Cryptocurrency and the Blockchain technology that underpins it are often seen as innovative and disruptive. However, not only the governments of various nations, but also the people of various sections and groups, have responded differently to this unique phenomenon, and everyone has observed Cryptocurrency through their own lens.

Cryptocurrency is a virtual or digital money that is protected by encryption, making double-spending and counterfeiting nearly difficult. The term “cryptocurrency” comes from the encryption technology that is utilised for network security. Cryptocurrency is supported by the conviction of its users in a market that will hold its worth. The majority of cryptocurrencies are decentralised networks built on blockchain technology, which is a distributed ledger system that records and verifies transactions via a peer-to-peer consensus method.

A cryptocurrency, sometimes known as a virtual currency, is a digital asset meant to function as a means of exchange, with transaction records kept in a digital ledger. It does not exist in the form of paper currency. It is not centralized, which means it is not issued by a government or central bank (for example in India, the currency is issued by the Reserve Bank of India). This property of cryptocurrencies makes them theoretically impervious to government intervention or control.

It functions as a public transaction database in a decentralised system using distributed ledger technology, most often a blockchain. In 2009, the first cryptocurrency, known as Bitcoin, was published. There are more than 4000 cryptocurrencies that are accessible presently.

Purpose of cryptocurrency:-

Cryptocurrency is designed to make it easier for two people to transfer cash without the use of a trusted third party like a bank or credit card firm. Instead, these transactions are protected by the use of public and private keys, as well as other types of incentive systems like as Proof of Work and Proof of Stake. In current cryptocurrency systems, a user’s “wallet,” or account address, has a public key, but the private key is only known by the owner and is used to sign transactions. Fund transfers are performed with low transaction costs, allowing users to avoid the exorbitant fees charged by banks and financial institutions for wire transfers.

Due to the semi-anonymous nature of cryptocurrency transactions, they are ideally suited for a wide range of illegal activities, including money laundering and tax evasion. Cryptocurrency supporters, on the other hand, place a high importance on anonymity, citing benefits such as whistleblower protection and demonstrators living in harsh regimes. Some cryptocurrencies have a higher level of security than others. Bitcoin, for example, is a comparatively poor option for doing criminal business online owing to forensic examination of the Bitcoin blockchain, which has helped authorities to capture and prosecute perpetrators. There are, however, more privacy-oriented cryptocurrencies like Dash, Monero, and ZCash, which are far more difficult to track.

Cryptocurrency regulations:-

Cryptocurrency is currently uncontrolled. Historically, under Section 35A[i] read with Section 36(1)(a)[ii] and Section 56[iii] of the Banking Regulation Act, 1949, and Section 45JA[iv] and 45L[v] of the Reserve Bank of India Act 1934, the RBI issued a notification titled ‘Prohibition on Dealing in Virtual Currencies (the ‘Crypto Ban Notification’) on April 6, 2018 and Section 10(2)[vi] of the Payment and Settlement Systems Act of 2007 was amended to prohibit all banks and financial institutions from offering services connected to cryptocurrency transactions, as well as from having any type of contact with those who already provide those services. Besides that, it has issued several cautionary statements about investing in it. Cryptocurrency, according to the RBI, are “stateless digital currencies” that trade via encryption methods and are protected from government intervention since they are not backed by a central bank. As a result, they may be often utilized in illegal transactions.

The crypto sector was virtually hamstrung as a result of the banking service, which needed exchanges to send and receive money in order to convert cash into cryptocurrency and pay employees, suppliers, and office space, among other things. Cryptocurrency customers were compelled to cash out immediately, and the sector was impacted on two fronts as a result of the loss of both banking services and fewer transactions.

Judicial approach to cryptocurrency:-

The Supreme Court knocked down a long-standing circular prohibiting cryptocurrency circulation in the nation on the following grounds in the case of Internet and Mobile Association v. RBI, a 180-page lengthy ruling by Justice V Ramasubramanian:

  1. The Reserve Bank of India (RBI) must not abuse its regulatory authority over virtual currencies.
  2. Any trade that supports the use of cryptocurrency is prohibited, which is disproportionate.
  3. It is also against the law under Article 19(1) (g)[vii] of the Constitution, which stipulates that businesses engaged in legal commerce are protected by the basic right to engage in any vocation, trade, or business.

The key elements of the decision are worth noting since the court and petitioners conducted significant worldwide benchmarking in defining cryptocurrencies, their identity, the instrument they entail, and who has the jurisdiction to regulate them. Many organisations across the world see cryptocurrency as having money-like characteristics, despite the fact that none of them have recognised it as legal tender, thus the RBI has the authority to regulate virtual currencies in this situation. The RBI has spoken in the past about confronting its entities and enterprises to avert harm to the banking industry and the economy, but there is no factual evidence to support this claim. It is critical to pay attention to these points listed below:

  1. The actions of the virtual currency function have not caused any harm to the RBI in the last five years or more.
  2. Virtual currencies were outlawed.
  3. Even the Inter-Ministerial Committee, which was formed in 2017 and proposed a particular legislative framework as well as the adoption of a new law, the Crypto-taken Regulation Bill 2018, had the goal of regulating rather than prohibiting the actions.

The court stated that RBI did not establish alternative procedures to protect against the aforementioned dangers. The court stated to the president of the European Union Parliament that the European Central Bank and Parliament had looked into not abandoning the cryptocurrency business, but instead recommended strengthening the financial system and regulatory schemes, and that the RBI had overlooked alternative measures in this case. The court also considered the four-prong criteria provided by the petitioners to assess the proportionality of the action that the RBI measures should pass, as stated in the case Modern Dental College and Research Centre v. State of Madhya Pradesh, 2016, as follows:

  • Measures taken by the RBI should be used for a specific purpose
  • Reasonably related to the goal
  • There are no less intrusive alternatives
  • The importance of goal and the limitation of rights should be linked

The court stated that the RBI’s use of terms like as “money laundering” or “black money” does not qualify as a valid purpose, and that other options should have been examined. The most important takeaway from this decision is that the Supreme Court chastised politicians, multiple committees, and two draft bills for failing to take a clear stance on cryptocurrencies.

Regulation of Cryptocurrency trade:-

Because cryptocurrency is an inalienable part of any state, and because cryptocurrencies are encroaching on this domain, regulating cryptocurrency would necessitate oversight from a variety of agencies as well as stringent laws, such as:

  1. The Reserve Bank of India (RBI) is in charge of regulating cryptocurrencies as legal money.
  2. The Directorate of Enforcement has issued a statement prohibiting the usage of cryptocurrencies in the case of economic crimes.
  3. The Department of Economic Affairs is in charge of regulating cryptocurrency’s involvement with the state’s economic policy.
  4. SEBI has approved the use of cryptocurrency in security contracts.
  5. Tax implications of cryptocurrency trade, according to India’s tax authorities.

As a result, putting together a complete framework to regulate every element of cryptocurrency trading appears to be a difficult undertaking. To establish an administrative presence in the crypto area, the RBI may rely on the blockchain system. It may also contemplate issuing licenses to cryptocurrency exchange, which would only be granted after a thorough review of records and the fulfillment of crucial compliance criteria.

Furthermore, a structure that, among other things, requires the reporting of exchange data to the RBI within a certain time frame may be established, which not only ensures the safety of exchanges and limits illegal usage, but also helps to increase consumer protection.

The tax authorities may tax the income made from purchasing and selling cryptocurrency as capital gains. The Securities and Exchange Board of India (SEBI) has the authority to regulate the trading elements of cryptocurrency transactions as well. This would boost traders’ morale since they will know that sufficient due diligence is being performed on crypto transactions, decreasing the danger of embezzlement in such transactions. Furthermore, businesses can sell initial coin offers (ICOs), which are similar to initial public offerings (IPOs), through which they may be able to obtain cash by releasing tokens in exchange for cryptocurrencies. To ensure the safety of customers and investors, SEBI may supervise the entire process and provide a return mechanism if delivery fails.

Blockchain Introduction:-

Blockchains are a sort of network chain (a way of assembling information and values) that generates “trust” in networks by providing audibility and consensus. Blockchain technology fosters trust by providing stakeholders with relevant records that have a low failure rate. It ensures security since no one can edit or alter a blockchain network, and no one can possess it without the consensus of its peers. In layman’s terms, it is the technology that stores information in a public database.

The blockchain is a technology that allows users to send information from one person to another in a secure and automated manner in the digital world. By forming a chain, one person has the ability to transfer information.

Pros and Cons of Blockchain:-

There are certain pros and cons of the technology. They are as follows:

Blockchain pros:-

  • Security & Durability

Blockchain technology ensures the highest level of transaction security and durability. This technology’s general management makes it more durable. Furthermore, the system distributes information blocks throughout the network, which improves durability by eliminating the possibility of transaction failure. It also offers strong security to consumers by providing “public key infrastructure.”

  • Integrity

Another significant feature of blockchain technology is that it provides users and stakeholders with a high level of integrity and confidence. When compared to other networks, blockchain has been found to provide high levels of data safety and integrity. It implies that it protects the data by ensuring that the data is always correct and that no one can change or add anything to the ledger once it has been posted.

  • Transparency & Immutability

This is the most important aspect of blockchain technology. The immutable characteristic of the technology or system offers a system in which users cannot remove or change the data saved in the network. It is secure because each block has a Hash ID, and if someone tries to modify it, the block will totally change the ID.

Furthermore, it gives a fantastic transparency system since it is available for everyone to view, and if someone tries to change the data, the users will discover right immediately.

  • Faster processing

Before blockchain technology became operational, traditional technologies required a significant amount of time and money to complete the task. However, since the adoption of blockchain technology, transactions have become much quicker and more frequent. This is also one of the most significant benefits of blockchain, since it saves time and money on the network.

  • Traceability

It is regarded as one of the most notable aspects of blockchain technology. The blockchain technology structure is designed in such a manner that it can easily trace the location of the network and is recognised as a safe and reliable source of transaction. It also leaves a permanent audit trail.

Blockchain cons:-

  • Complex regulations

It is one of the most serious drawbacks of blockchain technology. It is not required for any blockchain technology to have adequate rules and regulations in the network’s operation. As a result of the lack of laws and regulations, frauds occur, giving rise to the notion of ICO.

  • Privacy concerns

Another significant disadvantage of blockchain technology is that it poses privacy concerns. The most essential thing for every commercial firm is to protect privacy in order to maintain the value of their brand in the long term. However, owing to the absence of privacy in blockchain, many companies must face the loss of profit since information may be shared with competitors.

  • High cost

Although blockchain is less expensive than other networks, its solutions might be very expensive. In general, the cost is greatly depending on your requirements and the sort of blockchain functionality you need.

  • Dispensable performance

It is also a significant disadvantage of blockchain technology since the calculations necessary in this network are more repetitious than those required in traditional networks. It usually happens when new nodes are added when the ledger is updated. When there is an update in the ledger version, all of the network’s nodes update as well.

