{"id":309992,"date":"2023-12-23T12:00:29","date_gmt":"2023-12-23T06:30:29","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=309992"},"modified":"2023-12-28T17:49:16","modified_gmt":"2023-12-28T12:19:16","slug":"delhi-hc-insolvency-resolution-professional-is-not-public-servant-under-prevention-of-corruption-act-1988-legal-news","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2023\/12\/23\/delhi-hc-insolvency-resolution-professional-is-not-public-servant-under-prevention-of-corruption-act-1988-legal-news\/","title":{"rendered":"Insolvency Resolution Professional is not \u2018public servant\u2019 under Prevention of Corruption Act, 1988: Delhi High Court"},"content":{"rendered":"
\n

Delhi High Court:<\/span> In a petition filed by the petitioner under Article 226<\/a> of the Constitution<\/a> read with Section 482<\/a> of the Criminal Procedure Code, 1973<\/a> seeking to quash the FIR registered under Sections 7<\/a> and 7A<\/a> of the Prevention of Corruption Act, 1988<\/a> (‘PC Act’) read with Section 120-B<\/a> of the Penal Code, 1860<\/a> (‘IPC’), Tushar Rao Gedela, J<\/span>.*, opined that the omission to include Insolvency Resolution Professional (‘IRP’) in Section 232 of the IBC was not inadvertent but a thoughtful, wilful and deliberate one by the Legislature, and the Courts of law being empowered to interpret the same, ought not to legislate or supply casus omissus, which was prohibited. Thus, the Court opined that an IRP did not fell within the meaning of ‘public servant’ as ascribed in any of the clauses of Section 2(c) of the PC Act and accordingly, quashed and set aside the FIR.<\/p>\n

Background<\/p>\n

In an instant case, the Financial Creditor of FR Tech Innovations Private Limited (‘CD’) approached the petitioner to propose his name as IRP and the petitioner consented to act as an IRP of CD. Accordingly, the petitioner received an intimation from the Financial Creditor through e-mail along with a copy of order dated 14-11-2019, passed by the NCLT, Mumbai, whereby the petitioner was appointed as an IRP.<\/p>\n

As an IRP, the petitioner issued public announcement and invited claims from the creditors along with the documentary evidence in their support. The petitioner received eight claims for an amount of Rs. 2,12,08,445 from the creditors under various categories. The petitioner in his capacity as an IRP collated and verified the claims received by him from the creditors under various categories including the claim of the complainant’s wife, who allegedly submitted the forged and fabricated documents in support of her claim including a copy of the unstamped acknowledgement and inventions agreement. Thus, the petitioner sought additional details in support of her claims, which was a part of the verification process in accordance with the Insolvency and Bankruptcy Code, 2016<\/a> (‘IBC’).<\/p>\n

Further, during the telephone discussion on 30-12-2019, the petitioner conveyed to the complainant that he had been appointed as Resolution Professional by CoC in its first meeting which held on 28-12-2019 and the CoC had decided to recover Rs. 15.20 lakhs from the complainant’s wife along with the interest as she had received these amounts on the basis of forged and fabricated documents. Thereafter, the petitioner sent demand notices dated 07-01-2020 to the creditors including complainant’s wife.<\/p>\n

Subsequently, instead of responding to the demand notice dated 07-01-2020 and to pre-empt any legal action against his wife, the complainant filed a false and fabricated complaint against the petitioner under PC Act. Thereafter, an FIR was registered against the petitioner under Section 7 and 7A of the PC Act read with Section 120B of the IPC. The petitioner stated that he was not a public servant under PC Act and the Central Bureau of Investigation (‘CBI’) did not have any jurisdiction to investigate the case and any action by them was void ab initio. The petitioner further stated that he had been illegally detained because of the complainant.<\/p>\n

Subsequently, on 14-01-2020, Special Judge PC Act, passed an order of judicial remand for two weeks on the conclusion that the petitioner was a public servant as per Section 2(c) of the PC Act. Thus, the petitioner filed the present petition seeking to quash the impugned FIR and the impugned order dated 14-01-2020.<\/p>\n

The question arose before the Court was whether the petitioner, who was IRP was a public servant or not and thus, would he be liable for an offence punishable under the PC Act.<\/p>\n

Analysis, Law, and Decision<\/p>\n

Upon examination of Section 232 read with Section 233 of the IBC on the present case, the Court opined that a plain reading of Section 232 brought to fore that the Chairperson, Members, Officers of the Board, when acted in pursuance of any of the provisions of the IBC, were deemed IBC to be the public servants within the meaning of Section 21 of the IPC. The Court opined that the IBC did not define who was a public servant and therefore, only persons considered to be public servants were those who had specifically been named so in Section 232 of the IBC.<\/p>\n

