Bombay HC Upholds SBI Fraud Tag On Reliance Communications; Anil Ambani and Directors Held Liable

As per the news reports, in a decisive move reinforcing corporate accountability, the Bombay High Court has upheld the State Bank of India’s decision to mark Reliance Communications’ account as fraudulent, holding Anil Ambani and the company’s directors personally liable under the Reserve Bank of India’s (RBI) fraud guidelines.

Promoters and Directors Held Accountable Under RBI Norms

The Bombay HC ruling on October 3, 2025, delivered by Justices Revati Mohite-Dere and Neela Gokhale, dismissed Anil Ambani’s petition against SBI’s classification of Reliance Communications' (RCom) account as a fraud. The court highlighted that once a company is labelled fraudulent, its key functionaries, promoters and directors are automatically responsible for alleged wrongdoings and thus face penal action.

Timeline: Loans, Defaults and Fraud Tag

SBI granted over ₹3,600 crore in loans and credit to RCom and its group entities between 2012 and 2016. Following repayment defaults, the company was declared a non-performing asset (NPA) in August 2016. Later, on December 14, 2023, SBI issued show-cause notices to RCom, Anil Ambani, and 4 others. By June 2025, RCom’s account was formally tagged as fraudulent by SBI.

Relying on the RBI's Master Directions on Fraud Risk Management issued in 2024, the court ruled that individuals responsible for managing fraudulent accounts are barred from accessing credit for 5 years post-settlement.

Legal Arguments and Findings

Ambani’s counsel challenged SBI’s move, citing the switch from RBI’s 2016 guidelines to those of 2024. However, the court sided with SBI’s stand that older proceedings remain valid. The judiciary determined SBI’s order to be “reasoned” and found no procedural flaws.

Read More: ED Registers Fresh PMLA Case Against Anil Ambani, Reliance Communications!

Legal and Investigative Ramifications

Following the fraud classification, SBI reported the matter to the RBI and the Central Bureau of Investigation (CBI). The CBI soon launched a probe and filed a case against Ambani and RCom, citing a ₹2,929 crore bank fraud, with searches conducted at both personal and business premises.

Conclusion

This ruling underscores a stern message to corporations that defaulting companies and their top leadership are equally accountable under financial laws. By upholding the fraud classification, the Bombay HC reinforces regulatory frameworks aimed at deterring financial misconduct.

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