Delhi High Court canceled the decision of Union Bank of India, in which the bank account of the company of Jai Anmol Ambani, son of industrialist Anil Ambani, was declared a fraud. Delhi Court has clearly said that declaring any account as fraud without giving show-cause notice and opportunity of hearing is against natural justice.
Delhi High Court canceled the order of Union Bank
Justice Jyoti Singh of Delhi High Court said in her order that in this case, show-cause notice was never given to Jai Anmol Ambani properly. The address to which the bank sent the notice was vacated by the company in the year 2020 itself. In such a situation, it would be correct to assume that the notice was not duly served.
On this basis, the court canceled the order of Union Bank declaring the account a fraud. However, the court also clarified that this order does not mean that the bank cannot take further action. If Union Bank wishes, it can issue a fresh show-cause notice to Jai Anmol Ambani. The court directed that the bank will have to provide all the necessary documents along with the new notice, so that Anmol Ambani can file his reply properly. After receiving the reply, the bank can take a new decision.
Jai Anmol Ambani had filed an application in Delhi High Court
This matter came to light when Jai Anmol Ambani filed a petition in the High Court saying that his account was declared a fraud in October. Whereas neither any notice nor opportunity of hearing was given to him. The petition also cited the decision of the Supreme Court, in which it has been said that it is necessary to give notice and opportunity to reply to any borrower before declaring him a fraud.
CBI has registered a case
In this matter, CBI has also registered a case against Jai Anmol Ambani and Reliance Home Finance Limited. It is alleged that Union Bank suffered a loss of about Rs 228 crore. According to the bank, RHFL had taken a credit limit of about Rs 450 crore, but due to non-payment of installments, the account was declared NPA in September 2019.
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