The Court opined that while enacting a particular law, the legislature was deemed to be aware of all the laws and considering the Sections 232 and 233 of the IBC, it could be safely said that the omission in Section 232 of the IBC was not advertent, but a deliberate omission to not include IRP within its ambit. Further, the Court referred to the Joint Committee Report on the IBC and opined that the legislature had deemed to have taken into consideration all the relevant acts and materials before codifying the IBC and the omission to not include IRP was not deliberate. Thus, as a consequence it was manifested that the IRP was not included within the ambit of Section 232 of IBC. Thus, the Court opined that it could be safely inferred that the IRP could not be considered to be a public servant by the legislature.<\/p>\n

The Court further opined that “the jurisdiction and authority conferred upon the Constitutional Courts is to interpret the law and not legislate. It is also fairly well settled that if a provision of law is misused and subjected to abuse of the process of law, it is for the legislature to amend, modify or to repeal it, if deemed necessary. The legislative ‘casus omissus’ cannot be supplied by judicial interpretative process. The exception of judicial interpretation coming to the aid of filling up a gap would arise only and only in a case of clear necessity and when the reason for it is found in the four corners of the statute itself.”<\/span><\/p>\n

The Court relied on Sangeeta Singh<\/span> v. Union of India<\/span>, (2005) 7 SCC 484<\/a>; Babita Lila<\/span> v. Union of India<\/span>, (2016) 9 SCC 647<\/a>; CST<\/span> v. Parson Tools and Plants<\/span>, (1975) 4 SCC 22<\/a> and opined that the plain and simple language of the statute ought to be taken into consideration unless the same were ambiguous or appeared to be repugnant to the aims and objects of the statutes when read as a whole or any absurdity arose during interpretation. The Court opined that in the present case Section 232 of the IBC had no ambiguity nor was it repugnant to the aims and objective of the IBC.<\/p>\n

The Court opined that when the individual performed the role of IRP or Liquidator, there could be a possibility that certain duties appeared to be public duties but whether the role of an individual as IRP were in nature of public duties was hard to conclude. The Court opined that despite having all the previous Acts on the instant subject, which were further codified to form IBC and despite being aware of the roles and duties ascribed upon the individuals who were appointed as Liquidators, Receivers, etc., the Legislature, in its wisdom, thought it was fit and prudent to not include IP as ‘public servant’ and such non-inclusion was, thus, a wilful and deliberate omission. The Court opined that, “It is trite that what is not specified may not be readily inferred, particularly if the same would be penal in nature. In other words, any provision of law entailing penal consequences ought to be strictly construed and nothing specified therein should not be read in or filled up readily.”<\/span><\/p>\n

Thus, the Court opined that the omission to include IRP in Section 232 of the IBC was not inadvertent but a thoughtful, wilful and deliberate one by the Legislature, and the Courts of law being empowered to interpret the same, ought not to legislate or supply casus omissus, which was prohibited. Further, whether the IRP was a ‘public servant’ or not according to IBC or PC Act or Section 21 of the IPC, was purely the domain of the Legislature and if required and necessitated, the legislature might carry out necessary amendments to the legislations.<\/p>\n

Thus, the Court opined that an IRP did not fell within the meaning of ‘public servant’ as ascribed in any of the clauses of Section 2(c) of the PC Act and accordingly, quashed and set aside the FIR.<\/p>\n

[Arun Mohan v. CBI, 2023 SCC OnLine Del 8080<\/a>, decided on 18-12-2023<\/span>]<\/p>\n

*Judgment authored by- Justice Tushar Rao Gedela<\/span><\/strong><\/p>\n\n

Advocates who appeared in this case :<\/p>\n

For the Petitioner:<\/span> Arshdeep Singh Khurana and Tannavi Sharma, Advocates;<\/p>\n

For the Respondent:<\/span> Prasanta Varma, SPP for CBI with Pragrya Verma and Pankaj Kumar, Advocates; Ram Niwas Buri and Rishabh Sharma, Advocates<\/p>\n

