DRT cannot prohibit the debtor from traveling abroad: HC | Nagpur News

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Nagpur: In a landmark verdict, the Nagpur Bench of the Bombay High Court ruled that in the absence of specific powers, the Debt Recovery Tribunal (DRT) cannot prevent a debtor from traveling abroad.
A divisional bench consisting of Justices Atul Chandurkar and Amit Borkar clarified that for the purpose of depriving or regulating a person’s right to travel abroad, it is necessary to have a procedure established by law, enacted by a competent legislature or by independent decision legislation.
“In the absence of a specific provision conferred by law, the DRT does not have the power to prevent a citizen from traveling abroad, in particular when the said right has been recognized as a facet of article 21 of the Constitution. The provisions of the “Collection of Debts Due to Banks and Financial Institutions” Act 1993, as they stand, do not even implicitly confer such powers on the court. »
The bench said that if the right to travel is part of a person’s personal freedom, they can only be deprived of it according to the procedure established by law. “This is distinct and separate from the right to free movement in a foreign country. The right to travel abroad, by its necessary implications, means the right to leave one’s home and visit a foreign country. It was clarified from the expression “individual freedom” in article 21 of the Constitution.
The decision came during the hearing of a plea from Anurag Padmesh Gupta, who is Gupta Energy’s personal guarantor. A consortium led by Axis Bank and another group of lenders – L&T Infrastructure Finance, State Bank of Mysore, Corporation Bank, State Bank of India and Bank of India (BOI) has financed a project by Gupta Energy to establish a power plant.
Proceedings under the “Insolvency and Bankruptcy Code, 2016” are pending in respect of Gupta Energy in the National Company Law Tribunal (NCLT) and were the subject of a winding up order passed on 15 March 2018 .
BOI filed a lawsuit before DRT against the petitioner and other directors of Gupta Energy for the recovery of Rs110.15 crore. The bank applied for an interim measure to prevent the petitioner from traveling abroad, which was granted on January 18, 2018. As the wedding of Gupta’s sister-in-law is scheduled in Turkey from June 12 to 14, he has asked DRT to request permission to travel. the. After his request was denied on May 23, he routed HC through attorneys Akshay Naik, Deven Chauhan and CJ Dhruv.
While quashing the DRT’s order, the judges said that the denial of permission to travel abroad was contrary to Article 21 and violated the right guaranteed by the Constitution.
“The government has not enacted any law or provision in the ‘Collection of Debts Due to Banks and Financial Institutions’ Act 1993 to deprive or regulate a person’s right to travel abroad. We have not forgotten the need to regulate the issue of the recovery of public funds. We are fully aware that in some cases it may be necessary, in the interest of the country and the public interest, to prevent certain persons from leaving India,” the judges said.
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