It is generally believed and rightly so, that the shareholders of a joint stock company are the ultimate authority on all matters pertaining to the company in which they are members. It turns out that it is not so, for one particular reason as per the Supreme Court of India. In a recent landmark judgment, the Supreme Court in the case of Terrascope Ventures Ltd., illegally diverted the company funds without the authorisation of the company’s shareholders. SEBI investigated this transgression and slapped the company with a penalty of Rupees one Crore besides a fine of ₹25 Lakhs on its Managing Director and other Directors in addition to a fine of ₹25 lakh each. It was a pretty standard enforcement action from the regulator. So, it looked. But it was not so, as the subsequent developments proved. The company tried a clever manoeuvre, seemingly routine. It held a shareholder’s meeting and got a resolution passed to “ratify” the illegal fund diversion, after the fact. They then argued to the SAT that since the shareholders – the owners of the company – had approved the action, the regulatory breach was cured. Surprisingly, the SAT also agreed with this stand. Here is when the case became curiouser. SEBI took the case to the Supreme Court. The latter held that violations of SEBI regulations – particularly diversion of preferential proceeds cannot be cured or legitimised post facto through a subsequent shareholder ratification. The Court clearly emphasised that SEBI’s disclosure and fairness requirements are meant to protect public interest, not just private rights and, therefore, such breaches must face regulatory consequences. In essence, the Supreme Court underscored that SEBI’s regulatory framework is designed to protect the integrity of the securities market and that such violations cannot be legitimised through shareholder approvals. This ruling strengthens the accountability of listed companies and reinforces investor trust. This judgment held out a number of subtle but prescient legal norms in corporate law. For companies, it reinforces strict compliance with SEBI regulations; creative interpretations or post-facto approvals will not shield a misconduct already committed. As far as investors are concerned it strengthens their protection by ensuring that disclosures made are truthful and enforceable. For regulators it affirms SEBI’s authority to penalise breaches even if shareholders appear to be forgiving. From a corporate governance standpoint, it establishes that fiduciary duties to shareholders are subordinate to statutory duties to the market and public interest. In essence, the Supreme Court underscored SEBI’s regulatory framework is designed to protect the integrity of the securities market and such violations cannot be legitimised subsequently by approval by shareholders. This ruling would strengthen the accountability of listed companies and reinforce investor trust. The Supreme Court has thus drawn a distinct bright red line. A shareholder’s vote cannot be used as a get-out-of-jail-free card for regulatory violations. Compliance is not a simple and harmless democratic process; it is a legal command, and corporate leadership is personally accountable for any transgressions here.
The recent passive euthanasia case of Harish Rana marked a historic moment in Indian law and medical ethics. In March 2026, the Supreme Court allowed the withdrawal of life-sustaining treatment for a 32-year-old man who had remained in a permanent vegetative state for over a decade after a serious head injury. It was the first time India’s highest court had directly sanctioned passive euthanasia for an individual under legal framework it had earlier recognized. What made the case so emotionally powerful was its long silence. Harish Rana had lived for years with no meaningful recovery, dependent on artificial nutrition and round-the-clock care. His parents’ plea was not framed as surrender, but as mercy — a painful request to end prolonged suffering and allow dignity at the end of life. The court’s decision reflected the difficult balance between preserving life and recognizing when treatment has become futile. For many observers, the case was not only a legal precedent but a deeply human one. It forced the country to confront the truth that medicine often delays, and law often hesitates to answer: when does care become prolongation and when does compassion mean letting go? Harish Rana’s death after the order gave the case an even heavier emotional weight, turning it into a public meditation on dignity, autonomy, and the limits of medical intervention. May Rana’s soul live in eternal peace!
