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Willful defaulter doesn’t have right to be represented by lawyer in ‘in-house’ proceedings of bank: Apex Court

May 14, 2019[2019] 105 189 (SC)

Advocates Act : When a person is declared to be a wilful defaulter under Circulars of Reserve Bank of India [RBI], such person is not entitled to be represented by a lawyer of its choice before such declaration is made

• There is no right to be represented by a lawyer in in-house proceedings contained in paragraph 3 of Revised Circular dated 1-7-2015, as it is clear that events of wilful default as mentioned in paragraph 2.1.3 would only relate to individual facts of each case

• Revised Circular, being in public interest, must be construed reasonably - This being so, and given fact that paragraph 3 of Master Circular dated 1-7-2013 permitted borrower to make a representation within 15 days of preliminary decision of First Committee, first and foremost, Committee comprising of Executive Director and two other senior officials, being First Committee, after following paragraph 3(b) of Revised Circular dated 1-7-2015, must give its order to borrower as soon as it is made. Borrower can then represent against such order within a period of 15 days to Review Committee. Such written representation can be a full representation on facts and law (if any). Review Committee must then pass a revisional order on such representation which must then be served on borrower. Thus, no lawyer has any right under section 30 of Advocates Act to appear before in-house committees so mentioned. Further, said committees are also not persons legally authorised to take evidence by statute or subordinate legislation, and on this score also, no lawyer would have any right under section 30 of Advocates Act to appear before same

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