KINGFISHER AIRLINES LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) The appellant in the AST is questioning a decision of a single Judge dated 10 July, 2014 [Kingfisher Airlines Ltd. and others v. Union of India and others, 2015 1 CompLJ 160], dismissing its WP No. 19247(W) of 2014 under Article 226 of the Constitution of India dated 4 July, 2014. Under a scheme framed by the Reserve Bank of India (in short RBI), with effect from 1 April, 1999, the banks, etc., incurred an obligation to submit to the RBI the details of the wilful defaulters and the banks, etc., were reporting all cases of wilful defaults that occurred or were detected after 31 March, 1999, on a quarterly basis. On 1 July, 2013, the RBI issued a Master Circular (in short MC) on Willful Defaulters for putting in place a system to disseminate credit information pertaining to wilful defaulters for cautioning the banks, etc. so as to ensure that further bank finance was not made available to them.

(2.) Paragraph 3 of the MC is quoted below:

(3.) United Bank of India sanctioning the appellant a Rs. 398.22 crore credit limit wrote a letter dated 28 May, 2014, to the appellant that the committee of the bank on identification of wilful defaulters classified it as a wilful defaulter on the grounds that it was in default on the loan that it did not utilize for the specific purpose for which it had been made available, but diverted for other purposes.