HC stays arrest of Lilavati trustee’s son in ₹14 cr debt case, orders fresh hearing

The court observed that certain evidence produced by the bank were not placed before the recovery officer for his perusal and restored the case to the officer for reconsideration.

MUMBAI: The Bombay high court on Tuesday extended the interim stay on the arrest of Rajeev Kishor Mehta, son of founder trustee of Lilavati Hospital, Kishore Mehta, and ordered a fresh hearing in the debt recovery matter of ₹14 crore filed by HDFC Bank Ltd.

Mumbai...13 May 2012...News... Lilavati Hospital, Bandra where Savio underwent a cardiac surgery in February, but suffered burn injuries after the surgery...Story by menaka Rao...HT Photo by Kalpak Pathak.

The court observed that certain evidence produced by the bank were not placed before the recovery officer for his perusal and restored the case to the officer for reconsideration.

The case revolves around a dispute between HDFC Bank and Mehta and other debtors, concerning an unpaid due of ₹14.74 crore. The bank had moved an application on February 2, 2018, in the Debts Recovery Tribunal, which held that Mehta had no intentions of repaying the outstanding amount and passed an order on February 5, 2020, which warranted his arrest.

Mehta challenged the Tribunal order in the Bombay high court. Senior advocate Nitin Thakkar, arguing on his behalf, said Mehta’s role in the case was different than other debtors as he had no means to pay the decretal amount.

Senior Advocate Kevic Setalvad, representing the bank, pointed out to a judgment issued by the Bombay high court on February 27, 2023, involving other debtors in the same case, which ordered reconsideration by the recovery officer.

After due consideration, a division bench, presided over by justices AS Chandurkar and Rajesh S Patil, restored the recovery proceeding filed by the bank and adjudicated the case to the recovery officer for fresh filing. It also instructed the 2020 order to be treated as an interim order.

“The bank produced certain newspaper report and extracts from websites. The court, however, found that all this material was not placed before the recovery officer for his consideration,” it added, and directed the recovery officer to confirm, modify or set aside the order dated February 5, 2020, and allow fresh affidavits and evidence within a stipulated timeframe and take a final decision on merits within a period of three months. The court stayed Mehta’s arrest till then, on the basis of the same 2020 interim order.