TMI Blog2019 (12) TMI 1023X X X X Extracts X X X X X X X X Extracts X X X X ..... ault. Further, the disciplinary proceedings should not be pending against the proposed resolution professional. If the satisfaction is recorded on this ground, the order of admission can be made, whereas, the rejection is contemplated by clause (b) of sub-section (5) of section 7. Before rejection of the application, the applicant has to be given an opportunity to rectify the defect and within the time stipulated in the proviso below clause (b). The CIRP shall commence from the date of application under sub-section (5) and that is what subsection (6) of section 7 contemplates, whereas, the communication of the order to the Financial Creditor and the Corporate Debtor is an aspect covered by sub-section (7) of section 7 of the IBC. The legislature says by sub-section (1) of section 7 that an application can be made and by other sub-sections of section 7, how the application should be dealt with is enumerated. Pertinently, sub-section (5) of section 7 requires the satisfaction to be recorded in terms thereof. If that satisfaction is recorded, there is an admission of the application. The admission of the application has to be intimated or communicated. The order of admission or rej ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f these rules have been duly complied with and in token thereof affix his initials with date on the outer cover of the order. Everything depends upon the facts and circumstances in each case. Nobody should be allowed to manipulate the judicial process and secure favourable relief or judgment by deft management. Judges ought to be aware of the modern trends and tendencies in instituting and prosecuting litigation before a court of law. They must maintain absolute integrity and autonomy, independence of the judiciary cannot be compromised. At all costs, that should be maintained. If the functioning of the tribunal is monitored and supervised by a particular department of the Central Government, then, that departmental staff is appointed to assist the tribunal. Effective work cannot be done unless the Registrar, Superintendent and other staff members are drawn from the courts already functioning and discharging judicial functions. The trained staff of such courts can be deployed as a temporary measure and thereafter, by a proper selection process, the staff to assist and support the Judicial Members and the President should be selected and appointed. The staff ought to be drawn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would have to be first noticed. It is stated that on 16th May, 2013, Rolta LLC, a limited liability company incorporated in Delaware, United States of America executed an Indenture dated 16th May, 2013 for issuance of 10.75% Senior notes in aggregate principal amount upto USD200,000,000/-. Rolta LLC issued 10.75% Senior notes and for ease in reference, the parties to this Indenture are then set out in para 7. A copy of this Indenture is annexed to the petition as Exhibit B . It is stated that the parent guarantee is respondent no.6. Then, it is stated that on 24th July, 2014, a similar document was executed, in which again, the parent guarantee named was respondent no.6. 8. Thereafter, there are parent guarantees executed on 16th May, 2013 and 24th July, 2014. In respect of these Indentures, it is stated that the primary obligation of respondent no. 6 shall be towards holder of a note and to the trustees. Exhibits D and E are the copies of these parent guarantees. 9. On 24th April, 2018, the third respondent issued a letter claiming to be authorised by the holder of Notes calling upon the sixth respondent to make payment of sums described therein to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s concerned. The petitioner made inquiries with the sixth respondent and the office of its advocates on record before the NCLT.. However, it was confirmed by them that the impugned order has not been received. The order has not been uploaded on the website of the NCLT until 13th November, 2019 as the last order uploaded for the said insolvency petition relates to the hearing on 20th August, 2019, on which date, the arguments were concluded and the matter was reserved for orders by the concerned Bench. 11. In para 18 of the petition, it is alleged that on inquiries, the petitioner learnt that the insolvency petition/ proceedings were not listed for pronouncement of the order on 22nd October, 2019 before the concerned Bench. It was further revealed that though the advocates for respondent no. 6 were present before the Bench, the insolvency petition was not taken up. The petitioner says that since the Bench had reserved the order, he was diligently tracking the daily cause list. In para 20, it is stated that Mr.V.P.Singh (Judicial Member) was expected to demit office as a member of the NCLT as he was appointed as a member of the National Company Law Appellate Tribunal ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent no. 5 and having been left with no other remedy, he has filed this petition. The grounds are then set out and in relation to the validity and legality of the order, it is stated that this order is passed in violation of the principles of natural justice and the procedure established by law, which governs the functioning of the NCLT. It binds the Members/ officers discharging the respective duties. The order is bad in law and without jurisdiction, as the same has been passed by the NCLT in blatant violation of the Rules 150 and 152(2) of the National Company Law Tribunal Rules, 2016 (hereinafter referred to as the NCLT Rules, 2016). It is non est as the Rules mandate that the order has to be pronounced. It is in the interest of justice and fairness, that a procedure is established and there cannot be any communication of the order without it being pronounced. Since the NCLT is a statutory tribunal exercising judicial powers, it is bound to act in terms of the law, which includes the practice rules or rules of procedure. If these Rules are bypassed and no compliance is made therewith, then, such an order violates the basic cannons of fairness and justice. The petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... record. 3. However, what is tendered before this Court yesterday was a Register, which, according to Mr.Govilkar, contains the details such as the number of the proceedings, the date of the order and the date of uploading of the order or the date given for the uploading of the order. 4. It is stated with reference to this Register by Mr.Govilkar that it contains an endorsement that as far as the said proceedings are concerned, the final orders are dated 22nd October, 2019. 5. The order passed by the Members is also produced in a separate file together with some loose papers. The set of loose papers contains an endorsement, but without any date, which reads as under:- ORDER 19. MA 2216/2019 in C.P. (IB) 4375 (MB)/2018 Heard the argument of the Ld.Counsel for the Financial Creditor and Counsel for the Corporate Debtor. Ld. Counsel for the Financial Creditor sought leave of the court for filing a fresh declaration of proposed RP in Form 2. Prayer is allowed. Financial Creditor may file declaration by Proposed RP in Form 2 by the end of the date. It is Reserved for Orders. Sd/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r limit is not mandatory, what is mandated by the Rules is pronouncement . By Rule 151, pronouncement of order by any one member of the Bench is permissible. That will be a pronouncement on behalf of the Bench. When the order is pronounced under this Rule 151, the Court Master shall make a note in the order sheet, that the order of the Bench consisting of President and Members was pronounced in open court on behalf of the Bench. The argument throughout was that there was no date of pronouncement notified. There was no board prepared of the proceedings and particularly, the pronouncement of the order in open Court. There was no intimation to the parties and that the petitioner s advocate was in the Court, but no pronouncement was done. Interestingly, according to Mr.Dwarkadas, there is an endorsement at pages 547A and 547B that the pronouncement was made after the board was prepared. However, there is no contemporaneous record of this board having been notified. In fact, the contra record is that this board is prepared later. Mr.Dwarkadas sought to tender an affidavit of the petitioner affirming these allegations. 