Current scenario of Cryptocurrency in India:-

Recent developments in the crypto world, also like Bitcoin’s drop from $65,000 in April to below $40,000 as a result of Elon Musk’s remarks, have refocused attention on legislation governing cryptocurrency governance in India. Around 7 million Indians have already invested more than $1 billion in cryptocurrencies, and the government faces a difficult challenge in allowing the fintech sector to thrive in India while ensuring that there are no safety issues.

Stand of Government on Cryptocurrency:

After months of deliberation on whether to legalize or prohibit cryptocurrencies, the Indian government has made an optimistic step toward regulating digital currencies in India. The Ministry of Corporate Affairs (MCA) has made it necessary for businesses to report their cryptocurrency trading/investments within the fiscal year. Experts regard it as a positive start and anticipate that the taxes laws will be implemented. This is seen as the first step in regulating cryptocurrencies in India.

The accounting of crypto assets aims to reduce illegal activities and the circulation of black money through cryptos. Transparent disclosures can also help to enhance company governance. The Centre has informed crypto stakeholders that there would be no blanket ban on digital currencies and that it is currently developing its final position on the issue. Finance Minister Nirmala Sitharaman has stated that the government is open to experimenting with new technologies and is not dismissive of them. While the government has reservations over cryptocurrencies, it is also developing its own digital money. The government does not want to be left behind in the new age digital revolution, and it intends to capitalize on the advantages that blockchain technology provides. “The time has come to capitalize on its uses while also fortifying the digital infrastructure,”.



Unless and until a robust regulatory framework is implemented, India’s cryptocurrency industry would remain uncontrolled. While the Supreme Court’s ruling has boosted the crypto industry, and cryptocurrency start-ups in India are expanding and releasing new products, there are some concerns since the finance ministry has launched a government bill for inter-ministerial talks that may ban cryptocurrencies. Despite this, cryptocurrency start-ups in India are optimistic about cryptocurrency’s enormous potential and future, and they are pressing the government to avoid implementing a blanket ban.


[i] The Banking Regulation Act, 1949. Act no.  10 of 1949, section 35A: Power of the Reserve Bank to give directions.

[ii] The Banking Regulation Act, 1949. Act no.  10 of 1949, section 36(1) (a): Further powers and functions of Reserve Banks.

[iii] The Banking Regulation Act, 1949. Act no.  10 of 1949, section 56: Act to apply to co-operative societies subject to modifications.

[iv] Reserve Bank of India act, 1934. Section 45JA: Power of Bank to determine policy and issue directions.

[v]  Reserve Bank of India act, 1934. Section 45L: Power of Bank to call for information from financial institutions and to give directions.

[vi] The Payment and Settlement System act, 2007. No. 51 of 2007, section 10(2): Without prejudice to the provisions of sub-section (1), the Reserve Bank may, from time to time,

issue such guidelines, as it may consider necessary for the proper and efficient management of the

payment systems generally or with reference to any particular payment system.

[vii] Indian Constitution , Art.19(1)(g): to practise any profession, or to carry on any occupation, trade or business




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(2)Vijay Pal Dalmia, Explaining Bitcoin and Legal Position in India,(Mar. 28, 2020),

(3) Rachit Garg, Key insights on legal framework of cryptocurrency in India,(Apr. 25, 2021),

(4) Ayush Verma, Regulation of bitcoin under Indian framework, (Feb. 8, 2021),

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(6) Disha Ganguli, Cryptocurrency and its rising importance in India in 2021, (May 14, 2021),

(7) Ayush Verma, Laws and regulation of blockchain along with its status in India, (Oct. 30, 2020),









India’s Evolving FinTech Laws & Compliances


FinTech has gotten a lot of attention in recent years. Fintech garnered substantial amounts of FDI, comprehensive government responses, and even significant market acceptance. However, today’s definition of FinTech is payment systems that leverage technology such as PayTM and Gpay – does not always reflect its origins.

Originally, Diners Club Cards (early iterations of Credit Cards) were hailed as the pinnacle of FinTech; however, a common pattern with FinTech in the 20th century was that, like Diners Club Cards, these technological advancements were pioneered by legacy institutions (conventional banks, NBFCs, clearing houses, and so on), and that Fintech advancements in the 20th century were regulated solely due to this fact.

Payment Aggregators and Payment Getaways, on the other hand, have published a FinTech book in recent years (hereinafter referred to as PAs and PGs). Due to their low cost of compliance, these organizations are not as heavily regulated as Financial Institutions and are able to deliver excellent services to end-customers at a competitive price.

Legal scenario in India

The payments industry has a rather well-developed regulatory structure. In India, pre-paid payment instruments (PPIs), debit cards (by volume), and the RTGS and NEFT systems are used to make digital payments (by value). In India, the Payment and Settlement Systems Act, 2007[i], is the main piece of law that governs payment systems. The RBI does, however, periodically publish rules and regulations governing various aspects of the payments network.

PPIs, on the other hand, are primarily regulated by the Reserve Bank of India’s Master Direction on Issuance and Operation of Prepaid Payment Instruments. PPIs are also divided into three groups:

  1. Closed System Payment Instruments – These payment systems are used to make purchases of products and/or services within the ecosystem of the service provider. Cash withdrawal is not permitted by CSPIs. CSPIs are not recognized as payment systems since they do not allow payments and settlement for third-party services. Ola Money, MakeMyTrip Wallet, and BookMyShow Wallet are just a few examples.
  2. Semi-Closed System Payment Instruments – These are payment mechanisms that may be used to buy products and services as well as get financial services at a group of specified designated merchant locations/ businesses that have agreed to accept the payment instruments under a particular contract with the issuer. Take, for instance, Paytm Wallet.
  3. Open System Payment Instruments – These are payment methods that may be used to buy products and services, as well as to access financial services such as money transfers at any merchant location that accepts them, and to withdraw cash from ATMs. Poga, for example.

Uber and Oyo, for example, are subject to the PSSA and related RBI laws and regulations since they direct payments from customers to suppliers.

Payment Aggregators are organizations that allow e-commerce sites and/or merchants to accept several payment instruments from consumers once they have completed their payment responsibilities through Fintech, eliminating the need for each merchant to develop their own payment-integration system. PAs help retailers connect with their consumers. Payment Gateways are organizations that provide for the underlying technological infrastructure to direct and speed the completion of an online payment transaction while avoiding any involvement in the money handling. The RBI has announced the PAPG Guidelines (Guidelines on Regulation of Payment Aggregators and Payment Gateways), which are seen as a positive step forward in the direction of stronger Fintech regulation.

Fintech businesses were obliged to do KYCs under the stricter rules of the Prevention of Money Laundering Act, 2002; nevertheless, e-KYCs were done using Aadhaar[ii] due to the huge cost reductions. However, in the landmark judgment of Justice Puttaswamy (Retd.) v. Union of India[iii], the Hon’ble Supreme Court of India struck down provisions of the Aadhaar Act that allowed private organizations to utilize an individual’s Aadhaar number to confirm their identity. As a result, businesses were no longer permitted to use the Aadhaar Regulations-approved verification services.

The introduction of crypto currencies is another significant step in the Fintech industry. Crypto currency is a digital form of currency protected by encryption, with the majority of transactions taking place on decentralized networks based on blockchain technology, which is a distributed ledger maintained by a separate network of computers. Crypto currencies are distinguished by the fact that they are not issued by a central authority, making them – in principle – immune to government intervention.

The RBI, on the other hand, has long had a negative attitude toward crypto currencies, effectively prohibiting them through its numerous notifications. Nonetheless, in the case of Internet and Mobile Association of India v. Reserve Bank of India[iv], the Hon’ble Supreme Court of India struck down the RBI Circular, lifting the ban on bitcoin trading in India. However, it should be emphasized that, in overturning the RBI Circular, the Hon’ble Court concluded that the RBI can regulate or prohibit “anything” that may constitute a danger to or have an impact on India’s financial system, even if the activity does not fall within the credit or payment systems.

Regulations for Fintech industries

Existing authorities such as the RBI and other authorities such as SEBI and the IRDAI are in charge of the fintech industry. Despite the fact that there have been several requests for the establishment of an independent authority to regulate the payments sector, all of them have been denied.

In addition, regulatory approaches have been gaining traction in the worldwide environment. The RBI created an Enabling Framework for Regulatory Sandbox in support of this. FinTech enterprises, including start-ups, financial institutions, and any other organization affiliating with or giving assistance to financial services, are eligible to participate in the sandbox, according to the Framework. The regulatory sandbox is intended to inspire ideas that are being suggested for implementation in the Indian market in areas such as:

  • There is a lack of regulations.
  • There is a requirement to temporarily relax rules in order to facilitate the suggested innovation.
  • The proposed innovation offers a significant increase in the efficiency and effectiveness of financial service delivery.

Segment-wise Compliances

intech companies began as startups, while others have simply expanded their services online. Fintech companies have been classified in a variety of ways. Payments and remittance, lending platforms, personal finance, blockchain and crypto currencies, insuretech, business solutions, and investing platforms are just a few of the possibilities. Classifying a startup into one of the categories has become a difficult process. The majority of them have begun to offer numerous services, which has complicated the categorization process. Regulations and investments fluctuate depending on the industrial category. An overview of several rules and compliances, section by segment:-

  1. Payments and Remittance – The payments industry is the most important component of the fintech business. Since its beginning, this industry has experienced tremendous expansion, attracting a large number of investors. The demonetization of currency resulted in broad acceptance of the payments industry. According to a study conducted by ASSOCHAM – PWC India, digital payments in India would double to roughly 135.8 billion dollars by 2023. Around half of all payment-related companies are mobile/digital wallets, point-of-sale systems, and payment gateways. The Reserve Bank of India established a ‘High-level Committee on Deepening Digital Payments’ earlier this year.

The Payments sector has seen a lot of developments in recent years, from digital wallets to Payments Bank and UPIs. For digital payments, digital/mobile wallets were the preferred method. They were closed/semi-closed prepaid payment instruments that could be used for recharge, e-commerce, and shopping inside the same platform. KYC requirements for different prepaid payment instruments have been established by the RBI in its “guidelines for prepaid payment instruments.” KYC has become a requirement for using mobile/digital wallets, which are often semi-closed PPIs. Semi-closed PPIs are divided into two categories by the RBI: (i) PPIs up to Rs 10,000, for which just the minimum information of the PPI holder is required, and (ii) PPIs up to Rs 1 lakh, for which a full-fledged KYC is required. Customers of these wallets must complete at least a basic KYC in order to use the wallet and take advantage of some of its benefits.  The RBI has also told PPIs to keep suitable data and security management mechanisms in place to protect payment-related data and prevent fraud during online transactions.

