Ajay Vijh Vs Indian Banks Association & Ors. (Supreme Court of India)
The Supreme Court allowed the appeal and held that a writ petition under Article 226 challenging inclusion of an advocate’s name in the Indian Banks’ Association (IBA) Caution List is maintainable, notwithstanding that the IBA is not “State” under Article 12, since the action affects the advocate’s right to practise under Article 19(1)(g). The Court held that the RBI’s Caution List framework, issued under Section 35A of the Banking Regulation Act, 1949, is intended only for cases involving fraud, dishonesty, criminality or similar serious misconduct and cannot be extended to allegations of professional negligence or an erroneous legal opinion. It ruled that banks may discontinue empanelment of an advocate based on contractual considerations but have no authority to publicly declare an advocate professionally negligent or incompetent through the IBA Caution List. The Court further held that questions relating to professional misconduct or negligence of advocates fall exclusively within the disciplinary jurisdiction of the Bar Councils under the Advocates Act, 1961. Accordingly, the High Court’s judgment was set aside, the advocate’s inclusion in the Caution List was declared without jurisdiction and impermissible, and immediate removal of his name was directed. The Court also directed the Bar Council of India to undertake a performance audit of its disciplinary mechanism and consider institutionalising Continuing Legal Education and a National Legal Academy.