10. Mr.Ravi Kadam, the learned senior counsel ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in this capacity since 1991. On 15th November, 2019, accompanied with the advocates on record for respondent no. 6, he attended the office of NCLT situated at 4th floor, MTNL Building, G.D.Somani Road, Cuff Parade, Mumbai. A formal application was made in writing requesting search/ inspection of the records. After lodging that application, the Registry of the tribunal duly acknowledged receipt of the same and affixed its stamp. After that the deponent says that along with the advocates, he took physical search of the entire set of papers and proceedings available on record in the said insolvency petition. He also examined the original order passed and the attendance sheets/ notes of appearance for the dates of hearings/ listings in the said petition. Upon examination of the entire original record and proceedings, he noted that there are appearance sheets of 4th March, 2019, 28th March, 2019, 7th May, 2019, 18th June, 2019 and 24th June, 2019. He inquired with the Deputy Registrar whether any order/ appearance sheets other than the aforesaid are stored in any other place or maintained in any other file. He was informed that there is no record of appearance or order other th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 14 of I B Code shall not apply to such transactions as may be notified by the Central Government in consultation with any financial sector regulator. IV. That the order of moratorium shall have effect from the date of this order till the completion of the corporate insolvency resolution process or until this Bench approves the resolution plan under sub-section (1) of section 31 of I B Code or passes an order for the liquidation of the Corporate Debtor under section 33 of I B Code, as the case may be. V. That the public announcement of the corporate insolvency resolution process shall be made immediately as specified under section 13 of I B Code. VI. That this Bench appoints Shailendra Ajmera, a registered insolvency resolution professional having Registration Number [IBBI/ IPA-001/IP-P00304/ 201718/ 10568] as Interim Resolution Professional to carry out the functions as mentioned under I B Code, the fee payable to IRP/ RP shall comply with the IBBI Regulations/ Circulars/ Directions issued in this regard. 18. The Registry is directed to immediately communicate this order to the Financial Creditor, the Corporate Debtor and the Interim Resolution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted office on 22nd October, 2019 and took the charge in NCLAT as a Member on 23rd October, 2019. 23. Before we proceed further, we must note the preliminary objections raised by Mr.Ravi Kadam learned senior counsel appearing for respondent nos. 3 and 4 to the maintainability of this petition. He submitted that this petition should be dismissed only on the ground that the petitioner has an alternate and equally efficacious remedy of appeal to the NCLAT. The petitioner can impugn the order passed on 22nd October, 2019 in an appeal before the appellate tribunal. The order can be challenged inter alia on the ground that it has not been passed in total compliance with the procedural rules which are applicable. That there being no adherence to the procedural rules with regard to the pronouncement of the order is also a ground of challenge available to the petitioner, according to Mr.Kadam. Mr.Kadam would submit that a writ petition under Article 226 of the Constitution of India is not maintainable when there is an alternate and equally efficacious remedy, particularly of an appeal. Mr.Kadam would submit that there are well known exceptions to this rule carved out in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 7 of the IBC. We cannot lose sight of other two sub-sections. The other two sub-sections are sub-sections (6) and (7) of section 7. He also submitted that in noting the aim, object and purpose of the law, we also notice the language of sections 12, 13 and sections 60 to 62 of this IBC. Mr.Kadam would submit that the impugned order ticks and triggers further steps. These further steps have to be taken the moment the application made by respondent nos. 3 and 4 is admitted. There is then no escape from the consequences provided in law. Earlier it was a very time consuming process. Now, the order of admission has to be communicated to the Financial Creditor and the Corporate Debtor. Beyond that, there is no compliance provided in the law. The petitioner can always approach NCLAT and invite its attention to the fact that although the order has been passed on 22nd October, 2019, there was no communication of the same till 11th November, 2019 as proclaimed by the petitioner and therefore, this period be excluded from the time limit set out by law for filing of an appeal. In other words, this period be excluded while computing the period of limitation for filing the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etitioner has given up the relief in terms of prayer clause (a) of the petition, the prayer clause (b) is very much surviving. That seeks a writ of certiorari or any other appropriate writ, order or direction to quash and set aside the impugned order. 26. Mr.Dwarkadas has submitted that the nature of this writ itself would denote that it is not directed against the parties. It is directed against the tribunal or the court subordinate to this court. The anxiety is that this tribunal or the court below does not exceed its jurisdiction or act beyond its powers or contrary to and in utter breach of principles of natural justice or throws every procedural rule out of the window. Thus, if there is a complaint that the applicable basic procedure has not been complied with and that has occasioned failure of justice, then, a writ must go to quash and set aside the order of such a tribunal. If such an order is challenged, then, this court is duty bound to issue a writ of certiorari and ordinarily does not refuse it. It refuses the same only on exceptional grounds and on rare occasions when it finds that the party approaching this court is itself guilty or responsible for the br ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... availed of only to remove or adjudicate on the validity of judicial acts. The expression judicial acts includes the exercise of quasi-judicial functions by administrative bodies or other authorities or persons obliged to exercise such functions and is used in contrast with what are purely ministerial acts. Atkin L.J. thus summed up the law on this point in Rex V. Electricity Commissioners , 1924-1 KB 171 at p.205 (C) : Whenever any body or persons having legal authority to determine questions affecting the rights of subjects and having the duty to act judicially act in excess of their legal authority they are subject to the controlling jurisdiction of the King s Bench Division exercised in these writs. The second essential feature of a writ of certiorari is that the control which is exercised through it over judicial or quasi-judicial tribunals or bodies is not in an appellate but supervisory capacity. In granting a writ of certiorari the superior court does not exercise the powers of an appellate tribunal. It does not review or reweigh the evidence upon which the determination of the inferior tribunal purports to be based. It demolishes the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by certiorari but not a mere wrong decision. The essential features of the remedy by way of certiorari have been stated with remarkable brevity and clearness by Morris L. J. in the recent case of Rex v. Northumberland Compensation Appellate Tribunal , 1952-1 KB 338 at p. 357 (H). The Lord Justice says: It is plain that certiorari will not issue as the cloak of an appeal in disguise. It does not lie in order to bring up an order or decision for re-hearing of the issue raised in the proceedings. It exists to correct error of law when revealed on the face of an order or decision or, irregularity or absence of or excess of jurisdiction when shown. 