TMI Blog2024 (4) TMI 634X X X X Extracts X X X X X X X X Extracts X X X X ..... ation No. 859 of 2024 filed by Petitioner No. 1 and has recorded reasons as to why the said Interlocutory Application was being dismissed. This clearly shows that there is no violation of the principles of natural justice. The case of the Petitioners is that Petitioner No. 1 had followed the procedure provided under Rule 120 of the NCLT Rules and therefore the NCLT ought to have decided the said Application in its favour. On the other hand, it is the case of Respondent No. 3 that Petitioner No. 1 had not followed the procedure under Rule 120 of the NCLT Rules, and, therefore, the NCLT has correctly rejected Petitioner No. 1 s Application. This is surely an issue which can be raised in Appeal by Petitioner No. 1 and does not warrant interference by this Court in its writ jurisdiction under Article 226 of the Constitution of India. Moreover, this Court cannot lose sight of the fact that this inter se dispute between two groups for representing the Petitioner No. 1, who is the Corporate Debtor, cannot delay or jeopardize the proceedings filed by Respondent No. 3 as the financial creditor under Section 7 of the IBC. Any interference by the Writ Court would clearly affect the said proce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 8th February 2022, the JCM group, through a purported authorized representative, i.e., Mrs. Nirmala Tugnawat and an unauthorized Advocate, i.e., Adv. Mitika Agarwal, filed the Reply on behalf of Petitioner No. 1 to the Company Petition filed by Respondent No. 3, despite being removed as director of Petitioner No. 1. F] In 2022-2023, Petitioner No. 1 discovered that the JCM group had unauthorizedly filed the Vakalatnama of their Advocates and also unauthorizedly filed the Reply to the Company Petition. Accordingly, Petitioner No. 1, through its Advocate, i.e, Devanshu Desai, appeared in the matter. By certain orders, Respondent No. 3 was directed to serve Petitioner No. 1 with complete copies of the pleadings in the matter, which was duly done. G] On 17th January 2023, the Company Petition filed by Respondent No. 3 was finally heard by the NCLT and reserved for orders. The NCLT permitted both the sides, i.e., JCM group and the Advocates of Petitioner No. 1 to appear and make submissions. H] By an Order dated 24th February 2023, the NCLT dismissed the Company Petition filed by Respondent No. 3 on the ground of limitation. The ground of limitation was raised only by Petitioner No. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r was passed by the NCLT in the restored Company Petition directing Respondent No. 3 to serve copies of the pleadings in the restored Company Petition on the Advocates for Petitioner No. 1. At the time of passing of the said order, Petitioner No. 1 was represented by Advocate Devanshu Desai and Advocate Mitika Agarwal was not present at the said hearing. Q] In February, 2024, e-mails were addressed by the Advocate for Petitioner No. 1 requesting the Advocates for Respondent No. 3 to provide the pleadings in the restored Company Petition. The Advocate for Respondent No. 3 refused to provide the pleadings in the matter. R] Further, in February, 2024, Petitioner No. 1 discovered that Vakalatnama had been unauthorizedly filed by one M/s. Bulwark Solicitors on behalf of Petitioner No. 1 in the restored Company Petition. Petitioner No. 1 apprehended that the said Vakalatnama was signed by a member of the JCM group who had been removed from the Board of Petitioner No. 1. Accordingly, by e-mail dated 20th February 2024 addressed to M/s. Bulwark Solicitors, Petitioner No. 1 called upon it to refrain from representing Petitioner No. 1 in all matters. S] On 23rd February 2024, Petitioner No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal may deem fit and necessary in the interest of justice; b) At the time of hearing the Advocate on Record submitted that she has appeared as Counsel for the Corporate Debtor in the main Company Petition and had filed reply to the main Company Petition No 312/2021. The Advocate on Record vehemently opposed for discharging them as counsel on the record and allowing the applicant to bring on record as counsel for the Corporate Debtor in the main Company Petition. c) This bench is of the considered view that, the Interlocutory Application No. 859/2024 is filed under section 7 of the Insolvency and Bankruptcy Code, 2016. While adjudicating a petition u/s. 7 the bench is required to examine the twin conditions of debt and default as prescribed under the said section. In the present case, after perusing all documents and the record of default of Information utility (NesL) and after hearing both the counsels whose vakalatnama is on records, the bench has given its decision on the petition u/s. 7 and passed the necessary orders. The bench also observes that there is no NOC from the counsel who is on record. It is the obligation of the inducting counsel to obtain NOC and file it before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, Ms. Singhania submitted that the said Order dated 22nd March 2024 admitted the Petition against Petitioner No. 1 without allowing the Advocates who were entitled to represent Petitioner No. 1 to be heard in the matter. 