Bombay High Court
Partha Sarathy Sarkar vs Insolvency And Bankruptcy Board ... on 28 September, 2022
Bench: S.V. Gangapurwala, Madhav J. Jamdar
wpl23436-22.docx
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
Digitally
signed by
TRUSHA
TRUSHA TUSHAR
TUSHAR MOHITE
MOHITE Date:
2022.09.28
18:21:35
WRIT PETITION (L) NO.23436 OF 2022
+0530
1. Partha Sarathy Sarkar
Address: Off. No.1 First Floor
Jalaram Krupa, Janmabhoomi Marg,
Fort, Mumbai - 4000001. .... Petitioner
Versus
Insolvency & Bankruptcy Board of
India (IBBI)
Through its Chairperson
7th Floor, Mayur Bhavan,
Shankar Market,
Connaught Circus,
New Delhi - 110001
Mail id: [email protected] .... Respondent no.1
Secy., Ministry of Corporate Affairs,
Government of India
Address: 5th Floor,
100, Everest Building,
Netaji Subhash Road,
Mumbai 400 002 .... Respondent no.2
Mail id: [email protected]
Rajesh Kumar
General Manager (Adjudication)
7th Floor, Mayur Bhavan,
Shankar Market, Connaught Circus,
New Delhi - 110001.
Mail id: [email protected] ... Respondent no.3
Sudhakar Shukla,
Whole Time Member - IBBC,
7th Floor, Mayur Bhavan, Shankar
Market, Connaught Circus,
New Delhi - 110001
Mail id: [email protected] ... Respondent no.4
4. ICSI Institute of Insolvency
Professionals,
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Through its Managing Director,
3rd Floor, 22, ICSI House, Lodhi Road,
Institutional Area, New Delhi -
110003
Mail id: [email protected] .... Respondent no.5
Mr.Vijay Kurle a/w Mr.Samkit Shah for the Petitioner
Mr.Pankaj Vijayan a/w Ms.Tejashree Choudhari, Mr.Mohammed
Varawala for Respondent no.1
Mr.Ashish Mehta a/w Mr.Komal Bhoir i/b M/s.Ehes Legal Alliance
for Respondent no.2
CORAM: S.V. GANGAPURWALA &
MADHAV J. JAMDAR, JJ.
RESERVED ON: AUGUST 30, 2022
PRONOUNCED ON: SEPTEMBER 28, 2022
JUDGEMENT : (PER : S.V.GANGAPURWALA, J.)
1 The Petitioner assails the order of suspension of registration of
the Petitioner dated 24.06.2022.
2 The Petitioner is an Insolvency Professional. He is a
professional member of ICSI Institute of Insolvency Professionals
(ICSI and IIP) and an Insolvency Professional (IP) registered with
Insolvency and Bankruptcy Board of India.
3 The Registration of Petitioner as Insolvency Professional is
suspended for a period of three years under the impugned order
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dated 24.06.2022. The same is assailed in the present Writ Petition.
The learned counsel for the Respondents raised a preliminary
objection of the territorial jurisdiction to entertain the Writ Petition
of this court. In light of that, the learned counsel advanced
arguments on the issue of territorial jurisdiction on 30.08.2022.
The issue of territorial jurisdiction is decided under the present
order.
4 Mr.Vijayan the learned counsel for the Respondent
strenuously contends that the order of suspension is passed by the
authority at Delhi. The Petitioner has already filed an application
before the NCLT Delhi seeking interalia, a direction to hold a show
cause notice issued by the Respondent to be an attempt to interfere
in the course of proceedings qua the said application and issue
appropriate directions in terms of section 425 of the Companies Act.
The said application is pending adjudication before NCLT, Delhi.
This fact has been materially suppressed. The learned counsel
submits that the Petitioner has availed alternate remedy to
challenge the show cause notice by approaching the NCLT and as
such again approached this court challenging the final order
pursuant to the said show cause notice.
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5 The Respondent no.2 is a whole time member of the board and
as such disciplinary committee has been duly constituted under the
provisions of section 222 of the Insolvency and Bankruptcy, 2022.