30. The decision of Basappa (supra) has been followed in the case of Hari Vishnu Kamath vs. Ahmad Ishaque and Ors . In the following paragraphs, the Hon ble Supreme Court held as under:- 11. The writ for quashing is thus directed against a record, and as a record can be brought up only through human agency, it is issued to the person or authority whose decision is to be reviewed. If it is the record of the decision that has to be removed by certiorari , then the fact that the tribunal has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty Commissioner, Sibsagar. They were the subject, in the first instance, of proceedings under Art.226 of the Constitution in the High Court of Assam. Proceedings by way of certiorari are not of course . (Vide Halsbury s Laws of England , Hailsham Edition, Vol.9, paras 1480 and 1481, pp.877-878). The High Court of Assam had the power to refuse the writs if it was satisfied that there was no failure of justice, and in these appeals which are directed against the orders of the High Court in applications under Art 226, we could refuse to interfere unless we are satisfied that the justice of the case requires it. But we are not so satisfied. We are of the opinion that, having regard to the merits which have been concurrently found in favour of the respondents both by the Deputy Commissioner, Sibasagar, and the High Court, we should decline to interfere . 32. A perusal of this paragraph would reveal that the proceedings by way of certiorari are not of course . The High Court has the power to refuse the writ if it is satisfied that there was no failure of justice. The Hon ble Supreme Court once again had an occasion to examine the ambit and scope of this power and it c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact reached by the inferior Court or Tribunal as result of the appreciation of evidence cannot be reopened or questioned in writ proceedings. An error of law which is apparent on the face of the record can be concreted by a writ, but not an error of fact, however grave it may appear to be. In regard to a finding of fact recorded by the Tribunal, a writ of certiorari can be issued if it is shown that in recording the said finding, the Tribunal had erroneously refused to admit admissible and material evidence, or had erroneously admitted inadmissible evidence which has influenced the impugned findings. Similarly, if a finding of fact is based on no evidence, that would be regarded as an error of law which can be corrected by a writ of certiorari. In dealing with this category of cases, however, we must always bear in mind that a finding of fact recorded by the Tribunal cannot be challenged in proceedings for a writ of certiorari on the ground that the relevant and material evidence adduced before the Tribunal was insufficient or inadequate to sustain the impugned finding. The adequacy or sufficiency of evidence lend on a point and the inference of fact to be drawn from the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bordinate to the High Court within the limits of their jurisdiction. It means that this writ can be issued when the court comes to the conclusion that the tribunal has passed an order in utter disregard to the settled principles, including when it decides a question without giving an opportunity to be heard to the party affected by the order or where the procedure adopted in dealing with the dispute is oppose to principles of natural justice. 36. The above salutary principles have been summarised in a more recent decision of the Hon ble Supreme Court in the case of Surya Dev Rai vs. Ram Chander Rai and Ors. . The court, after referring to all the earlier judgments in the field, including those to which we have made a detailed reference above, concluded that this writ has to be issued not as a matter of course. The court would be justified in refusing the writ if no failure of the justice has occasioned. The writ of certiorari is issued for correcting gross errors of jurisdiction, namely, when a subordinate court is found to have acted without jurisdiction by assuming jurisdiction where there exists none or in excess of its jurisdiction by overstepping or crossing the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ensure that the court or the tribunal below follows the settled procedure and norms devised while rendering justice to parties. The orders and decisions must be in accord therewith. The orders and decisions should not result in failure of justice. The bounds or limits of jurisdiction are known to these tribunals or courts subordinate to High Court. If the High Court is endowed with the power to issue this writ, then, the purpose of such endowment cannot be overlooked. It is but the duty of the High Court to ensure that the limits are not crossed or that the jurisdiction is not exercised in a manner contrary to the settled cannons of equality, fairness and justice. The very foundation of justice is sanctity of court proceedings and the records. If that is totally lost, then, the High Court should not be a mute spectator. It must step in. 39. We have, therefore, no hesitation in holding that aware as we are of the principles enshrined in the decisions that have been brought to our notice by Mr.Kadam, this is a case covered by the exceptions. Still, we must notice the emphasis of Mr.Kadam on a decision of the Hon ble Supreme Court on this point. 40. Mr.Kada ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdiction or the vires of the statute is under challenge. Mr.Kadam would submit that these exceptions are exhaustive and therefore, we should not entertain the present writ petition. 41. Precisely, for this reason that we have observed in the foregoing paragraphs that Mr.Kadam s submissions overlook the very object and purpose of issuance of a writ of certiorari. That power is vested in the High Court not to correct an error of fact or to correct the orders which are capable of being challenged and corrected in appeal, but to remove certain fundamental defects and flaws in the functioning of a inferior court and tribunal and to direct it to act in accordance with the procedure or the law applicable to it. If a deviation or departure therefrom has resulted in failure of justice, then, we do not think that there is any prohibition in issuing a writ of certiorari. The decision in the case of Nivedita Sharma (supra) is distinguishable on facts. In any event, we have not deviated from the principles stated or referred therein. We are not providing a remedy to the petitioner to challenge the order impugned in this petition on merits. We are aware that for that purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Article 226 of the Constitution of India. On misplaced consideration, the statutory procedures cannot be allowed to be circumvented. Once again, in this decision, which is also rendered on merits, the Hon ble Supreme Court cautioned the High Courts in entertaining writ petitions, when there are effective and complete plural remedies to assail a sale under the SARFAESI Act and Rules. That the sale canbe challenged on all grounds including that mandatory requirement under the rules has not been followed. Hence, even this judgment is distinguishable on facts. 43. A Division Bench judgment of this court in the case of Anthony Raphael Kallarakkal vs. National Company Law Tribunal, Mumbai , decided on 7th September, 2018 lays down no different principles. This court reiterated the principle that in a given case, when exceptional facts and circumstances are made out, the High Court is not powerless and can exercise jurisdiction under Article 226 of the Constitution of India despite availability of alternate remedy. However, in the facts of that case, the party before this court had not only one, but two alternate remedies available. 