AK Balaji: SC issues notice on SLP filed by BCI; Directs RBI to refrain from granting permission to Foreign Law Firms

The Supreme Court has issued notice on the Special Leave Petition filed by the Bar Council of India (BCI) against the decision of the Madras High Court in AK Balaji’s case. The Apex Court also directed the RBI to refrain from granting any permission to “the foreign law firms to open liaison offices in India under Section 29 of the Foreign Exchange Regulation Act,1973”..Leaving little room for ambiguity, the Court further stated that the expression “to practice the profession of law” under Section 29 of the Advocates Act, 1961 “covers persons practicing litigious matters as well as non-litigious matters matters other than contemplated in para 63(ii) ofthe impugned order and, therefore, to practice in non-litigious matters in India the foreign law firms, by whatever name called or described, shall be bound to follow the provisions contained in the Advocates Act..”.It may be remembered that in para 63(ii) of its judgement, the Madras High Court had held that:.“(ii) However, there is no bar either in the Act or the Rules for the foreign law firms or foreign lawyers to visit India for a temporary period on a fly in and fly out basis, for the purpose of giving legal advise to their clients in India regarding foreign law or their own system of law and on diverse international legal issues.”.The Respondents have been granted ten weeks time to file their replies..The BCI was represented by Senior Advocate NM Krishnamani along with Senior Advocate and BCI Chairman Manan Kumar Mishra while a battery of Senior Counsels appeared for the Respondents..Dr. Abhishek Manu Singhvi, on instructions from Dua Associates, represented White & Case and Covington & Burling..Senior Counsel Mukul Rohatgi on instructions from EC Agarwala represented Ashurst, Clifford Chance, Eversheds, Bird and Bird, Linklaters and Clyde & Co..Senior Advocate Nageshwar Rao, on instructions from Trilegal, appeared for Allen & Overy..As reported by Bar & Bench in April this year, the BCI had chosen to appeal against the decision of the Madras High Court in AK Balaji v Government of India dated February 21, 2012. A copy of the petition may be read here..The Madras High Court, in its judgment, had held that foreign law firms or foreign lawyers cannot practice the profession of law in India either on the litigation or non-litigation side, unless they fulfil the requirement of the Advocates Act, 1961 (Advocates Act) and the Bar Council of India Rules..However, the Court clearly stated that there is no bar either in the Advocates Act or the BCI Rules for foreign law firms or foreign lawyers to visit India for a temporary period on a ‘fly in and fly out’ basis, for the purpose of giving legal advice on foreign law to their clients in India. The Court also held that foreign lawyers cannot be debarred from coming to India and conducting arbitration proceedings in disputes involving international commercial arbitration..It is against this decision that the BCI has chosen to file an appeal..Speaking to Bar & Bench on the main grounds of the appeal, BCI’s Standing Counsel in the Supreme Court, Ardhendumauli Kumar Prasad said, “BCI has primarily challenged the Madras High Court order on the ground that the issues relating to practice of profession of law by foreign lawyers before the Madras High Court were no longer res integra as the same were comprehensively dealt by the Bombay High Court while passing the final Judgment and order dated December 16, 2009 in WP No. 1526 of 1995”..Prasad added, “BCI has also appealed on the ground that the foreign lawyers who intend to practice in India shall first enrol themselves with BCI as per the charter of the Advocates Act, 1961”.With the Supreme Court now issuing notice in the petition, the uncertainty and ambiguity over the entry of foreign law firms may soon be put to rest.