# In the matter of Vishambhar Saran and Anr. vs. Central Bank of India and Ors.

> HC judgment dated 2024-05-14. Citation: TCN-2024-HC-00092. The case involves two writ petitions (WPO No. 633 of 2023 and WPO No. 212 of 2024) filed by…

- **Court:** HC
- **Order date:** 14 May 2024
- **Citation:** TCN-2024-HC-00092
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/vishambhar-saran-and-anr-vs-central-bank-of-india-and-ors-1354cbda

## Summary

### Background

The case involves two writ petitions (WPO No. 633 of 2023 and WPO No. 212 of 2024) filed by Vishambhar Saran and Anr. challenging the decision of the Willful Defaulter Identification Committee (First Committee) and the Review Committee (RC) to declare them as willful defaulters. The First Committee's decision was based on a Transaction Audit Report (TAR) prepared by Deloitte Touche Tohmatsu India, LLP. The petitioners argued that the TAR was not conclusive and that the Central Bank of India, being part of the consortium of banks, was bound by the NCLT's earlier rejection of the TAR in a related Corporate Insolvency Resolution Process (CIRP).

## Facts

Vishambhar Saran and Anr. filed two writ petitions, WPO No. 633 of 2023 and WPO No. 212 of 2024, challenging their classification as willful defaulters. The initial decision to classify them as such was made by the Willful Defaulter Identification Committee (First Committee), based primarily on a Transaction Audit Report (TAR) prepared by Deloitte Touche Tohmatsu India, LLP. The Review Committee (RC) affirmed this decision. The petitioners argued that the TAR was not conclusive, as the auditor itself had indicated limitations in its reliability. Furthermore, in a related Corporate Insolvency Resolution Process (CIRP), the National Company Law Tribunal (NCLT) had previously disbelieved the TAR. The Central Bank of India, a respondent in the writ petitions, was part of

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## Issues and analysis

### Issue 1: Whether the First Committee and the Review Committee were justified in relying solely on the …

**Ratio:** Reliance on a report that is not conclusive and whose reliability is disclaimed by its

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**Reasoning:** The court noted that the auditor itself had indicated in several places of the TAR that

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**Interpretation:** This means that committees determining willful defaulter status must consider

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**Application:** The court applied this principle to the present case, finding that the First

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## Parties

- **Judges:** SABYASACHI…
- **Appellants:** Vishambhar…
- **Respondents:** Central Bank of…

## Timeline

- **2015-07-01 — RBI Master C…**: Reserve Bank of India (RBI) issued the…
- **2019-09-30 — NCLAT Dec…**: The National Company Law Appellate Tribunal (NCLAT) decided on an appeal, affirming the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 1(c) — Short title, extent and commencement](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-1)

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