44. To our mind, in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cedural norms or rules. The applicable procedural rules devise proper and fair norms and standards. There, according to Mr.Dwarkadas, have been given a complete go bye and this deviation results in failure of justice. The complaint is that there is total failure of justice. That is occasioned by the fact that the tribunal heard the matter and reserved its orders. The tribunal Members were aware of the fact that one of them has been promoted as a Member of NCLAT sitting at New Delhi. That there was a notification issued promoting one of the Members, namely, the Judicial Member. He was, therefore, expected to take charge shortly. After this notification was issued, there was no great hurry to pass the order and that too without adherence to specific rules of procedure. Mr.Dwarkadas would submit that the rules themselves demand that the tribunal Members pronounce the order in open court. If such pronouncement of the order is not possible, they could have assembled in their Chambers and pronounced the order. This is not a case where there is any complaint or grievance about the manner of pronouncement. This is a complaint far more serious, according to Mr.Dwarkadas. That is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t an illegality going to the root of the matter. This is a case where, according to Mr.Dwarkadas, on the eve of the Member (Judicial) demitting the office, the order is dictated, shown as signed, but without any pronouncement. Mr.Dwarkadas would submit that once there is no evidence of pronouncement by both Members or one of them, then, such order is a nullity. Mr.Dwarkadas would submit that this is not a case of mere failure of the presiding Judge to date and sign the judgment at the time of pronouncing it, but it is a case where a judgment and order being pushed in despite of its non-pronouncement. It is in such circumstances that Mr.Dwarkadas would submit that the impugned order is a nullity. Mr.Dwarkadas, in support of his submissions, would rely upon the NCLT Rules, 2016 and particularly Part XIX thereof containing Rules 146 to 162. He would also rely upon the preceding rules and particularly those rules where the record or proceedings have to be maintained as per the rules contained in Part X of these rules. Mr.Dwarkadas highlighted two other rules, namely, Rule 89 falling in Part IX of these Rules and Rule 99 falling in Part XI, both of which make a reference to the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arguing that the order impugned in this case is one of admission. That order has been passed in a legal and valid manner. At best there is a procedural lapse. The reliance placed by Mr.Dwarkadas on the 2016 Rules is entirely misplaced. Mr.Kadam has sought to highlight the fact that the NCLT is flooded with cases relating to both aspects covered by the Code. There are about 15 Benches of this tribunal in India. Given the backlog and pendency, at times, some procedural aspects are overlooked, but that is not deliberate and intentional. If it is a mere mistake, but not vitiating the underlying proceedings nor the impugned order, then, we must not allow this writ petition. Mr.Dwarkadas s argument that there is failure of justice is not accurate, according to Mr.Kadam. There is no failure, much less miscarriage of justice. Mr.Kadam has taken us through the scheme of the IBC. He would submit that the sections in Chapter II of this IBC are under a broad title Corporate Insolvency Resolution Process . Section 7 enables initiation of CIRP by financial creditor. Sub-section (1), according to Mr.Kadam, enables such a Financial Creditor, either by itself or jointly with other fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... complete procedure. That is a complete for the purposes of initiation of CIRP by Financial Creditor and how the application in that behalf must be dealt with. They must guide us. According to Mr.Kadam, the sub-sections of section 7 do not require an order of admission to be pronounced, but merely to be communicated. If that is how the substantive provision reads, then, non-adherence to a procedural rule would not vitiate the order and proceedings and merely because there is no pronouncement. In other words, absence of pronouncement would not vitiate initiation of this process under section 7. 51. Mr.Kadam, therefore, made alternate submissions. His first assertion and primary one is that section 7 is the repository of the power to initiate the process and to admit the application. Anything outside that must not be read into the power conferred in the IBC. The NCLT may be existing prior to the enactment of this Code, but because the power is conferred in that tribunal does not mean that the procedure that the tribunal otherwise follows ought to be mandatorily followed while exercising power under section 7 of the IBC. The further alternate argument of Mr.Kadam is t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ning to oppression of minority. The argument in one of the cases, according to Mr.Kadam, was that the Company Law Board did not adhere to the rules on par with NCLT. It follows its own rules and although they contemplated pronouncement of order, absent it, the order was still taken to be binding. Ultimately, pronouncement was taken as equal or equivalent to communication. Mr.Kadam raised a further alternate argument by urging that if the procedural rules of NCLT are a mere guide, their strict adherence is not necessary. There is no mandate to pronounce. If that word is employed, it does not mean that a pronouncement is mandatory. The word is employed in a descriptive sense and not to make a requirement of pronouncement in open court mandatory. Even otherwise, that requirement does not mean pronouncement must be in open court. 53. Mr.Kadam would further alternatively submit that there are some rules framed by the NCLT, which alone apply to the proceedings under the IBC. The specific rules which can be applied are enlisted in the set of rules styled as the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (hereinafter referred to as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ta and Ors. (Civil Appeal No.8766-67 of 2019 decided on 15th November, 2019); 3. Innoventive Industries Limited vs. ICICI Bank and Anr. [(2018) 1 Supreme Court Cases 407]; 4. Nivedita Sharma vs. Cellular Operators Association of India and Ors. [(2011) 14 Supreme Court Cases 337]; 5. General Manager, Sri Siddeshwara Co-Operative Bank Ltd. and Anr. Vs. Ikbal and Ors. [(2013) 10 Supreme Court Cases 83]; 6. Anthony Raphael Kallarakkal vs. National Company Law Tribunal (2018 SCC OnLine Bom 13865); 7. State Bank of India and Ors. vs. S.N.Goyal [(2008) 8 Supreme Court Cases 92]; 8. Jer Rutton Kavasmaneck (alias Jer Jawahar Thadani) and Anr. vs. Gharda Chemicals Ltd. and Ors. [ 2012 SCC OnLine Bom 2035 ] 9. Mackeil Ispat and Forgoing Limited vs. State Bank of India (C.O.No.3224 of 2019 decided on 20th November, 2019); 10. Palogix Infrastructure Private Limited vs. ICICI Bank Limited (2017 SCC OnLine NCLAT 266) 56. For properly appreciating the above contentions, we must first refer to the IBC. The IBC is an Act to consolidate and amend the laws relating to reorganisation and insolvency resolution of corporate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s prevailing prior to the enactment of IBC. That there was Professional Presidency Town Insolvency Act, that there was a Companies Act, 1956 and amended from time to time right up to 2013 providing for these aspects is conceded before us. Mr.Kadam s arguments do not dispute the fact that insolvency, liquidation and voluntary liquidation or bankruptcy proceedings were prior to the enactment of the Code dealt with by the competent civil courts or courts conferred with jurisdiction under the Companies Act, 1956. After the 1956 Act, there were Company (Court) Rules, 1959 framed to guide the exercise of jurisdiction by the Company Court. The Civil Courts or the Company Courts were exercising the judicial powers and discharging judicial functions. It is these functions which have been now made over to the tribunal. Therefore, in the definitions, the definitions of certain terms are crucial. One of the definitions is of the term prescribed . That is to be found in section 2(26). It means prescribed by rules made by the Central Government. Then, there is a clearcut indication and that is to be found in section 2(27). 59. Part II of the IBC contains Chapter I ti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of interest; (b) any amount raised by acceptance under anyacceptance credit facility or its de-materialised equivalent; (c) any amount raised pursuant to any notepurchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument; (d) the amount of any liability in respect of any leaseor hire purchase contract which is deemed as a finance or capital lease under the Indian Accounting Standards or such other accounting standards as may be prescribed; (e) receivables sold or discounted other than anyreceivables sold on non-recourse basis; (f) any amount raised under any other transaction,including any forward sale or purchase agreement, having the commercial effect of a borrowing. Explanation.-For the purposes of this sub-clause,- (i) any amount raised from an allottee under a realestate project shall be deemed to be an amount having the commercial effect of a borrowing; and (ii) the expressions, allottee and real estateproject shall have the meanings respectively assigned to them in clauses (d) and (zn) of section 2 of the Real Estate (Regulation and Development) Act, 2016 (1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Explanation.