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SEBI’s consultation paper on reporting the value of units of AIFs to depositories
The Securities and Exchange Board of India (SEBI) has issued a consultation paper seeking comments on its proposal requiring Alternative Investment Funds (AIFs) to report the value of their units to depositories. This is part of SEBI’s continuing efforts to refine the regulatory architecture governing AIFs in India.
The present practice – AIFs communicate the Net Asset Value (NAV) of units primarily through direct investor reporting – does not provide a centralised mechanism for regulators or investors to access or verify valuation data. Given the rapid growth of the AIF industry and its increasingly complex asset structures, such decentralised reporting hinders supervisory oversight and transparency. The consultation paper recognises this gap and proposes a mechanism to capture and display NAV data through the depository system. This ensures consistency, traceability, and regulatory visibility, thereby aligning AIF operations more closely with the standardised and technology-driven mechanisms already prevalent in the mutual fund and listed securities space.
Key provisions
The paper represents a major step in technology-led regulatory supervision of private pooled vehicles, as SEBI aims to create a centralised, auditable layer of information that benefits investors, fund managers, and regulators alike. This is expected to improve operational consistency, reduce information asymmetry, and align AIF governance standards. Investors would be able to view the updated value of their holdings in their demat accounts, thus enhancing transparency and confidence in fund management activities. For SEBI, the initiative will improve market oversight by providing real-time access to valuation data and detecting irregularities promptly.
Circular implementing ISF recommendations on RPT standards
Based on a representation by the Industry Standards Forum (ISF), on October 13, 2025, the Securities and Exchange Board of India (SEBI) revised the disclosure framework for Related Party Transactions (RPTs) with immediate effect.
Key changes
The revised framework represents a continued effort to make compliance more practical without diluting governance standards and necessitates prompt internal alignment of governance processes. Through this amendment, SEBI has reduced duplication, enabling Audit Committees and shareholders to focus on the substance of RPTs.
SEBI (ICDR) (Second Amendment) Regulations, 2025
In September 2025, the Securities and Exchange Board of India (SEBI) introduced significant amendments to the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 (ICDR Regulations). These changes refine multiple aspects of capital raising and disclosure norms across the frameworks for Qualified Institutions Placements (QIPs), Initial Public Offerings (IPOs), Offers-For-Sale (OFS), promoter contribution, and Social Stock Exchanges (SSEs).
Key changes
This expansion means that essentially all significant stakeholders’ holdings must be in electronic (demat) form prior to an IPO filing. A similar requirement has been extended to SMEs planning IPOs as well. The IPO-bound companies must now coordinate with these various holders to eliminate any physical share certificates well in advance of the IPO process.
In other words, if a company had issued convertible instruments (like warrants or debentures) under a Court-approved scheme (with the business having been in existence for more than 1 year), the equity shares resulting from those instruments’ conversion will now be eligible for sale in the IPO even if the conversion happened within the last year.
The amendments to the ICDR Regulations are largely facilitative, representing a comprehensive update to India’s capital markets regulatory framework, as they streamline processes for seasoned issuers and investors, while upholding market integrity and investor protection.
Sadhguru Jagadish Vasudev v. Igor Isakov
The Delhi High Court recently directed Google to use its technology to identify and remove identical and infringing content that violates its own advertisement policies.1
In this matter, Sadhguru, a well-known public personality, had approached the Delhi High Court seeking relief against a series of misleading and infringing advertisements circulated on YouTube, misusing Sadhguru’s personality rights – including likeness (distinct attributes that make a person recognisable to the public), name, image, voice, and any other aspects of his persona which are solely and exclusively associated and identified with him – for any commercial or personal gain. In May 2025, the Court injuncted the violators from using or exploiting Sadhguru’s distinct personality rights.2 Subsequently, in October 2025, the Court directed the intermediary Google to use its technology to take down such infringing content.
Key highlights of the Court’s directions
The order represents a progressive judicial approach to intermediary accountability in the context of infringing and misleading digital content, underscoring the need for proactive, technology-driven compliance by platforms. By linking Google’s obligations to its own ad policy framework, the Court reinforced the principle that intermediaries cannot remain passive hosts when confronted with deceptive or harmful material.
