Delhi HC upholds quashing of 'wilful defaulter' tag on Ratul Puri

New Delhi: A division bench of Delhi High Court on Friday upheld a 2023 single judge ruling that set aside Bank of Baroda and Punjab National Bank's decision to declare businessman Ratul Puri as a wilful defaulter under the 2015 Reserve Bank of India's Master Circular on Wilful Defaulters. "We are in entire agreement with the single judge that the Master Circular does not envisage categorisation of a borrower as wilful defaulter without the requisite degree of circumspection and examination," the bench of Justices C Hari Shankar and Ajay Digpaul said in its order.

The bench said the forensic audit report (FAR) did not verify the source of funds invested in the subsidiaries of Moser Baer India (MBIL), with which Puri was earlier associated. The bank could not have issued show-cause notice to him for wilful default without verifying the source of funds, it observed.