Respondent no.3 is the General Manager of the Board. He has no
personal obligation towards the Petitioner. Respondent no.1 is a
statutory body constituted under the provisions of section 233 of the
Code and is not necessary party to the petition.
6 The learned counsel for the Respondent further submits that
entire cause of action has arisen at Delhi and no part of cause of
action has arisen within the territorial jurisdiction of this court. As
such, this court may not entertain the Writ Petition.
7 It is further submitted that the Petitioner was appointed as a
Resolution Professional pursuant to the order dated 21.08.2019
passed by NCLT Delhi with respect to the Corporate Office registered
at Delhi. Petitioner has taken charge of the Corporate data
registered at Delhi. Respondent conducted inspection / investigation
in respect of the conduct of the Petitioner as a Resolution
Professional at Delhi. Show cause notice was issued by the
Respondent at Delhi. The final suspension order was also passed in
Delhi and as such no part of cause of action has arisen within the
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territorial jurisdiction of this court.
8 The learned counsel relies on the judgment of the Apex Court
in the case of Oil and Natural Gas Commission vs. Utpal Kumar Basu
and Others1 dated 23.06.1994 to contend that the question of
territorial jurisdiction to entertain the Writ Petition must be based
on averments made in the petition.
9 The learned counsel submits that even if small part of the
cause of action arisen within territorial jurisdiction of this court, the
same by itself cannot be considered to be determinative factor
compelling the high court to decide the matter on merits. The court
shall invoke the doctrine of forum conveniens and in the present
case Petitioner ought to approach the High Court of Delhi.
10 The learned counsel relies on the judgment of the Apex court
in the case of Kusum Ingots & Alloys Ltd. vs. Union of India and
Another2. The learned counsel also relies upon the judgment of the
learned single Judge of Patna High Court in the case of Ashutosh
Ranjan vs. Union of India and Others3 dated 27.04.2022 and another
judgment of the Gujarat High Court in the case of Bhavendra
1 (1994) 4 SCC 711
2 (2004) 6 SCC 254
3 (2022) Legal Eagle 77
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Hasmukhlal Patadia vs. Union of India4 and submits that the place of
residence of the Petitioner would not give rise to the cause of action.
11 Per contra Mr.Kurle the learned counsel for the Petitioner
submits that the Petitioner's area of operation is also at Bombay.
Petitioner has assignments at Bombay. The order of suspension has
the effect at Bombay. As such the part of cause of action has arisen
within the territorial jurisdiction of this court. Only because the
office of Respondent no.3 is at Delhi, that cannot be the sole ground
to hold that this court would not exercise its jurisdiction.
12 The learned counsel for the Petitioner relies upon the
judgment of the Apex Court in the case of Shanti Devi Alias Shanti
Mishra vs. Union of India and Others 5 to contend that convenience
of an employee is to prosecute his case at the place from he belongs
to and receive the benefit. In such a case principle of forum
conveniens applies.
13 The learned counsel also relies on the judgment of the Apex
Court in the case of Oil and Natural Gas Commission (Supra) and
submits that notwithstanding that the seat of such authority or the
4 (2022) Legal Eagle 630
5 (2020) 10 SCC 766
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residence of the person against whom direction, order or writ is
issued, the matter can be filed before the court wherein the cause of
action wholly or in part arises.
14 We have considered the submissions.
15 It does not appear to be a matter of debate that show cause
notice was issued to the Petitioner by the Respondent and
subsequent thereto the order of suspension in respect of acts of
omission and commission in respect of the proceedings against the
Innovari Technologies Pvt. Ltd. at Delhi is issued. The Respondents
have also not disputed that the Petitioner acts as a Resolution
Professional and has work on hand at Mumbai. He is appointed as a
Insolvency Professional by the Mumbai Bench of Wholesale Foods
P.Ltd and the said proceedings is pending adjudication before the
NCLT, Mumbai Bench. The Petitioner is empanelled as Insolvency
Professional for financial institutions in Mumbai viz. (1) IDBI Bank
(2) Bank of Baroda. The Petitioner is also appointed in voluntary
liquidation of Gulf India Ltd. before NCLT Mumbai Bench.