  1. Financial Lending – In recent years, the Indian fintech industry has seen a boom in digital lending platforms. P2P lending and SME lending startups have exploded in India, completely changing the lending sector, which was formerly dominated by banks. Lending platforms make it easy to get a loan with minimal paperwork and in a short amount of time. MSME businesses in India profited immensely from these services, particularly when requesting for bank loans entailed cumbersome procedures with a low likelihood of acceptance. These platforms utilize machine learning and artificial intelligence (AI) to replace traditional techniques for assessing a borrower’s creditworthiness. Integration of numerous APIs through platforms such as Indiastack has aided the lending industry in India significantly.
  2. Personal Finance and Investment Platforms – Personal finance and asset management organizations were able to enter deeper segments of the market because to the rising usage of the internet and smartphones. The simplicity with which women and youth may invest and manage their own finances has drawn a bigger audience. When contrasted to conventional institutions, these platforms use current technology to make the entire process of investing and asset management easier.

The SEBI is the regulatory body in charge of this sector of the fintech industry. Several established players have already expanded their online services. There are stockbrokers registered with SEBI and members of the NSE and BSE, such as Zerodha. Companies that provide online trading must adhere to the NSE, BSE, and MCX trading member requirements. There are additional firms that provide personal financial and wealth management advising services. SEBI requires these companies to get a Registered Investment Advisor certificate (RIA). SEBI (Investment Advisers) Regulations were introduced in 2013 to govern these organizations. According to the standards, RIAs are required to give specific disclosures to their customers, such as their remuneration and other significant elements of the products/securities. They must also keep copies of documents such as risk profiles, KYC information, customer agreements, and financial advice offered, among other things. A compliance officer should be hired to ensure that the regulations’ compliance obligations are met. The ‘Association of Mutual Funds in India’ registers asset management firms that deal with mutual funds as distributors (AMFI). AMFI is a self-regulatory organization of SEBI-registered mutual funds that establishes criteria for mutual fund distributors.

  1. Insurtech – In India, online insurance services are still in their early stages. Consumers do not have a high level of confidence in this category. These platforms track the specific demands of clients via IoT-enabled services. For this sector, the IRDAI is the primary policymaker. Insurance brokers and online aggregators are the most common businesses operating in this sector. Insurance brokers may be found both online and offline and they operate as a middleman on behalf of their clients, assisting them in selecting the appropriate package. The insurance company pays a commission to insurance brokers. Aside from pay, they may be paid a fee by the client for expert services like as risk assessment, which will not be based on a proportion of the premium or claim amount. The IRDAI has established a code of conduct for these brokers to follow. They must follow the IRDAI (Insurance Brokers) Regulations of 2018.
  2. Cryptocurrencies/Blockchain-Based Business – The number of enterprises in this sector in India is dwindling. India is only second to the United States in terms of the number of blockchain developers. In India, the regulatory framework for crypto-related firms is not favorable. In 2018, When the RBI issued circular prohibiting banks in the nation from dealing with cryptocurrency exchanges and businesses, since then, several Indian firms in this field have relocated to foreign jurisdictions. A committee appointed by the Finance Secretary has suggested a full ban on cryptocurrency trading, ownership, mining, and use. Violations might result in severe fines, jail, or both, according to the suggestion. The country’s tight and ambiguous laws create an unfavorable climate for companies in this field. Only a handful of them are still alive, hoping for more favorable regulations. The Indian government, on the other hand, has stated that it is eager to promote the usage of blockchain technology, which is the underlying technology underpinning cryptocurrencies. Blockchain/crypto-related firms may not emerge in India until clear policies are in place.

The government of India is going to introduce a new bill entitled “Cryptocurrency and regulations of official digital currency bill” 2021. The New Bill the government recognizes the grey area of cryptocurrency regulations and wants to outright ban all private cryptocurrencies. However, it remains unclear if all types of cryptocurrency would fall under the scope of private cryptocurrency. Furthermore, in the month of March 2021, according to the newest amendments to Schedule III of the Companies Act, 2013, the Government of India has mandated that companies report their cryptocurrency assets beginning with the next financial year. That is to say, businesses must now declare profit or loss on cryptocurrency/virtual currency transactions, the value of their holdings, and details of any deposits or advances received for the purpose of trading or investing in cryptocurrency/virtual currency. People working in the crypto business have greeted this decision with open arms, since it is understood that it would allow all Indian enterprises to carry cryptocurrency on their balance sheets.


The Indian financial services sector is distinct from its western competitors; rather than a lack of convenience, the demand for financial inclusion has fueled the rise of financial service providers and related services in India. As a result, despite the fact that total financial service penetration remains low, adoption rates are substantially greater, presenting lucrative commercial potential. Furthermore, cheap data prices in India and the ever-decreasing cost of cellphones tremendously aid Fintech firms’ development.

Despite this, many authorities and new regulations make the Indian FinTech ecosystem difficult to navigate for international businesses. The sheer magnitude of the market, along with several flaws in present legislation, makes this a highly attractive possibility. One can only think how the sector will expand as indigenous services such as UPI move closer to become international services — it is, without a doubt, an exciting time for the Fintech area and the laws that surround it.


[i] Act no. 51 of 2007

[ii] Section 57 of the Aadhaar Act 2016

[iii] Justice Puttaswamy (Retd.) v. Union of India, Writ Petition (Civil) No. 494 OF 2012

[iv] Internet and Mobile Association of India v. Reserve Bank of India, Writ Petition (Civil) No.528 of 2018 with Writ Petition (Civil) No.373 of 2018




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New GST Regulation for Startups & New ITR e-Filing Portal


The imposition of the Goods and Services Tax[i] (GST) has largely influenced the way start-ups in India function. In the three years since its effective implementation, the number of new start-ups has grown considerably. The introduction of a new tax framework was critical to the elimination of numerous indirect taxes for the startups. GST guidelines for start-ups were established under the motto “One Nation, One Tax” to make compliance easier for MSME, particularly start-ups.

India’s Eligibility for New Start-ups

Prime Minister Narendra Modi launched the start-up India initiative in 2016 to promote entrepreneurs and increase India’s entrepreneurship. The programme aimed to encourage start-ups by encouraging bank funding, easing formation processes, offering tax exemptions, and providing other benefits.

In India, start-ups can take advantage of numerous GST perks and exemptions if they qualify as an “Eligible Start-up”.  To be considered a qualified start-up, a firm must meet a number of requirements. According to the Start-up India Action Plan, a small business concept must meet the following requirements in order to be considered a start-up.

  1. From the date of formation, a company must be formed or registered in India for about seven years (ten years for biotech firms).
  2. In any of the preceding financial years, the company’s annual turnover should not have exceeded INR 25 crore.

An eligible start-up is a company that aims to improve business processes, commodities, or services via innovation, invention, deployment, and commercialization. Start-ups must be technologically advanced, with intellectual property and technology as their driving forces.

  1. A start-up cannot be created by reorganising or dissolving an existing firm.
  2. The Inter-Ministerial Board structure requires a start-up business to get an eligibility certificate.
  3. A start-up can be formed as a private limited company, a registered partnership, or a limited liability partnership.

GST Impact on Indian Start-ups | GST Benefits

In India, the Goods and Services Tax (GST) has effectively absorbed all indirect taxes, resulting in a single tax structure. As previously stated, the “One Nation, One Tax” system has benefited growing start-ups. Several start-ups around the country have reaped the benefits that GST has provided over the years.


GST Registration — Increased Start-up Threshold Limit in India:-

Businesses with revenue of more than INR 5 lakh in a financial year (FY) were required to register under the former tax regime. Since the implementation of the GST, businesses having a yearly turnover of more than 40 lakh rupees (20 lakh for service providers) have been required to register under the GST system.

The GST’s higher threshold level is intended to make compliance easier for small enterprises in India, especially start-ups. In India, the GST system has also established the composition plan for small companies and entrepreneurs, which reduces the amount of tax paid by start-ups with yearly revenues of up to INR 1.5 crore.

Tax Credit on Purchases:-

Prior to the introduction of GST, service-oriented start-ups were required to collect and remit service tax to the government. Because most start-ups in India are in the service industry, one of the primary issues was the non-utilization of VAT paid on business transactions. There are no mechanisms for claiming credits on state VAT paid against service tax liability.

Since GST has consolidated many indirect taxes into a single tax structure, claiming Input Tax Credits is no longer an issue. Start-ups can now deduct taxes spent on procurement from taxes paid on sales under the Goods and Services Tax (GST) system.

 Procedures simplified for GST Registration and Return Filing:-

Over the last decade, India has largely revolutionised by shifting from manual to digital processes. To get a GST registration number, businesses no longer need to go from one government office to another and submit paper paperwork. Each procedure has been simplified and accelerated thanks to Digital India. Getting a registration number is a no-brainer job once you’ve organised all of your GST accounts and documents.

Several start-ups are affected by budget constraints; these start-ups can now take advantage of the GST system. GST has increased the threshold limit for registration and tax credits on purchases since its inception. In India, the simplicity with which returns may be filed has given relief to start-ups and small enterprises.

Calculating Taxes in a Simpler Way:-

Start-ups frequently operate on a tight budget, and they can’t afford to dedicate separate resources to different compliances such as Excise[ii], CST[iii], VAT, Service Tax, and so on. Instead, the introduction of the GST regime has streamlined tax compliance procedures, allowing start-ups to focus on other aspects of their businesses.

In India, the digital compliance system has expanded the scope of accounting software. Example – Imprezz, India’s first GST invoicing and billing software has been assisting small businesses with tax computations and return submission. Using accounting automation, you may do all of your tasks with a single click of a button.

Instead of several compliances and tax payments, it is considerably easier for start-ups that deal with both products and services to submit a single tax return and pay GST. According to the 22nd GST council meeting, which took place on October 6, 2017, start-ups with annual sales of up to INR 1.5 crore can file quarterly reports and pay quarterly taxes. Small companies and start-ups in India would benefit from the compliance relief.

India’s E-Commerce and Online Start-ups:-

Most innovative start-ups today utilise online presence rather than giving it all to traditional setups; most innovative start-ups today leverage online presence rather than giving it all to traditional setups. They trade online, which means they sell goods and services via the internet. The interstate movement of products is not a problem for e-commerce and other internet start-ups because GST is applied uniformly across the country.

Various VAT taxes were formerly applied in different states. For example, an online store delivering products to Karnataka must have a registered delivery vehicle and a file with the state’s VAT declaration. In the event the appropriate documentation is not produced, the products may be seized by the state’s tax officials.

States like as Rajasthan, Kerala, and West Bengal, on the other hand, regard these providers as facilitators or mediators and do not need them to register for VAT. All of these variations over how supplies were treated typically resulted in compliance issues. To make tax compliance easier, GST has combined all of these into a single tax structure.

Increased logistical efficiency:-

To avoid the CST and state entrance tariffs on inter-state goods transportation, logistics companies in India maintained numerous warehouses across states. The majority of warehouses were underutilised, resulting in higher operational expenses. Currently, the GST has lifted limitations on commodities transit across states, allowing warehouse consolidation across the country.

As a result, warehouse operators and e-commerce companies in India are showing an interest in establishing warehouses in key areas. It lowers needless logistical expenses, allowing start-ups involved in the delivery of products to make early profits.

