Rs 750 crore RCom loan: Anil Ambani withdraws plea for interim relief against IDBI Bank hearing

A vacation bench of Justice Sandesh D Patil on October 28 passed an order on a writ plea by Ambani against IDBI Bank Limited that sought urgent relief related to a hearing scheduled on October 30 in terms of the SCN issued to him. The petitioner claimed that if the hearing is held, it will cause great prejudice to him.

Pending hearing and final disposal of his plea against the bank’s action, Ambani sought direction from the court to restrain the respondent bank from holding a personal hearing until he is provided with all relevant material and provided a fair opportunity to respond.

The RBI master circular, based on which IDBI Bank initiated its impugned action, had allowed banks to classify any account as fraudulent and provided guidelines for the process. The RBI had issued the circular under the Reserve Bank of India (Frauds Classification and Reporting by Commercial Banks and Select FIs) Directions, 2016.

Advocate Ankit Lohia for Ambani submitted that his client had earlier submitted an initial response to the notice, but the bank had shared a copy of the forensic audit report (FAR) in response, which alleged that some related party transactions within the group were suspicious. Thereafter, as per the petitioner, in July this year, he sought supporting documents from the bank, based on which it gave the FAR, and the bank gave him annexures in that regard in the same month.

The next month, the petitioner requested “underlying” documents when he was called for a personal hearing on September 11. The bank, as per the petitioner, again called him for a personal hearing on September 25, and the petitioner sought 17 documents relied upon by the bank. He sought deferment of the hearing, citing that a similar matter related to the declaration of a loan account as fraudulent by another bank was pending before the high court.

Shared forensic audit report: IDBI Bank

However, IDBI Bank refused his request, prompting him to approach the high court. Ambani claimed that the personal hearing cannot be conducted in a proper manner until the bank provides the material relied upon. However, the bank argued before the high court that his plea was not maintainable as it had already shared FAR, the basis for initiating the action under RBI’s master circular, along with annexures.

“After hearing counsels for the parties, when this Court was not inclined to grant any ad-interim relief, learned counsel appearing for the petitioners on instructions states that he would withdraw the petition and appear before the respondent Bank ‘under the protest’,” the bench noted in its order.

Ambani sought liberty to raise in the high court all the contentions presented before the respondent bank in the current plea, and requested that, in the event of an adverse order by the bank, he be given the liberty to raise all those contentions before the appropriate forum.

The bank’s lawyer said it had no objection to the petitioner’s request. “Hence, the present writ petition is disposed of as withdrawn with liberty as prayed for. Since the petition is withdrawn, this court does not comment upon the merits of the matter,” the high court noted.

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