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India.com
02-07-2025
- Business
- India.com
Anil Ambani's first response to SBI in ‘fraudulent' tag matter, says it violates…, writes letter to…
Anil Ambani (File) Industrialist Anil Ambani's legal team has written to the State Bank of India, objecting to the classification of Reliance Communications' loan accounts as fraudulent. They argue that the move breaches RBI guidelines and defies court directives. In a letter dated July 2, the counsel described SBI's action as 'shocking,' stating it was issued ex-parte and in violation of the principles of natural justice. RCom Letter To SBI SBI's order is in direct contravention of various judgments of the Supreme Court and the Bombay High Court, as well as RBI guidelines, the counsel said. RCom in a filing to stock exchanges on Wednesday said that SBI is classifying its loan account as fraudulent, citing alleged diversion of funds in a case dating back to 2016. SBI, the counsel said, has also not allowed Ambani an opportunity of personal hearing to make submissions against its allegations. The counsel in the letter said SBI has not even responded to Ambani's communication about the invalidity of the show cause notice (SCN) for almost a year, and has not even provided the information forming the basis of their decision despite being repeatedly requested to enable him to respond to the SCN. SBI Withdraws Show Cause Notice SBI has withdrawn the show cause notice to other non-executive and independent directors of RCom. Ambani was also a non-executive director and not involved in the day-to-day affairs of RCom, and has been wrongly so categorized, the counsel said, adding Ambani is pursuing the matter as legally advised. 'The Bank's SCN dated December 20, 2023 had been issued prior to the revised RBI Master Directions dated July 15, 2024 which completely superseded the directions under which the SCN had been issued (and which are no longer in existence), the Bank would need to withdraw the said SCN. 'Given the extended silence of almost one year on behalf of the Bank to this communication, our Client (Ambani) was under the bonafide belief that Bank has accepted our Client's position in respect and did not intend to precipitate the matter,' it said. (With Inputs From PTI)
Mint
02-07-2025
- Business
- Mint
Anil Ambani responds to SBI's ‘fraud' tag on Reliance Communications' loan account: ‘Shocked to receive the order…'
Reliance Group's chairman, Anil Ambani, on Wednesday, 2 July 2025, responded to the State Bank of India's 'fraud' tag on Reliance Communications' loan account, saying that he was shocked to receive the ex-parte order from the Fraud Identification Committee (FIC) of the State-run bank, according to the official statement sent to SBI via his lawyers. Agarwal Law Associates, the law firm representing Ambani, alleged that the Bank did not respond to Ambani's latest communication related to the case. 'Our Client is shocked to receive the ex-parte order of the Fraud Identification Committee (FIC) of the Bank, purportedly classifying the loan account of RCOM as fraud, after almost a year of the Bank not responding to our Client's last communication,' said Anil Ambani through his lawyers at Agarwal Law Associates in a letter. The law firm also claimed that the show cause notice was issued prior to the revision of the RBI Master Directions released on 15 July 2024, which 'superseded' the directions under which the Bank's show cause notice was issued. They also said that the Bank would need to withdraw the show cause notice, given that the "extended silence of almost one year on behalf of the bank' had made the company and Ambani realise that SBI had accepted the position and did not intend to precipitate the matter. (This is a developing story. Please check back for updates.)
Time of India
02-07-2025
- Business
- Time of India
SBI marks Reliance Communications as fraud account; company says order ex-parte
State Bank of India (SBI) has classified the loan account of Reliance Communications (RCom) as fraud diversion of sanctioned loan amounts to pay connected parties, inter-company loan transactions and investments and misutilisation of sales invoices. The bank will take further action against the company and its former promoter director, Anil Ambani by reporting them to the Reserve Bank of India (RBI), according to a letter posted on the stock exchanges. In response to the stock exchange disclosure, Delhi based Agarwal Law Associates on behalf of their clients RCom and Anil Ambani expressed shock at what they said was an ex-parte order of SBI. 'Vide our letter dated October 21, 2024 we had submitted that as the bank's show cause notice (SCN) dated December 20, 2023 had been issued prior to the revised RBI Master Directions dated July 15, 2024 which completely superseded the directions under which the SCN had been issued (and which are no longer in existence), the bank would need to withdraw the said SCN,' the law firm said. Agarwal Associates said that after almost a one-year silence by SBI, RCom and Anil Ambani was under the impression that the bank had accepted the client's position and did not intend to precipitate the matter. The law firm also said that similar allegations against various other people have been dropped after the RBI master directions and Anil Ambani should also get that benefit. 'We reiterate that our client was not a whole-time director but was a non-executive director on the board of RCom and not responsible for the day to day functioning and operations of RCom which was undertaken by the key management personnel,' the law firm said in its letter addressed to the SBI fraud monitoring department , the bank's chairman, manging director and deputy managing director. Agarwal Associates said their clients were provided an incomplete copy of the forensic audit report (FAR) and without any underlying documents. 'The failure to provide all the documents has prevented our client from giving his detailed response to the allegations set out in the SCN and making submissions that there was no violation of the sanctioned facilities,' the law firm said. Ambani was also not given the opportunity of a personal hearing in the matter, Agarwal Associates said. In its detailed notice to the company SBI said after the Supreme Court order in March 2023 which said that promoters of companies have to be given a hearing before they are declared as fraud, the bank reversed its 'fraud' tag on RCom and its promoters. 'As part of the re-initiation of the process of fraud identification in the account, SCNs were served to the borrower and its promoters, directors dated December 20, 2023 for giving an opportunity of hearing in adherence to the principles of natural justice before deciding on identification and reporting of account as fraud…' SBI said in its letter. Another notice with a forensic audit report was sent to the promoters, directors again in March 2024 and another one in September 2024. The resolution professional had replied to the notices from SBI in January 2024, saying that nothing should constraint the bank from pursuing any action against hr erstwhile directors, management or employees of the company for fraudulent or actions of omissions. SBI follows, its peer Canara Bank which had also classified RCom as fraud citing similar reasons like routing of loan amounts to settle liabilities with connected parties and inter-company transactions . RCom and its subsidiaries had taken loans totalling Rs 31,580 crore from banks.
