The Aryavarth Express
Agency(New Delhi): In a recent development, Axis Bank found itself opposing a legal motion by BJP leader Subramanian Swamy at the Delhi High Court on Wednesday. Swamy’s Public Interest Litigation (PIL) calls for an investigation into what he claims is fraudulent activity by the bank aimed at illicitly gaining Rs 4,000 crore through the buying and selling of shares in Max Life Insurance. Axis Bank, along with Max Life Insurance, contested the PIL’s validity, arguing it pertains to a purely commercial deal between private firms, thus questioning the legal standing of the PIL.
Representing Axis Bank, senior advocate Mukul Rohatgi highlighted that the PIL fails to identify the specific group it aims to protect, noting that affected shareholders have the ability to approach the court independently. Neeraj Kishan Kaul, speaking for Max Life, emphasized that the deal in question has already undergone scrutiny by the relevant regulatory authority. Additionally, the insurance sector’s regulator IRDAI has reportedly levied a “possible penalty” concerning the disputed transaction.
Advocate Rajsekhar Rao, representing the petitioner, insisted that the case deserves a broader examination. The court, presided over by Acting Chief Justice Manmohan and Justice Manmeet P S Arora, has scheduled a continuation of the hearing for April 3.
Swamy’s petition accuses Axis Bank of making significant profits in an opaque manner by manipulating share transactions of Max Life Insurance, violating applicable laws. According to the petition, Axis Bank and its affiliates purchased a 12.002% stake in Max Life at a price substantially below market value, leading to an alleged illicit profit of approximately Rs 4,000 crore. Despite a Rs 3 crore penalty imposed on Max Life by IRDAI, Swamy argues that this does not suffice given the scale of the alleged fraud. He urges the court to mandate an expert-led inquiry into the matter and to establish thorough guidelines to prevent similar incidents in the future, highlighting the urgent need to address corruption within the banking and insurance sectors.