J&K&L High Court Stays Formation Of Ad-Hoc Committee For Institution Declared Unlawful Under UAPA, Directs Protection Of Existing Students

The Court was hearing a petition filed by the Union Territory of Jammu and Kashmir and others under Article 227 of the Constitution of India, challenging the order passed by the Principal District Judge, Shopian, on an interim application moved by the Foundation.

The trial court had directed constitution of an ad hoc committee under the supervision and control of the Provisional Liquidator appointed by the National Company Law Tribunal, Chandigarh Bench.

A Division Bench comprising Justice Sanjeev Kumar and Justice Mohd Yousuf Wani stayed the operation of the trial court's order, subject to objections and until the next date of hearing. The Bench, however, clarified that “the students, if any, studying in the school run by the respondent-company on the date of issuance of the order impugned shall not be disturbed” and directed that their ongoing studies and future education should not be adversely affected.

Background

The proceedings before the trial court arose from an order issued by the Divisional Commissioner, Kashmir, in exercise of powers under Section 8(1) of the Unlawful Activities (Prevention) Act, 1967, declaring Darul Uloom Jamiat Siraj-ul-Uloom, Imam Sahib, Shopian, an unlawful entity/place under the Act.

The declaration followed a police dossier submitted by the Senior Superintendent of Police, Shopian. The material placed before the competent authority referred to alleged serious legal, administrative and financial irregularities, including questionable land acquisition, absence of mandatory registration with competent authorities, alleged attempts to evade statutory oversight and suspected diversion or misuse of institutional funds.

It also referred to alleged links between persons associated with the institution and Jamaat-e-Islami, and allegations concerning activities prejudicial to national security.

The Foundation, through its Managing Director and Chairman, challenged the declaration and consequential action before the Principal District Judge, Shopian, by filing an application under Section 8(8) of the UAPA. It sought, among other reliefs, de-sealing and restoration of possession of the institution and suspension of consequential action pending disposal of the main application.

The applicants contended that the institution had been functioning since 2001 as an educational and welfare establishment, catering to more than 1,000 students, including around 800 residential students, and providing employment to over 100 teaching and non-teaching staff. They submitted that the declaration was based on vague and unsubstantiated allegations, without cogent material establishing the alleged unlawful activities.

The respondents opposed the interim application, contending that the applicants had failed to establish a prima facie case and that the relief sought substantially overlapped with the final relief claimed in the main application.

They maintained that the competent authority had examined the material placed before it and had afforded an opportunity of hearing before issuing the declaration. They also relied upon the subsequent order passed by the National Company Law Tribunal, Chandigarh Bench, appointing an Official Liquidator attached to the High Court of Jammu and Kashmir and Ladakh as Provisional Liquidator of the respondent-company.

While considering the interim application, the Principal District Judge, Shopian, first examined whether interim relief could be granted in proceedings under Section 8(8) of the UAPA.

The respondents had contended that the provision did not expressly confer power to grant interim relief and that the proceedings under the Act were not specifically contemplated by the Code of Civil Procedure, 1908.

The trial court did not accept the objection. It observed that where there was no express statutory prohibition against grant of interlocutory protection, an application for temporary injunction could be considered in accordance with the applicable provisions of the Code.

The trial court considered the subsequent order passed by the National Company Law Tribunal, Chandigarh Bench, appointing an Official Liquidator attached to the High Court of Jammu and Kashmir and Ladakh as Provisional Liquidator of the respondent-company.

The trial court held that restoring possession or management to the applicants could conflict with the directions of the NCLT. It held that the applicants could not be permitted to resume management or deal with the assets of the institution in their individual or collective capacity during the pendency of the proceedings.

Instead of directing restoration of possession or management to the applicants, the Principal District Judge directed the Provisional Liquidator, in coordination with respondent Nos. 2 and 3, to constitute an ad hoc committee for preservation and educational management of the institution under the overall supervision and control of the Provisional Liquidator.

It was tasked with undertaking immediate steps for physical inspection, preservation and protection of the school and college buildings, residential premises, furniture, books, equipment, records and other institutional infrastructure. The committee was also directed to take necessary measures for protection and preservation of the orchard and other agricultural or horticultural property forming part of the institution.

The Union Territory and other authorities challenged the trial court's order before the High Court.

When the matter came up before the Division Bench, it issued notice and stayed the operation of the impugned order, subject to objections and until the next date of hearing.

The Bench, however, made it clear that students studying in the school run by the respondent-company on the date of issuance of the trial court's order would not be disturbed. It further directed the petitioners to ensure that the students' ongoing studies and future education were not adversely affected in any manner.

The Division Bench also clarified that the trial court would proceed with determination of the issues raised before it and dispose of the main petition on merits.

Appearances

For the Petitioners: Mohsin S. Qadri, Senior Additional Advocate General; Maha Majeed, Assisting Counsel.

For the Respondents: Z.A. Qureshi, Senior Advocate; Razia Amin, Advocate.