India’s Tax Burden on Manufacturing Start-ups:-

Manufacturing start-ups face the brunt of the damage. According to Indian excise rules, manufacturing firms with an annual turnover of more than INR 1.50 crore were required to pay excise duty. However, after the implementation of GST, this threshold has been decreased to INR 40 lakh, raising the tax burden on numerous firms.

Consequences of Tax Evasion under GST Laws

To tackle tax evasion, India’s GST Council has required e-invoicing and digital return filing methods. The effective execution of the GST law necessitates the imposition of severe penalties on violators. It is critical to have a thorough understanding of the GST legislation. Otherwise, fines may be difficult to cope with for start-ups and new enterprises. Here are some of the most prevalent GST offences and penalties for small businesses in India.

  • Penalty for failing to register for GST.

For unpaid taxes, the penalty is 10% of the amount owed, or INR 10,000, whichever is     greater.

  • Non-issuing of GST invoices carries a penalty.

10% or INR 10,000 penalty for tax due, whichever is higher.

  • Penalty for not filing GST returns.

For unpaid taxes, the penalty is 10% of the amount owed, or INR 10,000, whichever is higher.

  • Under the GST, there is a penalty for committing fraud.

10% or INR 10,000 penalty for tax due, whichever is higher.

  • Penalties for failing to file GST returns on time.

The late charge will be INR 200 per day (INR 100 per day under the CGST Act and INR 100 per day under the SGST Act), with a maximum fine of INR 5,000.

  • Penalty for using the composition scheme when the Start-up is not qualified.

In the event of fraud, a penalty of INR 10,000 or 100% of the tax payable (whichever is larger) would be imposed under Section 74.

In the absence of fraud, a penalty of INR 10,000 or 10% of the tax owed (whichever is greater) will be imposed.

  • Unlawfully charging higher GST rates will result in a penalty.

Penalties for unpaid taxes are either 10% or INR 10,000, whichever is greater (in case additionally charged GST amount is not submitted to the government).

  • Unlawfully charging lower GST rates will result in a penalty.

Penalties for unpaid taxes are either 10% or INR 10,000, whichever is greater (in case additionally charged GST amount is not submitted to the government).

  • Penalties can be imposed if GST returns are filed incorrectly.

A penalty of INR 25,000

  • Invoices that are incorrectly issued are subject to a penalty.

A penalty of INR 25,000

  • Penalty for charging the wrong GST type (IGST, CGST, or SGST) without authority.

For this form of tax avoidance, there is no penalty. Businesses can pay the correct GST amount and get a refund for an earlier GST payment that was incorrect.

New ITR e-filing portal: Check benefits, features and other details

On June 7, 2021, the Income Tax Department has introduced its new e-filing system. The new e-filing platform is designed to provide taxpayers with ease as well as a contemporary, seamless experience. For a brief period of 6 days, from June 1 to June 6, 2021, the Department’s present portal was unavailable to taxpayers and other external stakeholders in preparation for this launch and migration efforts. The Department will not set any compliance deadlines at this time to avoid causing taxpayers any difficulty.

Furthermore, from the 10th of June 2021 onwards, orders have been issued to schedule hearings of cases or compliances only from the 10th of June 2021 onwards, to give taxpayers time to adjust to the new system. If a hearing or compliance that needs online submissions is planned during this time, it will be postponed or adjourned, and the work items will be rescheduled after this time.

External entities that use PAN verification services, such as banks, MCA, GSTN, DPIIT, CBIC, GeM, and DGFT, have also been informed of the non-availability of the services, and have been asked to make arrangements to ensure that their customers/stakeholders are informed, so that any relevant activity can be completed prior to or after the blackout period.

To avoid any difficulties during the blackout period, taxpayers were advised to finish any urgent activities involving any submission, upload, or download by June 1, 2021.

Benefits & Features of new ITR e-filing portal:-

·         To offer rapid refunds to taxpayers, the new taxpayer-friendly site is connected with instant processing of Income Tax Returns[i] (ITRs).

·         All interaction, uploads, and pending actions will be shown on a single dashboard for the taxpayer to review and act on.

Free ITR preparation software is accessible online and offline, including interactive questions to assist taxpayers in filling out ITRs even if they have no prior tax experience, as well as prefilling to reduce data entry effort.

·         New call centre for taxpayer support including FAQs, Tutorials, Videos, and a chatbot/live agent to provide immediate solutions to taxpayer questions.

·         All major desktop portal features will be available on the Mobile App, which will then be activated for full anytime access on the mobile network.

·         For simple payment of taxes, a new online tax payment system on a new portal will be introduced later with various new payment methods like as netbanking, UPI, credit card, and RTGS/NEFT from any taxpayer’s account in any bank.

The Department has asked taxpayers and other stakeholders for their patience throughout the transition to the new e-filing portal and the ensuing initial time while they become comfortable with the new system. This is another attempt by the CBDT to make compliance easier for its taxpayers and other stakeholders.


When it comes to bringing ideas to life, execution is crucial. Similarly, GST serves a similar role in the implementation of an effective tax system that aims to benefit Indian businesses. Furthermore, the new tax computation method is more user-friendly and efficient than the old, inefficient approach. It is reasonable to assume that GST is playing an important role in helping India’s start-ups reach their full potential.

[i] Act No. 12 of 2017.

[ii] Central Excise Act, Act No. 1 of 1944.

[iii] Central State Tax Act, Act No. 74 of 1956.

[iv] Income Tax Act, Act No. 43 of 1961.




(1) Amitmundra, GST Rules for Start-ups in India, (Feb. 22, 2021),

(2) NovoJurisLaw, Start ups and MSMEs: Registration and Advantages features of Atma Nirbhar package, (Aug. 11, 2020),

(3) Ayush Verma, Procedure for registration of GST, (May 22, 2021),

(4) The Gazzet Of India, The Central Goods And Service Act,2017, (Apr. 12, 2017),

(5) Harshita Tyagi, Income Tax Dept to launch new ITR e-filing portal: Check benefits, features and other details, (May. 25, 2021),

(6)The Central Board of Indirect Tax and Custom, The Central Goods and Services Tax Act, (Jun. 18, 2021),

IBC Amendment 2021: A Bliss for MSMEs


The President of India, Shri. Ram Nath Kovind, on April 4, 2021, promulgated the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2021. The said ordinance aims at amending the Insolvency and Bankruptcy Code, 2016, so as to make it more accommodating, cost-effective and hassle free for small businesses in the form of MSMEs (MSME full form is Micro, Small and Medium Enterprises).

A new chapter III A, which deals with pre-packaged insolvency resolution processes, has been added. According to the Ordinance, “an application for initiating a pre-packaged insolvency resolution process may be made in respect of a corporate debtor classified as a micro, small, or medium enterprise under sub-section (1) of section 7 of the Micro, Small, and Medium Enterprises Development Act, 2006.”

The bill offers pre-packaged resolution framework for stressed MSME businesses under the Code, having defaults of not more than Rupees One Crore. This pre-packaged resolution will allow efficient alternative insolvency process for the identified business in a manner that will maximize value for all stakeholders, preserves jobs and ensures least disruptions to the continuity of the business.


What is the Pre-Packaged Framework?

A Pre-Packaged insolvency framework, or more commonly known as a pre-pack is a system that allows debtors and creditors to come to an informal arrangement and prepare an insolvency plan before hand and submit it for approval. This method helps alleviate the stress of the corporate debtor by easing the process of corporate liquidation and insolvency. This is because the arrangement between the secured creditors and investors of the distressed company to form a consensual restructuring process saves time and is void of judicial intervention. It gives the parties a chance to mutually negotiate the terms and conditions and lay the future course of action and only involve the tribunal for approval and enforcement. This hybrid method allows for the company to skip the public biding process and facilitates greater cooperation and better business control.

Framework’s Informal Stage

The Indian pre-pack framework, according to the report, should combine the ‘best of both worlds’ by integrating aspects like speed, efficiency, and flexibility of an informal process with the binding effects and structure of a formal process. In order to achieve this goal, the Prepack Framework envisions the completion of certain actions prior to formally filing an application  for the start of the pre-packaged insolvency resolution process (“PP-IRP”), allowing the majority of the time to be spent outside of the formal process. These actions are like:

Actions by the Corporate Debtor – A special resolution must be passed by the members of the corporate debtor, or at least three-fourths of the total number of partners of the corporate debtor, as the case may be, sanctioning the filing of the Application (Resolution). This differs from the Report’s recommendation of a simple majority vote of the corporate debtor’s members. For the bankruptcy resolution of the corporate debtor, the corporate debtor must produce a “base resolution plan” (Base Resolution Plan). The provisions of Sections 30(1) and 30(2) of the IBC must be followed in the Base Resolution Plan. The majority of the corporate debtor’s directors or partners, as the case may be, shall sign a Declaration indicating, among other things:

  • Within 90 days of receiving the Application, the corporate debtor must file it
  • The name of the resolution professional who has been suggested and whose appointment has been approved
  • The Prepack is not being launched with the intention of defrauding anyone
  • Completion of the nomination process

Approvals taken by unrelated financial creditors –  The Prepack Framework states that a conference of financing creditors must be convened by the corporate debtor of financial creditors of a corporate debtor that are not the corporate debtor’s related parties, notified at least five days before the date of the meeting, except if the Unrelated FCs have agreed a shorter time. The corporate debtor is required to obtain the following approvals:

  • The FC’s which are not linked to the financial debt due to such creditors represent not less than 66 % shall approve the submission of the application. The corporate debtor must submit  (a) resolution, (b) declaration and (c) base resolution plan for the Inter-Related FCs before requesting such an approval
  • Unrelated FCs with a weighted voting share of at least 66 % of the total financial debt of such creditors should propose the name of an insolvency professional to be appointed as the resolution professional for the Prepack, and the said person should be approved by the Unrelated FCs with not less than 10% of the total financial debt of such creditors.

Framework’s Formal Stage

Following the completion of the informal procedure outlined above, an application for the formal beginning of a Prepack may be filed with the appropriate Adjudicating Authority in connection to a corporate debtor if the following requirements are met:

  • corporate debtor is an MSME
  • The De Minimus Threshold is met by the default
  • All of the steps outlined above that must be accomplished during the Informal Phase are performed
  • During the three  years preceding the date of beginning of Prepack or completion of CIRP, the corporate debtor has not undergone Prepack or completed CIRP, as the case may be (3 Year Period). It’s worth noting that the 3 Year Period appears to be measured from the hypothetical date on which the Prepack would be launched if the Application is allowed, rather than the date on which the Application is filed, according to the wording of the Ordinance.
  • As of the date of filing the application, the corporate debtor is not undergoing CIRP

The Adjudicating Authority has not issued an order under Section 33 of the IBC ordering the liquidation of the corporate debtor in concern and Section 29A of the IBC allows the corporate debtor to submit a settlement plan.


