Former ICICI Bank MD and CEO Chanda Kochhar. (Express photo by Pradip Das)The Bombay High Court on Thursday refused interim relief to ICICI Bank’s former CEO Chanda Kochhar in her suit against her former employer, seeking entitlements and retirement benefits. Kochhar had sought specific performance commitments and contractual obligations from her former employer related to benefits due to her since her early retirement from the bank on October 4, 2018.
A single-judge bench of Justice R I Chagla while pronouncing the verdict in her interim application clarified that Kochhar’s termination was valid.
“ICICI Bank did not have complete knowledge of the facts including the non-disclosures by Kochhar…these facts were disclosed only on receipt of the inquiry report. I have held that the termination was a valid termination and Kochhar did not come to court with clean hands. Kochhar is restrained by an order of injunction from dealing with any of the 6.90 lakh shares…,” Justice Chagla held.
Granting interim relief sought by the bank, the bench directed Kochhar not to deal with the 6.90 lakh shares that she claimed were allotted to her. “If she has dealt with any shares then she must disclose the same on affidavit in six weeks,” the judge clarified.
The bench refused Kochhar’s request for a stay on its interim order.
Kochhar’s suit filed in January this year sought specific performance commitments and contractual obligations promised to her after her early retirement in October 2018. Kochhar had claimed that the bank was required to pay her entitlements of around Rs 1,000 crore as per the current market value. She had alleged that the bank reneged on its contractual commitments and cannot terminate a person who had already retired.
Kochhar’s suit was being heard by single-Justice Chagla after another high court bench on April 12 directed its registry to transfer the suit from the commercial division of the court, governed by the Commercial Courts Act, 2015, to its regular civil division, governed by the Civil Procedure Code.
The court was also hearing an application filed by ICICI Bank seeking execution of the claw-back agreement and recovery of benefits granted by the bank to Kochhar.
The Indian Express had reported on March 29, 2018, that Videocon Group promoter Venugopal Dhoot had provided crores to a firm he had set up with Chanda Kochhar’s spouse Deepak Kochhar and two relatives, six months after the group got Rs 3,250 crore as a loan from ICICI Bank in 2012. In December 2017, the CBI registered a preliminary enquiry into the sanctioning of the loan.
In December 2020, the Supreme Court declined to interfere with a Bombay High Court order upholding the January 2019 decision of ICICI Bank to terminate Kochhar’s services as managing director and CEO. In January 2019, the board of ICICI Bank sacked Kochhar and decided to claw back all bonuses given to her since 2009 when she took charge of the top post.
Kochhar, in her plea argued through senior advocate Aspi Chinoy, had stated that her former employer was fully aware of the terms of reference and scope of probe while entering into the contract with her and the same had granted her certain benefits without any conditions.
However, the bank later did not fulfil its contractual obligation arising out of its acceptance letter of October 4, 2018, and did not justify the same, she argued.
As per Kochhar, the benefits granted to her consisted of stock options for employees which were exercisable till 2028 and a tranche of such stock options was expiring in April, this year, therefore she approached the high court.
She had sought a direction to the bank not to restrain her from any right of shares and benefits that she was entitled to 1.32 crore vested stock options and 16. 63 lakh vested stock options as per the acceptance letter.