A public interest litigation (PIL) plea has been filed by an advocate before the Delhi High Court, seeking a Special Investigating Team (SIT) probe into the "fit and proper status" of the Hinduja Group as the promoters of IndusInd Bank.
The petition comes at the back of the Reserve Bank of India accepting 21 out of 33 recommendations made by its Internal Working Group on the guidelines on ownership and corporate structure of Indian private sector banks.
Three of the accepted recommendations, which deal with cap on shareholding of promoters, are what the petition focuses on.
The petitioner in the case is also urging the high court to direct the RBI to disallow the policy to increase stakes to 26 percent by promoters tainted with criminal antecedents and financial fraud indictment in private sector banks. In doing so, the PIL has sought for the concerned recommendations made by Internal Working Committee (IWC) set up by the RBI in 2020 to be stayed in the meantime.
The petitioner questions the RBI's role as a regulator and points out that the central bank, as well as the IWG, were initially opposed to granting banking licence to large industrial houses. It is the petitioner's case that allowing raising the cap on shareholding for promoters to 26 percent is in effect "giving the same proposition in a twisting garb."
Allowing high shareholding for corporates "gives a clear message that corporates can come and siphon off public money for their business," the petition says. Increased shareholding of the Hindujas in IndusInd Bank may lead to "more siphoning, money laundering & playing with the Public Money of Depositors", the petition claims.
The Hinduja family, being a large shareholder in the IndusInd Bank should be probed to check for the "fit and proper" status criteria, it said.
Alleging criminal antecedents to Hinduja group, the petitioner, one Mahek Maheshwari, said that promoters of the bank from the Hinduja family are "not Indian citizens so they feel more secure to be not caught up by Indian Law". The Hinduja family has fraud indictment even in foreign countries, the PIL states.
Maheshwari also invokes averments of a family dispute within the Hindujas while questioning their status to be "fit and proper" to be promoters of a private bank.
The Bofors case kickbacks, alleged tax evasion insyances, and paradise paper leaks also find a mention in the petition against the Hindujas.
"It is amazing to note that how the IndusInd bank Ltd. promoters remain under the 'fit and proper status' till date with such credentials," reads the petition.
IndusInd Bank too finds itself in multiple "fiascos" with instances such as reported evergreening of loans, among others, it is said.
The petitioner has approached the high court after making representation before the concerned authorities and on being aggrieved by the inaction of the government against the new policy of the RBI which may bring a corrupt scenario in the banking sector according to the petitioner.
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