The Delhi High Court has stayed the probe by the fair trade regulator MRTPC into excessive rates allegedly charged by ABN Amro bank and Standard Chartered Bank for foreclosing loans.
Admitting the plea of the banks, the Court has directed the Monopolies and Restrictive Trade Practices Commission to first decide whether it has the jurisdiction over banks for conducting such investigations.
"We are of the view that the question of maintainability and jurisdiction ought to be decided first by the MRTPC and then only the preliminary investigation be proceeded with," said a Division Bench comprising Justice B D Ahmed and Justice Veena Birbal.
In May 2009, the MRTPC had directed its investigating unit Director General of Investigation and Registration (DGIR) to look into the "foreclosure charges" taken by the banks, suspecting them to be anti-consumer.
Initiating the probe, the DGIR wrote to ABN Amro and Standard Chartered Bank, directing them to furnish information on their customers and other details.
This was challenged by the banks before the High Court and they submitted that the MRTPC has no jurisdiction over the banking sector and even the MRTP Act, 1969, identifies the RBI as the sole regulator for the sector.