Bombay High Court Denies Interim Relief In Lilavati Trust Vs HDFC Bank Case

Lilavati Kirtilal Mehta Trust has filed a Rs 1,000 crore defamation suit in the Bombay High Court against HDFC Bank and its Managing Director and CEO Sashidhar Jagdishan, alleging that the bank made false and damaging statements regarding loan dues and related litigation. The Trust has claimed that such statements have harmed its reputation in the public domain and portrayed it and trustee Prashant Mehta as loan defaulters.

The petition also sought urgent interim relief from the court, including a gag order restraining HDFC Bank from issuing further public statements on the matter, removal of existing content, and a public apology. However, the Bombay High Court refused to grant any interim restraint at this stage, declining to pass a gag order against the bank or its officials.

In its observations, the court held that the statements made by HDFC Bank could not be treated as prima facie defamatory. Justice Somasekhar Sundaresan noted that the bank’s assertions were supported by material on record and appeared to be a bona fide clarification of its position in an ongoing dispute.

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The court further relied on the existence of a Debt Recovery Tribunal (DRT) recovery certificate while examining the issue, stating that such a certificate indicates legally recoverable dues. It rejected the Trust’s contention that liability had not been conclusively determined and observed that recovery proceedings in the matter had been subject to prolonged litigation.

The High Court also took note of what it described as a pattern of repeated legal proceedings initiated by the Mehta family across multiple forums, including earlier judicial observations that recovery actions had been delayed. It accepted the bank’s argument that it was entitled to respond to media queries and defend itself in light of ongoing public statements and litigation.

Dismissing the interim application, the court imposed costs of Rs 5 lakh on the Trust. The dispute stems from long-running recovery proceedings involving loans linked to the Mehta family, which date back over two decades and have led to multiple legal and regulatory disputes. In earlier proceedings, the court had also quashed an FIR filed against the bank’s CEO, terming it an abuse of process, while noting that similar complaints appeared to be linked to efforts to stall recovery actions involving dues of around Rs 65 crore.

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