2012 (2) TMI 333 - HC - Indian Laws

Restriction on Foreign Law Firm or Foreign Lawyers - Writ Petition filed claiming that Foreign Law Firms and foreign lawyers were practicing the profession of law in India in contravention of the Advocates Act and that they should be restricted from having any legal practice either on the litigation side or in the field of non-litigation and commercial transactions within the territory of India - Held that - Foreign law firms or foreign lawyers cannot practice the profession of law in India either on the litigation or non-litigation side, unless they fulfill the requirement of the Advocates Act, 1961 and the Bar Council of India Rules. However, there is no bar either in the Act or the Rules for them to visit India for a temporary period on a fly in and fly out basis, for the purpose of giving legal advise to their clients in India regarding foreign law or their own system of law and on diverse international legal issues. Moreover, having regard to the aim and object of the International Commercial Arbitration introduced in the Arbitration and Conciliation Act, 1996, foreign lawyers cannot be debarred to come to India and conduct arbitration proceedings in respect of disputes arising out of a contract relating to international commercial arbitration. The B.P.O. Companies providing wide range of customized and integrated services and functions to its customers like word-processing, secretarial support, transcription services, proofreading services, travel desk support services, etc. do not come within the purview of the Advocates Act, 1961 or the Bar Council of India Rules. However, in the event of any complaint made against these B.P.O. Companies violating the provisions of the Act, the Bar Council of India may take appropriate action against such erring companies.

Summary

Issues Involved:
1. Enrolment and Reciprocity
2. Legal Bar
3. Disciplinary Authority
4. Noble Profession
5. Causing Loss to the Exchequer
6. Practice of Law by Foreign Law Firms

Detailed Analysis:

Enrolment and Reciprocity:
The petitioner, an active practitioner of law, argued that to practice law in India, one must be a citizen of India or a national of a country with reciprocal arrangements under Section 47 of the Advocates Act, 1961. The petitioner highlighted that Indian lawyers face cumbersome procedures to practice abroad, while foreign lawyers face no such barriers in India. The court noted that the Advocates Act allows foreign nationals to practice law in India only if Indian nationals are permitted to practice in their country. The Bar Council of India (BCI) has not recognized any foreign law degrees, thus barring foreign lawyers from practicing in India without meeting specific conditions.

Legal Bar:
The petitioner contended that without enrolment in any State Bar Council, foreigners are not entitled to practice law in India due to the bar under Section 29 of the Advocates Act. The petitioner alleged that foreign lawyers, under the guise of Legal Process Outsourcing (LPO) and conducting seminars, were practicing law illegally in India, violating Income Tax and Immigration laws, and causing revenue loss. The court acknowledged that foreign law firms were operating without proper registration and were practicing law in fields like mergers and acquisitions, which is against the provisions of the Advocates Act.

Disciplinary Authority:
The petitioner emphasized that the legal profession in India is governed by the Advocates Act, which includes disciplinary rules and a hierarchy of disciplinary authorities. Foreign lawyers not enrolled under the Act would not be subject to this disciplinary control, leading to a lack of accountability. The court agreed that allowing foreign lawyers to practice without being subject to the disciplinary jurisdiction of the BCI would be problematic.

Noble Profession:
The petitioner argued that the legal profession in India is considered noble and not a business venture, unlike foreign law firms that treat it as a trade. Indian lawyers are prohibited from advertising, while foreign firms advertise their services, treating the profession as a business. The court noted the difference in the approach towards the legal profession between Indian and foreign law firms.

Causing Loss to the Exchequer:
The petitioner claimed that foreign law firms did not obtain necessary permissions from Indian authorities, causing a loss to the exchequer. The court acknowledged that foreign law firms were operating without proper permissions, which is illegal.

Practice of Law by Foreign Law Firms:
The court referred to the Bombay High Court's judgment in Lawyers Collective vs. Bar Council of India, which held that practice of law includes both litigious and non-litigious matters, and foreign lawyers not enrolled under the Advocates Act cannot practice law in India. The court agreed with this view and stated that foreign law firms cannot practice law in India without fulfilling the requirements of the Advocates Act and BCI Rules. However, the court allowed foreign lawyers to visit India temporarily on a "fly in and fly out" basis to advise their clients on foreign law or international legal issues. The court also allowed foreign lawyers to conduct arbitration proceedings in international commercial arbitration.

Conclusion:
1. Foreign law firms or lawyers cannot practice law in India without fulfilling the requirements of the Advocates Act, 1961, and BCI Rules.
2. Foreign lawyers can visit India temporarily to advise clients on foreign law or international legal issues.
3. Foreign lawyers can conduct arbitration proceedings in international commercial arbitration.
4. BPO companies providing non-legal services do not come under the purview of the Advocates Act, 1961, but BCI can take action against any violations.

The writ petition was disposed of with no order as to costs, and the connected miscellaneous petitions were closed.