# In the matter of Saskawa Inda Leprosy Foundation Vs. Union of India & Ors., W.P(C) 1273/2021 & CM APPLs. 3544/2021, 8050/2021, 1637/2021,27429/2021 & 33701/2021

> HC judgment dated 2022-08-01. Citation: TCN-2022-HC-00029. Sasakawa India Leprosy Foundation filed a writ petition challenging the constitutional validity of…

- **Court:** HC
- **Order date:** 1 Aug 2022
- **Citation:** TCN-2022-HC-00029
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/saskawa-inda-leprosy-foundation-vs-union-of-india-ors-wp-5bd935e4

## Summary

### Background

Sasakawa India Leprosy Foundation filed a writ petition challenging the constitutional validity of the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019, and Notification No. S.O. 4139(E) dated 18.11.2019. The petitioner, a public charitable trust, had fixed deposit accounts with Dewan Housing Finance Corporation Limited (DHFL). Insolvency proceedings were initiated against DHFL under the IBC, and the petitioner was aggrieved by the initiation of the insolvency process under the Impugned Rules.

## Facts

The Sasakawa India Leprosy Foundation, a public charitable trust, filed a writ petition challenging the constitutional validity of the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019, and Notification No. S.O. 4139(E) dated 18.11.2019. Between March 2017 and January 2018, the Petitioner opened four fixed deposit accounts with various branches of Dewan Housing Finance Corporation Limited (DHFL) in Delhi, totaling Rs. 7,56,07,000. These FDs were non-cumulative deposits, under yearly interest schemes, and were to mature only after 03.12.2019. Insolvency proceedings were initiated against DHFL under the IBC. The petitioner is aggrieved by the initiation of the insolvency

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## Issues and analysis

### Issue 1: Whether the Impugned Rules and …

**Ratio:** The Supreme Court in State of T.N. v. P. Krishnamurthy, (2006) 4 SCC 517, has laid down

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**Reasoning:** The court found that the Impugned Rules have been framed under the powers granted under

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**Interpretation:** The court interpreted the relevant sections of the IBC and the RBI Act to

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**Application:** The court applied the principles of judicial review to the Impugned Rules and

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## Parties

- **Judges:** SATISH CHANDRA…; Subramonium…
- **Appellants:** SASAKAWA INDIA…
- **Respondents:** Dewan Housing…; Union of…
- **Other parties:** Kohi…

## Timeline

- **2017-03-01 — Opening of Fixed…**: Between March 2017 and January 2018, the Petitioner opened four fixed deposit accounts…
- **2018-01-01 — Opening of Fixed…**: Between March 2017 and January 2018, the Petitioner opened four fixed deposit accounts…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 227 — Power of Central Government to notify financial…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-227)

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