Supreme Court Refuses Relief to Anil Ambani on Fraud Tag, Records His Intent to Settle with Banks

In Anil D Ambani v. Bank of Baroda (SLP(C) No. 12943-12944/2026 and connected cases), the Supreme Court on Thursday refused to stay the classification of Anil Ambani’s loan accounts as “fraudulent” by a consortium of banks.

The Bench comprising Chief Justice of India Surya Kant, Justice Joymalya Bagchi and Justice Vipul Pancholi held that there was no reason to interfere with the Bombay High Court Division Bench’s order, which had earlier lifted the interim stay granted by a Single Judge.

The Court clarified that the observations made by the High Court would not affect the final outcome of the civil suit filed by Ambani against the banks. It also directed that the trial be expedited, subject to cooperation from all parties.

During the hearing, Senior Advocate Kapil Sibal, appearing for Ambani, argued that the fraud classification would result in a “virtual civil death.” He stated, “I have been called a fraud. This is a virtual civil death, nobody will lend money to him.”

Sibal further contended that the classification was legally flawed as it was not based on a valid statutory audit. He argued that the report relied upon by the banks was prepared by a forensic service provider who was not qualified as an auditor under applicable law.

The Court, however, remained unconvinced. The Chief Justice observed concerns regarding alleged diversion of large sums of money, remarking, “…if the hard-earned money…1000s of crores of taxpayer hard-earned money alleged to be siphoned…Has the loss been made good?”

Supporting the banks’ position, Solicitor General Tushar Mehta argued that the audit had been conducted by a reputed entity selected through a proper tender process. He maintained that the lenders were entitled to rely on their chosen experts.

Senior Advocate Shyam Divan, also appearing for Ambani, emphasised that fraud classification carries serious civil and criminal consequences and must strictly comply with statutory requirements. He argued that only a qualified Chartered Accountant could conduct such an audit.

The Bench questioned whether it could substitute its own assessment for the commercial decisions of the lenders. It noted that nationalised banks are best placed to determine appropriate auditors, especially when public funds are involved.

After the order was pronounced, Sibal informed the Court that Ambani was willing to settle the matter with the banks and requested that his statement be recorded. The Solicitor General opposed this, stating that such a record “will be used for purposes which we cannot conceive.”

Despite the objection, the Court recorded the statement while clarifying that it had expressed no opinion on any proposed settlement. It also left all other legal remedies open to Ambani.