Mounting pressure on former CMD Chanda Kochhar, the ICICI Bank has filed a monetary suit in the Bombay High Court seeking her “termination of appointment” as the bank’s CEO and also sought recovery of various amounts from her.
The affidavit, filed on January 10, seeks dismissal of Kochhar’s petition that she had filed challenging her sacking after charges of money laundering surfaced against her. The bank stated that the issue can be decided in a commercial suit.
“ICICI has filed a suit seeking recovery of amounts towards the clawback of bonuses given to the petitioner (Kochhar) from April 2006 to March 2018 pursuant to the termination of the petitioner’s services,” the bank said in its affidavit, PTI reported.
A clawback is a provision in which incentive-based pay, like a bonus, is taken back from an employee by an employer if charges of misconduct surface against the former or in case of declining profits.
The affidavit further said that Kochhar’s conduct had caused substantial embarrassment to the bank and all the stake-holders, and led to an irreparable reputational loss to the bank.
“On December 8, 2016, Kochhar executed a clawback agreement with the bank pursuant to which ICICI is entitled to a return of the previously paid variable pay or deferred variable pay from the petitioner in the event of a determination of gross negligence or an integrity breach by Kochhar,” the affidavit stated.
“The petitioner (Kochhar) deliberately committed the violation with a malafide intent to obtain illegal benefits,” it further said. The affidavit also said Kochhar’s petition was a “malafide attempt” to secure valuable stock options of the bank.
The CBI had filed a case against Kochhar in January last year, alleging she had “dishonestly” granted loans to the tune of hundreds of crores to Videocon Group “in contravention of rules and policy … by abusing her official position”.
The Enforcement Directorate had also filed a case subsequently, attaching assets worth over Rs 78 crore belonging to Kochhar and her husband Deepak and companies associated with him.
The ED probe has revealed that loans were refinanced and new loan aggregating to Rs 1,730 crore was sanctioned to M/s Videocon Industries Limited (VIL) and its group firms. These loans turned non-performing assets (NPAs) for ICICI Bank on June 30, 2017.
A division bench of Justices R V More and S P Tavade on Monday directed Kochhar’s advocate Sujoy Kantawalla to go through the affidavit while posting the matter for further hearing on January 20.
Kantawalla argued that Kochhar’s termination from her post came months after the bank approved her voluntary resignation on October 5, 2018, and therefore the bank’s action is “illegal, untenable, and unsustainable in law”.
(With inputs from PTI)
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