Bombay High Court Stays Banks Action Against Anil Ambani and Reliance Communications

As per PTI reports, The Bombay High Court has issued a stay on actions by 3 banks against Anil Ambani and his company, Reliance Communications Ltd. This decision comes after the court identified violations of the Reserve Bank of India's Master Directions during the process. 

Violation of RBI's Master Directions 

On December 24, 2025, the Bombay High Court, led by Justice Milind Jadhav, ruled that the actions taken by the banks were based on a forensic audit report by BDO LLP.  

However, this report was deemed unreliable as it was not signed by a qualified chartered accountant, a requirement under the RBI's 2024 Master Directions on fraud. 

Potential Consequences for Ambani and Reliance Communications 

The court highlighted that without interim relief, Anil Ambani and Reliance Communications could face "grave and irreparable harm." Declaring their accounts as fraud could lead to severe repercussions, including being blacklisted, barred from new bank loans, potential criminal charges, and damage to reputation. 

Delayed Actions by Banks 

The court criticised the banks for their delayed actions, noting that they initiated the forensic audit for the period from 2013 to 2017 only in 2019. This delay was described as a "classic case where the banks have woken up from their deep slumber." 

Ambani's Challenge and Banks' Defence 

Anil Ambani challenged the show-cause notices issued by Indian Overseas Bank, IDBI, and Bank of Baroda, arguing that BDO LLP was not qualified to conduct the forensic audit since its signatory was not a chartered accountant.  

The banks, however, contended that the audit report complied with the 2016 RBI Master Directions, which did not necessitate the auditor to be a CA. 

Read More: Central Bank of India Declares RCom Subsidiary Reliance Telecom Loan Accounts as Fraud! 

Court's Final Observations 

The court maintained that according to the RBI's Master Directions, an auditor must be a CA. It also pointed out a conflict of interest, as BDO LLP had previously worked as a consultant for the banks involved. 

Conclusion 

The Bombay High Court's decision to stay the banks' actions against Anil Ambani and Reliance Communications underscores the importance of adhering to regulatory frameworks. The case highlights procedural lapses and the potential consequences of non-compliance with established guidelines. 

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