The court, which also heard over 30 law firms hailing from the United Kingdom, the USA, France and Australia, also modified a Madras High Court order permitting foreign lawyers and law firms to come to India on a "fly in and fly out" basis for rendering legal services here on offshore laws and diverse international legal issues.

"We hold that the expression 'fly in and fly out' will only cover a casual visit not amounting to 'practice'.

In case of a dispute whether a foreign lawyer was limiting himself to 'fly in and fly out' on casual basis for the purpose of giving legal advice to their clients in India regarding foreign law or their own system of law and on diverse international legal issues or whether in substance he was doing practice which is prohibited can be determined by the Bar Council of India," a bench of Justices Adarsh Kumar Goel and UU Lalit said.

The court said that apex bar body, the Bar Council of India or the Central government would be "at liberty to make appropriate Rules in this regard including extending Code of Ethics being applicable" to foreign lawyers and entities.

Referring to the Advocates Act and the Bar Council Rules, the top court said, "We uphold the view of the Bombay High Court and Madras High Court in para 63 (i) of the judgment to the effect that foreign law firms/companies or foreign lawyers cannot practice profession of law in India either in the litigation or in non-litigation side.

"Offshore law firms and lawyers had vehemently contended that there was no bar on them for carrying out consultancy or support services in the field of "protection and management of intellectual, business and industrial proprietary rights, carrying out market service and market research, publication of reports, journals etc.

A person not appearing before Courts or Tribunals and not giving legal advice cannot be said to be practice of law.

"The court also held that there was "no absolute right of the foreign lawyer" to come here and conduct arbitration proceedings in disputes arising out of a contract relating to international commercial arbitration.

It, however, said that foreign lawyers may not be debarred from conducting arbitration proceedings arising out of international commercial arbitration in view of the provisions of the Advocates Act.

The foreign lawyers and firms, which would take part in international arbitration proceedings, "Will be governed by code of conduct applicable to the legal profession in India," the court said.

The apex court also modified the Madras High Court direction that the BPOs, which provide customised and integrated services, do not come within the purview of the laws regulating the legal profession here.

"We hold that mere label of such services cannot be treated as conclusive. If in pith and substance the services amount to practice of law, the provisions of the Advocates Act will apply and foreign law firms or foreign lawyers will not be allowed to do so," the top court said in its 52-page verdict.