Bombay High Court judgment bars foreign law firms from operating in India
17 Dec 2009
The Bombay High Court on Wednesday finally put an end to the 15 year speculation over the legality of the operations of foreign law firms in India. The RBI had in 1994 allowed three foreign law firms to set up shop in India, a move which was challenged in 1995 by Lawyers' Collective, a public interest trust set up by lawyers to provide legal aid.
The honourable court ruled that the decision of the bank was not justified under the existing laws governing the conduct of practice by advocates.
Chief Justice Swatanter Kumar held that under the existing Advocate Act of 1961foreign law firms were barred from practising in the country and various bar councils under it.
The HC had stayed the bank's decision in 1995, but the matter was finally disposed on Wednesday after lengthy and at times, heated arguments from both sides, on the issue. The government argued that by 'practice', under the law meant only litigious practice in court, but the court while rejecting the argument held that 'it would then mean that advocates debarred for professional misconduct would then merrily carry on with practice in litigious matters.''
The court observed that when efforts were being made ensure that the legal profession stood tall in the fast-changing world, it would be improper to hold that the 1961 CU Singh and the bar councils have only a limited role to play in the field relating to practice of law.
However, on issues related to reciprocity and other rules to enable practice by foreign law firms in India, the court directed the central government which has been dealing with the issue for the last 15 years, to take an appropriate decision "expeditiously''. The centre has been favourably disposed toward allowing foreign law firms, but the Bar Council of India (BCI) remains opposed to it.
The court said that till the government decides to suitably amend the existing law or introduce new laws to the effect, the practice of legal profession, of both litigious or non-litigous nature would be governed by the Advocates Act, the Bar Council of India and the various state bar councils.
