The Supreme Court has ordered an inquiry into the
claims of a judicial member of the National Company Law Appellate Tribunal
(NCLAT) of being "approached by one of the most revered members of the
higher judiciary".
Sources privy to the development said the inquiry
will be conducted by the apex court's secretary general with the top court
deciding the future course of action on the basis of the outcome.
Justice Sharad Kumar Sharma, the judicial member of
the Chennai-based NCLAT, alleged being approached by a member of higher
judiciary for a favourable order in a case which was pending before him.
He recused himself from hearing the matter and even
recorded the incident in a two-paragraph order passed on August 13.
"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 (sic)," the NCLAT
order said.
The tribunal then requested the matter to be placed
before the "chairperson for nomination of an appropriate bench" for
hearing.
The two-member bench comprised Justice Sharma and
Technical Member Jatindranath Swain.
The bench was hearing an appeal filed by A S Reddy,
suspended director of Hyderabad-based KLSR Infratech, which is facing Corporate
Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code.
The judgment in the matter was reserved by the
insolvency appellate tribunal on June 18 after completion of hearing.
It also granted seven days time to both parties to
file written submissions, if any.
The matter was listed for orders on August 13 before
the two-member Chennai bench comprising Justice Sharma and Swain.
However, when the matter was called, Justice Sharma
recused from the matter and mentioned the reason in a two-para order passed on
that day.
CIRP was initiated by the Hyderabad bench of the
NCLT against KLSR Infratech over the plea filed by its creditor AS Met Corp Pvt
Ltd on July 14, 2023.
It appointed an interim resolution professional
after suspending the board of the realty firm.
The order was challenged by A S Reddy before the
NCLAT.
Justice Sharma, who retired from the Uttarakhand High
Court on December 31, 2023, and then joined NCLAT as a judicial member on
February 19, 2024, has previously recused from several cases.
He had recused from hearing matters relating to the
insolvency of ed-tech firm Byju's as he had previously appeared as a lawyer for
the Board of Control for Cricket in India.
Similarly, he recused from hearing matters related
to Jeppiaar Cements and Ramalinga Mills.