NHAI issued detailed guidelines for procurement of civil works under EPC, HAM, and BOT projects
Following its Executive Committee’s 558th meeting on March 28, 2025, the National Highways Authority of India (NHAI) has issued new policy guidelines for responding to pre-bid queries during the procurement of civil works under Engineering, Procurement, and Construction (EPC), Hybrid Annuity Model (HAM), and Build, Operate, and Transfer (BOT) projects.
The guidelines aim to enhance consistency and transparency through a uniform, structured, and accountable framework for managing and finalising replies to pre-bid queries across all technical divisions.
Key highlights of the guidelines
This structured approach marks a significant step toward enhancing transparency, efficiency, and policy uniformity in NHAI’s procurement process. It ensures that all divisions adopt a centralised decision-making mechanism for addressing bidder queries – thereby reducing ambiguity and promoting smoother project execution under EPC, HAM, and BOT models.
Market study on artificial intelligence and competition
On October 6, 2025, the Competition Commission of India (CCI) recently published its landmark market study on artificial intelligence and competition (Report). The study examines how Artificial Intelligence (AI) is reshaping competition in India’s digital economy, mapping opportunities for innovation while identifying risks of concentration and exclusion. Drawing on data from 106 stakeholders, including AI start-ups, user firms across sectors such as retail, Banking, Financial Services and Insurance (BFSI), and healthcare, as well as investors and legal experts, the Report provides a timely foundation for India’s regulatory and policy response to AI.
The Report arrives at a time when AI is becoming deeply embedded across India’s economic sectors. From personalised product recommendations and predictive analytics in e-commerce to automated fraud detection in financial services, AI has transitioned from an experimental technology to a commercial necessity. The domestic AI market, valued at USD 6.05 billion in 2024, is projected to grow nearly 5-fold to USD 31.94 billion by 2031, mirroring global trends where AI is expected to surpass USD 1 trillion in market value.
India’s AI ecosystem, as the Report highlights, is multi-layered, spanning data, computing infrastructure, model development, deployment, and governance. Upstream dominance remains with global players such as NVIDIA, AWS, and Google, while Indian start-ups drive downstream applications. Government initiatives like the IndiaAI Mission and the National AI Portal aim to democratise access to computing power and data, but the concentration of critical resources, data, and skilled talent continues to pose entry barriers.
Key findings on anti-competitive practices involving AI
Benefits of the Report
The Report marks a significant step toward a fair and innovation-driven digital economy. The study highlights that India’s competition law framework is well-equipped to handle emerging challenges like algorithmic collusion, data concentration, and self-preferencing, while urging firms to strengthen compliance through AI audits, transparency, and proper documentation. Responsible innovation must go hand in hand with accountability. Companies that embed fairness and transparency in their AI systems will not only meet regulatory expectations but also build lasting consumer trust.
Despite the forward-looking recommendations of the Report, several implementation challenges persist. The absence of clear parameters for assessing algorithmic collusion, market foreclosure, and data dominance may complicate enforcement. Many start-ups and Micro, Small, and Medium Enterprises (MSMEs) still lack the infrastructure or expertise to conduct internal AI audits or explain algorithmic decision logic, leading to uneven compliance. Additionally, ensuring coordination among regulators, particularly between the CCI, Ministry of Electronics and Information Technology (MeitY), and the Data Protection Board, remains a work in progress.
Absence of a contractual provision for refund is no bar to seeking recovery of dues
In a recent decision, the National Company Law Appellate Tribunal (NCLAT) held that advance payments under a contract are legally recoverable as operational debt where the Corporate Debtor (CD) fails to either perform the contract or refund the amount received.3
Pursuant to an agreement for the sale of machinery and scrap, BN Enterprises (Operational Creditor/OC) paid the entire consideration of INR 1 crore to Vasundhara Seamless Stainless Tubes Pvt Ltd (CD) as an advance.
Contrary to the terms of the agreement, the CD did not permit the OC to remove the scrap from its premises and failed to reply to the OC’s letters seeking a refund in lieu of permission to lift the material for several years.
Aggrieved, the OC initiated Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, 2016 (Code). The NCLAT held that the amount of INR 1 crore, admittedly paid by the OC to the CD, constitutes a legally recoverable operational debt, and that the CD’s failure to deliver the contracted goods or refund the advance money amounted to a default as contemplated under Section 3(12) of the Code.