- For the purposes of this sub-section, a default includes a default in respect of a financial debt owed not only to the applicant financial creditor but to any other financial creditor of the corporate debtor. (2) The financial creditor shall make an applicationunder sub-section (1) in such form and manner and accompanied with such fee as may be prescribed. (3) The financial creditor shall, along with the applicationfurnish- (a) a record of the default recorded with theinformation utility or such other record or evidence of default as may be specified; (b) the name of the resolution professional proposedto act as an interim resolution professional; and (c) any other information as may be specified by theBoard. (4) The Adjudicating Authority shall, within fourteendays of the receipt of the application under sub-section (2), ascertain the existence of a default from the records of an information utility or on the basis of other evidence furnished by the financial creditor under sub-section (3). (5) Where the Adjudicating Authority is satisfied that- (a) a default has occurred and the application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. Sub-section (2) says that the Financial Creditor shall make an application under sub-section (1) in such form and manner and accompanied with such fee as may be prescribed. Thus, the word such appearing twice and that is in relation to the form and manner and accompaniment with fees, all of which have to be prescribed. The prescription is by the rules. Then comes sub-section (3). That says that the Financial Creditor shall, along with the application, furnish and what should be furnished is set out in clauses (a) to (c) of sub-section (3). Thus, the record of the default recorded with the information utility or such other record or evidence of default as may be specified has to be furnished. The name of the resolution professional proposed to act as an interim resolution professional and any other information as may be specified by the Board has to be furnished. On receipt of this application, the adjudicating authority must ascertain the existence of the default from the records of the information utility or on the basis of other evidence furnished by the Financial Creditor under sub-section (3). Thus, the ascertainment of default has to be made and that is based upo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registered office of the corporate debtor. 64. The withdrawal of the application made under Rules 4, 6 and 7, as the case may be, is permitted by Rule 8 on a request made by the applicant before it is admitted, whereas, Rule 10 deals with filing of application and application fees. 65. A perusal of Rule 10 would show that the same pertains to the rules and procedure for conduct of proceedings under the Code. They are yet not notified. Until then, the application made under sub-section (1) of section 7 and sub-section (1) of section 9 and section 10 of the IBC shall be filed before the adjudicating authority in accordance with Rules 20 to 26 of Part III of NCLT Rules, 2016. Mr.Kadam overlooks the fact that Rule 10 has been inserted so that there is no vacuum. It is only to facilitate the filing of the applications under the sub-section (1) of section 7 and sections 9 and 10 that the rule makers have provided the procedure in that behalf in the NCLT Rules, 2016. Thus, only the procedure in relation to filing of application, which has been set out in the NCLT Rules, 2016, is applied until the rules of procedure for conduct of proceedings under the Code are not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, they enable making of an application by the Financial Creditor and it is clear that sub-section (2) says that the Financial Creditor shall make an application under sub-section (1) in such form and manner and accompanied with such fee as may be prescribed. The word prescribed means prescribed by the rules. In the instant case, the IBC rules are silent on the manner and fee. It is clear, therefore, that the legislature borrowed presently applicable rules of NCLT for the purpose of making of the application by the Financial Creditor. Thereafter, sub-section (3) says that the Financial Creditor shall, along with the application, furnish and what shall be furnished is then set out in clauses (a) to (c) of sub-section (3) of section 7. Thereafter, by sub-section (4), the adjudicating authority is required to ascertain the existence of the default from the records of the information utility or on the basis of other evidence furnished by the Financial Creditor. In terms of sub-section (5), the adjudicating authority must record its satisfaction and that is in relation to the default, if it has occurred and the satisfaction in that behalf has to be in terms of clause (a) of sub-se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the fact that it is the NCLT which has been designated as an adjudicating authority. It is a tribunal. It is discharging a judicial function. When a judicial function is to be discharged, then, it is inconceivable that the legislature will allow such a function to be discharged in a nontransparent manner. Ultimately, the legislature would never allow justice to be a casualty. The legislature never intends to create a situation where a party before the tribunal or court feels that justice has not been done to him or her. Eventually, justice has not only to be done, but seen to be done. If justice is to be seen to be done, then, by acceptance of the arguments canvassed by Mr.Kadam, we would be taking away that assurance or guarantee to the litigant. The legislature never intended to take away such an assurance and certainly, it cannot be taken away on the ground of expediency. Merely because the legislature intended quick, speedy and expeditious resolution of disputes enumerated in and covered by the IBC does not mean that it will be at the cost of justice. The courts of law and tribunals exercising judicial functions have to dispense justice. They cannot dispense with ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the daily cause list in remarks column, whenever compliance is required. 90. Carry forward of cause list and adjournment of cases on account of non-sitting of a Bench.- (1) If by reason of declaration of holiday or for any otherunforeseen reason, the Bench does not function for the day, the daily cause list for that day shall, unless otherwise directed, be treated as the daily cause list for the next working day in addition to the eases already posted for that day. (2) When the sitting of a particular Bench is cancelled forthe reason of inability of a Member of the Bench, the Registrar shall, unless otherwise directed, adjourn the cases posted before that Bench to a convenient date and the adjournment or posting or directions shall be notified on the notice board of the Registry. 72. Therefore, by sub-rule (1) of Rule 89, the Registry is required to prepare and publish on the notice board of the Registry before the closing of working hours on each working day the cause list for the next working day and subject to the directions of the President, listing of cases in the daily cause list shall be in the order of priority, unless otherwise ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Part X of the NCLT Rules, 2016 will make this aspect further clear. Rule 91 requires diaries to be maintained by the clerk-incharge in such form as may be specified in each appeal or petition or application and they shall be written legibly. The diary in the main file shall contain a concise history of the appeal or petition or application, the substance of the order passed thereon and in execution proceedings, it shall contain a complete record of all the proceedings in execution of order or direction or rule and shall be checked by the Deputy Registrar and initialed once in a fortnight. It is not that signatures have to be appended or that every rule demands a strict compliance. We can understand an omission or irregularity not vitiating the proceedings in their entirety. However, we cannot condone something which results in failure or miscarriage of justice. That is how Rule 92 of the NCLT Rules, 2016 requires the Court Master of the Bench to maintain order sheet in every proceedings and shall contain all orders passed by the tribunal from time to time. Rule 93 provides for maintenance of court diary. The parties or legal practitioners are also required to furnish to the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udicial parlance, particularly as per the Advance Law Lexicon to pronounce means to utter formally, officially or solemnly, to