The Supreme Court declined to intervene in the Bombay High Court’s decision to lift the temporary protection given to Anil Ambani regarding the classification of his loan accounts as “fraudulent” by lender banks under the RBI’s 2024 Master Directions. Chief Justice of India Surya Kant and other Justices dismissed Ambani’s petitions challenging the High Court’s ruling. The apex court clarified that the High Court’s observations would not impact the final judgment on Ambani’s civil suits against the fraud classification.
The Supreme Court directed a prompt trial of the pending suits, provided both parties cooperate, while keeping all legal options open for Ambani. During the hearing, Ambani’s counsel, Kapil Sibal, argued against the fraud classification, stating it could lead to severe consequences. However, the Bench was unconvinced, citing ongoing investigations into fund diversion allegations. Sibal questioned the validity of the forensic audit relied upon by the banks, emphasizing it did not comply with the required standards.
The dispute stemmed from a forensic audit report by BDO India LLP in October 2020, concerning loans to Reliance Communications. In 2025, the High Court had initially stayed bank actions based on the audit, but the division bench later lifted this stay. The Chief Justice and another Justice accepted the banks’ argument that the audit was conducted under the 2016 framework and that subsequent 2024 Directions did not nullify prior actions. Ambani has filed suits challenging the legality of the audit report and seeking damages.