16 The power conferred upon the High Court to issue directions,
orders or writs can be exercised by the High Court exercising
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jurisdiction in relation to the territories within which the cause of
action, wholly or in part, arises for the exercise of such power. The
Court exercising power under Article 226 of the Constitution can
issue writs detailed under clause 1 to the person or authority
situated beyond its territorial jurisdiction provided cause of action
wholly or partly arises within the territorial jurisdiction of the court
entertaining the Writ Petition.
17 Place of work of the Petitioner and /or Respondent may not be
much relevant in deciding the jurisdictional aspect. The place of
residence of the Petitioner would not be relevant. However, what is
relevant is that the cause of action, wholly or in part arises within
the territorial jurisdiction of the Court. The determinative factor is
the place of accrual of cause of action or part of cause of action.
18 It does not appear to be a matter of debate that the show cause
notice was issued to the Petitioner by the Respondents and
subsequent thereto, the order of suspension for the acts of omissions
and commissions in respect of the proceedings against Innovari
Technologies Pvt. Ltd. at Delhi.
19 Heavy reliance is placed by the learned counsel for the
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Respondents on the judgment of the Apex Court in case of Kusum
Ingots & Alloys Ltd. (Supra) to contend that on the basis of principle
of forum conveniens, the Petitioner ought to have filed the Petition
before the Delhi High Court. The Petitioner has already filed the
proceedings against the show cause notice before NCLT, Delhi. In the
case of Kusum Ingots & Alloys Ltd. (Supra), the Apex Court had
observed that even if a small part of cause of action arises within the
territorial jurisdiction of High Court, the same by itself may not be
considered to be a determinative factor compelling the High Court to
decide the matter on merits. In appropriate cases, the court may
refuse to exercise its discretionary jurisdiction by invoking the
doctrine of forum conveniens.
20 In a case of Shanti Devi Alias Shanti Mishra (Supra), the Apex
Court has observed that the convenience of an employee is to
prosecute his case at the place from where he belongs to and
receives the benefit. In such a case also, the principle of forum
conveniens applies.
21 The Respondents have not disputed that the Petitioner acts as
a Resolution Professional and has work on hand at Mumbai. He is
appointed as an Insolvency Professional by the Mumbai Bench for
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Wholesale Foods P.Ltd. and the said proceeding is pending
adjudication before NCLT, Mumbai Bench. The Petitioner is
empanelled as Insolvency Professional for financial institution in
Mumbai viz. 1) IDBI Bank 2) Bank of Baroda.
22 The Petitioner is also appointed in voluntary liquidation of Gulf
India Ltd. before NCLT Mumbai Bench. The effect of the impugned
order of suspension will be felt by the Petitioner even in the State of
Maharashtra.
23 Pursuant to the order of suspension, the Petitioner would not
be in a position to work as a Resolution Professional with the
assignments on hand in the State of Maharashtra. As observed, the
Petitioner is already having assignments in the State of
Maharashtra as a Resolution Professional. As the effect of the
impugned order will be felt by the Petitioner in the State of
Maharashtra, it can safely be concluded that part of cause of action
has arisen with the territorial jurisdiction of this court. Reliance can
be placed on the judgment of this court in Damomal Kauromal
Raisingani Vs. Union of India6. So also, the judgment of the Supreme
Court in the case of Shanti Devi Alias Shanti Mishra (Supra).
6 AIR 1967 Bom 355
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24 In view of the above, it cannot be said that only a small part of
cause of action as arisen within the territorial jurisdiction of this
court, the part of cause of action has arisen within the territorial
jurisdiction of this court.
25 In view of that, this court has territorial jurisdiction to
entertain the Writ Petition.
26 The matter shall be heard on merits.
(MADHAV J. JAMDAR, J.) (S.V. GANGAPURWALA, J.)
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