InfraLive September-15, 2025

DRT Order Exposes Sashidhar InfraLIVE September 15, 2025 6 www.infralive.com When the matter first came up before apex court on July 11, 2008, the court ordered, “Until further orders, further proceeding inNotice of Motion No.40 of 2007 in Insol- vencyNo. N/224/07 pending before the Bombay High Court shall remain stayed.” Subsequently, the court issued a notice in the instant matter because the correctness of judgement in Paramjeet Singh Patheja matter was doubted by another bench in Sundaram Finance v/s Ashok D Soniminde case and the said case was referred to a larger bench. On April 23, 2015, a three judge bench of the SC in Sundaram Finance matter upheld the judge- ment inParamjeet SinghPatheja. In view of the above, HDFC had no chance of getting any favourable order, where its appeal is pending since last 18 years (Civil Appeal No. 485 of 2008). Last year, after the death of Mr Kishor, HDFC made all his legal heirs as parties in this mat- ter includingMs Charu. Strangely, on the recovery front, HDFC (with just 5 per cent out- standing) did not take any action even after getting a favourable order in 2004 till 2018, while all the others lenders (with 95 per cent shares) had settled their dues, way back in 2012 and 2013. Possibly it wanted the outstanding to swell. After remaining silent for over 13 years, suddenly, on February 12, 2018, HDFC moved an application before DRT seeking direction for civil arrest of Kishor Mehta, Rajeev Mehta, Rajesh Mehta, Kiran Shah, and Govindbhai Patel on the ground that they had the capability but were not repaying the dues. On Feb 5, 2020, HDFC obtained arrest war- rants against three - Kishor Mehta, Rajeev Mehta, and Rajesh Mehta - fromtheRecoveryOfficer. On February 27, 2023, Kishor Mehta and RajeshMehta challenged this arrest warrant in Bombay High court (WP No. 132/2023), which directed DRT to review its order. Even after the review, onOctober 25, 2023 DRT issued fresh arrest war- rant against Kishor Mehta and RajeshMehta. On November 8, 2023 this was again challenged before the Bombay High Court. The court ordered sus- pension of its execution for two weeks within which 25 per cent of the outstanding was to be paid by them for staying the execution of the arrest warrant order. The Supreme Court also did not interfere in this matter. Finally, on June 14, 2024 Kishor & Rajesh paid Rs 3.69 cr to HDFC. The court directed DRT to review the entirematter. On the direction of high court, the DRT reviewed the entire matter. In its order of July 22, 2025, DRT with- drew the arrest warrant, and also exposed the real intention of HDFC management behind this litigation (see scan at pg 17). In a startling exposure, the DRT observed that HDFC Bank was in silent mode for 13 years and did not take any action against assets dis- closed by BDL and Mehtas. It said, “No recovery action was taken against the assets disclosed by the applicant from the date of recovery certificate in 2004 till 2017 i.e. for almost 13 years.” It further noted, “The law gave the right to recover dues mainly by attaching and selling the bor- rower's mortgaged and personal assets. Arrest is an option, yes, but only as a last resort.” While withdrawing the arrest warrant, DRT noted that, “HDFC concentrated, only and only, on arrest and prohibiting travels etc. show that the method adopted by the bank lacked the clean hands on its part.” DRT categorically observed that HDFC bank might be playing in the hands of rival familymembers. In its order, the DRT noted, “One also cannot ignore the long history of litigation between the parties, including cases before the Supreme Court. This points to the possibility that other grievances may be play- ing out through this execution.” In August Rajesh Mehta paid another Rs 7.50 crore that allowed himto travel abroad. On this issue, twice we sent email to Mr Sashidhar for his response, but he chose to remain silent. was also not specified nor did HDFC challenge it. At no stage, HDFC provided bill-wise details of out- standing loan to any forum includ- ing DRT. Filing of statement of accounts is a mandatory require- ment as per DRT Rule 9, without which the recovery application should have been rejected. Even before the above stated DRT judgement, from 2003 onwards itself most of the lenders started recovering their dues through sale of pledged assets. Many of the lenders settled their decreed claims worth Rs 123 crore during 2007, 2012 and 2013 throughOTS route. On the other hand, HDFC was on a different track. It did not bother to pursue recovery. Perhaps, it wanted the outstanding to multiply. But, it initiated legal process to declare Mr Kishor as insolvent. In this regard, it filed an application with the Insol- vency Registrar, and on Nov 3, 2006 obtained insolvency notice against Mr Kishor. This was a strange move because recovery proceedings and insol- vency proceedings are entirely dif- ferent. Once recovery proceeding gets exhausted i.e. a borrower / guarantor is unable to pay because he does not have any money or asset to repay (negative net worth), then only the insolvency proceedings can be initiated. But, in this case, HDFC for some reason was seen active on insolvency rather than recovery. Mr Kishor challenged the insol- vency notice before the Bombay High Court. On March 4, 2008, the single judge in its interim order stayed the insolvency proceedings initiated against him. On June 30, 2008 the Division Bench of the Bombay High Court upheld the single judge order citing the SC judgement in Paramjeet Singh Patheja v/s ICDS Ltd. In that case the apex court had said that pursuant to the issuance of recovery certificate, insolvency proceedings cannot be filed by a bank under the Presidency Towns Insolvency Act, 1909 (as amended in 1978). On July 9, 2008, HDFC filed an appeal against the said judgement before the Supreme Court.