Kaustuv Ray vs Idbi Bank - 2022 Supreme(Cal) 899

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2022 Supreme(Cal) 899

SABYASACHI BHATTACHARYYA
Kaustuv Ray – Appellant
Versus
Idbi Bank – Respondent

Advocates appeared:
Subhankar Nag, Advocate, Deep Basu, Advocate, Avishek Guha, Advocate, Ratnadipa Sarkar, Advocate, Avimanyu Roy Chowdhury, Advocate, Kausik De, Advocate, Chayan Gupta, Advocate, Roshan Pathak, Advocate, Mohini Majumdar, Advocate

JUDGMENT

Sabyasachi Bhattacharyya, J. - The present writ petition has been filed, challenging a notice dated June 16, 2021 sent to the petitioner to show cause as to why the petitioner should not be declared as a willful defaulter under the RBI Master Circular dated July 1, 2014.

2. Learned counsel for the petitioner contends that the impugned notice was drawn in the form of a demand notice instead of a proper show-cause notice. It is submitted that the said notice was issued in contravention of Clause 3, sub-clauses (a) and (b) of the RBI Master Circular.

3. Whereas the said sub-Clauses provide that the evidence of willful default should be examined by a committee, in the present case, there was no such independent application of mind by the Wilful Defaulter (WD) Committee for issuance of the show-cause notice. The said notice was a verbatim reproduction of a Transaction audit Report (TaR) filed in connection with a Corporate Insolvency Resolution Proceeding (CIRP) under the Insolvency and Bankruptcy Code, 2016 (for short, 'the IBC').

4. By comparing the respective Clauses of the two documents, learned counsel reiterates the above contention.

5. It is argued that the respondent-bank ha