 PPIRP Benefits

  • PPIRP is quicker than CIRP
  • It is Cost-effective because less time and numerous measures are done toward settlement before proceeding to the Adjudicating Authority, the amount of money spent is likewise lower
  • The Corporate Debtor’s management remains in the hands of the Corporate Debtor’s Board of Directors. As a result, the CD operation is easy
  • In the PPIRP, there is less judicial intrusion


Who can apply for PPIRP?

  1. It is available to Micro, Small and Medium Enterprises(MSME’s) with a minimum default threshold of Rs. 10 Lakhs and a maximum of Rs. 10 Crore.
  2. Unlike CIRP, it can only be availed by the corporate debtor.
  3. The company should not have undergone, applied for or completed PPIRP or CIRP in the preceding three years.
  4. There is no standing or past order with regards to liquidation of the corporate debtor.
  5. The corporate debtor is eligible as per standards of Section 29 of IBC.
  6. Not less than 66% of corporate creditors, not being related parties, have given approval to the PPIRP proposal and have also proposed a name for insolvency professional.
  7. A special resolution has been passed approving the filing of an application for initiating the PPIRP.

The pre-packaged insolvency resolution process must be completed within 120 days from the date of commencement of process. The resolution professional must file the resolution plan before the adjudicatory authority within the first ninety days and the authority must give its decision and approve the proposal within the remaining thirty days.

Upon commencement, the adjudicatory authority will declare a moratorium for the corporate debtor, appoint the resolution professional and make a public announcement with respect to the commencement of PPIRP. The process thereafter is almost identical to that of CIRP, with the resolution professional having several powers, formation of the committee of creditors and the submission of a resolution plan.

However, during the PPIRP, the management of the company will vest with the Board of Directors, subject to certain conditions.


All and above, the pre-packaged insolvency resolution process is attractive because it is much more cost-effective, speedy and efficient than the traditional Corporate Insolvency Resolution Process (CIRP), which is time consuming and is riddled with compliances and prone to delays.



 The government intends to investigate alternatives to the traditional corporate bankruptcy resolution procedure with the introduction of pre-packaged insolvency resolution. Given the particular character of MSMEs’ businesses and MSMEs’ importance to India’s economic growth, the IBC Ordinance 2021 places a specific emphasis on their rehabilitation. Recognizing that MSME businesses lack the resources to withstand protracted stress, the PPIRP strives to provide a semi-formal settlement method with the least amount of fees, delays, and conflicts. The pre-packaged procedure, in all aspects, offers a more mature and stronger insolvency procedure.






Pride Month June 2021 – History & Significance


As the world prepares to celebrate Pride Month in June, one may question what Pride Month is and why we celebrate it, especially because there are still many stigmas and a lack of understanding around Pride and the Pride Month.

The LGBTQ community has long struggled for the freedom to live a decent life. As a result, the world celebrates Pride month every June in recognition of community members who have overcome various barriers in their lives and have come a long way. The Pride month also shows how far LGBT rights have progressed and how much work remains to be done.

This Pride month is all about teaching acceptance, imparting pride history, and, most importantly, teaching love. Several initiatives and activities are being launched to educate people about the dangers of homophobia.


History of pride month

A brawl broke out in Stonewall Inn outside Manhattan, New York, in the early hours of June 28, 1969. Over 500 individuals — drag queens, butch lesbians, transgender persons, homosexual men, and homeless youngsters – attacked the New York City Police officers who were harassing and beating up the bar’s LGBT clients. Over a thousand individuals had joined the disturbances by the next day. For the first time, people had taken to the streets to protest the harsh anti-gay legal system and the institutions that enforced it. Stonewall shifted the trajectory of LGBTQIA+ rights throughout the world.

The world’s first Pride Parade took held in New York City on June 28, 1970. The procession began on Washington Place between Sheridan Square and Sixth Avenue and went up Sixth Avenue, concluding with a “Gay-In” in Central Park. It was then known as the Christopher Street Liberation Day March, named after the street on which Stonewall is located. On that day, 5000 people marched. This year, on the 51st anniversary of Stonewall, more than 3 million people marched to express their pride.


Advancement in India  

The first Pride Parade in India, known as the Kolkata Rainbow Pride Walk, took place in Kolkata on July 2, 1999. It is also the oldest Pride march in South Asia. Despite the fact that it attracted participants from other places like as Mumbai and Bangalore, there were only approximately 15 in total, none of them were women.

The march, also known as the Friendship Walk, is thought to have been organised in Kolkata because of the city’s long history of and close ties to various human rights movements, including feminist, Dalit, disabled, and child rights. This is comparable to why Stonewall happened so close to New York City, and why the world’s first pride march was staged there as well — in the late 1960s, New York was the epicentre of several movements, including the civil rights and anti-Vietnam war movements. Pride benefits from its intersectionality, as seen by this. Another example is how, in India, Pride Parades sometimes include caste-related debate and demonstrations.

It’s been 22 years since the Rainbow Pride Walk in Kolkata in 1999. Pride Parades are being organised in more than 21 Indian cities.

In the years 1999, 2003, 2004, and 2005, Kolkata was the only place where pride marches were organised. Bengaluru, Delhi, and Puducherry marched in unison with Kolkata in 2008. Nearly 2500 individuals took part in the event. The BJP caused some disturbances, but they mainly went off without a hitch. The then-Prime Minister’s support for LGBTQ rights, as well as the Delhi High Court’s decision decriminalizing homosexuality in 2009, was a significant step forward.

Bengaluru’s pride parade, known as the Bengaluru Namma Pride March, has taken place every year since 2008, usually around December. It is preceded by Queer Habba, a month of queer festivities. Coalition for Sex Workers and Sexuality Minority Rights is organizing the event (CSMR). Corporate businesses including as Goldman Sachs, Google, and IBM are known to participate in the Bengaluru pride march.

The Delhi Pride Parade takes place every year on the last Sunday of November. It runs from Barakhamba Road to Jantar Mantar, stopping at Tolstoy Marg on the way. It is totally supported by the community, and the organisers have continuously declined corporate sponsorship. The Delhi Queer Pride Parade also openly promotes Dalit, feminist, and disability rights movements. In 2018, more than 5000 individuals took part.

In Guwahati, Assam, the first pride parade in the North East was staged in 2014. It has been held every year in the first week of February since then. It arose from Guwahati’s involvement in a Global Day of Rage held in 2013 in protest of the Supreme Court’s reinstatement of Section 377[i] after the Delhi High Court had abolished it in 2009. The 2017 march slammed the AFSPA and urged that it be repealed. On the 3rd of February, 2019, Queer Pride Guwahati held its most recent iteration.

Another huge pride parade, this one in Chennai, began in 2009. It’s called Chennai Rainbow Pride , every June during Pride Month. It is organised under the umbrella of the Tamil Nadu Rainbow Coalition, and a stringent no-corporate-sponsorship policy is in place. Last year, about a thousand individuals took part in the Self-Respect March, which is also known as the Self-Respect March.

In 2017, pride marches around India protested the proposed Transgender Persons Bill[ii] 2016, and Kolkata had a Transgender Day of Rage on the same day as the march.

In India, 2018 was a particularly happy year for pride parades, as the harsh section 377[iii] was repealed. In 2018, the LGBTQ community marched around the country as relatively free citizens.

The Hyderabad Queer Pride, Pride de Goa, Queer Gulabi Pride Jaipur, Bhopal Pride March, and others are all prominent pride parades in India.


Indian pride parade timeline

The Indian LGBTQ community has come a long way after facing high criticism from the society as well as government. The final judgement on the freedom of LGBTQ community’s future in India with Navtej singh johar’s[iv] case. In India, there has been no shortage of discussions on homosexuals’ rights. Section 377 of the Indian Penal Code of 1860, which dealt with unnatural offences and, among other things, criminalized homosexuality, was also a contentious topic. The entire notion of homosexuality was viewed as being against nature’s will and so unwelcome in society. The debate over the criminalization of homosexuality centred on the Indian constitution’s articles 14[v], 15[vi], and 21[vii], which are basic rights that guarantee equality, non-discrimination on the basis of sex, and personal liberty, respectively, and that section 377 infringes on these rights. The above landmark case decriminalized homosexuality while also addressing several critical constitutional issues.


Current status of their legal rights

Same-sex couples, single person, and unmarried couples have found it increasingly difficult to adopt since the Central Adoption Resource Authority (CARA) established adoption rules. Many Indian residents have been denied equality in numerous facets of their lives just because of their sexuality. This may be seen in the fights for marriage equality, adoption rights, the freedom to serve openly in the military, and a variety of other fights to abolish discrimination based on sexual orientation.

The gay and lesbian assertion on their rights – “to be treated equally, fairly, and equitably as citizens of India; that respect should be given to who they are, what they are; the right to choose, the right to be unmarried, and the right to their own sexual orientation” – is a crucial point in the discussion on the politics of liberation. In India, the demand for gay and lesbian freedom and equality was first made in a concerted way around the end of 1991. The Charter of Demands, which consists of 19 points, was released in the report less than Gay’s last chapter.

Only the first cause, such as the removal of the discriminatory section of the IPC, has been addressed so far, leaving the remaining demands unaddressed. Adoption is becoming more popular among lesbians and gays as a means of forming families. In adoption processes, however, same-sex couples have a lot of trouble getting fair treatment from the courts. In rejecting adoption to lesbians and gays, courts often neglect actual data and the unique facts of the case, according to judicial rulings. Lesbians and gay males have had an especially tough time gaining equal footing with heterosexuals in the family arena. “Discrimination against gays is pervasive in the family law environment where judges and agencies have extensive discretion,” say proponents of same-sex adoption. Lesbians and gay men who want to raise children regularly face discrimination and misunderstandings about their sexual orientation, which “turn courts, lawmakers, experts, and the public against them, usually leading in undesirable consequences such as physical custody loss.”

Human rights are based on the assumption that all people are equal. As a result, all persons possess dignity and should be treated equally. Anything that diminishes its dignity is a violation, as it goes against the concept of equality and allows prejudice to flourish. Lesbian, gay, bisexual, transgender, and intersex people’s human rights are gaining momentum across the world, with significant progress being made in several countries in recent years, including the introduction of new legislative safeguards. Legal protection should include equal protection under the law for job opportunities, marriage, and adoption, putting the LGBT population on level with heterosexuals.


Issue with section 377

  • Is Section 377 of the IPC a violation of Article 14 of the Constitution’s Right to Equality?
  • Is Section 377 of the IPC a violation of Article 19 of the Constitution’s guarantee of freedom of speech and expression?
  • Is Section 377 of the IPC a violation of Article 21 of the Constitution’s right to life with dignity?
  • Is it a violation of Article 15 of the Constitution to discriminate based on sexual orientation under Section 377 of the IPC?
  • Was the Supreme Court’s judgment in the Suresh Kumar Koushal[viii] case reasonable in terms of defining morality as social morality?

To arrive on the conclusion of the case the bench also referred to judgments in NALSA v Union of India[ix] (recognized transgender identity) and Justice K.S. Puttaswamy v Union of India[x] (recognized fundamental right to privacy).



