contend that § 7 of the IB code is unconstitutional in nature as it violates
the rights conferred under Part III of the Constitution of India. The Constitution is the Supreme law of land and the
executive is answerable to judiciary.1 An administrative act, including
subordinate legislation, is liable to be struck down as unconstitutional and
void if it transgresses any of the mandatory provisions of the Constitution.
Hence § 7 of the IB code needs to be struck down with immediate effect. This
contention is two-folded 1.1 It is violative of Art.14 of the
Constitution. 1.2 It is violative of Art.21 of the Constitution.
1.1 It is violative of Art. 14 of Constitution of Nalanda
2. The doctrine of equality enshrined in
Art. 14 of the Constitution, the basis of Rule of Law doctrine, is the basic
feature of the Constitution.2 It is contended that the impugned decision and order of
NCLT in this regard is violative of principle of equality and hence violative
of Art 14.of the constitution of India. This contention is two – folded 1.1.1 § 7 violates the principles of natural justice 1.1.2 It is arbitrary, vague and unreasonable.
1.1.1 § 7 violates the principles of
3. The petitioners
contend that § 7 of the IB code violates the principles of natural justice as
it does not provide the provision of hearing to the corporate debtor.
The concepts of natural justice
and audi alteram partem are now an integral part of the guarantee of
equality under Art.14 of the Constitution of India. It has been held by Supreme
Court in Delhi Transport Corporation v. DTC Mazdoor Union3 that
“the audi alteram partem rule, in essence, enforces the equality
clause in Art.14 and it is not only to quasi judicial bodies but also to
administrative order adversely affecting the party in question”.
4. Further it has been held in Maneka
Gandhi v. Union of India,4
that “Art. 14 is an authority for the proposition that the
principles of natural justice are an integral part of the guarantee of equality
assured by Art. 14 an order depriving a person of his civil right passed
without affording him an opportunity of being heard suffers from the vice of
violation of natural justice”.
1 Natural Resources Allocation, In
re., Special Ref . No. 1 of 2012, (2012) 9 S.C.R. 311.
2 Indra Sawhney v. Union of India,
(1999) Supp 5 S.C.R. 229.
3 1991 A.I.R. 101.
4 1978 A.I.R. 597.