declare or affirm, as pronounce a judgment or order. A declaration authoritatively or by way of a judgment is understood as pronouncement. We do not think that pronouncement is a formality, as is suggested before us. We hasten to clarify that we do not intend to be exhaustive and in every fact situation or circumstances judicial orders would not be declared as illegal or not binding merely because there is a minor deviation or departure or non-adherence to procedural rules. Ultimately, no general rule can be laid down. However, when Part XIX of the NCLT Rules, 2016 titled as Disposal of Cases and Pronouncement of Orders contains Rules 146 to 162 and particularly Rules 150 to 152 specifically on the point of subject of pronouncement, then, they cannot be ignored totally and in all situations, particularly on broad consideration of expediency. The expediency that is demonstrated in the present case is disturbing. If there was a hearing held in the month of August, 2019 and that was the last one, the remainder of the months of August and September wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ailable, the Impugned Order could not have been passed, and; e. Instead of listing the said Insolvency Petition for rehearing, a purported certified copy of the Impugned Order seems to have been issued by Respondent No.2 to Respondent No.5 on 7th November 2019, and; f. pronouncement of orders being mandatory under the rules, copy of the Impugned Order merely stating to be certified and bearing the inscription SD/- does not lend any sanctity unless the order is signed by both members of the concerned bench and pronounced in open court as per the said Rules. g. In light of the infringement of its legal and fundamental rights, the Petitioner has approached this Hon ble Court seeking exercise of its powers under Article 226 of the constitution of India inter alia based on the facts and legal grounds stated in detail hereinbelow. 77. A perusal of the record of the tribunal also does not reveal that the same was maintained in accordance with the NCLT Rules. There is nothing therein to show that barring the date of filing of the petition/ application, the date of its registration, the date of its copy being served on the other side, the replies and o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sent a open and transparent declaration and announcement of a judicial order. 79. In the present case, the language of Rules 150 to 152 enables us to hold that the pronouncement of the order is indeed necessary. These rules read as under:- 150. Pronouncement of Order.- (1) The Tribunal, after hearing the applicant andrespondent, shall make and pronounce an order either at once or, as soon as thereafter as may be practicable but not later than thirty days from the final hearing. (2) Every order of the Tribunal shall be in writing and shall be signed and dated by the President or Member or Members constituting the Bench which heard the case and pronounced the order. (3) A certified copy of every order passed by the Tribunal shall be given to the parties. (4) The Tribunal, may transmit order made by it to anycourt for enforcement, on application made by either of the parties to the order or suo motu. (5) Every order or judgment or notice shall bear the sealof the Tribunal. 151. Pronouncement of order by any one member of the Bench.- (1) Any Member of the Bench may pronounce the orderfor and on behal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent, on application made by either of the parties to the order or suo motu. The rule also states that the order or judgment or notice shall bear the seal of the tribunal. If there was absolutely no necessity of pronouncement of the order, Rule 151 would not have been inserted at all. Rule 151 has been inserted with a purpose. It is stated in Rule 151 that any Member of the Bench may pronounce the order for and on behalf of the Bench. By Rule 152 it is permissible for the President to authorise any other Member to pronounce the order if the Members of the bench, who heard the case are not readily available or have ceased to be Members of the tribunal. This can be done after the President is satisfied that the order has been duly prepared and signed by all the Members who heard the case. Thus, as per rules a duly prepared and signed order can be pronounced by another Member who was not part of the Bench which heard the case. We are aware of the fact that there is great inconvenience to litigants and parties before a court of law if judgments are not duly prepared, signed and pronounced before the presiding officers or Members demit office or handover charge on the eve of eith ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gistrar. The copies have to be made. A communication of the order to the parties is contemplated by sub-rule (3) of Rule 157 but after that is pronounced by the Bench. The steps prior to the communication are as crucial as the pronouncement. 82. We searched from the records any proof or evidence of such transmission of the order by the Court Master or the entries by the Court Master and we found nothing. In fact, in this case, the records are maintained in a haphazard manner. There is index and there is nothing like required and proper entries by the Court Master or order sheets in the file. The huge pendency of cases or shortage of staff should not mean that litigants have to suffer. If the staff is required to complete the records, then, they must do so so that there is no embarrassment to the Members of the tribunal and undue harassment to the litigants by their inaction or acts of omission and commission. In the present case, when there is absolutely no dispute about the factual aspects and that the arguments of both sides have proceeded on the footing that there is no record of pronouncement, then, all the more we cannot agree with Mr.Kadam that in the present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Allahabad delivered in a criminal appeal. The appeal was heard on 11th December, 1952 by a Bench comprising of two Judges at Lucknow. The arguments were heard. Before the judgment could be delivered, one of the Judges was transferred to Allahabad. While there he dictated the judgment purporting to do so on behalf of himself and his brother Judge, it was a judgment for and on behalf of the Bench. He signed every page as well as at the end, but did not date it. He then send this to other Judge at Lucknow. He died before the judgment was delivered. Now, the sole Member of the Bench of two Judges purported to deliver the judgment, he signed it and dated it. He placed the date below it. The signature of the Judge who had already expired was appearing on the judgment. The litigants and the public at large was not aware that when the judgment was delivered, one of the Judges of the Bench had already expired. The consequences and repercussions of such judgment were indeed drastic, in that the criminal appeal was dismissed, the conviction and sentence was upheld. The sentence imposed was a death sentence. In these circumstances, the question before the court was whether the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed too narrowly; nor do we desire to curtail the jurisdiction which the Privy Council point out is inherent in courts to make good inherent defects caused by accidents such as death. As this decision of the Judicial Committee was relied on in the arguments we will quote the passage which is relevant here. It is at page 295 of - Firm Gokal Chand v. Firm Nand Ram AIR 1938 PC 292(A). The facts are not quite the same as here because the judgment was actually delivered in open court and both the judges who constituted the Bench were present and concurred in it. But before it could be signed, one Judge went on leave. The Rules required the judgment to be signed and dated at the time that it was pronounced. Their Lordships said-- The rule does not say that if its requirements are not complied with the judgment shall be a nullity. So startling a result would need clear and precise words. Indeed the Rule does not even state any definite time in which it is to be fulfilled. The time is left to be defined by what is reasonable. The Rule from its very nature is not intended to affect the rights of parties to a judgment. It is intended to secure certainty in the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing, all the rules designed to secure certainty about its content and matter-can be cured; but not the hard core, namely the formal intimation of the decision and its contents formally declared in a judicial way in open Court. The exact way in which this is done does not matter. In some Courts the judgment is delivered orally or read out, in some only the operative portion is pronounced, in some the judgment is merely signed after giving notice to the parties and laying the draft on the table for a given number of days for inspection. (underlining ours) 11. An important point therefore arises. It is evident that the decision which is so pronounced or intimated must be a declaration of the mind of the Court as it is at the time of pronouncement. We lay no stress on the mode or manner of delivery, as that is not of the essence, except to say that it must be done in a judicial way in open Court. But however it is done it must an expression of them ind of the Court at the time of delivery. We say this because that is the first judicial act touching the judgment which the Court performs after the hearing. Everything else up till then is done out of Court and is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal and unalterable opinion or was only intended to be a tentative draft sent with an unwritten understanding that he is free to change his mind should fresh light drawn upon him before the delivery of judgment. 