Business Standard

Delhi HC stays proceedings against PNB ex-CEO, others

IANS  |  New Delhi 

The Delhi High Court has stayed trial court proceedings against former Managing Director and Chief Executive Officer (CEO) of Punjab National Bank Usha Ananthasubramanian and 11 other PNB officials in a case related to violations of the Banking Regulation Act.

Justice R.K. Gauba, in his May 20 order has asked the Reserve Bank of India (RBI) to file a response on the plea and listed the matter for July 17 for further hearing.

Reserve Bank of India has filed a complaint accusing PNB officials of furnishing false and misleading statements to it in the aftermath of the PNB scam.

"The counsel for the second respondent (complainant) on being asked was unable to give an explanation as to why a general reference was made in the complaint leading to similar general mention in the summoning order to Section 46 of the Banking Regulation Act, 1949, without the specific penal clause being indicated."

In March, Metropolitan Magistrate Dharmender Singh issued summon against Ananthasubramanian, current Managing Director and CEO Sunil Mehta, former Executive Director R.S. Sangapure and former General Managers Rakesh Kumar and Nehal Ahad, among others.

RBI on August 3, 2016, issued a "confidential circular" directing banks to strengthen the controls around the operating environment for fund transfers through SWIFT or similar interfaces.

It asked PNB to file a report on the compliance of the circular. But, PNB allegedly submitted a false compliance report. In the aftermath of the PNB scam, RBI scrutinised PNB's Brady House Branch in Mumbai where it found that PNB's Core Banking System was not integrated with many critical applications and that there was no online integration of SWIFT with the Core Banking System.

--IANS

ak/kr

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, May 24 2019. 19:22 IST
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