PMC Bank scam: RBI moves SC against Bombay HC order on sale of mortgaged property

Tribune News Service
New Delhi, February 4

The Reserve Bank of India (RBI) on Tuesday moved the Supreme Court challenging a Bombay High Court order for sale of mortgaged property in connection with the Rs 7,000 crore Punjab and Maharashtra Cooperative (PMC) Bank scam, contending the order was passed without hearing the banking regulator.

Senior Advocate Rakesh Dwivedi mentioned the RBI’s petition before a Bench headed by Chief Justice of India SA Bobde and requested it to grant urgent hearing. However, the Bench asked Dwivedi approach the mentioning Registrar.

 The RBI submitted that the PIL on which the high court passed the impugned order without making the RBI party to it. It said the measures taken by it, including the appointment of an administrator, were brought to the high court’s notice.

 A day after the Bombay High Court ordered shifting of Rs 7,000 crore PMC Bank scam accused HDIL promoters Rakesh Wadhawan and Sarang Wadhawan from Mumbai’s Arthur Road Jail to their residence under the constant watch of prison guards, the Supreme Court had on January 16 stayed the decision.

The top court had passed the order after Solicitor General Tushar Mehta, representing Enforcement Directorate, submitted that the high court’s order allowing their release from prison must be stayed.

Besides shifting them to their residence, the HC had ordered setting up a three-member panel to evaluate and sale of encumbered assets of Housing Development and Infrastructure Limited (HDIL) to expeditiously recover dues payable by the firm to PMC bank. It has asked them to cooperate with the committee.

The high court order had come on a PIL seeking expeditious disposal of HDIL assets attached by the Economic Offence Wing and the Enforcement Directorate and repaying PMC Bank depositors at the earliest.

The PMC Bank scam came to light in September last year after RBI discovered that the bank had allegedly created fictitious accounts to hide over Rs 4,355 crore of loans extended to almost-bankrupt HDIL. The PMC bank masked 44 problematic loan accounts, including those of HDIL, by tampering with its core banking system, and the accounts were accessible only to limited staff members, RBI had said.