Chanda Kochhar's plea against sacking has no legal ground: ICICI Bank to HC

The bank is seeking recovery of amounts towards the clawback of bonuses given to her from April 2006 to March 2018 after her termination of services by the bank.

The Bombay High Court on Tuesday heard a petition filed by former ICICI Bank CEO Chanda Kochhar challenging the validity of her termination by the lender. The hearing took place as the bank opposed a plea by Kochhar to keep the matter part-heard before the earlier bench of Justices Ranjit More and Surendra Tavade.

The bank is seeking recovery of amounts towards the clawback of bonuses given to her from April 2006 to March 2018 after her termination of services by the bank. Kochhar moved the high court on November 30, 2019, challenging "termination" of her employment by ICICI Bank, which also denied her remuneration for her alleged role in granting "out of turn loans worth Rs 3250 crore to Videocon Group which benefitted her husband Deepak Kochhar".

The bank had given a composite reply to the court on all the objections raised by Kochhar stating that Section 35B of the Banking Regulation Act of 1949, under which she is seeking nullification of the termination of her services, is a “regulatory provision”. The Reserve Bank of India (RBI) had also said that its approval to the termination was within its jurisdiction and was given after considering the request of Kochhar’s former employer.

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The bank has raised the objection that Kochhar’s writ petition is not maintainable, that “it is a private banking company and the writ petition seeks to contest what are purely private contractual terms”. Hence, the bank argued that Kochhar’s writ petition did not have a legal basis.

Earlier in January, the Enforcement Directorate (ED) attached assets and cash belonging to the Kochhar duo, which included her South Mumbai apartment at CCI Chambers, valued at Rs 3.5 crore (book value) along with assets of projects of Deepak Kochhar’s Nupower Renewables and its subsidiaries such as Wind Farms, Echanda Urja Private worth Rs 74 crore (book value). Besides, a cash amount Rs 10.5 lakh, which the ED had seized during the search operation from the premises of Pacific Capital Services, another company of Deepak Kochhar.

Chanda Kochhar seeks more time to appear before Sebi for a personal hearing

The coming Tuesday had been set as a date for personal hearing, cross-questioning and recording of her statement.

Business Standard : ICICI Bank’s former managing director and chief executive officer (MD and CEO), Chanda Kochhar, has sought more time to appear before the Securities and Exchange Board of India (Sebi) for a personal hearing, said a source in the know.

Kochhar has been issued a showcause notice by the regulator for alleged violation of the code of conduct. The issue is not disclosing a potential conflict of interest arising out of business dealings between ICICI Bank when she was its MD & CEO, Videocon Industries and her husband, Deepak Kochhar’s Nupower Renewables.

The coming Tuesday had been set as a date for personal hearing, cross-questioning and recording of her statement. “(Her) representative has informed Sebi’s adjudicating officer, who is probing the case, that she would not be able to keep Tuesday’s date and has sought a month’s time,” said a source. Adding: “Regulatory officials are mulling the options and studying the reasons cited for the extension by Kochhar.”

ALSO READ: From bad loans to asset quality, how ICICI Bank fared under Chanda Kochhar

A text message sent to Kochhar on Friday did not elicit a response. Kochhar had, on October 4, opted for early retirement from the bank. The resignation offer was accepted with immediate effect and Sandeep Bakhshi named as her successor the same day. Earlier, on June 18, Kochhar was asked to go on leave until an independent enquiry to probe this and related cases of impropriety were concluded. Bakhshi was appointed chief operating officer and named the interim head. Kochhar's exit came before the completion of the four months of leave she had been granted.

According to the rules, a bank cannot operate with an interim chief for more than four months. For Kochhar to have returned as chief, the probe would had to be completed before October 17. It appears the enquiry, by former Supreme Court judge B N Srikrishna, would take one more month.

According to the sources, Kochhar and her legal representative are awaiting the Srikrishna panel's report before the Sebi appearance.

Srikrishna is looking into all the allegations against Kochhar, including the assets she owned and the links between assets acquired and the loan being sanctioned to Videocon Industries. The panel is also likely to call Kochhar to hear her, said another person.

Sebi had issued its showcause notice on May 23, based on a preliminary enquiry. It has said there was potential conflict of interest in the transactions between ICICI Bank and the Videocon group. By not disclosing the details of her husband's dealings with Videocon, she had not complied with the provisions of the listing agreement (with the stock exchanges). Therefore, proceedings were initiated by Sebi against both the bank and her.

Kochhar had replied to Sebi, debying all the charges on breach of the code of conduct. She had claimed all the requisite disclosures were adhered to by her, in line with the code of conduct of the bank, mandated for the top management and senior employees.