In Brief
The Supreme Court held that borrowers declared as 'wilful defaulters' under RBI Circulars have no unconditional right to legal representation before the in-house bank committees. These committees exercise administrative, not judicial, power and are not 'tribunals' under the Advocates Act. Oral hearings are not mandatory; written show-cause procedures satisfy natural justice. However, given the severe consequences (financial debarment, management changes, insolvency disqualification), the Court read into the 2015 Revised Circular procedural safeguards: the committee must give its order to the borrower; the borrower has 15 days to submit written representations to a review committee; and the review committee must issue a reasoned order. The Delhi High Court's judgment permitting legal representation was overturned.
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