Reply to Chanda Kochhar’s claim: HC to RBI

The Bombay high court (HC) on Monday directed the Reserve Bank of India (RBI) to file a reply to the claim of former ICICI Bank managing director (MD) and chief

The Bombay high court (HC) on Monday directed the Reserve Bank of India (RBI) to file a reply to the claim of former ICICI Bank managing director (MD) and chief executive officer (CEO) Chanda Kochhar that her termination under Section 35 (b) of the Banking Regulation Act, 1949 on January 30, 2019 did not have a previous sanction of RBI and was secured by the bank on March 13, 2019.

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The matter will come up for hearing on December 18.

Senior counsel Darius Khambatta, appearing for ICICI Bank, said through an affidavit that there has been no violation of Section 35 (b). The bank told a division bench of justice Ranjit More and justice Surendra Tavade that the order was passed belatedly as it was awaiting the justice (retd) Srikrishna Report.

The affidavit further referred to their enquiry report and pointed out that Kochhar had not fulfilled her contractual duties while serving the bank and had failed to disclose her personal interests through her husband, who was a director of Quality Techno Advisors Private Limited. This, the affidavit said, was against the code of conduct and applicable laws, rules and regulations.

Khambatta submitted that in light of these disclosures by the report, the bank decided to terminate her services, and so the petition was not maintainable.

However, senior advocate Vikram Nankani, along with advocate Dr Sujay Kantawala, for Kochhar pointed out the fact that as per Section 35 (b), “previous” sanction of RBI was required to terminate the services of Kochhar. However, even after receiving the bank’s letter seeking approval to terminate her services, RBI failed to observe that the additional sanction was being sought post facto and issued the approval on March 13.