Anil Ambani, who was one time hailed as one of India’s biggest business tycoons, finds himself in the news once again as the State Bank of India (SBI) has labeled him and his firm Reliance Communications (RCom) “fraud.” His lawyers have vehemently objected to this action, stating that SBI did so without allowing Ambani a proper opportunity to present his case or express his version. They termed it a patent breach of fundamental principles of natural justice. According to Ambani’s counsel, the bank didn’t even provide all documents related to the show cause notice.
Reliance Communications was once among India’s leading telecom companies, but it collapsed under heavy debt. The company is currently under the Corporate Insolvency Resolution Process (CIRP) since 2019 under the Insolvency and Bankruptcy Code (IBC). A resolution plan has been approved by the Committee of Creditors and is waiting for the final nod of the NCLT (Mumbai Bench). Despite this pending decision, SBI classified RCom and Ambani as fraud entities on June 13, 2025, under RBI’s Master Directions on Fraud Risk Management.
In Parliament, Minister of State for Finance Pankaj Chaudhary stated that the SBI is also going to lodge a complaint with the CBI. He added that proceedings for personal insolvency against Ambani are already pending before the NCLT. For his lawyer, this move has hurt the reputation of the bank, particularly since no personal hearing was accorded to Ambani, contrary to the principles of fairness.
Interestingly enough, Canara Bank — also a part of the same lender group — withdrew its fraud labeling of RCom and Anil Ambani. On July 10, in front of the Bombay High Court, Canara Bank acknowledged that their previous designation “could not be sustained in law” and retreated. This created ambiguity because while one big bank retreated, SBI is still very much holding ground. Ambani’s lawyer wondered why various banks within the same consortium are going in different directions.
SBI’s exposure to RCom till August 2016 was about ₹2,228 crore of principal and ₹787 crore of guarantees. But now the issue has become even more delicate because recently the Finance Ministry brought out a list of large loan defaulters where the aggregate value of bank frauds and defaults comes to about ₹16,000 crore. This list comprised some popular companies and pointed towards the gigantic issue of bad loans that Indian banks are confronting these days. Everyone is asking whether everyone defaulting is being treated in an equal manner.
In most of the news stories, officials have opined that prior to labeling any company or promoter as “fraud,” banks need to follow procedure and provide sufficient opportunity for explanation. Without this, the action appears one-sided and arbitrary. The Anil Ambani case is now closely observed by the business community since it throws serious questions on consistency and transparency in the banking system.
Overall, this whole controversy indicates just how thin is the relationship between Indian banks and big corporates. The disparity in treatment by SBI and Canara Bank has left everyone confused. The people will keenly observe what NCLT and courts decide. Moreover, with the government getting tougher against big defaulters, this case might be used as an example for dealing with such issues in the future.
In 2019, Supereme court ordered Ambani to pay or go to Jail. What was the happening then?