In the February 26 issue of Bizsol Update we had done an article on “Treaty Shopping by Companies” consequent to the landmark judgment of the Supreme Court in the case of Authority for Advance Rulings v. Tiger Global International Holdings. Consequent to this judgment everyone was waiting with bated breath on the ramifications of this judgment and the government’s response. After the infamous Vodafone case that haunts the tax authorities even today, the dilemma before the Central Board of Direct Taxes’ (CBDT) was only to be expected. However, CBDT on its part, appears to have learnt its lessons well on the subject of retrospective amendments even before the judgment in Tiger Global arrived by fine tuning the retrospective nature of the judgment. Simply put, it made a decisive pivot by making a policy change to counter the uncertainty created by the Supreme Court’s January 2026 judgment in the Tiger Global case. In that ruling, the Supreme Court upheld the invocation of GAAR on Tiger Global’s 2018 exit from Flipkart, despite the underlying investments having been made prior to 1st April 2017, the formal commencement date of GAAR. The judgment significantly unsettled investor confidence by suggesting that GAAR could override statutory and treaty‑based grandfathering when tax benefits materialise post‑2017. The Court’s reasoning hinged on the view that GAAR applies with reference to the timing of the tax benefit rather than the timing of the investment and that grandfathering was not absolute where an arrangement lacked the much-needed commercial substance. This interpretation raised fears of retrospective application and heightened scrutiny of legacy private equity and venture capital structures, particularly those routed through Mauritius and Singapore. Market participants were concerned that the exits from long‑held investments could be reopened to GAAR, fundamentally altering India’s attempt at tax stability. Responding swiftly, the CBDT amended the Income‑tax Rules on 31st March 2026 to explicitly provide that GAAR shall not apply to income arising from the transfer of investments made on or before 1st April 2017, irrespective of when the exit occurs. The amendment effectively ring‑fences capital gains from legacy investments and reasserts the original legislative intent behind GAAR grandfathering when the regime was operationalised in 2017. From a legal standpoint, the CBDT’s clarification significantly narrows the precedential reach of the Tiger Global judgment on the specific issue of grandfathering. While the Supreme Court ruling remains authoritative on broader principles such as the primacy of substance over form, the non‑conclusive nature of tax residency certificates and the ability of GAAR to override treaty benefits in cases of abuse. Its capacity to unsettle pre‑2017 investments have now been curtailed by executive rule‑making. In effect, the amendment neutralises the most commercially disruptive aspect of the judgment without undermining its anti‑avoidance core. Policy wise, the move represents a pragmatic balancing act. It preserves India’s tightening stance against aggressive tax avoidance for post‑2017 structures while restoring certainty for long‑term capital already deployed under an earlier legal framework. For foreign investors, especially those planning exits from legacy holdings, the amendment provides a much‑needed clarity and reduces the risk of protracted tax disputes. At the same time the Tiger Global doctrine continues to serve as a cautionary signal that future structures must demonstrate genuine economic substance and commercial rationale and withstand GAAR scrutiny.
The SEZ model promoted by the government is today struggling due to policy uncertainty, weak infrastructure and misuse of incentives. The government does not appear to be in a mood to give up its promotion of SEZs. It is now trying to revive them by allowing limited domestic sales at concessional duty rates and introducing safeguards to protect local industry. Frequent changes in tax incentives and rules have discouraged long-term investments. Many SEZs were set up in areas with poor connectivity for political reasons leading to underutilisation. Site selection and approvals often favoured vested interests rather than genuine industrial potential of areas identified. Productivity has stagnated in government-run SEZs while privately managed ones have performed better highlighting the inefficiencies in public administration. India’s SEZs were designed for export-led growth but rising protectionism and competition from other countries have reduced their effectiveness. Now let us look at why they have not developed as expected. India tried to replicate China’s SEZ success but lacked the same scale, infrastructure and policy consistency. SEZ firms often remained isolated rather than becoming hubs for large-scale manufacturing. Withdrawal of certain exemptions (like MAT and DDT) reduced SEZs’ attractiveness. Many SEZs exist only on paper or operate far below potential due to lack of demand and cumbersome compliance requirements. The good news is that the government has come out now with new initiatives to speed up the processes. SEZ units can now sell a portion of their output in the Domestic Tariff Area (DTA) at concessional duty rates (5%–12.5%), from the financial year 2026 -2027. A three-tier framework with caps and value-add norms ensures SEZ goods do not undercut domestic manufacturers. The recent Budget has also come out with a slew of measures to provide additional incentives like one-time concessional duty sales linked to export performance and focus on strengthening SEZs as “pillars of India’s trade ecosystem.” Recognition of 368 notified SEZs with exports crossing ₹11.7 lakh crore in 2025–26 (a 32% rise over the previous year). While some SEZ units welcome the relief, others criticise these concessions as minimal and these are also burdened with onerous compliance requirements. It remains to be seen whether structural weaknesses (land, infrastructure, policy inconsistency) continue to remain the as hurdles. All that the units can say is that we have faced more difficult situations in the past.
It is increasingly becoming apparent that the US war against Iran is a reckless and costly escalation that lacks clear congressional authorisation and has already imposed major economic and strategic costs all around. Trump’s war on Iran is increasingly being seen not as a demonstration of strength but as a case study in strategic overreach. What was sold as a swift display of resolve has, instead, become a widening conflict with heavy financial, diplomatic and human costs. Reports now place the daily burden on the United States at up to $2 billion, with analysts warning that the longer the war drags on, the more it deepens the national debt and drains public resources. The deeper criticism is not only about the cost of the war, but about its logic. Iran was not a weak target that could be struck without consequence; it was always known that it was likely to respond asymmetrically, using missiles, drones, maritime pressure and regional proxies to widen the battlefield. That is exactly what has happened, with attacks hitting Gulf states, shipping routes, and sensitive energy corridors, turning what was framed as a controlled campaign into a volatile regional crisis. The moral case against the war is equally forceful. Conflict rests on the familiar illusion that force can substitute strategy. Yet military action without a credible political endgame is not policy; it is plain drift. The campaign has raised fears of civilian harm, and broader instability in a region where escalation can quickly become irreversible. Perhaps the sharpest criticism is aimed at the built-in safeguards that were supposed to prevent such adventurism. In theory, the U.S. national-security system is designed to force debates, legal reviews, congressional oversight and interagency restraint. However, in practice, those checks appear to have been too weak to stop a conflict launched without clear congressional authorisation and prosecuted largely through military power alone. The result is a system that looks robust on paper but brittle under a determined executive. The war’s cost, then, is not only measured in dollars or destruction. It is also measured in the erosion of trust – in institutions, in judgment and in the idea that great powers can use force without paying the price.