13. Views similar to this were expressed by a Full Bench of the Calcutta High Court consisting of nine Judges in the year 1867 in ...Mahomed Akil v. Asadunnissa Bibee, 9 WR 1 (FB) (B). In that case, three of the seven Judges who constituted the Bench handed in signed judgments to the Registrar of the Court. Before the judgment could be delivered, two of them retired and one died. A Full Bench of nine Judges was convened to consider whether the drafts of those three Judges could be accepted as judgments of the Court. Seton-Kerr, J. who had heard the case along with them, said - Certainly as far as I can recollect, they appeared to have fully made up their minds on a subject which they had very seriously considered, and on which they had abundant opportunities of forming a final determination. I am however not prepared to say that they might not on further consideration have changed their opinions .. Despite this, all nine Judges were unanim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judgment of the Hon ble Supreme Court. Their applicability does not depend upon the nature of the lis, the hierarchy of courts/ tribunals, the stake involved in the litigation and related issues. The above principles highlight the mode and manner of discharging judicial function and duty, permeating or spreading throughout, from entertainment of the proceedings till their culmination in a final judgment and order. Even the final act has to be performed in a manner consistent with the procedural rules and not abrogating them altogether. At all stages, regard to the underlying guiding rules is necessary, else, exceptions or departures would displace the rules completely. Litigations are frequently used as pressurising, harassing, embarrassing tactics by unscrupulous parties and they will play with the whole system if consistency is not maintained. That is not to say that small or minor infraction or deviation will necessarily vitiate the whole process. Everything depends upon the facts and circumstances in each case. Nobody should be allowed to manipulate the judicial process and secure favourable relief or judgment by deft management. Judges ought to be aware of the modern t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... less the same results in miscarriage of justice. In all procedural laws certain things are vital. Disregard of the provisions in respect of them would prove fatal to the trial and would invalidate the conviction. There are, however, other requirements which are not so vital. Non-compliance with them would amount to an irregularity which would be curable unless it has resulted in a failure of justice. 9. Question then arises as to whether the failure of a trial judge to sign the judgment at the time of its pronouncement because of its having not been transcribed is a procedural irregularity curable under Section 537 of the Code. In this respect we find that the question as to what is the effect of a judge not signing the judgment at the time it was pronounced was considered by the Judicial Committee in the case of Firm Gokal Chand v. Firm Nand Ram, AIR 1938 PC 292. The appeal in that case in the Lahore High Court was heard by a Division Bench consisting of Harrison and Agha Haider, JJ. The judgment in the case was actually delivered by Harrison, J. with whom Agha Haider, J. concurred. The judgment was pronounced on February 22, 1933 but Harrison, J. went on leave before sig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10. The above decision was a referred to by this Court in the case of Surendra Singh v. State of Uttar Pradesh, 1954 SCR 330 = (AIR 1954 SC 194) and it was observed that Section 537 of the Code of Criminal Procedure does as much the same thing on the criminal side as Sections 99 and 108 on the Civil. This Court in that decision dealt with a criminal case wherein death sentence had been awarded. The case in the High Court was heard by a Bench of two judges. The judgment was signed by both of them but it was delivered in Court by one of them after the death of the other. It was held that there was no valid judgment and the case should be reheard. Arriving at that conclusion, this Court took the view that a judgment is the final decision of the court intimated to the parties and the world at large by formal pronouncement or delivery in open court and until a judgment is delivered, the judges have a right to change their mind. In the course of discussion Bose, J., who spoke for this Court also made an observation regarding the signing of the judgment and other similar matters in the following words: Small irregularities in the manner of pronouncement or the mode of deliv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supra)], there was indeed a procedural irregularity not resulting in any miscarriage of justice. There, the judge dictated the judgment and order of conviction and sentence, but that was not transcribed for more than nine months. However, it had been pronounced. If the conclusion was made known by a pronouncement in open court or otherwise required by the rules, then, a mere belated transcription and handing over of copies to the accused would not vitiate the trial and it could never be held to be a miscarriage of justice. The failure of justice results when there is absolutely no adherence to the rules of procedure. 89. In the case of State of Uttar Pradesh (supra), the Hon ble Supreme Court in paras 4 to 7 and 14, 15 and 16 held as under:- 4. In exercise of powers conferred by clause 8 of the Statutory Order the Government had set up the Tribunal. Clause 9 of the Statutory Order provides for the procedure to be followed by the Tribunal. Sub-clause (7) of this clause is in these terms: The decision of the Tribunal shall be in writing and shall be pronounced in open court and dated and signed by the member or members of the Tribunal, as the case may be, at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e whether the terms of clauses 18 and 24(2) have been complied with in any case. 15. .. Now under section 10 of the Act of 1950, an appeal is competent if preferred within thirty days from the date of the publication of the award where such publication is provided for by the law under which the award is made, or from the date of the making of the award where there is no provision for such publication. Now the U.P.Act or the Statutory Order does not provide for any publication of an award. Therefore an appeal from the Tribunal set up under the Statutory Order has to be filed within thirty days from the making of the award. Hence again it is essential that the date of the making of the award shall be known to the parties to enable them to avail themselves of the right of appeal. This cannot be known unless the judgment is pronounced in open court for the date of award is the date of its pronouncement. Hence again pronouncement of the judgment in open court is essential. If it were not so, the provisions for appeal might be rendered ineffective. 