TMI Blog2023 (11) TMI 223X X X X Extracts X X X X X X X X Extracts X X X X ..... rities in such cases. Only when the action of the administrative authority is so unfair or unreasonable that no reasonable person would have taken that action, can the Court intervene. This Court does not find that the decision making process adopted by the Board or the decision based on the final report is perverse or is contrary to law or against public interest, which would warrant interference from this Court under Article 226 of the Constitution of India. Court while exercising its jurisdiction under Article 226 of the Constitution of India while examining any enquiry report does not go into excruciating detailed facts nor does it substitute its conclusion to the one arrived at by the fact finding body. If the process adopted in the enquiry is fair, reasonable and transparent then the Writ Court does not interfere with the findings to substitute its own conclusion to the one arrived at by the authority simply because another view is possible. Petition dismissed. - HON'BLE MR. JUSTICE SUBRAMONIUM PRASAD For the Petitioner Through: Mr. Shubham Gupta and Mr. Mahesh Kumar, Advocates For the Respondents Through: Mr. Jagjit Singh, Mr. Preet Singh and Ms. Ka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circulation in the concerned area. d. It is stated that the Petitioner herein, who was the Operational Creditor of the Corporate Debtor, filed its claim on 27.09.2017 before the Respondent No. 2. It is stated that the Respondent No. 2, in contravention of the provisions of the IBC uploaded the incomplete Information Memorandum (IM) of the Corporate Debtor on its website thereby making it a public document. e. It is stated that a complaint was filed by the Petitioner herein against Respondent No. 2 with the Respondent No. 1/Board on 18.03.2019 highlighting the irregularities committed by the Respondent No. 2 during the CIRP process of the Corporate Debtor. It is stated that in response to the complaint filed by the Petitioner herein, Respondent No. 1 replied stating that prima facie there seems to be some merit in the allegations of the Petitioner herein. However, no action was taken by the Respondent No. 1 against Respondent No. 2. f. It is stated that on 05.09.2019 the Petitioner filed an addendum to the complaint already filed by him before the Board. g. It is stated that since the CIRP process failed, the NCLT passed an order for liquidation of the Corporate Debtor. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arned Counsel for the Petitioner also contends that Board has been extremely secretive about the nature and manner in which investigation has been conducted by it on the complaint made by the Petitioner against Respondent No. 2. He further states that the Board has not been transparent in respect of the investigation done by it and the result of the investigation. 6. Per contra, learned Counsel for Respondent No. 1 draws the attention of this Court to the various provisions of the CIRP Regulations and the Insolvency And Bankruptcy Board Of India (Grievance And Complaint Handling Procedure) Regulations, 2017 (hereinafter referred to as the 2017 Regulations ) which have been framed for disposal of grievances and complaints against service providers including Resolution Professionals. He contends that under Regulation 7 of the 2017 Regulations, upon receiving a complaint from any person regarding the nature and manner of performance of a service provider, including a Resolution Professionals, information is sought from both, the complainant and the service provider. The Board investigates into the matter and forms its opinion. If the Board finds that there is no merit in the compl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a prima facie case. (7) Where the Board is of the opinion that there exists a prima facie case, it may issue a show cause notice under regulation 11 of the Insolvency and Bankruptcy Board of India (Inspection and Investigation) Regulations, 2017 or order an investigation under Chapter III of Insolvency and Bankruptcy Board of India (Inspection and Investigation) Regulations, 2017]. (8) Where the Board is of the opinion that the complaint is not frivolous, it shall refund the fee of two thousand five hundred rupees received under sub-regulation (3) of regulation 3 9. This Court vide Order dated 03.02.2023 had directed the Respondent No. 1 to file the Interim Report dated 13.01.2020 and the Final Report dated 29.05.2020 to satisfy itself about the nature and manner of investigation carried out by the Board against Respondent No. 2. The said reports have been filed. 10. This Court has perused the Draft Inspection Report and the Final Inspection Report. A perusal of the Final Inspection Report shows that the Investigating Agency has thoroughly examined the complaint by recording the factual position on each aspect, the legal provisions applicable, the observations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... professional agencies, insolvency professionals and information utilities; (c) levy fee or other charges 2 [for carrying out the purposes of this Code, including fee for registration and renewal] of insolvency professional agencies, insolvency professionals and information utilities; (d) specify by regulations standards for the functioning of insolvency professional agencies, insolvency professionals and information utilities; (e) lay down by regulations the minimum curriculum for the examination of the