The Supreme Court Tuesday declined to interfere with a Bombay High Court order upholding the January 2019 decision of the ICICI Bank to terminate the services of Chanda Kochhar as its Managing Director and CEO.
The bench of Justices Sanjay Kishan Kaul, Dinesh Maheshwari and Hrishikesh Roy told Senior Advocate Mukul Rohatgi, representing Kochhar who had come in appeal, “We are not inclined to interfere with the High Court order. This falls within the realm of private bank and employee.”
Kochhar had moved the High Court, contending that the termination was communicated months after ICICI Bank approved her voluntary resignation in October 2018. Termination from service, she said, was therefore “illegal, untenable and unsustainable in law”.
In January 2019, the board of ICICI Bank, after considering an investigation conducted by retired Supreme Court judge, Justice BN Srikrishna, sacked Kochhar and decided to claw back all bonuses given to her since 2009 when she took charge of the top post.
The ICICI Bank and Chanda Kochhar came under regulatory scrutiny after The Indian Express first reported on March 29, 2018 that Videocon Group promoter Venugopal Dhoot provided crores of rupees to a firm he had set up with her spouse, Deepak Kochhar, and two relatives, six months after the Videocon Group got Rs 3,250 crore as loan from ICICI Bank in 2012. In December 2017, the CBI had registered a preliminary enquiry (PE) into the sanctioning of the loan.
In January 2019, the CBI booked the Kochhars, Dhoot and others and said Chanda Kochhar had “dishonestly” granted loans to the tune of hundreds of crores of rupees to the Videocon Group “in contravention of rules and policy … by abusing her official position”. In September this year, the Enforcement Directorate arrested Deepak Kochhar in connection with its probe into an alleged money laundering case. The ED registered a case based on the January 2019 CBI FIR.
On Tuesday, a special court in Mumbai, rejected the bail application of Deepak Kochhar. One of the grounds he cited for grant of bail was that the adjudicating authority under the PMLA had said last month that the assets of Kochhar and his wife, attached by the ED, did not qualify as proceeds of crime.
The ED had opposed the bail application, stating that Kochhar was “misleading” the court by linking two separate proceedings. It said the adjudicating authority’s decision, which it would challenge before the appropriate forum, was separate from the criminal charges that Deepak Kochhar was facing before the PMLA court.
In the Supreme Court, Rohatgi, appearing for Chanda Kochhar, said the Bombay High Court dismissed her petition on the ground of maintainability.
He said the bank had converted her retirement from service into termination. He said this was done without the approval of the Reserve Bank of India.
“The bank recalled my earlier resignation and converted it into termination… This was wrong as it was against the norms,” Rohatgi said on behalf of Chanda Kochhar.
“Whether the termination can be done without approving the resignation is a question… You cannot convert resignation into termination. There is no question of termination as there was no previous approval as per the clause,” he said.
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