16. For all these reasons it seems to us that the clear intention of the legislature is to make it imperative that jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ument as it overlooks the object and purpose of pronouncing a judgment. Before us, the issue is not of not following the rules of procedure in every detail nor is the manner of pronouncement challenged before us. We do not think that we can cure the basic defect in this manner. This would mean that the requirement of pronouncing a judgment need not be adhered to at all. Secondly, it makes mockery of judicial proceedings. Thirdly and importantly, the arguments or the attempt made by Mr.Kadam, if accepted, would result in paper compliance with the requirement of pronouncement of the judgment and order by the tribunal. We cannot take such a casual and light hearted approach. We cannot condone the defect in this manner. We do not think that the defect in this case is curable in nature. We find that this defect vitiates the proceedings in their entirety. We are, therefore, of the firm opinion that if we accept the course suggested by Mr.Kadam, we would be diluting the rigour of the requirement set out in the rules. Even if they are procedural rules, the requirement of pronouncement of the judgment or the order in open court or in a transparent manner serves a salutary purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt in the case of Jer Rutton Kavasmaneck and Anr. vs. Gharda Chemicals Ltd. and Ors. . That is also misplaced, inasmuch as, the issue arose in somewhat different context. There, after having participated in and argued the case on merits, a contention, inter alia, raised was that the Company Law Board Regulations, 1991 were not adhered to. The argument was that the impugned order passed by the Company Law Board had not been pronounced. The respondent had received the impugned order and took steps to implement it even before the appellant learnt and/ or received the order. It was submitted that the order that is not pronounced is not an order in the eyes of law. The answer to that argument was that where the Act or Rules did not require pronouncement in open court, then, the mode of delivery of judgment or order depends on particular Act and Rules or Regulations. The learned Single Judge noted the arguments, but eventually held that there is a requirement stipulated for pronouncement of order in open court. In the case before the learned Single Judge, the order of the Company Law Board was not pronounced in the open court, however, it was communicated to all parties and copy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt XIVA had been inserted by the Constitution (Forth-second Amendment) Act, 1976 with effect from 3rd January, 1977, its aim was speedy and expeditious justice. Article 323A is titled as Administrative tribunals , whereas, Article 323B enables setting up of tribunals for other matters. The appropriate legislature may, by law, provide for the adjudication or trial by tribunals of any disputes, complaints or offences with respect to all or any of the matters specified in clause (2) with respect to which such legislature has power to make laws. The present tribunal is traceable to the power conferred in the appropriate legislature under Article 323B. Noting the ambit and scope of this constitutional power and particularly to set up tribunals, the Hon ble Supreme Court emphasised that these tribunals are constituted as a substitute for the established and pre-existing mechanism. In paras 66, to 70, 73 and 76, the Hon ble Supreme Court held as under:- 66. .. Therefore, the personnel manning the administrative tribunal in their determination not only require judicial approach but also knowledge and expertise in that particular branch of constitutional and administrative l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... occasion different and complex questions of law which baffle the minds of even trained judges in the High Court and Supreme Court would arise for discussion and decision. 68. In Union of India v. Sankal Chand Himatlal Sheth, (1978) 1 SCR 423 at 442 : (AIR 1977 SC 2328 at p.2338), this Court at p.463 (of SCR) : (at p.2355 of AIR) laid emphasis that, independence of the judiciary is a fighting faith of our Constitution. Fearless justice is the cardinal creed of our founding document. It is indeed a part of our ancient tradition which has produced great judges in the past. In England too, judicial independence is prized as a basic value and so natural and inevitable it has come to be regarded and so ingrained it has become in the life and thought of the people that it would be regarded an act of insanity for any one to think otherwise . At page 471 it was further held that if the beacon of the judiciary is to remain bright, Court must be above reproach, free from coercion and from political influence. At page 491 (of SCR) : (at p.2376 of Air), it was held that the independence of the judiciary is itself a necessitous desideratum of public interest and so interference with it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adjudicatory Tribunal and the institution as well would command the requisite confidence of the disputants. In Shri Kumar Padma Prasad v. Union of India, (1992) 2 SCC 428 : (1992 AIR SCW 1094), this Court emphasised that, Needless to say that the independence, efficiency and integrity of the judiciary can only be maintained by selecting the best persons in accordance with the procedure provided under the Constitution. The objectives enshrined in the Constitution cannot be achieved unless the functionaries accountable for making appointments act with meticulous care and utmost responsibility. 70. In a democracy governed by rule of law surely the only acceptable repository of absolute discretion should be the Courts. Judicial review is the basic and essential feature of the Indian constitutional scheme entrusted to the judiciary. It cannot be dispensed with by creating tribunal under Arts 323A and 323B of the Constitution. Any institutional mechanism or authority in negation of judicial review is destructive of basic structure. So long as the alternative institutional mechanism or authority set up by an Act is not less effective than the High Court, it is consistent with co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the High Court prescribed under Art.217 of the Constitution, namely, that he was not a District Judge for 10 years in State Higher Judicial Service, which is a mandatory requirement for a valid appointment. Therefore, this Court declared that he was not qualified to be appointed as a Judge of the High Court and quashed his appointment accordingly. The facts therein are clearly glaring and so the ratio is distinguishable. 76. Before parting with the case it is necessary to express our anguish over the ineffectivity of the alternative mechanism devised for judicial reviews. The Judicial review and remedy are fundamental rights of the citizens. The dispensation of justice by the tribunals is much to be desired. We are not doubting the ability of the members or Vice-Chairmen (non-Judges) who may be experts in their regular service. But judicial adjudication is a special process and would efficiently be administered by advocate Judges. The remedy of appeal by special leave under Art.136 to this Court also proved to be costly and prohibitive and far-flung distance too is working as constant constraint to litigant public who could ill afford to reach this court. An appeal to a B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ident should be selected and appointed. The staff ought to be drawn from legal field. If any administrative staff or departmental member is appointed or deputed to work in the tribunals, he may not have any experience of working in a court. We have have noticed in this case that the NCLT lacks such a staff. It is on account of the staff members that in this case both the judicial Members have been embarrassed. The litigants suffer by a requirement to hold the proceedings afresh. 101. As a result of the above discussion, we are of the firm view that the present writ petition is maintainable and for the reasons aforenoted, the writ of certiorari must go to quash and set aside the impugned order. We, accordingly, issue that writ of certiorari and quash and set aside the impugned order on the ground that the same is a nullity. Once it is a nullity and cannot be allowed to stand, then, we have no alternative, but to declare that all steps consequential to this order would also not survive. The appointment of the resolution professional would also have to go and every step/ measure taken by him also must fall to the ground. Now, the application made by the applicant in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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