Businessman Anil Ambani has suffered a legal setback in a bank fraud-related case after the Bombay High Court lifted the earlier stay that had prevented banks from proceeding with fraud investigation actions against him. The court’s division bench also rejected Ambani’s plea seeking a four-week extension of interim protection.
The decision was delivered by a bench comprising Chief Justice Shree Chandrashekhar and Justice Gautam A. Ankhar. The court observed that the earlier order passed by the single-judge bench contained serious procedural and legal irregularities. The bench ruled that maintaining an order found to be legally flawed would be contrary to the principles of justice.
FCRF Launches Flagship Certified Fraud Investigator (CFI) Program
Banks Challenge Ambani’s Interim Relief in Fraud Probe
The dispute mainly arose from appeals filed by Bank of Baroda, IDBI Bank and Indian Overseas Bank along with audit firm BDO India LLP. These entities had challenged the single bench order that had restrained them from continuing fraud investigation proceedings against Ambani.
The case gained attention after banks initiated proceedings to classify the loan account as fraudulent based on a forensic audit report. Banks claimed that the audit revealed suspicious financial transaction patterns that required detailed investigation. However, the Ambani side argued that the audit process did not comply with required legal and statutory standards.
Single Judge Granted Stay Citing RBI Audit Norms
In December 2025, the single-judge bench of Justice Milind Jadhav had granted interim relief by staying bank action. At that time, the court had also noted that forensic audits conducted under the directions of Reserve Bank of India must follow transparency standards comparable to statutory audit procedures.
Banks Cleared to Resume Forensic Audit Investigation
Later, the banks and audit entities challenged the order before the division bench. Following the latest High Court ruling, banks are now permitted to continue investigation and regulatory action in accordance with banking norms.
Ambani’s legal team had sought a four-week stay on the order, but the court rejected the request, stating that granting a stay on a decision already found legally flawed would undermine judicial process.
₹40,000 Cr Controversy Fuels Banking Fraud Debate
The financial dispute related to the case is also being linked in media reports to a controversy involving approximately ₹40,000 crore, though no official judicial document has confirmed the exact amount.
Ruling Strengthens Bank Fraud Probes, Appeal Options Open
Financial analysts believe the ruling could strengthen fraud investigation mechanisms in the banking sector. The decision also indicates that courts may carefully evaluate the legal foundation of regulatory and forensic audit-based actions before intervening.
Following the ruling, the concerned banks are expected to continue their investigation procedures, while the Ambani side still retains the option to approach higher judicial forums for appeal.
