There Is An Increase In Structured Financing, Application Of Fintech And Data Privacy Laws In The Financial Sector—In Conversation With Abir Lal Dey, Partner, Saraf and Partners

How and when did you know becoming a lawyer was your life’s true calling? 

I have been raised in a household filled with lawyers, I, therefore, had the opportunity to see my father and other relatives resolve long-standing issues of their clients. In the process I also had the opportunity to witness the satisfaction and happiness of their distressed clients, this left an indelible mark in me to engage in law and to help serve society. Therefore, I decided to practice law early on in my life. I completed my pre-graduation studies at Kolkata and secured admission to law colleges both at Kolkata and Pune. While I wanted to study in Kolkata, my father insisted that I move to Pune to gather exposure while studying law. Studying at Pune far from my family and comfort zone gave me the strength to deal with obstacles and shaped me into the person that I am today. 

Would you please tell us about your specialization and the array of work you handle at your firm?

I am part of the firm’s Banking & Finance (B&F), Project & Infrastructure and Insolvency & Restructuring practice. In addition to that I have special focus on Fintech. My practice focuses primarily on rendering legal advice, structuring, drafting, risk allocation and negotiation, assistance to borrowers & lenders for all their B&F needs. I have advised on a multitude of domestic Indian lending structures & products, and various overseas India-linked borrowing and lending matters. My work has covered multiple sectors including Logistics & Warehousing, Infrastructure, Aviation, Highways, Renewable Energy, Oil & Gas, Transmission, Ports, Real Estate, Stressed Assets, Financial Services and Asset Management, and has advised on diverse products covering the entire gamut of B&F practices including Project Finance, Structured Finance, External Borrowings, Trade Finance, Acquisition Finance, INR and Foreign Currency Bond issuances, Insolvencies and Restructurings.

In addition, I am also a Guest Faculty Member at the Jawaharlal Nehru Institute of Banking and Finance (JNIBF) at Hyderabad and conducted various sessions at law schools across the country. 

What are your predictions for the Finance Sector in 2022?

The financial market has shown early trends in the increase in structured financing, application of fintech, and data privacy laws.

The financial market is ever-evolving and the pandemic coupled with the new insolvency and restructuring regime has acted as a catalyst to that process. The financial market has shown early trends in the increase in structured financing, application of fintech, and data privacy laws. Furthermore, the present government is also determined to resolve maximum non-performing assets which can be evidenced, inter alia, by the legislative intent around bad banks. Therefore, in the coming months, we can also see the increasing importance of restructuring, insolvency, and securitization laws. 

One recent landmark judgement that you’d like to share a word about.

Ebix Singapore (P) Ltd. v. Educomp Solutions Ltd. (Committee of Creditors) decided on 13-9-2021. In this matter the Hon’ble Supreme Court bench consisting of Hon'ble Dr. Chandrachud, B.V. Nagarathna considered some of the aspects of the Insolvency and Bankruptcy Code ("Code ").

Supreme Court's observations:

Absence of a Provision

The Supreme Court applying the rule of casus omissus (‘a situation omitted from or not provided for by statute or regulation and therefore governed by the common law’) held that no provision or legislation for withdrawal of a resolution plan existed in the Code, and such withdrawal cannot be allowed through judicial interpretation. The apex court acknowledged that the UNCITRAL Guide also does not provide for allowing withdrawal of a resolution plan and insists on laying down a detailed procedure for even amendments to a resolution plan if at all the legislature wishes to allow amendments to the submitted plans.

Commercial Wisdom

Furthermore, it also held that once the committee of creditors had already rejected the withdrawal proposal, and it was done in the exercise of committee of creditors’ commercial wisdom, the adjudicating authority could not have interfered with it by allowing an action which was legally not available. Allowing it would amount to “transgressing into the domain of the legislature”.

Terms of a Resolution Plan

Rejecting the argument that a resolution plan is only binding after it is approved by the NCLT, the Court held that is a product of the Code, which has a binding effect on the CoC and the resolution applicant after it has been approved by the CoC and is pending the approval of the NCLT. 

Referring to the aforesaid judgement, we recently got a favourable order before the NCLT bench of Mumbai for our ongoing matter. 

As a new age lawyer, what to your mind is the one thing in the current legal ecosystem at the Bar, Bench, or in the Law Firms that needs our attention.

The members of the bar, bench, and law firms should be sensitized about mental health and wellbeing, and they should also be encouraged to effectuate active steps for addressing mental health issues at workplaces. 

With the ever-increasing competition in our profession, the ever-growing complexities of transactions, stringent timelines, and the onset of pandemic, every lawyer is experiencing stress in some form or the other. In such context, the mental wellbeing of every lawyer is of utmost importance to maintain a quality talent pool and attract future generations to this noble profession. Therefore, the members of the bar, bench, and law firms should be sensitized about mental health and wellbeing, and they should also be encouraged to effectuate active steps for addressing mental health issues at workplaces. 

Many Congratulations on joining the BW Legal World Elite 40 Under 40 Club of Achievers 2021. What to your mind has helped you get to where you are and what advice would you have for others who want to set off in a similar direction?

I firmly believe that I am what I am because of the contribution of my family, colleagues who are akin to my family and the circumstances. I will always immensely be grateful to them for consistently contributing positively to my life and wellbeing. 

My advice to everyone who is set off in a similar direction is to be true to oneself and the work/assignments being assigned to them. Sincere hard work has and always will bear great things for people who practice them every day. 

As a final note, would you please recommend to our readers your favourite book that left a lasting impression on you.  

“Getting to Yes: Negotiating Agreement Without Giving In” by Roger Fisher, William Ury, Bruce Patton. This book describes with illustrations simple yet effective methods of negotiation and the same is a must-read for all lawyers.