SBI loan fraud: SC permits bank to respond to reply of private firm chairperson accused of fraud

The Supreme Court has permitted SBI to file a rejoinder to the reply of Suman Vijay Gupta, a citizen of the Dominican Republic and chairperson of a Mumbai-based private company, who was stopped from travelling to the UAE because of a case in which she is accused of defrauding the bank of Rs 3,300 crore.

The top court had on March 16 taken up for urgent hearing the appeal of the State Bank of India against a Bombay High Court order permitting Gupta, the chairperson of Ushdev International Limited (UIL), to travel abroad on furnishing a personal undertaking that she will come back to face legal proceedings here.

“The Solicitor General (Tushar Mehta) submits that the applicant (Gupta) who took up the citizenship of the Dominican Republic after the declaration of her account as Non Performing Asset (NPA), has been permitted to travel by the impugned orders dated March 10, and 14 March 2023 of a Division Bench of the High Court of Judicature at Bombay...

“Pending further orders, there shall be a stay of the operation of the impugned orders...,” a bench headed by Chief Justice D Y Chandrachud said on March 16.

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On Thursday, the bench, also comprising Justice J B Pardiwala, took up the plea of SBI for hearing and was urged by lawyer Sandeep Kapur, appearing for Gupta, that she has filed her reply to the bank’s plea and she be permitted to go abroad.

The lawyer said the Bombay High Court rightly permitted Gupta to travel abroad.

The solicitor general, appearing for the bank, opposed the plea saying he may be permitted to file a rejoinder to Gupta's reply.

“The State Bank India is permitted to file its rejoinder affidavit, if need be. List the Special Leave Petitions on April 14,” the bench said.

Earlier, the top court, while staying the Bombay High Court order, had taken note of the submissions of the top law officer that the law enforcement agencies have had a bad experience allowing economic offenders and fraudsters to go abroad on personal undertakings as they seldom honour them and come back to face legal proceedings.

"She is the chairperson of a company which took a loan of Rs 3,300 crore. The CBI is investigating (the case). After the loan was declared an NPA (non-performing asset), she renounced the citizenship of India and got the citizenship of Dominica," the top law officer had said.

A look out circular (LOC) was issued and she was prevented from travelling, he had told the court, adding the Bombay High Court said will let her go if she filed an undertaking stating that she will return to face legal proceedings in the case against her.

"We have a very bad experience with the undertakings," Mehta had said.

Mehta had said insolvency proceedings were initiated against UIL after the fraud was detected and the CBI later registered a case against Gupta, who relinquished her Indian citizenship and became a Commonwealth of Dominica citizen while residing in the UAE.