The Supreme Court of India clarified natural justice requirements in bank fraud classification under RBI Master Directions. It rejected a mandatory personal hearing, endorsing a written-hearing process with show cause notice, disclosure of material, borrower representation, and a reasoned order. Crucially, borrowers are entitled to full forensic audit reports, with limited, justified redactions. The ruling balances borrower rights and bank obligations, shifts focus to transparency and evidence, and reduces procedural challenges while strengthening scrutiny of audit quality and decision-making.
Please click here to read the full article by Hormuz Mehta, Partner; Ahsan Allana, Principal Associate; and Kunal Bilaney, Associate, published in Bar and Bench.
Hormuz is a Partner in Disputes Practice Area with a specialization in white collar crimes, penal laws, cross-border crimes, criminal investigations and general corporate criminal disputes.