A person’s ability to choose a mate should not be limited by his or her sexual orientation. It denies them not just their basic fundamental rights to equality and privacy, but also their right to live in dignity, which is contained in the right to life and liberty. In India, those who are born outside of the two primary genders are shunned and rejected on the grounds that they are of a third gender. In order to provide a better living environment for the LGBT community, the Indian government’s Home Department must take the lead and collaborate with state governments in sensitising law enforcement agencies and involving all stakeholders in identifying and implementing measures to achieve the constitutional goal of social justice and the rule of law. There are no laws protecting homosexuals and lesbians from job discrimination or allowing them to marry their preferred partner.

The rising gay and lesbian movement provides not only new identities, but also new possibilities for societal change. Despite its small size, the movement rejects both the monolith and the mass. It serves as a reminder that if forced conformity is to be resisted, human lives must be represented as varied; selfhood as numerous; and communities as voluntary and diverse. A new definition of political pluralism would be one that assesses a society not only on the number of organizations it accepts, but also on the number of identities it permits people to adopt. There are still areas in India where people haven’t heard of the LGBT movement and believe that gays and transgender individuals should be shunned from society. The Researcher, on the other hand, believes that India can only be declared free when society no longer discriminates against those who are homosexual, gay, bisexual, transgender, cisgender, or straight.

[i] The Indian Penal Code, 1860, S. 377.
[ii] The Transgender Persons (Protection of Rights) Bill, (Sep. 08, 2016).
[iii] Id. at 1
[iv]  Navtej Singh Johar v. Union of India, (2018) 10 SCC 1.
[v] Indian constitution. Art.14: Equality before law
[vi] Indian constitution. Art.15: Prohibition of discrimination on grounds of religion, race, caste, sex or place of birth
[vii] Indian Constitution. Art.21: Right to Life and Personal Liberty
[viii] Suresh Kumar Koushal and Anr. v. Naz Foundation and Ors., (2014) 1 SCC 1.
[ix] National Legal Services Authority v. Union of India and others,  AIR 2014 SC 1863
[x] Justice K S Puttaswamy and Anr v. Union of India and Ors [Writ Petition (Civil) No. 494 of 2012]




  1. Hamsadhwani Alagarsamy, The History Of Pride Parades In India,( June. 24, 2019),


  1. Primelegal, Status of LGBTQ Community in gender equality,(Mar.31, 2021),
  2. TheFreePress, When is Pride Month and why is it celebrated at this time? History, significance and more,( June 1, 2021),( 11:39 AM IST),
  3. Diganth Raj Sehgal, Case Comment on Navtej Singh Johar v. Union of India, (Nov.22, 2019),
  4. Arohi ambade, Case Summary: Navtej Singh Johar v. Union of India thr. Secretary Ministry of Law and Justice,( Jul. 23, 2020),
  5. Shalini Ojha, Showing solidarity to LGBTQ: Why is June ‘the pride month’, (Jun 03, 2018)( 12:18 am),
  6. Yash Dahiya, National Legal Services Authority vs Union of India – Case Analysis,( Aug. 27, 2018),



Legal Challenges Faced by a Startups in India

Startups[i] are young, rapidly expanding businesses started by one or more entrepreneurs. They are in the early stages of development and have limited resources and experience. Even though the Indian government has taken several initiatives to encourage the growth of start-ups in order to promote entrepreneurship and employment by providing easier IPR facilitation, a favorable taxation system and easier compliance for the setting-up company etc., start-ups in India still face numerous challenges such as funding, insufficient skill, and a lack of marketing strategies. Over that startups have obligations to operate in compliance with laws. Failure to respect the laws can give start-ups serious problems such as fines, punishments, revocation of licenses, expenses in litigation, etc. that can adversely affect the limited capital of startups.

Business structure

Many start-ups struggle to determine what the best business structure for their venture is since business structures differ from one to another, and what is good for one may be bad for another in terms of risk, the number of people involved, profit sharing, liability, taxation, annual meetings, and registration, among other factors. A start-business up’s structure could be a partnership, a sole proprietorship, a private limited company, or an LLP, for example. In India, the following are some of the most popular company structures.

Sole proprietorship – It gives complete control over their firm, and the best part is that the proprietor is the sole beneficiary of all profits. This structure is popular because to its simpler taxation system, which determines the tax amount based on the revenue received by the proprietor. This structure is not taxed as a separate legal entity in India, unlike other business types. The proprietors, on the other hand, file their taxes as part of their individual tax returns. For a sole proprietorship earning less than or equal to $250,000, the tax rate is nil. When the proprietor’s income exceeds $250,000, he or she must pay a 5% tax. If the income is between five lakhs and ten lakhs, the tax rate is 20%; if the income exceeds ten lakhs, the tax rate is 30%. There are some drawbacks, such as the fact that if the proprietor is unable to pay the business’s debts, his personal assets may be sold to meet the needs. Another problem of this structure is that it has a very restricted ability to raise cash.

Limited Liability Company (LLC) -This business form is best for businesses that are unstable or risky. The great feature about this structure is that the liability is restricted, which means that personal and business assets are treated separately, and personal assets cannot be utilised to repay debts. The company is treated as a separate legal entity in this structure. The costs of founding a Limited Liability Company are significantly higher than those of a sole proprietorship. An Indian LLC is subject to a 30% income tax; there is a surcharge on the income tax of 12% if the company’s income exceeds Rs.10 million; there is also a 4% health and education surcharge in India; and the LLP can be charged with the minimum alternate tax of 18.5 % on the total income of the company, it has to perform audit and has to pay tax online to the income tax department according to section 44AB[ii] of Income tax 1961.

Partnership firm – The Partnership Act and the Indian Contract Act control this business structure, which is appropriate when more than one person is participating in the business. Its taxes structure is very similar to that of a sole proprietorship. A partnership firm’s key defining characteristic is that it involves more than one individual, with the partnership deed governing the agreement between them. A partnership firm is obligated to pay 30% income tax plus a 12% surcharge if the taxable income exceeds one crore rupees – 12% Interest on capital is authorized . – Health and Education Cess is 4% of tax, including surcharges under Income c. It should be highlighted that, unlike proprietorships, a partnership firm has a separate legal identity from its partners. The real drawback of this structure is that profits are shared among numerous partners, which can lead to problems such as disagreements between partners’ views.

Licence and Permits

Start-ups may need a variety of licences, approvals, or licences to carry out their plans, as a lack of legal awareness could result in penalties. Licenses, approvals, and permits may differ from one business to the next; therefore a person should be informed of local laws, rules, and regulations before starting a business. Licenses are not always quick and easy to obtain from government officials, and they take a lot of time and money. Registration certificates, GST registration, FSSAI license, import and export code, udyog aadhar registration, and other licenses are among the licenses required by businesses. Dealing with goods or services that are prohibited by law may result in criminal charges, which could land the businessman in jail or subject him to severe fines and penalties.

GST registration – In the current scenario, for e-commerce businesses, GST registration is required. Businesses with a turnover of equal to or greater than 40 lakhs should get themselves registered for GST registration. There are certain types of businesses that should have GST registration, failure to which is known as an offence.  Casual taxable persons, non-resident taxable persons, e-commerce aggregators, those paying using the reverse charge mechanism, and others should be required to register for GST.

Trademark registration – Building a brand takes a lot of time and effort, as well as a lot of money. As a result, it’s critical to ensure that you possess the rights to use the logo, slogan, product shape and packaging, sound, fragrance, colour combinations, and anything else that gives your brand a particular character. In India, you can register a trademark under the Trademark Act of 1999. It allows for exclusive ownership rights and prevents others from using the mark, benefiting the registered mark’s owner.

Start-up registration –   The Start-up India Scheme is an Indian government initiative that was announced in 2016 with the goal of promoting start-ups, assisting in the creation of jobs, and producing income. Several programs have been launched under it in order to create a robust start up ecosystem and convert India from a majority of job seekers to job producers. The Department for Industrial Policy and Promotion is in charge of it (DPIIT).

Legal documents & Agreements

Employment contracts and offer letters – Employment agreements serve as the foundation for the organization’s workforce. It outlines employees’ rights and responsibilities, as well as rules for resolving internal conflicts. It also contains information on the hiring process, as well as confidential information that will be shared with employees. When employing new personnel, the offer letters must also be very explicit. These define what the staffs are supposed to do.

Founder and co-founders’ agreement – Signing an agreement that specifies the working coordination of all parties and shapes outlines to set boundaries becomes required in the case of businesses with numerous founders or founding parties. It’s to prevent any future squabbles. To avoid any conflicts among the start-up’s founding parties, both co-founders should sign a formal operating agreement. This document outlines each of the founders’ roles, ownership, and early investments. During the incorporation stage of a company, a founders’ agreement is recommended, which lays out the duties and tasks of each of the co-founders. It’s also a good idea to have a written format for this text.

Non-disclosure agreement – Start-ups are formed with the primary goal of introducing new and creative business models, goods, and services to the market. Persons and corporations are always eager to copy such concepts and learn about the internal business strategy, and they may try to extract information from various people involved in the firm. An NDA will be incredibly beneficial in protecting your commercial interests. The parties have agreed to protect the company’s sensitive information by signing this agreement. This is a contract that recognises sensitive information and establishes criteria for its protection. The primary goal of a non-disclosure agreement is to safeguard confidential information.

Intellectual property rights

Intellectual property rights are the heart and soul of any startup company. Many start-ups are concerned that their idea or strategy will be stolen, thus it is essential for them to secure their intellectual property rights as soon as possible. The other concern is that the start-up should double-check that what they want to do or sell has already been protected. So that they don’t have to deal with issues like trademark infringement or other intellectual property breaches after investing a large sum of money in their firm.

Annual Mandatory Compliance for Start-ups in India

In India, start-ups must adhere to a number of regulations imposed by numerous statutes. These responsibilities include filing tax and other returns on a regular basis, having board and other meetings, and keeping statutory books and accounts, among others.




Annual Compliance Checklist for Startups:-

  • Appointment of Auditor[iii] – It’s important to understand what a statutory audit is and what it’s for. The distinction between a statutory audit and any other audit is negligible. The main goal of this audit is to see if a company is presenting accurate financial information, such as bank balances and financial activities. The corporation appoints an auditor for this purpose. He will be appointed for a five-year term, and if the company is new, the auditor must be hired within one month of the company’s launch.
  • Annual general meeting[iv] (AGM) – An annual general meeting of the shareholders of a private corporation is required to be conducted every year. It is required that it be held in the final six months of the financial year. Certain important matters are discussed at the AGM, such as the approval of financial statements, the appointment of auditors, the salary or payment of directors, the declaration of dividends, and so on.
  • Board Meetings[v] – First meeting within 30 days of incorporation, Minimum 2 meetings, one in each half calendar year.
  • Reports of directors[vi] – According to the Companies Act of 2013, every director is required to file annual reports detailing their directorships in other companies. This must be done in writing, and an official report has been given.
  • Income tax – The following are the conditions for income tax compliance: – Income Tax Returns, Tax Audit Reports, Periodic Returns (Monthly, Quarterly, Annual GST, TDS Returns, etc.), Monthly/Quarterly GST Returns, Quarterly TDS Returns, etc. Assessment of advance tax liability and periodic payment of advance tax, payment of periodic dues like GST liability, TDS &TCS payment,   Regulatory Assessment of business under several laws (for example, the Environment and Protection Act, the Money Laundering Act[vii], the Competition Act[viii], the Factory Act, and so on).

