Be present in next IL&FS hearing or face arrest: NCLT to Axis, StanC CEOs

The Mumbai NCLT on Monday issued an ultimatum to the CEOs of Axis Bank and Standard Chartered Bank to be personally present at the next hearing, failing which it will direct the authorities to issue nonbailable warrants against them in a case relating to the IL&FS case.

An NCLT bench headed by Bhaskara Pantula Mohan issued the ultimatum while hearing a contempt petition against Amitabh Chaudhry and Zarin Daruwala of Axis Bank and StanChart India, respectively, for not being personally attending the hearings so far.

The tribunal has fixed the next date of hearing on December 16 and asked Chaudhry and Daruwala to be present. The bench noted that both these bankers never presented themselves before the bench since the issue surfaced last December.

The case relates to these banks allowing ex-head of ILFS Financial Services Ramesh Chandra Bawa and his family withdraw money from their accounts with these banks and also accessing the lockers even after these accounts were frozen by the tribunal.

But the banks had submitted that the particular transactions took place before they got the copy of the tribunal order freezing these accounts.

The tribunal froze these accounts on December 3, 2018.

Following this, the contempt notices were issued these three after the corporate affairs ministry had alleged that the banks facilitated Bawa to withdraw/transfer money from their accounts to his wife Ashakiran and daughter Akansha, apart from letting him access the lockers.

Following this, on April 26, 2019, the NCLT issued contempt notices to Chaudhry and Daruwala. Later it also issued a similar contempt notice Bawa for not following its directions.

The ministry also informed the tribunal that Bawa withdrew/transferred Rs 1 crore and Rs 14 lakh from Axis Bank accounts in two instances violating the December 3, 2018 NCLT order freezing the accounts.

The ministry counsel had also said Bawa accessed his lockers with these bank four times since December 3.

While freezing the accounts, the NCLT on December 3 had also restrained former directors of IL&FS Group from disposing of or creating any third-party rights on their properties.