RBI defends its nod for Chanda Kochhar's sacking from ICICI Bank

Says decision to terminate her was fair, not arbitrary

No violation of fundamental rights: RBI

– The bank, while terminating her employment, also denied her remuneration and rescinded the bonuses and stock options given to her from April 2009 to March 2018

– She was accused of playing a role in grant of out-of-turn loans of Rs3,250 crore to Videocon Group, which allegedly benefitted her husband, Deepak Kochhar

– The RBI in its affidavit said there was no violation of Kochhar’s fundamental rights, and its decision to approve the termination of her services was devoid of any “malafides or arbitrariness”

Mumbai, December 18

The Reserve Bank of India (RBI) told the Bombay High Court on Wednesday that its decision to grant approval to ICICI Bank for termination of appointment of Chanda Kochhar as MD and CEO was fair and not arbitrary.

The central bank filed an affidavit in response to a petition filed by Kochhar last month, challenging her ouster as the chief executive and managing director of ICICI Bank months after she voluntarily left the private sector lender.

The bank, while terminating her employment, also denied her remuneration and rescinded the bonuses and stock options given to her from April 2009 to March 2018.

She was accused of playing a role in grant of out-of-turn loans of Rs 3,250 crore to Videocon Group, which allegedly benefitted her husband, Deepak Kochhar.

Chanda Kochhar’s lawyers Vikram Nankarni and Sujay Kantawalla argued that her termination came months after the bank had already accepted her voluntary resignation on October 5, 2018, and therefore the sacking was illegal.

The RBI in its affidavit said there was no violation of Kochhar’s fundamental rights, and its decision to approve the termination of her services was devoid of any “malafides or arbitrariness”.

While giving such approvals, the RBI does not sit in judgment over the legality of the action, it added.

“RBI does not get involved in employee-employee disputes,” the affidavit said.

“It is not the function of RBI to micromanage the actions of the bank and substitute its commercial wisdom for that of the bank,” the affidavit filed by Navin Nambiar, general manager of RBI’s Department of Regulation, said.

The central bank received a letter from ICICI Bank on February 2, 2019, informing that the bank’s Board of Directors has considered the report submitted by the Justice Srikrishna committee and concluded that Kochhar was guilty and reconsidered her early retirement, the affidavit said. PTI