Corporate Governance for Startups

The set of concepts, procedures, and processes that govern a firm are referred to as corporate governance. The company has been given rules on how to direct or govern itself so that it may achieve its goals and objectives in a way that adds value to the organization and benefits all stakeholders in the long run. The company governance is carried out and is based on accountability, fairness, transparency, and responsibility.

Challenges faced by startups in establishing good corporate governance

  1. Insider trading – The term “insider” refers to a person who has information of a managerial loophole that is not available to the general public or investors. The term “insider” has a broader definition that encompasses directors, officers, and employees, as well as anybody with a connection to the company’s operations. These individuals are more likely to have access to sensitive information, as it entails the misuse of secret information, which is unethical and amounts to a breach of a fiduciary duty of trust and confidence, as well as a loss of public trust. When it comes to these difficulties, the majority of businesses adhere to SEBI regulations.
  2. Disclosure, Accountability, and Transparency – The disparity between those who have and those who do not will continue to grow until we make them stakeholders and learn to match the context around us with fairness and transparency, as well as create a sense of harmony and warmth with the environment.
  3. Succession planning – It means deciding who to place in the right position at the right time.
  4. The necessity of judicial reforms – The judiciary has raised public awareness of issues such as consumer and environmental protection. The government’s most recent action is to abolish the political system and inculcate faith and trust in the democratic government. Many additional items have been devised to lessen the burdens of the judiciary as well as to resolve conflicts quickly, such as ADR.
[i]  The term ‘startup’ is used in orientation with the definition of the federal government (Dwivedi, A. B.  (2016): The government has finally defined the word ‘startup”;
[ii] Audit of accounts of certain persons carrying on business or profession, section 44AB, Income tax act, 1961.
[iii] Appointment of Auditors, section 139 (6), companies act 2013.
[iv] Annual General Meeting, section 96(1), companies act 2013.
[v] Meetings of Board, section 173, companies act 2013.
[vi] Financial Statement, Board’s Report, etc., section 134, contract act 2013.
[vii] The Prevention of Money Laundering Act, 2002 enables the Government or the public authority to confiscate the property earned from the illegally gained proceeds.
[viii] The Competition Act, 2002.



1.Anubhav Gupta, Legal And Ethical Issues Faced By The Start-Ups In India,(Mar.03 2021),

2.Apoorv Sarvaria & Rishima Rawat, Legal Challenges Faced by a Startup in India, (Apr. 09, 2019),

3.Akshay Mankar, Annual Mandatory Compliance for Start-ups in India, (Aug. 20, 2018),

4.Shrijay Sheth, Choosing the Right Business Structure for Your Startup, (Jan.3,2019),

5.Saakshi Gupta, Need of Corporate Governance in startups, (Aug.24,2020),

6.Corporate legit, Open a Limited Liability Company in India, (Mar.26,2021),

7.Cleartax, Partnership Firm Tax Return Filing, (Jan 05, 2021) 01:15:49 PM,

  1. Rachit Garg, 10 essential and important legal documents needed to start a startup in India, (Apr. 2, 2021),



Complaint over Compliance: WhatsApp’s challenge to the new IT Rules


Global social media giant WhatsApp has moved to the High Court of Delhi, challenging the new IT Rules introduced by the Government of India. WhatsApp specifically protests against the traceability clause and contends it to be unconstitutional. This petition comes at a time when social media operators stand at the verge of being banned from continuing operations in India, as the three-month long deadline given by the Ministry of Electronics & Information Technology (MEITy) has expired.


What are the new rules?


The Information Technology (Guidelines for Intermediaries And Digital Media Ethics Code) Rules, 2021, notified by the Centre on February 25, 2021, inter alia to regulate and elevate ethical and grievance redressal standards and mechanisms followed by social media intermediaries. Such regulations purports to mandating such intermediaries, and especially those that hold a ‘significant’ position in society, to ensure a three-tier grievance redressal mechanism. Furthermore, the rules also mandate appointment of Chief Compliance Officer who shall ensure compliance with IT Act, 2000 and the rules made thereunder, along with appointing a nodal officer who shall be at 24/7 disposal for coordinating with law enforcement agencies.

Apart from the above, one of the most controversial and also extremely significant rules imposed is that of enabling ‘Traceability’. This rule mandates social media intermediaries to modify tech so as to enable tracking the origin of messages and posts.


Why challenge?



In a challenge to the clause of Traceability, WhatsApp contests that “The threat that anything someone writes can be traced back to them takes away people’s privacy and would have a chilling effect on what people say even in private settings, violating universally recognized principles of free expression and human rights.”


To enforce such a clause the social media intermediary would have to do away with its ‘end-to-end encryption’ facility, that ensures complete privacy protection of users. The operator also expresses concern about decoding and storing personal messages of users, which will be violative of the spirit of Article 21 and the Right to Privacy, a fundamental right recognized in Justice K.S. Puttaswamy vs. The Union of India.



  1. The Information Technology (Guidelines for Intermediaries And Digital Media Ethics Code) Rules, 2021
  2. Information Technology Act, 2000
  3. Justice K.S. Puttaswamy vs. Union of India (2017) 10 SCC 1
  4. WhatsApp

Marico v. Abhijeet Bhansali: Influencers and Brand Protection in the age in Social Media


In the early part of 2020, the Bombay High Court was called upon to adjudicate a matter involving a social media influencer. The Bombay High Court’s judgement in the case of Marico Limited v. Abhijeet Bhansali[1] determines the nature of social media influencers’ relationship with marketers and followers/subscribers had an impact on the court’s decision. In the case above mention wherein the Learned Single Judge of Hon’ble High Court of Bombay Justice S. J. Kathawalla restrained by an order of temporary injunction a social media influencer concerning a video in which he reviews a branded Coconut Oil and compares it with Virgin Coconut Oil. The Learned Single Judge found the Video to be false and disparaging. The Influencer in question filed an appeal which reversed the findings of the Learned Single Judge subject to certain modification in the video.


Brief Facts


Plaintiff, one of the biggest FMCG companies in India and one of Plaintiff’s products, Parachute edible coconut oil, was claimed to be amongst the most reputed brands owned by Plaintiff. Defendant, a YouTuber had his channel titled ‘Bearded Chokra’. On or about 1st September 2018, Defendant published a video titled ‘Is Parachute Coconut Oil 100% Pure?’. In this video, Defendant reviewed Plaintiff’s product. In the mentioned video the defendant is forceful, decisive and assertive with his words and statements against PARACHUTE branded coconut oil. He explains that it is one of the most sold and consumed coconut oils in India and that he was going to “break down all the tiny details” about the product and “bring the truth” to the viewers.  Plaintiff filed the present suit claiming that Defendant made false claims and statements about Plaintiff’s product.


Summary of Plaintiff’s arguments


The Impugned video provided incorrect information and deceived the viewer into believing that the tests conducted substantiated the claim of the defendant that the plaintiff’s product was of inferior quality and/or is inferior to other oils, subsequently, the impugned video as a whole was disparaging and denigrating in nature. The video also maliciously published by the defendant comprises words and visuals in respect of the plaintiffs’ product, which were false and which have not only denigrated the plaintiff’s product but also caused and likely to further cause special damage to the plaintiff. Since the defendant claims that creation and publication of such videos is his occupation and source of livelihood, the defendant’s review cannot be equated or treated at par with any other review provided by an ordinary consumer since the intention of an ordinary consumer is not to generate viewership or hits and consequently earn revenues from the impact created by the Impugned Video. Hence, the acts of the defendant fall under the category of ‘commercial activities and not a general review of the product by an ordinary consumer. The defendant also in his video promoted a competing product in substitution for the product of the plaintiff and urged the viewers to stop using the plaintiffs’ product and attempted to promote two other competing products by providing links for purchasing these products from online retailers such as amazon. Consequently, Defendant’s actions satisfy all ingredients to constitute disparagement, slander of goods, and malicious falsehood.


Summary of Defendant’s Arguments



There was no malicious intent from the defendant’s side and the purpose of the video was only educational in nature. The defendant remarks that the plaintiff has used a trick of showing a wet coconut alongside its product to fool consumers into thinking that its product was derived from wet coconut instead of copra. Subsequently, the defendant’s offer to delete certain parts of the video was made as a concession to settle the dispute and was not an admission. Upon buying products from clicking on the link mentioned by Defendant, Defendant receives a commission from the online site not the competitors of Plaintiff. However, Defendant’s recommendations and review videos in the past have been made without receiving any commission. Plaintiff uses the term ‘coconut oil’ when they are selling copra oil which is of inferior quality. Statements made by Defendant in the Impugned Video are true and constitute bona fide opinion and is guaranteed by Article 19(1)(a) of the Indian Constitution. Defendant’s statement that Plaintiff’s oil’ is of an inferior quality to other organic cold-pressed coconut oils’ is correct and per the scientific literature. Some of the words of Defendant such as that the smell of Plaintiff’s product is akin to a dried or rotten coconut’ were used for exaggeration and were not to be taken literally. An action for disparagement/malicious falsehood/slander of goods can only be against a trader or a competitor.


Observations by the Single Bench



The Single Bench stated that the defendant being a ‘social media influencer’ bears a higher burden to ensure there is a degree of truthfulness in his statements and added that a social media influencer cannot deliver statements with the same impunity available to an ordinary person. The court on the statements made by the defendant remarks that in the impugned Video, Defendant has made use of forceful statements and thus has portrayed himself as an expert who has undertaken extensive research. The literature relied upon by Defendant pertains to gauging the quality of ‘Virgin Coconut Oil’ and thus inapplicable to the present case. The court on the question of whether the Defendant had any reason to believe that the statements he made were true since there is material in respect of Plaintiff’s product to demonstrate that such belief was possible.  And thus, Defendant’s statements have been made with recklessness and without caring whether they were true or false. On the defendant’s fundamental right to free speech the court observed that Defendant has afforded no explanation for using the term ‘rotten coconuts. Later in his video, Defendant has once again insinuated that Plaintiff’s product might be made from poor quality coconuts.

In an action for disparagement/malicious falsehood/slander of goods, it is irrelevant whether the Defendant is a trader or not so long as the necessary ingredients are satisfied. Fundamental rights cannot be abused by any individual by maligning or disparaging the product of others.


Observations in the Appeal by the Division Bench[2]


The Appeal by Abhijeet Bhansali was allowed with some minor modifications to the video. However, the dominant message conveyed by the video was not restricted.


