- Case
- MOHAMMED ENTERPRISES (TANZANIA) LTD. v. FAROOQ ALI KHAN (Supreme Court of India, 03-01-2025)
- Law
- Constitution of India, Insolvency and Bankruptcy Code.
Constitution of India, 1949: The judgment discusses Article 136, noting that the appeals are against the High Court's judgment. Article 226 is also discussed, specifically regarding the High Court's exercise of jurisdiction and whether it was appropriate to interdict proceedings under the Insolvency and Bankruptcy Code (IBC). The court refers to a prior decision, *CoC of KSK Mahanadai Power Company Limited v. M/S UP Power Corporation Limited*, taking exception to the High Court exercising its discretionary jurisdiction under Article 226, breaching the discipline of alternate remedy as contemplated under the IBC. Mr. Shyam Divan argued that the writ petition under Article 226 is not barred, particularly when there is a violation of the principle of natural justice.
Insolvency and Bankruptcy Code, 2016: The judgment extensively discusses the IBC, particularly in the context of Corporate Insolvency Resolution Process (CIRP). Section 12(A) is mentioned in relation to the offer made by the resolution applicant being inferior to the proposal made by the first respondent. Section 29 is mentioned regarding the resolution professional issuing the Information Memorandum. Section 60(5)(c) is cited regarding the jurisdiction and power of the Adjudicating Authority. The court emphasizes that the IBC is a complete code in itself. The judgment also refers to Regulation 19 of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, in conjunction with Section 12(A) of the IBC. The court notes that an unjustified interference with the proceedings initiated under the IBC breaches the discipline of law.
General Principles of Law: The judgment discusses the principles of natural justice, specifically in relation to the alleged violation due to the lack of a 24-hour notice. The High Court's decision to set aside the resolution plan was primarily based on this violation. The court also touches upon the concept of delay and laches in approaching the High Court, noting that the respondent invoked the jurisdiction of the High Court almost three years after the alleged violation of natural justice. The judgment emphasizes the importance of adhering to protocols and procedures to maintain legal discipline and preserve the balance between the need for order and the quest for justice.
