While upholding an order passed by a single judge, a division bench of Bombay High Court (HC) dismissed an appeal filed by Chanda Kochhar, former managing director and chief executive officer (MD&CEO) of ICICI Bank Ltd, seeking post retirement benefits.
In an order, the bench of justice Rajesh S Patil and justice KR Shriram says, "The trial court has exercised its discretion reasonably and in a judicial manner. The observations made by the single judge on the conduct of appellant (Ms Kochhar), though not conclusive, are very serious in nature. If the interim reliefs sought by Ms Kochhar is granted, that would cause irreparable injury and prejudice to respondent."
"The balance of convenience is completely in favour of respondent (ICICI Bank), since it is a public listed company, and if Ms Kochhar succeeds in her suit, ICICI Bank can at that stage be directed to purchase shares from the stock market or to pay an amount equal to their value to Ms Kochhar. Per contra if Ms Kochhar’s suit is ultimately dismissed, ICICI Bank would then be required to seek recovery of the shares acquired by Ms Kochhar and/or monetary equivalent of the same," the bench says.
Further, the HC states that whether Ms Kochhar's offer of early retirement resulted in cessation of the employer - employee relationship that would preclude ICICI Bank from taking any disciplinary procedure or action against her or terminate her employment, are all 'matters of trial' which cannot be decided at the interim stage.
Noting that Ms Kochhar has approached the HC just two days before the expiry of the three-year limitation period from the date of cause of action, the bench concludes that the delay in approaching the Court would itself disentitle the former MD&CEO from seeking any interim relief as prayed for.
In her plea, Ms Kochhar sought reinstatement of her employee stock options (ESOPs) as well as specific performance of her retirement benefits. However, the HC observed that "…the reliefs sought by Ms Kochhar are in the nature of final reliefs and grant of such reliefs would amount to decreeing Ms Kochhar's suit at the interim stage."
ICICI Bank sought clawback of bonuses and revocation of retirement benefits, including vested and unvested ESOPs of Ms Kochhar. It contended that the services of Ms Kochhar was treated as 'termination for cause' with effect from 4 October 2018 for breach of good conduct during her employment.
Ms Kochhar was sacked from ICICI Bank a few months after she voluntarily quit. Later, she challenged her dismissal in January 2019, while the mandatory 'prior sanction' was given by the Reserve Bank of India (RBI) in March 2019.
The justice BN Srikrishna committee that probed allegations against the former MD&CEO of ICICI Bank found that she violated the Bank's code of conduct in dealing with conflict of interest and fiduciary duties in the case of loans to Videocon that had routed a part of the money to a company owned by her husband Deepak.
In a release at that time, ICICI Bank says that following the receipt of the enquiry report and its due consideration and the conclusions thereat, after due deliberations, the board of directors decided to treat the 'separation' of Ms Kochhar from the Bank as a 'termination for cause' under the Bank's internal policies, schemes and the code of conduct with all attendant consequences. (Read: Srikrishna committee indicts Chanda Kochhar
In March 2020, a division bench justice NM Jamdar and justice MS Karnik had dismissed her plea challenging her termination as the MD&CEO of ICICI Bank. The bench accepted ICICI Bank's contention that the petition was not maintainable as it was a contractual dispute concerning a private body.
In her plea filed in November 2019, Ms Kochhar had also challenged the private bank's actions seeking to recover various amounts towards the clawback of bonuses and stock options given to her between April 2009-March 2018 for her alleged role in extending loans of Rs3,250 crore to the Videocon group, which benefited her husband Deepak Kochhar. (Read: Bombay HC dismisses Chanda Kochhar's plea against her sacking as ICICI chief