Delhi HC rejects petition seeking documents from National Housing Bank against India Bulls Housing Finance for evidence collection

Delhi HC dismissed a petition seeking directions against National Housing Bank to compel India Bulls Housing Finance Limited to produce documents and responses. The petitioner, involved in litigation with another entity, attempted to collect evidence through writ jurisdiction to file intervention or appeal applications before NCLAT regarding an NCLT Chandigarh order. The HC held that writ jurisdiction cannot be used for fishing expeditions or evidence collection against parties with pending disputes. The court emphasized that writ powers exist to protect constitutional and legal rights, not to aid fact-finding processes. The petition was dismissed as misuse and abuse of court process.

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Issues Involved:
1. Petitioner's request for NHB to consider and decide upon the representation dated 18th August, 2023.
2. Petitioner's request for NHB to call upon IBHFL to produce responses and relevant documents regarding the query dated 6th April, 2023.
3. Examination of the fraudulent sanction and disbursement of loans by IBHFL to Embassy Group.
4. Petitioner's intent to use collected information for legal proceedings before NCLAT, New Delhi.

Summary:

Issue 1: Petitioner's Request for NHB to Consider and Decide Upon the Representation
The petitioner, a minority shareholder in India Bulls Real Estate Limited (IBREL), filed a petition seeking directions against the National Housing Bank (NHB) to consider and decide upon the representation dated 18th August, 2023. The representation highlighted various irregularities committed by India Bulls Housing Finance Limited (IBHFL) concerning the fraudulent sanction and disbursement of loans to Embassy Group by creating unauthorized charges on land belonging to Karnataka Industrial Area Development Board (KIADB).

Issue 2: Petitioner's Request for NHB to Call Upon IBHFL to Produce Responses and Relevant Documents
The petitioner also sought directions for NHB to call upon IBHFL to produce responses and relevant documents regarding the query dated 6th April, 2023. The petitioner argued that IBHFL released a substantial amount of Rs. 1,318 Crores to Embassy Group by creating charges on a property not belonging to any Embassy Group companies and without the requisite consent of KIADB.

Issue 3: Examination of the Fraudulent Sanction and Disbursement of Loans by IBHFL to Embassy Group
The petitioner submitted that the fraudulent actions by IBHFL were brought to light in proceedings filed in Karnataka High Court. The petitioner emphasized that the disbursement of funds by IBHFL to Embassy Group required close scrutiny by NHB due to the serious concerns raised.

Issue 4: Petitioner's Intent to Use Collected Information for Legal Proceedings Before NCLAT, New Delhi
The court noted that the petitioner intended to use the information collected from NHB to file an appropriate intervention application or appeal before the National Company Law Appellate Tribunal (NCLAT), New Delhi. The petitioner had been contesting the amalgamation proceedings between Embassy Group and IBREL before the National Company Law Tribunal (NCLT), Chandigarh.

Judgment:
The court held that the writ jurisdiction could not be used by a party to collect evidence and documents against another party with whom the petitioner had pending disputes. The court emphasized that writ jurisdiction is meant to safeguard constitutional, legal, and vested rights, not to serve as a tool for a fishing and roving enquiry. The petition was deemed a misuse and abuse of the process of the court. Consequently, the court dismissed the petition along with the pending application, reiterating that the court process must be used bona fide and properly, and not be abused.

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