In a significant ruling on the professional rights of advocates, the Supreme Court has held that the Indian Banks' Association (IBA) cannot effectively blacklist a lawyer by placing their name on a caution list circulated among banks merely on allegations of negligence. While recognising that banks are free to remove advocates from their own panels, the Court made it clear that such action cannot be converted into a public declaration affecting an advocate's professional reputation.
The Court also issued broader institutional directions, asking the Bar Council of India (BCI) to establish a National Legal Academy for advocates, similar to the National Judicial Academy for judges.
Background of the Case
The case arose after advocate Ajay Vijh challenged the inclusion of his name in the IBA's caution list dated February 5, 2020. Vijh had earlier served as a panel advocate for Syndicate Bank, now Canara Bank.
The bank alleged that while preparing a search and title report for property offered as loan security, the advocate failed to disclose that a portion of the property had already been sold. According to the bank, this incorrect legal opinion exposed it to financial risk and facilitated fraud by the borrower.
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Following these allegations, the advocate's name was included in the IBA's caution list, which was circulated among banks and financial institutions. Vijh argued that the action was taken without prior notice, without giving him an opportunity to be heard, and without following the Reserve Bank of India's procedural guidelines governing such caution lists.
He further claimed that several banks removed him from their panels after the circulation of the list, causing financial loss as well as damage to his professional reputation.
After the Allahabad High Court declined to entertain his writ petition, he approached the Supreme Court.
Court's Observations
A Bench comprising Justice PS Narasimha and Justice Alok Aradhe held that the advocate's inclusion in the caution list solely on the basis of alleged negligence could not be sustained in law.
The Bench observed,
"While banks have the freedom to remove a lawyer from their panel, there cannot be a public declaration of such action through a caution list."
The Court further clarified that questions relating to an advocate's professional conduct or misconduct fall within the exclusive regulatory jurisdiction of the Bar Council of India and the State Bar Councils under the Advocates Act.
During the proceedings, Senior Advocate Maninder Singh, appearing as amicus curiae, argued that the caution list interfered with the advocate's right to practise his profession and that disciplinary action against advocates lies exclusively with the Bar Council framework. The Bar Council of India and the Union Law Ministry supported this position.
Justice Narasimha also expressed concern over the effectiveness of the present disciplinary mechanisms governing advocates and indicated the need for institutional reforms.
Direction to Establish National Legal Academy
Beyond deciding the dispute, the Supreme Court issued important directions aimed at strengthening the legal profession.
The Bench directed the Bar Council of India to establish a National Legal Academy for advocates on the lines of the National Judicial Academy, which provides training to judges across the country.
The Court observed,
"BCI shall establish a National Legal Academy for advocates like there is National Judicial Academy for judges."
It also said the Bar Council should undertake a performance audit of its disciplinary system and institutionalise a culture of continuing legal education and professional discipline among advocates.
Decision
Allowing the advocate's challenge on this issue, the Supreme Court ruled that the IBA cannot place a panel lawyer on a caution list solely on allegations of negligence in a manner that publicly affects the lawyer's professional standing. The Court held that disciplinary matters concerning advocates fall exclusively within the jurisdiction of the Bar Council of India and State Bar Councils.
At the same time, the Court directed the Bar Council of India to establish a National Legal Academy for advocates and to strengthen its disciplinary framework through performance evaluation and continuing legal education.
Case Details:
Case Title: Ajay Vijh v. Indian Banks Association
Case Number: Diary No. 10787 of 2024
Judge: Justice PS Narasimha and Justice Alok Aradhe
Decision Date: July 7, 2026
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