The Supreme Court expressed anguish after an NCLAT judge revealed that a revered higher judiciary member allegedly sought a favourable order. Directing a probe, the Court stressed that such influence threatens judicial independence, fairness, and integrity of legal proceedings.
New Delhi: The Supreme Court initiated an inquiry following a shocking revelation by Justice Sharad Kumar Sharma, a Judicial Member of the National Company Law Appellate Tribunal (NCLAT) in Chennai.
Justice Sharma disclosed that he had been approached by “one of the most revered members of the higher judiciary of this country to issue a favorable order in an insolvency case.”
The Apex Court has instructed its Secretary General to investigate the identity of the judge whether from the Supreme Court or a High Court who allegedly sought to influence the case’s outcome.
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This revelation emerged in a judicial order issued by Justice Sharma, who recused himself from hearing the case on August 13.
The order stated,
“We are anguished to observe, that one of us, Member (Judicial), has been approached by one of the most revered members of the higher judiciary of this country for seeking an order in favour of a particular party. Hence, I recuse to hear the matter. Place before the hon’ble chairperson for nomination of an appropriate bench,”
The case in question involves insolvency proceedings against KLSR Infratech Ltd., a Hyderabad-based real estate firm, and was being considered by a two-member bench consisting of Justice Sharma and Technical Member Jatindranath Swain.
Although the bench had completed hearings and reserved judgment on June 18, the matter was subsequently referred to the NCLAT Chairperson after Justice Sharma’s recusal. The Supreme Court’s intervention highlights the serious nature of the disclosure, which has reverberated throughout the legal community.
An inquiry into such allegations is rare and raises significant concerns about judicial integrity and independence at the highest levels.
The case, Attluru Sreenivasulu Reddy, Suspended Director of M/s. KLSR Infratech Ltd. v. M/s. AS Met Corp Pvt. Ltd. & Anr., involves an appeal against the admission of KLSR Infratech Ltd. into the Corporate Insolvency Resolution Process (CIRP).
Following the revelation, the bench directed that the case be reassigned to another bench by the NCLAT Chairperson.
This is not the first instance of Justice Sharma stepping aside due to attempts to influence his rulings.
- On June 11, 2024, while dealing with disputes involving Shri Ramalinga Mills, he recused himself after noting that a respondent had sought a favorable judgment.
- On November 18, 2024, he withdrew from a case related to Jeppiar Cements, stating: “Since I have been approached by my real brother who has dropped in the following messages…With a very sorry note, I refuse to hear this appeal.”
- Earlier in 2024, he also recused himself from cases concerning the insolvency of edtech firm Byju’s, citing a previous professional association with the Board of Control for Cricket in India (BCCI), the petitioner in that matter.
Justice Sharma’s latest recusal has sparked serious concern within the legal community, as references to “higher judiciary” include judges from both the Supreme Court and High Courts.
Although he did not name anyone, the suggestion of attempted influence from such esteemed ranks raises troubling questions about judicial independence in insolvency cases.
Consequently, the proceedings involving KLSR Infratech Ltd. will now be assigned to a new coram, further delaying a case that had already concluded hearings and reserved orders.
This is not the first time Justice Sharma has taken such a step. On June 11, while hearing a group of appeals linked to Shri Ramalinga Mills and related companies, he had noted in open court that one of the respondents had tried to approach him for a favourable judgment. He recused from that matter as well and sent the case back for fresh allocation.
Earlier in 2024, Justice Sharma also recused himself from hearing cases related to the CIRP of Byju’s, since that proceeding was initiated by the Board of Control for Cricket in India (BCCI), an organization for whom he had previously appeared as a lawyer.
Case Title: Mr. Attluru Sreenivasulu Reddy, Suspended Director of M/s. KLSR Infratech Ltd. v. M/s. AS Met Corp Pvt. Ltd. & Anr.
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