# In the matter of Ratul Puri vs. Punjab National Bank & Ors.

> HC judgment dated 2024-02-29. Citation: TCN-2024-HC-00122. The writ petition challenges an order dated 20.04.2023 by the Review Committee of Punjab National…

- **Court:** HC
- **Order date:** 29 Feb 2024
- **Citation:** TCN-2024-HC-00122
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/ratul-puri-vs-punjab-national-bank-ors-ef9c6f7f

## Summary

### Background

The writ petition challenges an order dated 20.04.2023 by the Review Committee of Punjab National Bank, confirming an earlier order dated 13.07.2022 by the Identification Committee, which declared the petitioner, Ratul Puri, as a Wilful Defaulter under the Master Circular on Wilful Defaulters, 2015, issued by the Reserve Bank of India (RBI). The declaration stemmed from Puri's association with Moser Baer Solar Ltd. (MBSL). The bank alleged diversion of funds and failure to meet loan repayment obligations by MBSL.

## Facts

Ratul Puri, the petitioner, is the Chairman of Hindustan Power Projects Pvt. Ltd. Punjab National Bank (PNB) sought to declare Puri a Wilful Defaulter due to his association with Moser Baer Solar Ltd. (MBSL). MBSL, a subsidiary of Moser Baer India Limited (MBIL), faced financial difficulties. The bank alleged that MBSL had diverted funds through lease agreements with MBIL and investments in Helios Photovoltaic Ltd. A Forensic Audit Report was used as the basis for the Wilful Defaulter declaration. The petitioner resigned as Executive Director of MBSL on 30.04.2012 and as full time Director on 16.11.2012. The lender banks were aware of the lease agreements and the investments during the CDR process. The court found that the security deposits by MBSL to MBIL were not

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## Issues and analysis

### Issue 1: Whether the Respondent Bank can declare the Petitioner as a Wilful Defaulter based solely on the …

**Ratio:** Lender banks must independently assess the facts and circumstances and cannot solely rely

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**Reasoning:** The court emphasized that the lender banks must independently assess the facts and

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**Interpretation:** The Master Circular casts a specific obligation on the Respondent Bank to act

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**Application:** The Respondent Bank attributed acts of Wilful Default to the Petitioner only on

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## Parties

- **Judges:** Purushaindra…
- **Appellants:** RATUL…
- **Respondents:** Moser Baer Solar…; Punjab National…
- **Other parties:** Kohi…
- **Advocates:** Dayan Kri…; Vaibhav M…; +6 more

## Timeline

- **2017-11-14 — Previous Writ Petition…**: An earlier writ petition was disposed of after the Respondent Bank stated it was not…
- **2019-04-09 — Show Cause Noti…**: Respondent Bank issued a Show Cause Notice to…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 3 — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-3)

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