Banking moguls have protested against the arrest of former State Bank of India [SBI] chairman Pratip C Chaudhuri and inquired about how he was arrested involving an Alchemist asset reconstruction company and distressed debtor.
Ranjish Kumar, ex-chairman of SBI, commented, saying, Prima facie, it seems the rules and regulations have been ignored.
This is not the way it is done without allowing a person to say what he wants to say. It does not appear to be a case of corruption.
He also added, saying the case involves a dispute between an ARC and the property owner, and someone seems to have singled out. It is not about someone individual; today it is him, tomorrow it will be someone else.
Arundhati Bhattacharya, the first woman to head one of the biggest banks in the country and the successor of Pratip Chaudhuri, spoke in support of him saying, she can attest to the fact that MR.
Chaudhuri is utterly and conscientiously honest, and there is no wrongdoing on his part. This is a sad day for bankers when a senior banker is taken to a task like this without doing anything wrong.
It is ironic to know that the arrest followed after the finance minister of India, Nirmala Sitharaman;s norms on uniform staff accountability framework for non-performing assets [NPA] accounts of over 50 crores, which were there and meant to protect bankers from bonafide business decisions that bear out to be wrong later.
Bankers have been cautious of action taken by law enforcement agencies, prompting many of them to slow down in giving out loans to anyone. This concern made even the prime minister of India, Narendra Modi, confront and address them.
State Bank of India, deputy director MD Sunil Srivastava tweeted, saying, I find it pathetic. The system is being again by defaulters despite all efforts by Narendra Modi headed the central government to refurbish the judicial process to improve transparency and introduce accountability.
Numerous bank executives expressed that Pratip Chaudhuri’s arrest will raise fears in sanctioning loans and the recovery process where the lenders and borrowers take the option for settling the dues and wave the penal interest.
SBI sources claimed that the borrower has sought to annoy the bank and disrupt its attempts to recover the dues for a very long time.
They have also drawn attention to that it is improbable that it was Chaudhuri’s decision with the size of the transaction.
An SBI executive said even in smaller loans, and it is never one person who decides on the recovery action.
A senior banker, not named, commented, if a defaulter can send a former bank presiding officer to jail on an allegation, how can bankers be expected to do this? The government has repeatedly assured the bankers that authorities cannot pick up a banker without reason. The case has been filed just before the courts are closed for Diwali- and it appears that this was done on purpose.
The SBI released a statement that the court has not been briefed correctly about the sequence of events.
Chaudhuri retired from SBI in September 2013, and all the people in the director position who had joined the ARC were pronounced equally guilty in the case.
SBI said it seems that the copies of the court proceedings, which are now with us, have not been briefed correctly to the court.
SBI is not a part of this case, and the views of SBI have not been considered in the proceedings. All due processes have been followed while making a sale to the ARC, and the bank has offered its cooperation.