2013 (6) TMI 867 - HC - Indian Laws

Summary

Issues involved:
1. Propriety of the Grievance Redressal Committee's decision to label the petitioners as wilful defaulters.
2. Adequacy of reasons provided by the Grievance Redressal Committee.
3. Procedural fairness and transparency in the adjudication process.

Summary:

Propriety of the Grievance Redressal Committee's Decision:
The petitioners challenged the decision of the Grievance Redressal Committee of the respondent bank, which rejected their representation against being classified as wilful defaulters u/s a master circular of the Reserve Bank of India dated July 1, 2011. The relief sought was the annulment of notices dated February 7, 2013, and March 4, 2013, which informed the petitioners of their inclusion in the wilful defaulters list.

Adequacy of Reasons Provided:
The court observed that the Grievance Redressal Committee's decision, dated December 1, 2012, was a four-line decision unsupported by any discernible reason. The minutes of the committee meeting on November 19, 2012, failed to show any application of mind or assessment of the petitioners' representation. The court emphasized that reasons are the lifeblood of every decision affecting the rights of parties and must be clear and explicit to indicate due consideration of the points in controversy.

Procedural Fairness and Transparency:
The court highlighted that the process of adjudication must be fair and transparent, especially given the grave consequences of being labeled as a wilful defaulter. The Grievance Redressal Committee's decision must reflect the defence of the would-be wilful defaulter against the preliminary committee's opinion and evidence. The court criticized the committee's decision for being perfunctory and lacking detailed reasoning, which is required to ensure fairness and transparency.

Conclusion:
The court set aside the decision of the Grievance Redressal Committee dated December 1, 2012, and directed the committee to hear the petitioners afresh with due seriousness and provide a reasoned decision. The respondent bank was also instructed to recall any information circulated about the petitioners being wilful defaulters and to communicate this to the petitioners. The petitioners were awarded costs of 3000 GM from the respondent bank for its inappropriate appreciation of the seriousness of the procedure and tardy conduct.