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TOP STORY OF THE WEEK
RBI Liberalises India's External Commercial Borrowing (ECB) Framework
The Reserve Bank of India (RBI) has notified the Foreign Exchange Management (Borrowing and Lending) (First Amendment) Regulations, 2026, marking a significant shift toward a more market-oriented external borrowing regime. The updated regulations expand the scope of eligible borrowers, allowing any non-individual resident entity including limited liability partnerships and companies currently undergoing corporate insolvency resolution to raise ECBs. These eligible borrowers can now secure up to USD 1 billion or 300% of their net worth, while financially regulated entities face no capped borrowing limits.
LEGAL & TECH
Supreme Court of India Releases Landmark Draft Regulations for AI Use in Judiciary
On June 3, 2026, the Supreme Court of India issued the preliminary draft of the 'Regulations for Use of Artificial Intelligence (AI) in Courts, 2026', establishing a crucial governance framework for AI adoption across the Indian judicial system. The proposed rules adopt a presumption in favor of responsible AI deployment, strictly limiting the technology to an assistive capacity for administrative tasks, legal research, translation, and transcription. Crucially, the draft explicitly prohibits AI systems from deciding verdicts, evaluating bail, or conducting predictive risk scoring, ensuring that human primacy and judicial independence are maintained.
Singapore court orders six-month jail term for Byju Raveendran over contempt
Once valued at usd22 billion and considered India's most successful EdTech startup, Byju's has suffered a dramatic collapse, with its net worth now estimated at a negative Rs8,245 crore due to outstanding liabilities and employee dues. The company is burdened by massive debt, legal disputes, and governance concerns. Founder Byju Raveendran was recently sentenced by a Singapore court to six months in jail for contempt of court over non-compliance with asset disclosure orders, though he maintains the issue is procedural and not related to fraud. Despite the setbacks, Raveendran plans to appeal the ruling and remains optimistic about reviving the company
CORPORATE COMPLIANCE
SEBI Imposes Rs 15.95 Crore Penalty on Suzlon Energy for Historic Financial Misstatements
The Securities and Exchange Board of India (SEBI) has levied a significant penalty of Rs15.95 crore on Suzlon Energy Limited and its key executives over severe financial misstatements. In a revised regulatory order, SEBI overturned an earlier exoneration, heavily penalizing the company for disclosure irregularities spanning fiscal years 2013-14 through 2017-18. While the company claims its operations remain unaffected and firmly denies the allegations, it has announced intentions to formally challenge the SEBI directive before the Securities Appellate Tribunal.
RBI Penalizes Nagar Sahkari Bank Over Severe Lapses in NPA Classification Norm
The Reserve Bank of India (RBI) has formally imposed a monetary penalty on Nagar Sahkari Bank Ltd., Maharajganj, following an extensive statutory inspection of the institution's financial position. The central bank found the institution significantly failed to comply with strict regulatory directives regarding income recognition, asset classification, and provisioning . Specifically, the RBI determined that the bank consistently failed to identify non-performing assets (NPAs) on an ongoing basis and incorrectly classified existing credit facilities.
Risk Intelligence
SEBI Restrains Rajesh Exports Promoter Over Allegations of Rs 15 Lakh Crore Inflated Revenue
The Securities and Exchange Board of India (SEBI) has officially restrained Rajesh Mehta, promoter and Executive Chairman of Rajesh Exports, from dealing in the company's securities following severe allegations of financial misrepresentation. The regulator discovered that the company allegedly projected an inflated financial position, reporting consolidated revenues largely attributed to its Swiss subsidiary, Valcambi SA. However, SEBI observed that Valcambi's standalone revenues constituted less than 0.50% of the reported consolidated figures, a massive discrepancy deemed unsupported by verifiable records.
ED Arrests Deepak Cables MD in Rs 899 Crore Consortium Bank Fraud
The Directorate of Enforcement (ED) has arrested the Managing Director of Deepak Cables (India) Limited in connection with a massive Rs899.35 crore bank fraud involving a State Bank of India-led consortium. The investigation revealed that the company systematically secured and sustained massive credit facilities by submitting falsified financial statements and manipulating its account books. The accused allegedly utilized a complex network of entities to execute fictitious sales, engage in circular trading, and issue fake corporate guarantees to artificially inflate turnover.