https://www.taxtmi.com/caselaws?id=450338 The Delhi HC quashed a wilful defaulter declaration under the Master Circular on Wilful Defaulters, 2015. The court held that the respondent bank failed to comply with procedural safeguards when issuing the show cause notice and relied improperly on inconclusive forensic audit observations to infer fund diversion. The bank could not declare the petitioner a wilful defaulter based solely on forensic audit reports without independent objective assessment. The court emphasized that wilful default must be intentional, deliberate and calculated, based on the borrower's entire track record, not isolated incidents. Since lender banks had previously approved a CDR package despite knowing the alleged acts, they tacitly acquiesced to the arrangements and could not later classify the same known acts as wilful default without proper independent evaluation. en-us Thu, 29 Feb 2024 00:00:00 +0530 Mon, 04 Mar 2024 09:14:07 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=450338 The Delhi HC quashed a wilful defaulter declaration under the Master Circular on Wilful Defaulters, 2015. The court held that the respondent bank failed to comply with procedural safeguards when issuing the show cause notice and relied improperly on inconclusive forensic audit observations to infer fund diversion. The bank could not declare the petitioner a wilful defaulter based solely on forensic audit reports without independent objective assessment. The court emphasized that wilful default must be intentional, deliberate and calculated, based on the borrower's entire track record, not isolated incidents. Since lender banks had previously approved a CDR package despite knowing the alleged acts, they tacitly acquiesced to the arrangements and could not later classify the same known acts as wilful default without proper independent evaluation. Case-Laws Indian Laws Thu, 29 Feb 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=450338