Chanda Kochhar Files Suit For Benefits Unconditionally Provided By ICICI Bank When Accepting Early Retirement

According to the Suit, the Bank accepted her early retirement on October 4, 2018, and had unconditionally agreed to honour certain commitments and contractual obligations towards her entitlements and benefits, which it later "wrongfully resiled from."

Justice Anil Menon, while hearing the Suit on Thursday, granted two weeks' time to ICICI Bank to file its response and a rejoinder, if any, by Kochhar needs to be filed in a week thereafter. The court has adjourned the case to March 24. Senior Advocate Aspi Chinoy, instructed by law firm Rashmikant and Partners, appeared for Kochhar. The bank was represented by Senior Advocate Darius Khambata, instructed by law firm Veritas Legal.

The Suit contends that the bank, infact, acted upon its commitments and obligations and did give her certain retirement benefits between October and December 2018. "However, the Bank on receipt of the Enquiry Report (by retired Supreme Court Justice BN Srikrishna), sought to convert her early retirement into a 'Termination' four months after her retirement without any legal basis and subsequently declined to grant her the benefits which was unconditionally committed to be given to her at the time of her early retirement," the Suit argues.

It further states that the Bank could not have terminated a person who had already retired. "The Bank was fully aware of the Terms of Reference and the scope of enquiry and with full knowledge had entered into a contract with Chanda Kochhar granting her certain retirement benefits unconditionally. The Bank has reneged from its contractual commitments and obligations flowing from its acceptance letter dated 4th October 2018 without justification," the Suit further claims.

A private enquiry was set up in May 2018 under Justice Srikrishna after the bank received a whistle-blower complaint making allegations against Kochhar, following which post which she proceeded on leave. However, as the Banking Regulation Act, 1949, does not provide for more than four months' period for interim arrangement for Managing Director of a Bank, Kochhar applied for early retirement, which was accepted.

The bank, however, converted the early retirement into termination after the Bank's internal inquiry allegedly found that Kochhar had violated disclosure norms on conflict of interest and that her October 2018 exit would not be treated as normal resignation but as a dismissal. This resulted in certain benefits not being passed on to her, against which she has filed the current Suit on January 28, which was heard for the first time on Thursday.