The CD’s argument that the advance amount ceased to be a debt was not supported by any evidence, such as delivery receipts, gate passes, weighment slips, or transport records, particularly in light of the trail of letters by the OC. Importantly, the said letters bore the CD’s seal and acknowledgement.
Even in the absence of any contractual provision for a refund, Sections 65 and 70 of the Indian Contract Act, 1872 oblige the CD to refund the advance money received, where the performance of the contract was not rendered or had become impossible. As such, CD’s failure to perform/refund crystallised into the OC’s right to recover the advance as operational debt.
The Tribunal further observed that the entries in the balance sheets of successive financial years consistently acknowledged the debt, without any qualifications or conditions, and therefore, treated the amount as a continuing liability.
The ruling benefits purchasers by reinforcing their right to recover unrefunded advances under the Code, while reminding manufacturers/sellers to maintain transparent records, and document reasons for any disputed claims to mitigate insolvency risks.
A purchaser cannot be burdened with additional liability in case of bona fide litigation
In a recent decision, the Karnataka High Court held that when the execution of a sale deed is delayed due to the vendor’s default and subsequent litigation, the stamp duty payable should be based on the value agreed in the original sale agreement, not the market value prevailing at the time of registration.4
Under an agreement for the sale of land in 1994, the vendor had failed to execute a sale deed, prompting the purchaser to file a suit for specific performance.
The suit and the appeal were decreed in the purchaser’s favour in 2005 and 2007, respectively. However, at the time of registration in 2008, the Sub-Registrar refused to register the deed for undervaluation, demanding stamp duty based on the 2008 market value.
Aggrieved, the purchaser approached the Karnataka High Court, arguing that the delay was entirely due to the vendor’s default, resulting in the consequent litigation.
The Court observed that, had the vendor not failed to execute the sale deed in 1994, which led to over a decade of litigation, the purchaser would have paid stamp duty based on the consideration mentioned in the original sale agreement. The Court further clarified that, even where a sale deed is executed pursuant to the Court’s direction in execution proceedings, the stamp duty is payable on the agreed consideration and not on the prevailing market value.
Importantly, the Court noted that the litigation between the parties was bona fide and not a device to evade higher stamp duty. Therefore, the benefit available in cases where a sale deed is executed through Court execution proceedings would equally extend to a sale voluntarily executed by the judgment debtor in favour of the decree holder in compliance with a decree.
This ruling provides valuable relief to purchasers who face delays due to a vendor’s default, ensuring they are not penalised by higher stamp duty on account of protracted litigation. Stakeholders should, however, ensure proper documentation of the original agreement and maintain clear evidence of genuine disputes to avail such benefits.
Authentication Mechanisms for Digital Payment Transactions Directions, 2025
Building on earlier policy announcements in 2024 and 2025, the Reserve Bank of India (RBI) recently issued the Authentication Mechanisms for Digital Payment Transactions Directions, 2025 (Directions)
The evolution of digital payments in India has not only brought unparalleled convenience but also increased exposure to fraud and cyber risks. Recognising the vulnerabilities in existing authentication mechanisms involving One-Time Passwords (OTPs), the Directions introduce a more adaptive, technology-neutral, and risk-based authentication framework, while maintaining b user protection and compliance with data privacy norms under the Digital Personal Data Protection Act, 2023 (DPDPA).
The Directions apply to all payment system providers and participants, including banks, non-banks, and card issuers, who must ensure full compliance by April 1, 2026. For cross-border Card-Not-Present (CNP) transactions, card issuers must comply by October 1, 2026.
Key changes
Benefits and challenges
Footnotes:
1 Sadhguru Jagadish Vasudev v. Igor Isakov, Civil Suit (Commercial) No. 578 of 2025 (Delhi High Court)
2 2025 SCC OnLine Del 3804
3 Rakesh Bhailalbhai Patel v. Vasundhara Seamless Stainless Tubes Pvt Ltd, Company Appeal (Appellate Tribunal) (Insolvency) No. 1695 of 2024
4 Writ Petition No. 49527 of 2016
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