Setback to Anil Ambania’s Bombay HC upholds SBI move to classify loan account as ‘fraud’
The Bombay High Court on Friday dismissed a petition filed by debt-ridden industrialist debt ridden Anil Ambani, challenging the State Bank of India‘s (SBI) decision classifying his and Reliance Communications‘ accounts as fraud. A bench of Justices Revati Mohite Dere and Neela Gokhale said there was no merit in the plea. The SBI had classified the accounts as fraud, alleging misappropriation of funds by entering into transactions that violated the terms of loans extended by it. Recently Bank of India and the Bank of Baroda also classified these accounts as fraud.
Anil Ambani moved the HC, arguing that the bank had not followed the principles of natural justice as it did not grant him a hearing. Certain documents, based on which the classification orders were passed, were not provided to him initially and were furnished only after six months, the petition claimed.
SBI this year lodged a complaint with the Central Bureau of Investigation (CBI), which searched premises linked to Reliance Communications and Ambani’s residence. The CBI had registered a complaint after the State Bank of India claimed a loss of Rs.2,929.05 crore resulting from alleged misappropriation by Reliance Communications and Anil Ambani. ED is also probing the case, and previous month, the agency had interrogated the tainted Industrialist for hours.
The debt-ridden industrialist argued that he was only a non-executive Director and had been selectively singled out. He also argued that an adequate opportunity to present his defence was not provided. The High Court, however, found that SBI had followed the RBI’s July 2024 Master Directions on fraud classification and dismissed the plea.
Interestingly, the same bench had earlier stayed a similar order issued by Canara Bank against Anil Ambani, citing non-compliance with the RBI’s Master Circular. This Circular requires banks to hear the borrower before classifying their account as fraudulent. However, in July 2025, the matter came to be disposed of after Canara Bank informed the Court that it had withdrawn the fraud classification. He had also moved against Union Bank of India’s fraud classification. However, the same Bench declined a stay and directed Ambani to approach the RBI.
For all the latest updates, download PGurus App.
