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In the case of Suresh Kumar Patni v. Punjab National Bank (WP 206 of 2020 and GA 838 of 2020), Justice Arindam Mukherjee of the Calcutta High Court has stayed an order of the bank declaring the petitioner a ‘wilful defaulter’ due to the uncertain economic situations due to COVID-19. The principle of natural justice have to be complied with and the judge has allowed the interim order dated 29th June 2020 to be extended.
The advocate on behalf of the petitioner has submitted that according to a circular date 1 July 2015, a two tier mechanism is provided before declaring a person as a wilful defaulter. In this case the first committee i.e. Identification Committee did not conclude whether the petitioner is a wilful defaulter or not. On the other hand the second committee i.e. “the Review Committee has mechanically declared the petitioner as a wilful defaulter even though there is no finding by the Identification (first) Committee”. According t him the order passed by the committees are illegal and without jurisdiction.
The respondent bank had submitted that “the order dated 29th June, 2020 was obtained by suppressing the actual state of affairs”. It is further revealed that after proper scrutiny the petitioner does fall under the category of ‘wilful defaulter’. According to them the order of 29th June should be withdrawn on the grounds of suppression, but no document has been submitted to prove the same. The respondents have submitted that the writ petition should be dismissed after cancelling the order.
The court after considering the seriousness of the circular is of the view that the bank should comply by the principle of natural justice. “It is the balance of convenience and inconvenience which should be the primary guiding factor in granting injunction or restraining order”. According to the court the bank would suffer led prejudice that the petitioner if the bank is not allowed to publish the petitioner as a wilful defaulter. On the contrary, the petitioner will suffer great prejudice if his name is listed in the wilful defaulter’s list. Therefore, the court has allowed the interim order to continue and the bank has been restrained from publishing the petitioner’s name as wilful defaulter till 17th August 2020.
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