The Delhi High Court dismissed a PIL by NGO Infrastructure Watchdog seeking a probe into Punjab National Bank and Bank of Maharashtra’s One-Time Settlement with Asian Hotels North, calling it speculative and unsupported by facts.
New Delhi: The Delhi High Court has rejected a public interest litigation (PIL) that asked for an investigation into the One-Time Settlement (OTS) deals made by Punjab National Bank (PNB) and Bank of Maharashtra (BOM) with Asian Hotels North Private Limited, the company that owns Hyatt Regency in Delhi.
A Division Bench of Justice C Hari Shankar and Justice Ajay Digpaul said that the PIL, filed by a New Delhi-based NGO called Infrastructure Watchdog, was not supported by proper facts or evidence.
The Court observed that it was only based on
“surmises, conjectures and assumptions” and that “no case was made out to even issue notice in the matter.”
The Bench noted that what the petitioner wanted from the Court was not reasonable and said,
“What the petitioner is seeking from this Court is, however, clearly a roving inquiry, on the basis of skeletal facts, without being aware of the complete nature of the transactions which form subject matter of the petition.”
The judges stated that both public sector banks had used proper financial judgment before entering into the OTS agreements.
The Court cautioned that if such PILs are entertained,
“it could throw the entire banking system into jeopardy, and disincentivise banks and financial institutions from entering into bona fide commercial transactions.”
The Court also relied on the responses of PNB and BOM to conclude that there was no wrongdoing on their part.
It said,
“Submissions made by the PNB and BOM showed that there was no contumacious or culpable financial impropriety in the decision of the PNB and the BOM to enter into the OTSs with Asian Hotels Private Limited.”
The Bench further remarked that the writ court could not cancel a private contract between parties, as requested by the petitioner.
It added,
“Besides, the fact that, even otherwise, a writ court cannot set aside a private contract executed between the parties, as is prayed in the present petition, we are also of the view that no case for granting the prayer for institution of an investigation into these matters by the CBI, CVC or any other agency is made out with the AHN.”
The NGO had alleged that the OTS settlements were undervalued, leading to a potential loss to the public exchequer. It claimed that the valuation of the Hyatt Regency hotel during negotiations was much lower than its actual market value.
The petitioner said that it had already sent complaints to vigilance and enforcement authorities but did not get any meaningful response.
While examining the petition, the Court also referred to Rule 9(i)(c) of the PIL Rules, which mandates that the petitioner must clearly mention the source of knowledge of the facts alleged in the case. The judges noted that this rule had not been properly followed.
The Court said,
“Rule 9(i)(c) of PIL Rules requires a specific averment in the writ petition as to the source of knowledge of the fact alleged.”
However, the petitioner had only mentioned that the information came from a “reliable whistleblower,” which the Court found inadequate.
The Bench stated,
“A mere reference to the source as a ‘reliable whistleblower’ cannot satisfy the requirement of Rule 9(i)(c).”
The judges emphasized the importance of transparency before the Court, explaining,
“The disclosure, under Rule 9(i)(c) of the PIL Rules, has to be a meaningful disclosure. In an extreme case, where, for example, disclosure might endanger the life or limb of the petitioner, the Court may permit the disclosure to be made in a sealed cover, or confidentially to the Court. There can, however, be no secrecy from the Court, and the reference to the source of the petitioner’s information as a ‘reliable whistleblower’ cannot, to our mind, be said to conform to the mandate of Rule 9(i)(c) of the PIL Rules.”
After evaluating all arguments, the High Court ultimately dismissed the petition, concluding that it lacked sufficient factual basis and was not maintainable.
Several senior advocates appeared in the case. Advocates Prashant Bhushan, Pranav Sachdeva, P Rohit Ram, Abhay Nair, and Sanyam Jain represented the petitioner NGO, Infrastructure Watchdog.
The Union of India was represented by Central Government Standing Counsel (CGSC) Amit Tiwari with advocates Himanshu Bidhuri and Ayush Tanwar.
Additional Solicitor General (ASG) N Venkatraman, along with advocates Nishant Awana, Abhishek Singh, and S.K. Rout, appeared for Bank of Maharashtra. PNB was represented by Attorney General R Venkataramani, along with advocates Alok Kumar, Parnika Jolly, and Tarun Kumar.
Senior Advocates Mukul Rohatgi and Rajiv Nayar appeared on behalf of Asian Hotels North Private Limited, assisted by Unum Law’s Sidhant Kumar, Saurabh Seth, Arpit Singh Arora, Devanshi Singh, Akshit Mago, Om Batra, Molly Agarwal, and Pratyush Srivastava.
The Central Vigilance Commission (CVC) was represented by advocates Ravinder Agarwal, Manish Kumar Singh, and Vasu Agarwal. The Central Bureau of Investigation (CBI) was represented by Special Public Prosecutor (SPP) Anupam S Sharma along with advocates Harpreet Kalsi and Vashisht Rao.
The High Court’s judgment sends a clear message that PILs must be backed by concrete evidence and not merely suspicions, especially when they question legitimate financial decisions of banks and institutions.
Case Title:
Infrastructure Watchdog v Union of India and Ors.
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