The Supreme Court on Wednesday restrained the Reserve Bank of India from granting licenses or permission to foreign law firms to practise in India.

A bench of justices R M Lodha and A R Dave also issued notices to 31 law firms in the country on the appeal filed by Bar Council of India against a Madras High Court judgement, which took the view that foreign lawyers cannot be debarred from certain arbitration proceedings in India.

The apex court's passed the direction after senior counsel M N Krishnamani appearing for BCI sought a clarification on the issue as the Madras High Court's February 21, 2012, judgement was contrary to the earlier ruling of the Bombay High Court that no foreign lawyers or firms can operate in India.