Recently, there was an extremely important case that got decided in a US court. California Civil Verdict against YouTube and Meta, where a jury found that the platforms were negligent in designing addictive products and failing to warn users about the risks, especially for young people. This decision is a landmark one with potentially wide social consequences. This verdict against YouTube and Meta marks a turning point in the debate over digital responsibility. A California jury concluded that the companies designed platforms with features that were knowingly addictive and that these design choices contributed to harm for a young user. The case was especially significant because it focused not on the content users saw, but on the architecture of the platforms themselves – endless scroll, algorithmic recommendations, autoplay and other engagement tools built-in to keep people online longer. Its broader social impact is profound. For years, social media companies have defended themselves by arguing that they merely host content and that users choose how to engage. This verdict pushes back against that defense by suggesting that design can be a form of behaviour-shaping power, especially over children and teenagers. In practical terms, it strengthens the argument that platforms may owe a duty of care to users, particularly the young and vulnerable. The case also reflects a changing social mood. Parents, schools, doctors and lawmakers have increasingly worried that digital platforms are not neutral tools but ‘attention’ machines. The emotional force of the trial came from the plaintiff’s story of early exposure, compulsive use and mental health distress which made the legal argument feel like a public reckoning with an everyday habit many families know only too well. That is why the verdict matters beyond the courtroom in the US – it gives legal voice to a social anxiety that has been building for years around the world. For society, the message is both cautionary and corrective. It suggests that innovation without restraint can become exploitation, and that profit-driven design may eventually face accountability when it affects mental well-being. Whether appeals change the outcome or not, the case has already shifted the conversation from “How do we use these platforms?” to “How these platforms were built to use us?” One feels a bit surprised that this issue took so long to reach the courtroom. What is more surprising is that this exercise was developed consciously by You Tube and Meta.
On third January 26 the United States kidnapped Nicolas Maduro, the President of Venezuela. It was a daring (though morally questionable) act of kidnapping, it was also a daring coup de tat of the country’s freely elected (again, questionable) leader. Ironies notwithstanding, the people of that country must have been hurting and feeling humiliated just because they could not protect their own President, however bad he was. Notwithstanding any other consideration, this act by a foreign nation (read the US) must have dealt a severe blow to the collective sovereign pride of that country’s subjects. Even if the President of that country had inflicted unspeakable suffering to his own countrymen, no Venezuelan still would have been able accept this humiliation. Providentially, however, Venezuela got a rare opportunity to do just that. As luck would have it, both the countries reached the finals of the World Baseball Classic! What is more, Venezuela scored a 3-2 spectacular victory over the US. This match was more than a sporting upset. It was a rare moment of catharsis for the Venezuelan! For Venezuela, a nation long accustomed to economic strain and political uncertainty, the win offered a collective release – a brief restoration of pride, dignity, and emotional energy that transcended the scoreboard. The psychological irony of the match was unmistakable. The United States, with its superior resources and deeper sporting infrastructure, entered the tournament as the expected winner. Venezuela, by contrast, brought the emotional intensity of an underdog carrying the nation’s hopes on their shoulders. Yet, it was Venezuela that appeared mentally freer, more urgent and more united. In a high-pressure competition, expectation can weigh heavily, while adversity can sharpen resolve. For the players, the game became a test of composure under symbolic pressure. The Venezuelan team was not only chasing a title; it was embodying the aspirations of millions seeking a moment of triumph and a collective relief. For the Americans, the loss served as a reminder that talent and pedigree do not guarantee any psychological edge. Discipline, belief and timing often decide outcomes when the margins are tight. For the people of both countries, the match carried meanings beyond sports. In Venezuela, it was catharsis in its purest form – an emotional high that briefly cut through hardships. For the United States, it was a quiet lesson in humility: dominance is never permanent, and confidence without urgency can be costly. The result was a vivid reminder that in sport, as in business, resilience and focus can outweigh size, reputation and expectation. I know where in the world map Venezuela is. I know Nicolas Maduro is a tyrant and has done more damage to Venezuela than good. But when I read this real-life story, I could not resist the temptation of standing up and clap. Long live Venezuela and long live the Venezuelan!
Thank you.
Venkat R Venkitachalam
