SAT orders SEBI to grant Chanda Kochhar access to ICICI Bank documents, data in Videocon loan case

The Securities Appellate Tribunal (SAT) recently directed the Securities and Exchange Board of India (SEBI) to allow former ICICI Bank CEO and Managing Director Chanda Kochhar access to the documents filed by ICICI Bank in the proceedings pertaining to the Videocon loan case [Chanda Kochhar v SEBI].The order passed by a bench of Justice PS Dinesh Kumar (Presiding Officer), Meera Swarup (Technical Member), and Dr Dheeraj Bhatnagar (Technical Member) also directed SEBI to provide Kochhar access to the case-related data on ICICI Bank's portal, server and devices.The SAT held that denying access to such material would be a violation of the principles of natural justice, particularly when the proceedings against Kochhar and ICICI Bank emanate from the same set of facts."SEBI is directed to furnish a copy of SCNs [show cause notices] issued to the ICICI Bank and allow the appellant to inspect and take notes from all replies, written submissions/annexures/exhibits/documents filed by ICICI Bank with the respondent and also with respect to the ICICI Bank’s Secretarial Portal and data stored in Bank’s server and devices in respect of ICICI Bank-Videocon Group saga and thereafter fix a date of hearing," it ordered..The direction was passed on an appeal moved by Kochhar in relation to a notice issued to her by SEBI on March 12.Kochhar contended that the show cause notice (SCN) and its amended version were based on submissions made by the Bank and the data stored in its internal systems.Since she no longer holds any official capacity at ICICI Bank following her resignation in October 2018, she sought access to these documents to prepare her defense.Senior Advocate Pesi Modi, appearing for Kochhar, argued that SEBI’s refusal to share documents submitted by ICICI Bank—despite the intertwined nature of the allegations—violated her right to a fair hearing. He emphasized that SEBI was relying on material sourced from the bank to proceed against Kochhar while denying her access to the same..SEBI, represented by Senior Advocate Gaurav Joshi, objected to the maintainability of the appeal under Section 15T of the SEBI Act, contending that a hearing notice is not an appealable order. SEBI further asserted that ICICI Bank was not a party to the amended SCN and that none of the bank’s submissions were being used against Kochhar. Moreover, it claimed that the materials sought were confidential and not in SEBI’s possession..The SAT in its decision said that after her removal from the bank, Kochhar would not have any access to the materials/documents pertaining to the ICICI Bank. "Every person has a right to defend his/her case. In the present case, respondent is independently proceeding against the appellant on the same cause of action/facts in which both the appellant and the Bank are facing enquiry. The respondents have initiated parallel proceedings against ICICI Bank as well as the appellant," it noted.It added that there should be absolute fair practice on part of the quasi-judicial authority while conducting an enquiry. The fundamental principle is that any material which has not been brought to his notice cannot be used against a delinquent, it stressed..The tribunal further observed that denying access to material exclusively held by the bank would risk exposing the adjudicatory process to potential bias, especially since the same adjudicating officer is presiding over both matters. It thus directed SEBI to furnish copies of the SCNs issued to ICICI Bank and allow Kochhar access to the documents and related data..The case pertains to a ₹3,250 crore loan sanctioned by ICICI Bank to the Videocon Group in 2012, during Kochhar’s tenure as CEO and MD. Allegations first surfaced claiming that the loan was part of a quid pro quo arrangement, wherein a company owned by her husband, Deepak Kochhar, allegedly received ₹64 crore in funding from the Videocon Group soon after the loans were disbursed.The Central Bureau of Investigation (CBI), in its chargesheet, has said that from 2009 to 2011, ICICI Bank sanctioned multiple loans to entities linked with Videocon. .Senior Advocate Pesi Modi with advocates Kyrus Modi, Vishesh Malviya, Deepa Shetty, Taniya Dsouza and Athrarva Patvardhan instructed by Rashmikant and Partners appeared for KochharSenior Advocate Gaurav Joshi, with Advocates Nitin Jain, Ravishekar Pandey, Ankit Ujjwal Advocates instructed by Agama Law Associates appeared for SEBI.[Read SAT Order]