Bombay High Court says Chanda Kochhar's termination from ICICI Bank was valid
The HC dismissed her interim application in her suit against the bank.
Bombay High Court says Chanda Kochhar's termination from ICICI Bank was valid | File
Mumbai: The Bombay High Court on Thursday said prima facie retrospective termination of former Chief Executive of the ICICI Bank Chanda Kochhar from the bank in 2019 is "valid".
Justice Riyaz Chagla, in an interim order, also restrained Kochhar from dealing with ICICI's 6,90,000 shares which she had acquired through stock options between October 4 and December 11, 2018.
Court: Disclose all transactions within six weeks
The court further directed her to disclose within six weeks, in an affidavit, all her transactions while dealing with the stocks.
The HC was hearing an application filed by Kochhar in her suit against the bank seeking post-retirement benefits. In the suit filed against the bank, Kochhar sought specific performance of her entitlements and benefits that were unconditionally provided to her when the bank accepted her early retirement on a October 4, 2018.
While dismissing her application, the court also said that she had not come to court with "clean hands."
“ICICI Bank did not have complete knowledge of the facts including the non-disclosures by Ms Kochhar (at the time of her resignation).. these facts were disclosed only on receipt of the inquiry report. I have held that the termination was a valid termination and Ms Kochhar didn't come to court with clean hands,” said justice Chagla.
He further added: “Ms Kochhar is restrained by an order of injunction from dealing with any of the 6.90 lakh shares....”
Kochhar: Bank was aware of all terms of reference
Kochhar claimed in her suit that the bank was fully aware of the terms of reference and scope of enquiry when entering into a contract with her which granted her certain benefits unconditionally. She alleged that the bank later reneged from its contractual commitment flowing from its acceptance letter without any justification.
Also, the bank could not have terminated a person who had already retired, she claimed.
The benefits granted to her unconditionally included employee stock options that were exercisable till 2028 and a tranche of such stock options was purportedly expiring April this year, which gave rise to the urgency in hearing.
The bank, on the other hand, sought for an order directing Kochhar to stay her hands on the stocks till her suit is finally heard.
Following a complaint, the bank initiated an inquiry in 2018 which indicted her and said that she had violated disclosure norms on conflict of interest. Kochhar applied for early retirement, which was accepted.
The bank, however, converted the early retirement into termination in January – February 2019. The bank decided to treat her October 2018 exit as a dismissal and not a normal resignation.
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