SREI Equipment Finance Limited Vs BSCPL Infrastructure Limited & Ors. (Calcutta High Court)
The Calcutta High Court considered an appeal against a judgment dated 8 April 2026 whereby the learned Single Judge had quashed a show cause notice dated 15 January 2026 issued by SREI Equipment Finance Limited for declaration of the respondents as wilful defaulters, along with the extract of the minutes of the Wilful Defaulter Identification Committee (WDIC) meeting dated 18 December 2025. The Single Judge had held that the notice and the committee extract did not specify the events and circumstances constituting wilful default and that the notices dated 6 February 2025 and 13 August 2025 merely demanded payment and referred to insolvency and arbitration proceedings. The Single Judge also observed that arbitral proceedings were pending and concluded that the matter was not one of wilful default.
The appellant contended that the respondents, being guarantors, failed to honour the guarantees despite having sufficient means to pay, while continuing to service credit facilities obtained from other financial institutions. It submitted that the WDIC relied upon the notices dated 6 February 2025 and 13 August 2025, the CIBIL Report dated 13 November 2025, and resolved to issue the show cause notice. The appellant argued that a show cause notice need not narrate every factual detail, that the proceedings were at a preliminary stage, and that the writ petition was premature. It also contended that pendency of arbitration did not bar proceedings for declaration as wilful defaulters under the RBI Master Circular.
