBI board when the initial holders transferred the bonds to subsequent holders. Sambit replies by explaining the word 'calculated'. The bench asks if it was a civil or criminal offence and the Amity speaker states that it is a civil offence.
17:55 Sambit cites precedents to support his argument that there was a clear intention on the part of the company to go around the law and make a public issue. He uses the fact sheet to show that there were sufficient communications by SEBI to the company. When asked by the bench if the bonds were freely transferable, Sambit retorts by stating that if the four bondholders could find thousand other transferees and get the approval of the company, then they should be considered freely transferable. Sambit doesn't seem to have convinced the bench on a query related to the meaning of a marketable security and its implications. He is now dealing with the issue of whether the offer document in the present case was a prospectus or not.
18:22 The speaker discusses the doctrine of corporate veil and argues that the auditors are responsible to the company as they have certified the issue as a private placement when it was actually a public offer. Sambit finishes his arguments and the rebuttals begin.
The NLS speaker Diwakar indirectly asks for extra time but was politely refused by the bench. He said that there were many misstatements by the other side. The bench asked him if the company was so efficient that it was able to approve the transfer to thousand tranferees. Diwakar responded by saying that the first paragraph of the fact sheet stated that the company was extremely efficient. In a rare move, the bench allowed the counsel to use the rest of his rebuttal time to make another submission regarding disposition of the CLB at a earlier stage. The Amity team stressed on their previous arguments during the surrebuttals.
The final rounds have concluded and all the participants are proceeding for High Tea. The results will be announced during the Valedictory function which will begin shortly.
19:31 The final results have just been announced. NLSIU Bangalore defeat Amity Law School, Delhi and win the 2nd NLIU - Juris Corp National Corporate Law Moot. Diwakar Kishore from NLSIU wins the best speaker award. NLS also wins the best memorandum award. Tanya Sood from HNLU takes home the best researcher award.
NLS Bangalore has gained 31 points from this moot and replaces NLU Jodhpur as the current table toppers. The MPL 3 Season standings are being updated right now.
19:50 Diwakar Kishore, the best speaker winner from NLS Bangalore said that the moot was the best judged moot he had ever participated in. He said that the most toughest rounds were the semifinals and the final rounds. He noted that his team won the semis against GLC Mumbai by just three points. Further, Diwakar explained that the timing of the SAT order in the SEBI-Sahara case which recently came out had helped the respondents greatly. But, he said that the judges had kept that in mind while judging. He said that his team tried to explain that the logic of the SAT order was erroneous and the judges accepted it. He also greatly appreciated the organisers of the moot for putting up a good show.
On being told that NLS Bangalore now tops the MPL 3 Season Standings, Diwakar retorted that he was greatly pleased to see his college being No. 1 in the standings. "We've been under performing over the last two years and its good to be back on the top. The important thing is to remain at the top throughout the season."
21:05 The MPL 3 Season Standings have been updated. NLS Bangalore now enjoys a 26 point lead over NLU Johdpur. GLC Mumbai and NUJS Kolkata occupy the third and the fourth positions (even though both colleges have equal number of points, since GLC has gained more points from a higher tier while compared to NUJS, they have been ranked third).
NLU Delhi has been awarded three points for finishing semifinalists at the Law Asia International Moot last month. Team MPL could not confirm the results immediately and apologises for the delay. The moot organisers have still not replied to our queries for confirmation of the results. However, the NLU Delhi moot court committee independently confirmed that it had finished semifinalists in the moot.
The NLU Delhi team consisted of Siddharth Garg, Nayantara Pande and Tanvee Nandan. Garg said that NLU Delhi lost to Singapore Management University in the semifinals. Apart from NLU Delhi, only two other Indian teams NLU Jodhpur and HNLU Raipur participated in the moot.
Another Tier 5 International moot, the FDI International Arbitration moot is concluding today at London. Two Indian teams, NUJS and GNLU are participating at the moot. Team MPL has not yet received any concrete information regarding the performance of the Indian teams.
Also, the problem solving question round for the Tier 2 ICC Trial Moot recently concluded and the results of the rounds were announced last week. Moot organiser from the International Criminal Law Network, Ms. Lieneke Louman said: "I am really amazed how important moot court competitions are for the Indian students. The two Indian teams that made it to the next round are National Law University, Jodhpur and Bangalore University". She also hinted at the possibility of having a comprehensive national qualifying round for the moot in future.
So, that's about it for today! Team MPL thanks Bishen Jeswant, Albin Thomas, Aditi Verghese, Akshay Amritanshu and Ritwik Parashar from NLIU Bhopal for their kind cooperation in supporting today's live blog. Good night!