On  Freedom of Speech the Division Bench stated the statements of facts or statements of opinions or defamation, where a person asserted a matter of fact, it cannot be restrained from expressing himself. In cases of opinions or subjective issues, different considerations apply. Whether a statement is a fact or opinion depends upon whether the consumer can verify the statement. If yes, the same cannot be treated as an opinion. If an opinion is based on disclosed non-defamatory facts, action against it is not maintainable, irrespective of how unreasonable or derogatory the opinion is.  However, if an opinion is based on undisclosed or implied facts, the support of an action depends on the understanding of the statement. If the recipient reasonably believes the truth of an undisclosed or implied defamatory fact about the subject of the statement, the speaker is liable for making a defamatory statement. Admittedly, Respondent’s product is not extracted from fresh coconut oil and it uses an expeller pressed process. This results in a yellowish tint and a strong odour. Thus, Respondent accepts statements of facts made by Appellant that the suggested claim of Respondent that its oil is extracted from fresh coconut, is false.


The Division Bench also opined on the errors made in the decision of the single bench. Learned Single Bench has wrongly held that the Appellant has compared Respondent’s product with an unknown product which was a virgin coconut oil. The Single Bench has overlooked the fact that even the Respondent had claimed its oil to be virgin coconut oil.  The only error committed by the Appellant is to refer to the exemplar oil as organic coconut oil because the reference is to virgin coconut oil, but this is a trivial error and does not mislead the viewer who would clearly understand that the essentiality of the presentation is that Respondent’s product is not extracted from fresh coconuts and that the expeller pressed process is used to extract the oil from Copra.



[1] 2020 (81) PTC 244 (Bom).

[1] Commercial Appeal (L) No. 31 of 2020.

Kunhi Muhammed Etayattil Vs. The Asst. Registrar of Companies : Kerala HC’s expresses dismay over the in India

The 10 month long brawl


The case  Kunhi Muhammed Etayattil Vs. The Asst. Registrar of Companies  the High Court of Kerala, purports to a writ petition filed by the petitioner in order to set aside a rejection letter given by the Registrar of Companies, regarding an application for incorporating an LLP, with regards to the name “Reef Wellness and Excellence LLP”. The rejection letter, as contended by the petitioner did not specify any reasons for dispute or non-compliance.

The petitioner intended to incorporate a Limited Liability Partnership for the purposes of doing a recreational and wellness centres business, under the aforesaid name. Therefore, he filed an application on the Ministry of Corporate Affairs website under the RUN-LLP forum, for reserving the name under Rule 18(2) of the LLP Rules, 2008. The said application was approved, and it was stated that the name was available.

Subsequent to receiving this communication, the petitioner filed the FiLLP form for incorporating the Limited Liability Partnership under the name ‘Reef Centre for Wellness and Excellence LLP’. However, this application received a series of objections and was declined time and again for the following reasons:


  1. The respondent in his first response to the above application noted: “No Resemblance found, TM Checked u/c (Under Class) 44,35,41 Name can be given.” However, this communication also pointed out some defects and deficiencies in the application,
  2. The petitioner rectified the application and resubmitted it, void of all defects.
  3. The resubmitted form was again replied to by the respondents asking for an NOC which should be in the name of the person whose name is mentioned on the annexed utility bill.
  4. To this the petitioner submitted a clarification that the above requirements have already been met.
  5. The respondents again rejected the application and that in the case of proprietorship, NOC should be given on the letterhead duly stamped and signed and further that Business Visa of one of the partners, who is a resident of India, also has to be submitted.
  6. The petitioner replied to the same, however owing to inaction by the respondents, he filed a complaint with the Escalation Authority under the Ministry of Corporate Affairs, which without referring to the contentions rejected the complaint.
  7. The petitioner again responded to the Authority stating that an OCI Card from an Indian Passport Holder cannot be sought. Pursuant to which, the authority asked him to file a fresh FiLLP form as the maximum number of re-submissions allowed have been exhausted.
  8. The fresh FiLLP form was rejected by the respondents stating that the proposed names included the word REEF which is already there in TM under Class 5. The petitioner responded with a clarification that Class 5 dealt with pharmaceuticals whereas this application was under class 35.
  9. The petitioner was again asked to resubmit the FiLLP form with the remark, which was subsequently denied, and he made the representation that the name was already reserved by him, though the time limit expired. However, this was again not accepted by the respondents leading to this appeal.

The Issue in  Kunhi Muhammed Etayattil Vs. The Asst. Registrar of Companies  case


Whether the Registrar of Companies was correct on rejecting the application based on an existing trademark in another class of goods and services?

Court’s Opinion



 The above tussle(Kunhi Muhammed Etayattil Vs. The Asst. Registrar of Companies) continued for over 10 months and the High court rightly “described as a ‘system generated harassment’ aggravated by non-application of mind by officials who leave

everything to be dealt with by the system, thereby putting the common man to an agonising phase of suffering, where he is condemned to deal with faceless men and machines.” The Hon’ble court was unpleased with the sorry state of affairs and also gave clarification on the law relating to trademarks, while referring to Nandhini Delux v.Karnataka Co-operative Milk Producers Federation Limited. It stated that while the LLP Act read with the Trade Mark Act, 1999 disallow the use of same, similar or identical names, Section 28 of the latter act makes it clear that such exclusive right is limited with the proprietor in relation to the goods and services in respect to which the trademark is registered. Therefore, there is no question of confusion or deception in the matter of Trademark if the products or services fall in distinct and different classes.

The high court directed the respondents to incorporate the LLP without raising any disputes regarding the name.




  1. Kunhi Muhammed Etayattil Vs. The Asst. Registrar of Companies [1] WP(C). No. 3057 OF 2021(F)
  2. Nandhini Delux v. Karnataka Co-operative Milk Producers Federation Limited [AIR 2018 SC 3516]



A cryptocurrency is a digital asset that functions as a medium of exchange where the individual ownership of coin records is stored in a ledger which exists in the form of a database which is computerized using a strong cryptography to secure the records of transfer, to verify the ownership of coins and to control the creation of additional coins.[1] Cryptocurrencies are usually not issued by the central authority and do not exist in a physical form like in the case of paper money.[2] The first open-source decentralized cryptocurrency was released in 2009 and other cryptocurrencies have been created thereafter.



A software called the cryptocurrency wallets help in sending the cryptocurrency transactions. The wallet is used to transfer the balances from one public address to another by the person who creates the transaction. In a digital public ledger called the blockchain all the transactions and balances are recorded.




There has always been a contention regarding the legality of the use of cryptocurrency. Cryptocurrencies are usually a target of several concerns such as it being a channel for black money or anonymously funding terrorism due to the lack of a traditional government or bank-backed system to regulate its use.

Various warnings have been issued by the Reserve Bank of India (RBI) through its press releases regarding the potential risks of the use of cryptocurrencies to the financial system of the nation, since 2013. A report has also been released by the Inter-Ministerial Committee on February 28, 2019, which recommended certain measures concerning cryptocurrencies, which includes a complete ban on the use of private cryptocurrencies.[3]

RBI has issued a circular in 2018, April, banning the regulated financial institutions from providing services to businesses dealing in exchanging/ trading of cryptocurrencies, which has led to a complete turmoil in the trading industry of the Indian Cryptocurrency.[4] The crypto-trading entities have led to various writ petitions challenging the validity of the circular before the Supreme Court in the case of Internet and Mobile Association of India v. Reserve Bank of India in the year 2020.[5] In this case, the supreme court had deliberated on the legality of cryptocurrency and has struck down the circular issued by the RBI as being unconstitutional.[6][7]

In this case, the role of RBI as a central bank to manage currency, money supply, and interest rates in the economy has been analysed by the Supreme Court. The SC has also recognized the maintenance of price stability as an objective of RBI. It has observed that cryptocurrency is competent to be accepted as a valid payment for the purchase of goods and services, and that the RBI can regulate the payment systems.

The circular issued by RBI was also challenged on the grounds that it denies access to those who trade in cryptocurrency would be similar to a denial of their constitutional right to carry on any trade or profession and hence, would be violative of Article 19(1)(g) of the Constitution of India[8]. This contention was upheld by the Supreme Court. A clear distinction has been drawn by the SC between the three categories of persons as those who trade in cryptocurrency as a hobby as opposed to those who engage in trading in cryptocurrency as their occupation/ business. It held that the first category who sell and buy cryptocurrency as a mere hobby cannot support their claim on the Article(1)(g) as it only covers occupation, trade, profession, or business. The SC concluded by saying that since cryptocurrencies are not banned in India, depriving them of accessing banks and payment channels would be disproportionate.



Currently, there is an absence of an absolute regulation on the cryptocurrency market in India although the judgement has provided a temporary relief. It is very much unlikely to think that the financial institutions would be inclined towards investing in such virtual currencies, considering such a vacuum.[9] There is no regulation of cryptocurrencies in India. However, purchasing/ selling cryptocurrencies is completely legal in India and there is no law prohibiting Indians to do the same.[10] There had been a banking ban due to which the exchanges of cryptocurrencies were not able to hold bank accounts between July 2018 to March 2020. Nevertheless, the Supreme Court has quashed the ban in 2020.[11]


The future of Cryptocurrency is questioned over its murky structure and also due to the absence of any kind of a legislative/regulatory framework confirming the status of them till date. It remains uncertain as to whether they would be treated as a “stock” or a “currency” or they will be an outright ban on dealing with them.[12]




[1] Cryptocurrency, DAILY FINANCE,

[2] Matteo D’Agnolo, All You Need To Know About BitCoin, ECONOMICTIMES, [26 Oct. 2015],

[3] Abigail Johnson Hess, India might ban private cryptocurrencies like bitcoin and develop a national digital coin, CNBC, [JAN 30 202112:14 PM],

[4] Nupur Anand ,Arun Jaitley has just killed India’s cryptocurrency party, QURTZ INDIA, [Feb. 1, 2018 12:32 PM],

[5] Internet and Mobile Association of India v. Reserve Bank of India (2020)3MLJ541.

[6] Aneesha Mathur, Supreme Court quashes RBI ban on cryptocurrency trade, INDIA TODAY, [March 4, 2020],

[7] Supreme Court Lifts Ban on Cryptocurrency Trading in India, THE QUINT, [04 Mar 2020, 3:09 PM],

[8] INDIA CONST. art. 19, cl. 19(g).

[9] Vaishali Basu Sharma, Will 2021 Be the Year When India Finally Clarifies Laws Around Cryptocurrencies?, THEWIRE, [23 DEC. 2020],

[10] Rajeev Kumar , Investing in Cryptocurrency? Risks, Safety Legal Status, Future in India – All you need to know, FINANCIAL EXPRESS, [February 15, 2021 7:19 PM],

[11] India bans crypto-currency trades, BBC NEWS, [6 April 2018],

[12] Bijin Jose, Crypto conundrum: Digital Currency future seems vague in India, THE ECONOMIC TIMES, [Feb 22, 2021],