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Three banks, auditor challenge interim order that stayed actions against Anil Ambani over ‘fraudulent’ accounts

A division bench of Chief Justice Shree Chandrashekhar and Justice Gautam A Ankhad on Monday began hearing the pleas by Bank of Baroda (BoB), IDBI Bank and Indian Overseas Bank (IOB) and auditor BDO India LLP.

3 min readMumbaiJan 13, 2026 05:10 AM IST

Three banks and auditor move Bombay High Court against single bench order staying action on forensic audit of Anil Ambani’s Reliance Communications accounts

THREE BANKS and an auditor have approached a division bench of the Bombay High Court challenging the order of single bench which had stayed all present and future actions taken against Ambani by three banks based on a Forensic Audit Report (FAR) into Reliance Communications (R Com) and group entities.

A division bench of Chief Justice Shree Chandrashekhar and Justice Gautam A Ankhad on Monday began hearing the pleas by Bank of Baroda (BoB), IDBI Bank and Indian Overseas Bank (IOB) and auditor BDO India LLP.

Earlier, pending hearing and final disposal of the suit by Ambani, Justice Milind N Jadhav had granted interim relief to Ambani and stayed all actions taken by the three banks, and restrained them from proceeding further on show-cause notices and fraud-classification order.

The Reserve Bank of India (Frauds Classification and Reporting by Commercial Banks and Select FIs) directions circular allows banks to classify any account as fraudulent and provides guidelines for the process. The RBI had further instructed banks to establish their own policies.

Justice Jadhav had passed an interim order in multiple suits filed against the consortium of banks with the State Bank of India (SBI) as a lead lender and BDO India LLP, claiming that their decision to classify his accounts related to RCom, which is under insolvency, as “fraudulent” was based on an “illegal” forensic report.

Solicitor General Tushar Mehta representing the banks argued that the due to the impugned order, the entire process initiated by the banks was reversed and a kind of status quo ante has been brought into force, which is having the “disastrous” effect on the action.

Mehta said that BoB had already declared bank account as “fraudulent,” which is now stayed and other two banks had issued SCNs which got halted.

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He also argued that the single-judge did not consider the limitation in filing of the suit while passing an order and the suit was “hopelessly time barred”.

The banks also claimed the decision of another bench that dismissed Ambani’s plea against State Bank of India (SBI) order that classified his account as fraudulent was not considered in last month’s order. It was further argued that Ambani’s suit had not challenged the FAR on merits.

Mehta also argued that the RBI master circular did not have any stipulation that the auditor should be a member of Institute of Chartered Accountants of India (ICAI) and claimed that Ambani’s suit was merely based on RTI application filed by a third person who sought BDO’s registration details.

Seeking stay on the impugned order, the banks also contented that while Ambani was aware of FAR in 2021, he did not challenge the findings and the impugned order opened “floodgates” for similar litigations despite the BDO was approved forensic auditor by SEBI and “not just a nobody picked from the street.”

The division bench posted further hearing on Wednesday.