8. Further, Ms. Singhania submitted that, since the said Order dated 22nd March 2024 had been passed in clear violation of the principles of natural justice, the present Writ Petition could be entertained and an alternative remedy was not a bar to entertain the present Writ Petition. In support of this proposition, Ms. Singhania relied upon the judgement of this Court in Kamal K. Singh Vs. Union of India Ors. (WPL No. 3250 of 2019) and on the judgement of the Supreme Court in Kalpraj Dharamshi and Anr. Vs. Kotak Investment Advisors Limited Anr. (2021) 10 SCC 401. 9. Ms. Singhania submitted that, in these circumstances, this Court ought to entertain this Writ Petition and quash and set aside the said Order dated 22nd March 2024. 10. On the other hand, Ms. Behramkamdin, the learned Advocate for Respondent No. 3, opposed the granting of any reliefs in the Petition. Ms. Behramkamdin submitted that the NCLT had correctly rejected Interlocutory Application No. 859 of 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e controversy between the parties is whether Petitioner No. 1 had followed the procedure provided under Rule 120 of the NCLT Rules whilst seeking discharge of the Advocate appointed by the JCM group and seeking appointment of its own Advocate to represent Petitioner No. 1-Company. It is the case of the Petitioners that the said Rule 120 has been followed and therefore the NCLT was not right in refusing to adjudicate the dispute as to which Advocate was entitled to represent Petitioner No. 1 before the NCLT. On the other hand, it is the submission of Respondent No. 3 that the procedure provided under Rule 120 had not been followed and therefore the NCLT was correct in not considering the Application of Petitioner No. 1 for change of Advocate and had rightly rejected the same. 15. We are of the view that, considering the scope of the controversy between the parties in Interlocutory Application No. 859 of 2024, it would be appropriate that this Petition is not entertained and the Petitioners are relegated to the remedy of filing an Appeal before the NCLAT. The controversy is such that can be clearly decided by the NCLAT and does not warrant interference of this Court in its writ juris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be condoned or overlooked by us and thereafter the only remedy available to parties is by way of an appeal to correct the decision. If the decision itself has been rendered in utter breach of the rules of procedure or in violation of the principles of natural justice occasioning or resulting in failure of justice, even then, the High Court need not or cannot step in. If that is how we approach this writ, possibly, we would frustrate and defeat the very object and purpose of issuing it. We have to 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 j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowing the party to bypass the alternate and equally efficacious remedy. The remedy provided by the statute must be followed. The High Court, therefore, should not have entertained the writ petition. The bar enacted has exceptions and that alternate remedy is not necessarily to be availed of when the writ petition is filed for enforcement of any of the fundamental rights or there has been a breach of principles of natural justice or where the order under challenge is wholly without 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 applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l has acted without jurisdiction or in breach of the principles of natural justice, then a Writ Court, in its jurisdiction under Article 226 of the Constitution of India, may entertain a Writ Petition and not relegate a party to the alternate remedy of an Appeal. Of course, it is equally well established that the Writ Court has a discretion in these matters, and whether a Writ Court would exercise its discretion and invoke its writ jurisdiction would depend on the facts of each case. In the present case, there is no doubt that the NCLT had the jurisdiction to pass the said Order dated 22nd March 2024, inter alia, in respect of Interlocutory Application No. 859 of 2024 filed by Petitioner No. 1. The NCLT, in its Order dated 22nd March 2024, has considered Interlocutory Application No. 859 of 2024 filed by Petitioner No. 1 and has recorded reasons as to why the said Interlocutory Application was being dismissed. This clearly shows that there is no violation of the principles of natural justice. The case of the Petitioners is that Petitioner No. 1 had followed the procedure provided under Rule 120 of the NCLT Rules and therefore the NCLT ought to have decided the said Application in i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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