Case Briefing:
The case is BAR COUNCIL OF INDIA V. A.K. BALAJI, decided on 13 March 2018, and cited as 2018 INSC 235. The judgment was rendered by a Division Bench of the Supreme Court of India, comprising Justices Adarsh K. Goel and Justice Uday U. Lalit. Justice Goel authored the judgment.
Questions Presented (Issues)
The Supreme Court addressed three main questions:
- Does the phrase “practise the profession of law” in Section 29 of the Advocates Act, 1961 (“Advocates Act”) include only lawyers practising before courts or also include lawyers offering other types of legal services (e.g., in law firms)?
- Whether foreign lawyers, foreign law firms, or Business Process Outsourcing (“BPO”) companies providing legal services in India, can do so without adhering to the Advocates Act and the Bar Council of India Rules, 1975 (“BCI Rules”). If not, can these foreign entities provide legal advice in India by visiting on a “fly-in-fly-out” basis?
- Are foreign lawyers/foreign law firms permitted to conduct international commercial arbitration proceedings in India?
Factual Background
The litigation arose after the Reserve Bank of India (“RBI”) authorized foreign law firms to establish representative (liaison) offices in India. This authorization prompted cases to be filed challenging the RBI’s decision before the Bombay and Madras High Courts.
The Madras High Court ruled that foreign lawyers or foreign law firms were prohibited from practising law without complying with the Advocates Act and the BCI Rules. However, the Madras High Court allowed them to visit India for short durations to provide legal advice and conduct international arbitration proceedings.
The Bombay High Court agreed with the prohibition on the practice of law, but adopted a stricter stance, prohibiting these foreign entities from even providing legal advice during short visits to India. Further, the Bombay High Court held that they could not perform arbitration unconditionally without regulation by Indian laws. Due to these conflicting decisions, the Global Indian Lawyers Collective and the Bar Council of India (“BCI”) appealed to the Supreme Court of India.
Decision and Holding
The Division Bench of the Supreme Court resolved the conflict between the High Court decisions and held the following:
- The practice of law is defined broadly, encompassing both litigation (court appearances) and non-litigation work, such as drafting documents and giving opinions.
- All foreign lawyers, foreign law firms, and BPO companies providing legal services are subject to the Advocates Act and the BCI Rules.
- Legal advice provided by a foreign lawyer on a “fly-in-fly-out” (temporary) basis is permissible only if it is done regularly and not casually.
- Foreign lawyers have no “absolute right” to conduct international commercial arbitration in India. However, they may be permitted to participate if the Rules of Institutional Arbitration apply or if the matter falls under the provisions of the Arbitration Act, provided they adhere to the code of conduct governing the legal profession in India.
Reasoning (Rationale)
Broad Scope of Legal Practice and Adherence to the Advocates Act:
The Supreme Court characterized the right to practise law as a broad right. This right includes two specific rights: the right to appear before a court, and the right to draft legal documents, provide consultancy services, and participate in legal conferences (non-litigation). The Court upheld the view of the Bombay High Court that the Advocates Act was enacted to regulate both persons practising before courts and those practising in non-litigious matters outside courts.
Crucially, Section 29 of the Advocates Act permits only advocates enrolled with the BCI to practise the profession of law whether before any Court/authority or outside the Court. The Court clarified that this restriction applies equally to Indian citizens and foreigners. Thus, all foreign lawyers, foreign law firms, and BPO companies offering legal services that amount, directly or indirectly, to the practice of law must comply with the Advocates Act and BCI Rules. Appearance before courts is strictly limited to lawyers enrolled with the BCI, unless permission is secured from the relevant court.
Nature of “Fly-in-Fly-Out” Visits:
Regarding the temporary visits by foreign lawyers, the Supreme Court reasoned that short-term/temporary visits must be regular or frequent to be deemed the practice of law. Casual visits, such as one or two per year, are not considered regular. The definition of “regular” is not fixed and must be determined based on the facts of each case and the decision of the individual court. Significantly, the Advocates Act and the BCI Rules will apply whether the guidance provided pertains to foreign law or domestic (Indian) law.
Arbitration Proceedings by Foreign Lawyers:
The Court noted that a plain reading of Sections 32 or 33 of the Advocates Act does not impose an “inherent bar” on foreign entities conducting international commercial arbitration. However, the court mandated that such proceedings must adhere to the code of conduct applicable to the legal profession in India. The Supreme Court also stated that the Central Government or the BCI retains the power to create specific regulations concerning arbitration proceedings.
Case: BAR COUNCIL OF INDIA vs A.K. BALAJI, C.A. No. 7875-7879/2015
