Delhi High Court Flags Concerns Over BCI’s Strict Penalties on Foreign Law Firms

The Delhi High Court on Thursday raised serious concerns about the Bar Council of India’s (BCI) amended Rules that allow strict penalties—including suspension of registration—against foreign law firms based only on a preliminary inquiry.

A Division Bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela said that, at first glance, the Rules seem excessive. The judges observed that either the BCI must amend these provisions or the Court may have to “read them down.”

The Bench questioned Rule 10 of the 2022 BCI Rules governing foreign lawyers and law firms. The Court noted that the Rules permit action after only a preliminary inquiry, without any detailed investigation, which goes against established legal practice.

The judges remarked that it is difficult to understand how such a major penalty like suspension can be imposed without giving the foreign lawyer or firm a full opportunity to present evidence and respond to the allegations. They stressed that natural justice requires that all documents forming the basis of the inquiry must be shared with the firm.

The Court was hearing a petition by CMS IndusLaw and four of its lawyers, who alleged that the BCI issued a notice without sharing the material on which it relied. The BCI notice, issued in August, accused CMS IndusLaw and Dentons Link Legal of unauthorised collaborations with foreign law firms.

Senior Advocate Amit Sibal, appearing for the petitioners, said that the notice refers to statements supposedly made by the firm, but no such statements were ever issued. He added that despite seeking clarity, the firm has not received any documents from the BCI.

He also raised doubt about whether the BCI Rules regulating foreign law firms were approved by the Chief Justice of India and the Central government, as required by law.

After hearing the matter, the Court said that principles of fairness demand that if the preliminary inquiry is the only inquiry, all relevant documents must be provided to the firm. The Bench granted BCI additional time to take instructions and asked whether the Rules had received mandatory approvals.

The Court also directed the BCI to postpone its proceedings against CMS IndusLaw, which were scheduled for November 16. Meanwhile, the petitioners have been asked to hand over the documents earlier sought by the BCI.

The matter will now be heard next week.