insolvency professionals for their enrolment as members of the insolvency professional agencies; (f) carry out inspections and investigations on insolvency professional agencies, insolvency professionals and information utilities and pass such orders as may be required for compliance of the provisions of this Code and the regulations issued hereunder; (g) monitor the performance of insolvency professional agencies, insolvency professionals and information utilities and pass any directions as may be required for compliance of the provisions of this Code and the regulations issued hereunder; (h) call for any information and records from the insolve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al agencies which shall be non-discriminatory; 14. Respondent No. 1/Board is the authority to regulate the functioning of the Insolvency Professionals and the Board comprises of experts in the field who have been appointed by the Central Government to carry out the functions specified under Part IV of the IBC. It is well settled that Courts do not sit as an Appellate Authority over the decisions taken by the experts. 15. The Apex Court in Mansukhlal Vithaldas Chauhan v. State of Gujarat, (1997) 7 SCC 622, has observed as under: 25. This principle was reiterated in Tata Cellular v. Union of India [(1994) 6 SCC 651 : AIR 1996 SC 11] in which it was, inter alia, laid down that the Court does not sit as a court of appeal but merely reviews the manner in which the decision was made particularly as the Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted, it will be substituting its own decision which itself may be fallible. The Court pointed out that the duty of the Court is to confine itself to the question of legality. Its concern should be: 1. Whether a decision-making authority exc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d) 29. It may be pointed out that this principle was also applied by Professor Wade to quasi-judicial bodies and their decisions. Relying upon the decision in R. v. Justices of London [(1895) 1 QB 214]. Professor Wade laid down the principle that where a public authority was given power to determine a matter, mandamus would not lie to compel it to reach some particular decision. 30. A Division Bench of this Court comprising Kuldip Singh and B.P. Jeevan Reddy, JJ. in U.P. Financial Corpn. v. Gem Cap (India) (P) Ltd. [(1993) 2 SCC 299 : AIR 1993 SC 1435 : (1993) 2 SCR 149] observed as under: (SCC pp. 306-07, para 11) 11. The obligation to act fairly on the part of the administrative authorities was evolved to ensure the rule of law and to prevent failure of justice. This doctrine is complementary to the principles of natural justice which the quasi-judicial authorities are bound to observe. It is true that the distinction between a quasi-judicial and the administrative action has become thin, as pointed out by this Court as far back as 1970 in A.K. Kraipak v. Union of India [(1969) 2 SCC 262 : AIR 1970 SC 150] . Even so the extent of judicial scrutiny/judicial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hraseology used in relation to exercise of statutory discretions often use the word unreasonable in a rather comprehensive sense. It has frequently been used and is frequently used as a general description of the things that must not be done. For instance, a person entrusted with a discretion must, so to speak, direct himself properly in law. He must call his own attention to the matters which he is bound to consider. He must exclude from his consideration matters which are irrelevant to what he has to consider. If he does not obey those rules, he may truly be said, and often is said, to be acting unreasonably . Similarly, there may be something so absurd that no sensible person could even dream that it lay within the powers of the authority. In another, it is taking into consideration extraneous matters. It is unreasonable that it might almost be described as being done in bad faith; and in fact, all these things run into one another. Lord Greene also observed (KB p. 230 : All ER p. 683 F-G) it must be proved to be unreasonable in the sense that the court considers it to be a decision that no reasonable body can come to. It is not what the court considers unre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise a decision of the administrator as irrational the court has to hold, on material, that it is a decision so outrageous as to be in total defiance of logic or moral standards. Adoption of proportionality into administrative law was left for the future. 22. These principles have been noted in the aforesaid terms in Union of India v. G. Ganayutham [(1997) 7 SCC 463 : 1997 SCC (L S) 1806]. In essence, the test is to see whether there is any infirmity in the decision making process and not in the decision itself. (See Indian Rly. Construction Co. Ltd. v. Ajay Kumar [(2003) 4 SCC 579 : 2003 SCC (L S) 528] .) 17. As stated above, this Court does not find that the decision making process adopted by the Board or the decision based on the final report is perverse or is contrary to law or against public interest, which would warrant interference from this Court under Article 226 of the Constitution of India. Court while exercising its jurisdiction under Article 226 of the Constitution of India while examining any enquiry report does not go into excruciating detailed facts nor does it substitute its conclusion to the one arrived at by the fact finding body. If the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
