IBA's Caution List Against Advocates for Negligence Is Illegal and Violates Self-Regulation

Case Snapshot

• Case Name: Ajay Vijh v. Indian Banks Association & Ors.

• Citation: 2026 INSC 670

• Bench: Justice Pamidighantam Sri Narasimha and Justice Alok Aradhe

• Date of Judgment: July 2, 2026

• Area of Law: Constitutional Law, Professional Ethics, Banking Regulation, Advocates Act

Judgment in Brief

The Supreme Court held that the inclusion of an advocate's name in the "Caution List" maintained by the Indian Banks Association (IBA) on the ground of professional negligence is illegal and unsustainable. The Court declared that the Caution List, intended to alert banks about fraud and criminal misconduct, cannot be extended to cases of alleged negligence or errors of professional judgment. It further held that allegations of professional misconduct against advocates fall within the exclusive jurisdiction of the Bar Councils under the Advocates Act, 1961, and cannot be adjudicated by banks or banking associations. The Court also directed the Bar Council of India to undertake a performance audit of its disciplinary mechanisms and to institutionalise Continuing Legal Education (CLE) for advocates, including consideration of establishing a National Legal Academy.

Relevant Facts

• The appellant, an advocate, served as panel counsel for Canara Bank. In 2015, he rendered a legal opinion regarding property offered as security for a loan. The Bank later alleged that the opinion was erroneous and that a portion of the property had been alienated earlier.

• The Bank removed him from its panel on grounds of negligence and forwarded his name to IBA for inclusion in the Caution List.

• The appellant's name was included in the Caution List titled "Third Party Entities Involved in Fraud," with remarks: "Given Wrong Legal Opinion And Negligence in Conducting Search and Bank Was Exposed to Loss and Financial Risk."

• The inclusion was done without prior notice or opportunity of hearing.

• The appellant filed a writ petition before the Allahabad High Court, which dismissed i

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