Reji Sivankutty Vishakhathil v. State Bank of India & Ors
Case Details & Bench
- Court
- High Court of Kerala
- Hon'ble Judges
- V. G. Arun
- Judgment Date
- 2023-03-09
- Court Decision / Holding
- The writ petition is dismissed, without prejudice to the petitioner's right to pursue remedies before NCLT or NCLAT, as appropriate.
- Final Disposition
- Writ petition dismissed
Parties to the Case
Appellants / Petitioners
- Reji Sivankutty Vishakhathil
Respondents
- State Bank of India, Peroorkada Branch, Trivandrum
- Shawn Jeff Christopher (Liquidator of Acharya Techno Solutions (India) Private Limited, JVR Associates, Chartered Accounts, etc.)
Legal Representation & Advocates
Counsels for Petitioners
- • Adv. Anil D. Nair
- • Telma Raju Edathara
- • Vineeta Krishnan
- • Adv. Aravind Sreekumar
Counsels for Respondents
- • Adv. Santhosh Mathew
- • Adv. Nidhi Jacob
- • Adv. Sukumar Nainan Oommen
- • Adv. Sherry Samuel Oommen
- • Adv. Nitish Sathesh Shenoy
Case Synopsis & Summary
Reji Sivankutty Vishakhathil, the Director of Acharya Techno Solutions (India) Private Limited, challenges a Liquidator’s directive to freeze his company’s director account during the Corporate Insolvency Resolution Process under the Insolvency and Bankruptcy Code, 2016 (IBC). The NCLT had found a preferential repayment of Rs. 42.50 lakh to the petitioner in 2017–18 and directed restitution to the Liquidator. Following subsequent NCLT/IA orders (Dec 2021–Feb 2022), the Liquidator sought to recover the amount and, on the Liquidator’s request, the State Bank of India froze the petitioner’s current account in the name of “Picky Assist.” The petitioner contends that the Liquidator lacks power to freeze a director’s account and that any execution should occur under Rule 56 of the NCLT Rules, 2016 with due process. The respondents argue that the Liquidator’s protective measures to preserve assets are within the scope of CIRP and that the petition is not tenable, especially since an NCLT order (Ext. R2(E)) itself directed freezing. Relying on Swiss Ribbons and Ghanashyam Mishra, the High Court holds that IBC is self-contained and external interference should be limited, noting the petitioner has a viable remedy before NCLT/NCLAT. The petition is dismissed, but without prejudice to pursuing remedies before the statutory bodies.
Provisions of Law Cited
Legal Doctrines & Maxims
- res integra
- efficacious alternative remedy
- self-contained Code (IBC)
Submissions & Arguments
Contentions of Appellants / Petitioners
The petitioner’s counsel argued that no provision in the IBC or Rules confers a power on the Liquidator to freeze the director’s bank account. The prescribed recourse would be execution under Rule 56 of the NCLT Rules, with Rule 57 and CPC procedures, after due hearing. The Petitioner maintained that the freezing was done without hearing and without a valid statutory basis. He emphasised that IBC is a self-contained Code and High Courts should refrain from interference in the CIRP proceedings; the remedy, if any, lies within NCLT/NCLAT. The petition also challenged the Liquidator’s actions as beyond the statutory remit and sought relief against the bank’s freezing order on fundamental due process grounds.
Contentions of Respondents
The respondents submitted that the Liquidator has a duty to preserve corporate assets and prevent dissipation during CIRP and that the Bank acted in line with legal requirements and NCLT orders (Ext. R2(E)). They argued that the writ petition is not maintainable, given the efficacious alternative remedy before NCLAT. The Bank highlighted SOP-compliant verification for the freezing decision and pointed out that post‑order actions and NCLT directives legitimize the freeze. They asserted deference to the resolution framework under Swiss Ribbons and Ghanashyam Mishra and argued that interference would undermine the CIRP and the Liquidator’s protective powers.
Cited Precedents (2)
| Case Name | Citation | Treatment | Explanation |
|---|---|---|---|
| Swiss Ribbons (P) Ltd v. Union of India | (2019) 4 SCC 17 | Positive | Cited to support the proposition that IBC is a self-contained code and High Courts should refrain from interfering with the resolution process, thereby guiding the court toward deference to the CIRP framework. |
| Ghanashyam Mishra and Sons. Pvt. Ltd. v. Union of India | (2021 SCC OnLine SC 313) | Positive | Cited to reinforce the deference to the resolution process under the IBC and to limit judicial interference in CIRP proceedings. |
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