The Supreme Court on Thursday refused to interfere with the Bombay High Court order that had vacated interim protection granted to industrialist Anil Ambani against the classification of his loan accounts as "fraudulent" by lender banks under the RBI's 2024 Master Directions.
A bench of CJI Surya Kant and Justices Joymalya Bagchi and Vipul Pancholi dismissed Ambani's petitions challenging the High Court's ruling, which had set aside a stay earlier granted by a single judge.
However, the apex court clarified that the High Court's observations will not affect the final adjudication of Ambani's civil suits. It also directed an expeditious hearing of the pending cases while keeping all other legal remedies open.
During the hearing, senior advocate Kapil Sibal, appearing for Ambani, argued that being labelled "fraud" amounted to a "virtual civil death" and said interim protection should not have been withdrawn in this manner.
However, the bench was not convinced, noting that serious allegations of diversion and siphoning of public funds were under investigation. The court also observed that nationalised banks were competent to rely on forensic audit reports prepared by professional agencies engaged through proper process, stating that it could not substitute its view for that of the lenders.
The dispute arises from a forensic audit report dated October 15, 2020, prepared by BDO India LLP in connection with loans extended to Reliance Communications and related entities. Ambani has challenged the fraud classification and the validity of the audit report in civil suits before the Bombay High Court.
In a related development, the Reliance Group clarified that Amitabh Jhunjhunwala and Amit Bapna, both former senior executives, are no longer associated with the group. The statement came after reports of their arrest by the Enforcement Directorate in a money laundering probe linked to alleged banking fraud involving Reliance Home Finance Ltd (RHFL) and Reliance Commercial Finance Ltd (RCFL).
According to officials, Jhunjhunwala and Amit Bapna were arrested in connection with ongoing investigations under the Prevention of Money Laundering Act (PMLA), based on cases registered by the CBI.
Separately, the CBI has filed multiple cases against Reliance Communications, Anil Ambani, and others, including allegations of causing a wrongful loss of around Rs 3,750 crore to LIC through investments in non-convertible debentures. The agency has also earlier investigated alleged bank fraud cases involving several lenders.
The Supreme Court has previously emphasised the need for a coordinated, time-bound investigation into alleged large-scale frauds linked to Reliance Communications and its group entities, urging agencies like the CBI and ED to work together.
(With inputs from IANS)
