#conflict of interest

The SAT ruled that the conditions in sub-clauses (i)-(iii) of SEBI’s Regulation 27(1) bind not only the promoter’s direct entities but also borrowers, subsidiaries and associates linked to the promoter. This interpretation broadens the scope of prohibited rating assignments for credit rating agencies, exposing them to liability for ratings tied to any promoter-related borrowing.

The Bombay High Court has ruled that disbursing funds to a family member for work that never occurred cannot trigger disqualification under Section 14(1)(g) of the Maharashtra Village Panchayats Act. This sets a critical precedent: financial transactions with relatives, absent actual involvement in panchayat functions, do not amount to conflict of interest-protecting elected representatives from overbroad interpretations of disqualification.

Rajasthan High Court rules that shared premises, common chartered accountant, and notary between bidders create a rebuttable presumption of conflict of interest under Rule 81(3)(D) of the RTPP Rules, justifying disqualification even without evidence of actual bid rigging. The ruling sets a strict standard for bidder independence in public procurement.

The Punjab & Haryana High Court held that a state electricity utility’s Managing Director cannot appoint an arbitrator under a contractual clause when the dispute involves the utility’s own contractual obligations, as this creates an inherent conflict of interest under Section 12(5) of the Arbitration Act. This ruling reinforces the independence requirement for arbitrator appointments in public utility contracts and protects parties from biased appointment mechanisms.

Supreme Court directs CBI investigation into Arunachal Pradesh’s public works contracts, citing systemic violations of tender norms, missing records, and conflicts of interest involving high officials. The ruling reinforces that transparency and accountability in public procurement are non-negotiable constitutional obligations under Article 14, setting a precedent for stricter scrutiny of state-led contract awards.

MP High Court rules that a Commissioner of Urban Administration cannot serve as an arbitrator under the Arbitration and Conciliation Act due to direct conflict of interest under the Seventh Schedule. The judgment reinforces that even party-appointed arbitrators in a three-member tribunal must be impartial and independent, invalidating unilateral appointments by state entities with vested interests.

MP High Court rules that a Principal Secretary of the Transport Department cannot serve as sole arbitrator under a contract due to inherent bias, applying Section 12(5) of the Arbitration and Conciliation Act. The judgment reinforces that party-appointed arbitrators with direct departmental ties violate statutory impartiality requirements, impacting all government-contractor disputes with similar clauses.