TaxTMI 
TaxTMI 
2023 (1) TMI 747
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....e well known exceptions to the rule that an alternate remedy must first be exhausted. An express finding is that the existence of an alternate remedy does not per se divest a High Court of its powers under Article 226 of the Constitution of India in an appropriate case although ordinarily a writ Court would not entertain a writ petition where there exists an efficacious alternate remedy. While the rule of exhaustion of a statutory alternate remedy is a rule of policy and convenience, it is also one of discretion. 3. One of the principles that attaches to evaluating any administrative or executive action in judicial review is whether the standard applied is reasonable and proportionate. Other well settled tenets of natural justice are of course that an opportunity of being heard must be given and that a reasoned order must be passed. Equally, no authority can exercise jurisdiction that is not vested in it. A hearing is not to be an empty formality. It must be an effective hearing and must result in a reasoned order that reflects a proper application of mind. This speaks to the decision-making process, not the resultant decision itself. Where these elements are found even prima faci....
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....y Rule 3(1)(k) is important: = "3 Eligibility for registered valuers.-(1) A person shall be eligible to be a registered valuer if he- (a) ... ... ... ... (k) is a fit and proper person: Explanation.- For determining whether an individual is a fit and proper person under these rules, the authority may take account of any relevant consideration, including but not limited to the following criteria- (i) integrity, reputation and character, (ii) absence of convictions and restraint orders, and (iii) competence and financial insolvency." (Emphasis added) 12. The Rules also provide that throughout the period of registration, that is to say as long as the person is registered, these qualifications and eligibility criteria must be maintained. 13. Some time in September 2019, a First Information Report No. 86 of 2019 came to be registered by the Economic Offences Wing ("EOW") through its Banking Unit-II, a Division of Mumbai Police. This was directed against certain officials of the PMC . The case was one of on creation of fictitious and the siphoning off huge sums of money for the benefit of a corporate entity known as Housing and Development Infrastructure Ltd ("HDIL"). ....
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....st the Petitioner the entire case was based on conjecture and surmise. 17. It is true that the Petitioner was afforded a personal hearing which his Advocates attended on 4th August 2021. However, on 28th February 2022, the IBBI through its Whole Time Member ("WTM") issued the impugned order. The operative portion of that order at page 22 reads thus: "5. In view of the above, the Authority, in exercise of powers vide notification of Central Government no. GSR 1316(E) dated 18.10.2017 under Section 458 of the Companies Act, 2013 and in pursuance of rule 15 and rule 17 of the Companies (Registered Valuers and Valuation) Rules, 2017, hereby, suspends the registration of Mr. Vishwanath Shridhara Prabhu as a registered valuer till he is exonerated of the charges. 6. In accordance with provisions of Rules 174(8) of the Valuers Rules, the directions of this order shall come into force with immediate effect in view of para 5 above. 7. A copy of this order shall be forwarded to IIV India Registered Valuers Foundation where Mr. Vishwanath Shridhar Prabhu is enrolled as a member. 8. Accordingly, the show cause notice is disposed of." (Emphasis added) 18. On 6th August 2022, the Peti....
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....ween the valuer and the stakeholders. Based on the professional opinion of a valuer, for the purposes of Corporate Insolvency Resolution Process, CoC takes prudent commercial decisions. Therefore, it becomes crucial to engender as well as maintain the reputation and integrity of the valuation profession and the trust of the stakeholders, so that the decision makers in the market have adequate comport to take any crucial economic decision without any fear or doubt. 4.7 In view of the foregoing, the Authority finds that pendency of the criminal proceeding against Mr. Prabhu for the offences as stated above, adversely affected his integrity and reputation and makes him a person who is not 'fit and proper' to be eligible as a RV. Hence, the Authority finds that this is in violation of Rule 3(1)(k) of the Companies (Registered Valuers and Valuation) Rules, 2017." (Emphasis added) 20. On the face of it, it is difficult to comprehend the reasoning, logic or rationale in this order, especially in paragraph 4.7. Anyone may set the criminal process in motion against anyone. There may be an FIR. There may even be a charge-sheet. But, except in certain specific statutes, the presumption in....