Buy Constitution of India  HERE<\/a><\/h3>\n

\"Constitution<\/a><\/p>\n

Buy Penal Code, 1860   HERE<\/a><\/h3>\n

\"penal<\/a><\/p>\n

Buy Prevention of Corruption Act, 1988   HERE<\/a><\/h3>\n

\"prevention<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

“Whether the Insolvency Resolution Professional is a public servant or not according to Insolvency and Bankruptcy Code or Prevention of Corruption Act, 1988 or Section 21 of Penal Code, 1860, is purely the domain of the legislature and if required, the legislature may carry out necessary amendments to the legislations.”<\/p>\n","protected":false},"author":67011,"featured_media":303940,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,10],"tags":[2543,31387,30597,32084,2675],"class_list":["post-309992","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-highcourts","tag-Delhi_High_Court","tag-insolvency-and-bankruptcy-code-2016","tag-insolvency-resolution-professional","tag-prevention-of-corruption-act-1988","tag-public_servant"],"yoast_head":"\nInsolvency Resolution Professional is not 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Professional under IBC is a \u2018public servant\u2019 under Prevention of Corruption Act: Jharkhand High Court","author":"Ridhi","date":"April 11, 2023","format":false,"excerpt":"Jharkhand High Court clarified that Section 233 of Insolvency and Bankruptcy Code (\u2018IBC Code\u2019) gives protection to a resolution professional from criminal prosecution for acts in good faith, and not where he has been apprehended red-handed with the bribe amount.","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"jharkhand high court","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/02\/MicrosoftTeams-image-471.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/02\/MicrosoftTeams-image-471.png?resize=350%2C200&ssl=1 1x, 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However, this immunity does not extend to the erstwhile officers and persons responsible for\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"Delhi High Court","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2024\/02\/Delhi-High-Court.webp?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2024\/02\/Delhi-High-Court.webp?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2024\/02\/Delhi-High-Court.webp?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2024\/02\/Delhi-High-Court.webp?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":367103,"url":"https:\/\/www.scconline.com\/blog\/post\/2025\/11\/19\/mediation-insolvency-corporates-indian-regime\/","url_meta":{"origin":309992,"position":2},"title":"Mediation in Insolvency for Corporates – A Need Under the Indian Insolvency Regime","author":"Editor","date":"November 19, 2025","format":false,"excerpt":"by Eshna Kumar*","rel":"","context":"In "Op Eds"","block_context":{"text":"Op Eds","link":"https:\/\/www.scconline.com\/blog\/post\/category\/op-ed\/legal-analysis\/"},"img":{"alt_text":"Insolvency Mediation India","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/11\/Insolvency-Mediation-India.webp?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/11\/Insolvency-Mediation-India.webp?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/11\/Insolvency-Mediation-India.webp?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/11\/Insolvency-Mediation-India.webp?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":196727,"url":"https:\/\/www.scconline.com\/blog\/post\/2018\/06\/07\/death-of-main-accused-under-prevention-of-corruption-act-does-not-result-in-abatement-of-trial\/","url_meta":{"origin":309992,"position":3},"title":"Death of main accused under Prevention of Corruption Act does not result in abatement of trial","author":"Bhumika Indulia","date":"June 7, 2018","format":false,"excerpt":"Bombay High Court: A Single Judge Bench comprising of Prakash D. Naik, J. answered a reference made by the Additional Chief Metropolitan Magistrate in a case where the co-accused, who were not public servants, were tried under the provisions of Prevention of Corruption Act 1988 (PC Act) even after the\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":153624,"url":"https:\/\/www.scconline.com\/blog\/post\/2017\/08\/31\/moratorium-provisions-under-maharashtra-relief-undertakings-special-provisions-act-1958-repugnant-to-insolvency-and-bankruptcy-code-of-2016\/","url_meta":{"origin":309992,"position":4},"title":"Moratorium provisions under Maharashtra Relief Undertakings (Special Provisions Act), 1958 repugnant to Insolvency and Bankruptcy Code of 2016","author":"Prachi Bhardwaj","date":"August 31, 2017","format":false,"excerpt":"Supreme Court: Dealing with the question relating to applicability of the Maharashtra Relief Undertakings (Special Provisions Act), 1958 vis-a-vis the Insolvency and Bankruptcy Code of 2016, the bench of RF Nariman and SK Kaul, JJ held that the State law is repugnant to the Parliamentary enactment as under the said\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2017\/09\/Supreme-Court_Colour.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2017\/09\/Supreme-Court_Colour.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2017\/09\/Supreme-Court_Colour.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2017\/09\/Supreme-Court_Colour.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2017\/09\/Supreme-Court_Colour.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":112661,"url":"https:\/\/www.scconline.com\/blog\/post\/2017\/03\/08\/insolvency-and-bankruptcy-board-of-india-recognises-two-insolvency-professional-entities-under-insolvency-and-bankruptcy-code-2016\/","url_meta":{"origin":309992,"position":5},"title":"Insolvency and Bankruptcy Board of India recognises two Insolvency Professional Entities under Insolvency and Bankruptcy Code, 2016\u00a0","author":"Saba","date":"March 8, 2017","format":false,"excerpt":"The Insolvency and Bankruptcy Board of India (IBBI) has recently recognised two Insolvency Professional Entities (IPEs) as under: S. No Name of IPE Constitution Address 1 IRR Insolvency Professionals Private Limited Limited Company D-55,\u00a0Defence Colony, New Delhi - 110024 2 AAA Insolvency Professionals LLP Limited Liability Partnership E-10A, Lower Ground\u2026","rel":"","context":"In "Hot Off The Press"","block_context":{"text":"Hot Off The Press","link":"https:\/\/www.scconline.com\/blog\/post\/category\/news\/hot_off_the_press\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/12\/DSC_4762-e1474523869607.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/12\/DSC_4762-e1474523869607.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/12\/DSC_4762-e1474523869607.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/12\/DSC_4762-e1474523869607.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/12\/DSC_4762-e1474523869607.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]}],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/posts\/309992","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/users\/67011"}],"replies":[{"embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/comments?post=309992"}],"version-history":[{"count":0,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/posts\/309992\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/media\/303940"}],"wp:attachment":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/media?parent=309992"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/categories?post=309992"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/tags?post=309992"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}