Money & Banking

Bombay HC dismisses Kochhar petition challenging termination of employment

Our Bureau Mumbai | Updated on March 05, 2020

Former ICICI Bank CEO Chanda Kochhar. File Photo   -  Bloomberg

The Bombay High Court has dismissed the writ petition filed by former ICICI Bank Managing Director and CEO Chanda Kochhar against her termination from the post, noting that the dispute arises from a contract of personal service.

“The writ petition is dismissed as not maintainable,” said division bench of Justices MS Karnik and Nitin Jamdar in its order.

“The dispute raised in this petition arises from a contract of personal service. The termination of the petitioner is in the realm of contractual relationship,” it further said.

A private organisation is subject to various statutory enactments, but that cannot make its activity amenable to the writ jurisdiction, it further said, adding that private contracts would not be subject to writ jurisdiction merely because of the fact that they are structured by statutory provisions.

“ICICI is a private body. It is not an instrumentality of the state. It receives no public funding,” the court said.

“Since Section 35B(1)(b) does not regulate service conditions, approval for termination under it does not adjudicate the rights of the petitioner as an employee,” the court added.

Section 35B(1)(b) of the Banking Regulation Act says that in the case of a banking company, no appointment or re-appointment or termination of appointment of a chairman, a managing or whole-time director, manager or CEO can come into effect without the previous approval of the Reserve Bank of India.

Kochhar had challenged the approval for termination from the RBI and the bench had issued notice to the regulator as well. “For the contractual remedies, the petitioner will have to approach the appropriate forum and not writ jurisdiction,” it further held.

Kochhar, who was terminated from service by ICICI Bank in January 2019, had contended that she was terminated months after she had sought early retirement in October 2018. She had moved the High Court on November 20, 2019, challenging termination of her employment.

In her petition, she had contended that ICICI Bank had also denied her remuneration and clawed back on bonuses and stock options between April 2009 and March 2018 for her alleged role in granting out of loans worth ₹3,250 crore to the Videocon Group, which, in turn, benefitted her husband, Deepak Kochhar.

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Published on March 05, 2020
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