MADANLAL JUHARMAL GOYAL Vs. UNION OF INDIA

JUDGEMENT

(1.) In this petition filed under Article 226 of the Constitution of India the petitioner seeks the following reliefs:-

(2.) Before dealing with the merits of the petition, it is pertinent to highlight brief facts leading to the present petition which are as under:

(3.) The learned counsel for the petitioners submits that the primary contention of the Petitioners is based on the settled position that an order directing investigation under Sec. 212 (1) (c) of the Companies Act, 2013 ("Companies Act") should stand on its own feet and must be able to demonstrate that there exist material/circumstances which warrant investigation and that such material/circumstances have been been considered and an opinion is formed by the government to investigate into the affairs of the company on the basis such of material/circumstances. This opinion must be based on specific grounds and reasons which shall form a part of the order authorizing sanction. It is the specific case of the Petitioner that though an order sanctioning investigation ought not to be subjected to judicial review on merits, the same can be examined on ground whether the sanction complies with the mandatory requirement of; i) there is requisite opinion formed by the Central Government; and ii) existence of material and circumstances to indicate that the company's affairs are causing prejudice to the public interest. The Petitioners submit that in the present case the order of investigation is completely unreasoned, requisite opinion is not formed by the Central Government, there does not exist material/circumstances/fact necessitating investigation and is without any basis and is merely based on the ipse-dixi of the liquidator who has already filed an application under Sec. 66 of the Insolvency and Bankruptcy Code 2016 ("IBC"), which is pending adjudication.