Your Weekly dose of Legal, Technology and Risk Insights
TOP STORY OF THE WEEK
Iran war threatens India's 'Goldilocks' economy
The escalating conflict involving the United States, Israel, and Iran poses economic and diplomatic challenges for India. India relies heavily on the Gulf Cooperation Council for oil, trade, investment, and remittances from nearly 10 million Indian workers, making the region crucial to its economy. Analysts warn that a prolonged conflict could disrupt energy supplies, widen India's trade deficit, and push up domestic inflation, threatening the country’s current 'Goldilocks' phase of strong growth and low inflation. It also complicates India's foreign policy strategy of maintaining balanced relations with all sides while safeguarding its economic interests.
LEGAL & TECH
CJI DY Chandrachud advocates for ethical AI integration in legal research
D. Y. Chandrachud, speaking at the Indo-Singapore Judicial Conference, highlighted the transformative role of artificial intelligence in legal research and judicial processes while stressing the need for ethical safeguards in its adoption. He noted that AI can enhance efficiency in legal work and court administration but warned about risks such as bias, errors, and lack of transparency. The CJI emphasised the importance of accountability, robust oversight, and global collaboration to ensure AI strengthens rather than undermines the justice system.
Bombay HC Strikes Down Unlawful GST Cash Seizures
The Bombay High Court ruled that GST officers cannot seize cash during searches unless it is clearly linked to a GST offence. Justices G. S. Kulkarni and Aarti Sathe held that the Rs1 crore seized from a trader was arbitrary and without legal authority, ordering its return with interest within two weeks. The court noted that under the Central Goods and Services Tax Act, 2017, officers must record a valid 'reason to believe' and cannot treat cash as seizable goods, reinforcing limits on GST search and seizure powers.
Arvind Kejriwal requests the Chief Justice of the Delhi High Court to move the excise policy matter away from Justice Swarana Kanta Sharma.
Arvind Kejriwal, along with Manish Sisodia and other accused in the Delhi excise policy case, wrote to the Chief Justice of the Delhi High Court seeking transfer of the matter from the bench of Justice Swarana Kanta Sharma. They argued that the case should be heard by an impartial bench, citing concerns over neutrality and noting that several earlier orders by the judge in related proceedings were overturned by the Supreme Court of India. The request came after the Central Bureau of Investigation challenged a trial court order that had discharged Kejriwal and 22 others in the excise policy case.
CORPORATE COMPLIANCE
SEBI Settles Proceedings With 29 Venture Capital Funds Over Compliance Lapses
The Securities and Exchange Board of India settled enforcement proceedings against 29 venture capital funds for failing to liquidate investments within the permitted timeframe under the old regulatory regime. Under the Venture Capital Fund Settlement Scheme, 2025, the funds collectively paid about Rs2 crore in settlement charges, allowing the cases to be closed without further action. The violations largely stemmed from legacy funds registered under the SEBI Venture Capital Funds Regulations, 1996 that continued holding investments beyond their scheme tenure.
RBI tightens banks' dividend payout norms
The Reserve Bank of India issued new guidelines tightening dividend payouts by banks, capping them at 75% of net profit and linking them to capital adequacy and asset quality. Banks must maintain regulatory capital requirements and report positive adjusted profit after tax before declaring dividends. The rules also prohibit paying dividends from exceptional or non-recurring income and will take effect from FY27, with existing norms continuing until FY26.
RISK INTELLIGENCE
NSE appoints 20 merchant bankers for its much-anticipated IPO
National Stock Exchange of India has appointed 20 merchant bankers along with legal and advisory firms to manage its proposed IPO, following approval from its IPO committee led by Srinivas Injeti. The exchange is expected to file its draft papers with Securities and Exchange Board of India within two months, with the IPO likely before the end of the year. This marks a record number of bankers for an IPO mandate, surpassing the 18 appointed for the IPO of ICICI Prudential Asset Management Company in 2025.
ED Seizes Assets Worth Rs26.86 Crore in Saubhagya Ispat Bank Fraud Case
The Enforcement Directorate has provisionally attached immovable assets worth Rs 26.86 crore belonging to Saubhagya Ispat India Pvt Ltd in a bank loan fraud case. The probe stems from a case registered by the Central Bureau of Investigation alleging that the company secured loans from Andhra Bank (now part of Union Bank of India) using forged documents. Investigators claim the funds, meant for steel business expansion, were instead diverted to related entities and routed through fictitious transactions.