SC rejects SBI plea to vacate stay on Anil Ambani's personal bankruptcy process

NEW DELHI: The Supreme Court on Thursday dismissed the plea filed by the State Bank of India (SBI) seeking a vacation of the stay granted by Delhi High Court on personal bankruptcy proceedings against Anil Ambani, chairman of Reliance Group.

The apex court bench, headed by Justice L Nageswara Rao, directed the high court to consider the issue on 6 October.

The bench, also comprising Justices Hemant Gupta and S Ravindra Bhat, gave liberty to SBI to seek modification of the stay order passed by the high court on 27 August.

The three-judge bench said, "Why don't you go back to high court to argue the Anil Ambani case?"

On 27 August, the high court’s division bench had passed an interim order staying the Mumbai bankruptcy tribunal's order. The bench had said proceedings against corporate debtors will continue and issued notice to the central government, SBI and others. The bench had also restrained Ambani from selling or transferring any of his personal assets and listed the matter for hearing on 6 October.

The SBI, in its petition before the apex court last week, had submitted that the high court did not grant the bank an opportunity to file a counter affidavit and was not justified in passing an interim order staying insolvency proceedings against Ambani “who owes to the Bank public



money to the tune of ₹1707 crores".

The plea also argued that the high court was not justified in entertaining the writ petition when the territorial jurisdiction was in Mumbai as the demand notices were issued by the bank in Mumbai; insolvency proceedings were filed before the NCLT, Mumbai bench; the writ petitioner (Ambani) resides in Mumbai and the petitioner bank (SBI) has its headquarters and corporate office in Mumbai.

SBI submitted in its petition that great prejudice and irreparable damage would be caused to the petitioner if the impugned judgment of the high court was brought into effect. The bank had prayed for an “ad-interim ex-parte" stay order on the 27 August interim order passed by the high court.

On 26 August, Ambani had moved the Delhi high court against the appointment of a resolution professional on personal guarantees given to SBI for securing corporate loans. Ambani had challenged the validity of the section pertaining to personal guarantee and asked if there ws any enabling provision in the Insolvency Bankruptcy Code (IBC) for such an order.

In March, SBI had filed a petition in the Mumbai bench of the National Company Law Tribunal (NCLT) under section 95 of IBC for personal bankruptcy based on guarantees issued by Ambani. NCLT had appointed Jitender Kothari as a resolution professional (RP).