SC Grants Interim Stay on HC Judgment; Reviews Audi Alteram Partem Principles & Alleged Factual Errors in Decision.

The SC issued notice on the Special Leave Petition, granting an interim stay returnable in four weeks, addressing the interpretation of audi alteram partem principles and the alleged factual errors in the HC's judgment. The SC temporarily refrained from reporting the matter to the CBI, pending further review of the Master Circular mandates.

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Issues:
1. Interpretation of principles of audi alteram partem in clauses of Master Circular.
2. Examination of Forensic Audit Report conclusions.
3. Alleged factual errors in the High Court's judgment.

Analysis:
1. The judgment addressed the petitioner's contentions regarding the interpretation of audi alteram partem principles in the Master Circular. It was noted that a coordinate Bench of the High Court had previously considered this issue in a related case. The Supreme Court balanced the interests by acknowledging the stay on implementing personal hearing principles while also cautioning against acting upon the Joint Lenders meeting minutes/orders.

2. Another aspect highlighted by the petitioner was the High Court's extensive reliance on the Forensic Audit Report. The petitioner argued that the High Court misinterpreted the report's conclusion, stating that no intentional fraud was found by the management. However, the High Court concluded that the petitioner's company account was rightly declared as 'fraud' based on other parts of the report. The petitioner contended that this was a factual error, emphasizing that the court should not deviate from the Forensic Audit Report's findings.

3. As a result of the above issues, the Supreme Court issued notice on the Special Leave Petition and the interim prayer for stay, returnable in four weeks. Considering the mandates outlined in the Master Circular, specifically regarding lodging a complaint with the CBI within 30 days, the Court decided not to report the matter to the CBI temporarily. The judgment concluded by directing the issuance of a copy of the order along with additional instructions for service.

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