Agarwal Law Associates, the legal counsel for Anil Ambani, has responded to State Bank of India's move to classify the Reliance Communications loan account as "fraud," stating that the firm is "shocked to receive the ex-parte order" of the bank's Fraud Identification Committee.
In its statement, the law firm said the bank has not responded to Ambani's last communication for over a year. It emphasised that Ambani was serving only as a non-executive director at the time of the alleged transactions and had no role in the day-to-day functioning or operations of the now-defunct telecom company.
The legal team has also raised concerns over due process, alleging that SBI failed to provide Ambani with a personal hearing and did not furnish relevant documents pertaining to the fraud classification. The firm has formally called upon the bank to withdraw the classification.
This comes after SBI decided to mark RCom's loan account as 'fraud' based on transactions dating back to August 2016, according to a regulatory filing. The bank is also set to report Anil Ambani to the Reserve Bank of India as part of its obligations around key managerial personnel linked to such cases.
RCom, which is currently undergoing a corporate insolvency resolution process under the Insolvency and Bankruptcy Code, clarified that the resolution plan has already been approved by its committee of creditors and awaits final nod from the National Company Law Tribunal.
Under RBI guidelines, banks must report fraud accounts to the central bank within seven days, and if the fraud involves more than Rs 1 crore, a complaint must be filed with the Central Bureau of Investigation within 30 days.
The classification could open the door for further investigation. Neither SBI nor Ambani has publicly commented on the matter yet.
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