Key Points
The Bombay High Court on Monday granted interim stay on the effect of the master circulars issued by the Reserve Bank of India that permits banks to declare any account as a fraud account without a hearing..
A division bench of Justices Gautam Patel and Neela Gokhale stayed effect of the Reserve Bank of India Master Directions on Frauds Classification and Reporting by Commercial Banks and Select FIs issued in 2016 till September 11 when it would hear petitions challenging the same...
As per the circulars, once a bank classifies an account as fraud, it is the responsibility of that bank to report the same to the Central Repository of Information on Large Credits platform to alert other banks...
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Banks opt to go slow on fraud classification
09, May, 23Tamilnad Mercantile Bank MD and CEO S Krishnan said when lenders perform forensic audit of an account, they already keep borrowers in know of the proceedings.
Fraud classification may get delayed: Banks
17, May, 23The Supreme Court clarified on Friday that it had not directed banks to accord a “personal hearing” before classifying a borrower's account as fraud, as reported by PTI.
HC stays bank action under RBI’s circular on fraud a/cs
20, Jun, 23India Business News: Mumbai: The Bombay high court on Monday stayed an action by banks under a master direction issued by the Reserve Bank of India (RBI) on ‘frauds classi.
Fraudulent A/cs: Supreme Court rejects SBI plea on ruling applicability
12, May, 23The State Bank of India had asked the court to clarify that the ruling would only apply prospectively and not affect past decisions. However, the court refused and clarified that a personal hearing meant a defaulter should be given adequate notice and an opportunity to make a representation.
Borrowers should be heard before accounts are classified as fraud: SC
27, Mar, 23The Supreme Court on Monday held that borrowers must be given an opportunity to be heard before their accounts are classified as fraud.
Borrowers must be accorded hearing before declaration of bank account as fraud: SC
27, Mar, 23A bench headed by Chief Justice D Y Chandrachud, while upholding a Telangana High Court verdict, said a classification of accounts as fraud results in civil consequences for borrowers and hence, an opportunity of hearing must be given to such persons.
‘Lender must hear borrower before listing a/c as fraud’
27, Mar, 23The decision to classify a borrower account as fraudulent must be made by a reasoned order, the top court said
Banks' fraud account classification faces legal challenges: No personal hearings, potential court battles
06, Oct, 23Banks in India will not provide a personal hearing to companies before classifying them as 'fraud' accounts, but will re-evaluate the decision if legally challenged. The procedure, which aims to codify the steps to classify companies with outstanding loans of ₹50 crore or more as fraud accounts, follows a Supreme Court direction in March 2023 to provide a hearing to borrowers before such a step is taken. Some bankers and legal experts believe the procedure may lead to court disputes.
Banks Vs Borrowers: SBI Asks Supreme Court For Clarification On 'Fraud' Ruling
17, Apr, 23Giving the entire forensic report to defaulter borrowers will forewarn them about ongoing investigations, SBI tells Supreme Court.
Banks mull common framework on hearing borrowers before fraud tag
24, May, 23A committee will be set up soon to draw up the framework, said the people cited above. It will detail the process of approaching borrowers, the documents to be submitted and reports to be given to them, along with timelines and the course of action.