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Informist, Thursday, Apr. 16, 2026

 

--SC refuses to stay banks' orders to declare Anil Ambani's account as fraud 

--Ambani to SC: Want to settle case with bks on declaration of acct as fraud

 

NEW DELHI – The Supreme Court Thursday refused to stay the move by a consortium of banks to declare industrialist Anil Ambani's bank accounts as fraud. The bench, led by Chief Justice of India Surya Kant, said that hard-earned money of citizens has been allegedly siphoned off by Ambani. "We see no ground to interfere with the judgment of the (Bombay) High Court," said the bench, also comprising Justice Joymalya Bagchi and Justice Vipul M. Pancholi. However, the apex court asked the high court to expedite the hearing on Ambani's plea against declaration of account as fraud. 

 

The apex court noted a statement by Ambani that he would like to settle the matter with banks. Solicitor General of India Tushar Mehta, appearing for the banks, opposed the recording of Ambani's statement, saying that it will be misused in future cases. However, the top court did not express any opinion on the merits of Ambani's statement in its order. 

 

Ambani, the chairman of the Anil Dhirubhai Ambani Group, had said his account was declared fraud on the basis of an "illegal report" by forensic auditor BDO India LLP. Ambani had said BDO India was not recognised as an "auditor" under the Reserve Bank of India's revised master directions on fraud, issued in 2024.

 

"Who knows better than banks on who can do a financial audit?", said Chief Justice Kant. The top court will be substituting the wisdom of the bank if it questions the recognition of auditor in Ambani's case, said Chief Justice Kant. 

 

Based on BDO India's forensic audit, the consortium of banks, which includes Indian Overseas Bank, IDBI Bank Ltd. and Bank of Baroda, declared Ambani's and others' accounts as fraud. In 2024, the RBI revised its master directions that said the external auditor appointed by banks should be an auditor under the Companies Act, 2013, meaning it has to be registered with the Institute of Chartered Accountants of India.

 

Ambani said that BDO India does not meet the criterion under the RBI's revised master circular of 2024 and was, therefore, not competent to carry out any audit, including a forensic audit. Ambani said that BDO India, which describes itself as offering assurance, tax, advisory, business services and digital services, does not claim to be a qualified auditor under Indian law and is not registered with Institute of Chartered Accountants of India. Any fraud proceedings based on such a report are illegal, said Ambani.

 

Last year, the State Bank of India had classified the loan account of Ambani and Reliance Communications as fraud for deviation of funds in a 2016 case. State Bank of India alleged that Ambani had misappropriated bank funds by entering into transactions that violated the terms of the loans. Thereafter, the Central Bureau of Investigation lodged a case against Ambani for alleged bank fraud that led to a loss of over INR 29.29 billion to SBI. Other banks have also passed similar orders against Ambani and Reliance Communications.

 

At 1318 IST, shares of Indian Overseas Bank were down 0.4% at INR 34.93, IDBI Bank fell 0.9% to INR 73.74, Bank of Baroda declined 0.6% to INR 277.45, while those of Reliance Communications Ltd. were up 1.0% at INR 1.0 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Deepshikha Bhardwaj 

 

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