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TMI Blog2019 (8) TMI 219X X X X Extracts X X X X X X X X Extracts X X X X ..... fication Committee consisting of the specified number of personnel with the requisite qualifications and the Constitution of a Review Committee, again of the requisite number and qualification. Once such committees are established, the Master Circular requires that a bank having material to proceed against an account, to have the same declared as a wilful defaulter, under such Master Circular, to place such material before the Identification Committee. In the present case, the decision of the Review Committee under challenge, is not informed with reasons. Although, the Review Committee is at liberty to concur with the finding of the Identification Committee, it has to deal with the representation made by the borrower before it. The ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Company Law Tribunal, New Delhi. In such proceedings, initially, a resolution professional was appointed by NCLT, New Delhi by its Order dated November 14, 2017. Subsequently, a liquidator has been appointed in respect of the affairs of the Company. Learned Senior Advocate appearing in support of the first writ petition has referred to the provisions of the Master Circular on Wilful Defaulters of Reserve Bank of India dated July 1, 2015. He has submitted that, the Company was not given any opportunity of hearing either by the Identification Committee or by the Review Committee. He has relied upon the judgment and order dated November 5, 2019 passed in W.P. No. 1399 (W) of 2019 (Pawan Kumar Patodia Ors. v. Union Bank of India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such judgment and order to modulate its affairs. The ratio laid down in M/s. Jah Developers Pvt. Ltd. Ors. (supra) should not be applied to test the decision of the Review Committee. He has drawn the attention of the Court to the fact that, the decision of the interim Committee is not under challenge in the present writ petition. He has referred to the various grounds of challenge made in the writ petition and has submitted that, since the challenge is limited to the decision of the Review Committee and since, the Review Committee did not have the benefit of M/s. Jah Developers Pvt. Ltd. Ors. (supra) on the date of taking of the decision, the same should not be faulted. The entire proceedings under the Master Circular on Wilful Defaulte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t petition is at the behest of the Company who enjoyed the credit facilities from the Bank. The Company after it obtained credit facilities from the Bank underwent a Corporate Debt Restructuring process in the year 2012-2013. Master Restructuring agreement dated December 27, 2012 subsequently amended on March 30, 2013 was entered into. The Company however failed to pay its debts. The Company has claimed that, the product manufactured by the Company suffered technological obsolescence and therefore became unviable. The second writ petition is at the behest of the guarantors of the credit facilities enjoyed by the Company. In both the writ petitions, challenge has been levelled against a decision of the Review Committee dated July 9, 2018. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of Law decide on the law available. It declares, in a given case, the interpretation of the existing law. Such a declaration does not mean that, the Court has laid down a new law. It has interpreted the existing law and stated the interpretation of such existing law. In my view, M/s. Jah Developers Pvt. Ltd. Ors. (supra) declared what, the procedure is required before followed while disposing of a proceedings under the two Master Circulars on Wilful Defaulters of Reserve Bank of India. It declared what such Master Circulars on Wilful Defaulters required the Bank and the two Committees established under the Master Circulars to follow. The contention that, the decision of the Review Committees made prior to M/s. Jah Developers Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial to proceed against an account, to have the same declared as a wilful defaulter, under such Master Circular, to place such material before the Identification Committee. Upon the Identification Committee being satisfied with the sufficiency of the materials placed before it, and is of the view that, there are sufficient grounds to suspect that, the account can be classified as a wilful defaulter, then, it is required to issue a show-cause notice to the account holder, for such account holder to respond thereto. The response is thereafter considered by the Identification Committee. If the decision of the Identification Committee is adverse to the account holder, then, the account holder is at liberty to prefer an appeal before the Revi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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