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Karvy case: ICICI Bank to challenge Telangana HC stay on DRT proceedings

ICICI Bank is planning to challenge the order of the High Court (HC) of Telangana that stayed a plea of the lender, which it filed in the debt recovery tribunal (DRT) against Karvy Stock Broking.

The high court had stayed the plea of the bank that immoveable and moveable properties of Karvy Stock Broking and other respondents be taken under possession. According to the bank, it is in the process of challenging the HC’s stay on this direction.

ICICI Bank in a statement said the DRT proceedings have not been completely put on stay. “The DRT orders requiring the defendants to deposit sufficient security and imposing a non-disposal injunction on the properties have been upheld by the HC, and continue to be binding on the defendants,” the statement said.

Among other prayers that still stay operational, ICICI Bank had sought recovery of Rs 629 crore. The DRT in its order dated December 9, 2019, had directed Karvy Stock Broking to deposit Rs 629 crore before the tribunal within 15 days of the receipt of the order, failing which the “petition schedule properties shall be attached”.

However, in a statement, Karvy denied any part of ICICI Bank’s plea is operational.

“The order dated December 9, 2019, has been stayed by the HC, which includes attachment of properties and deposit of security amount. Since the said order has been stayed, nothing in that remains operational,” said Karvy.

Also, Axis Bank has moved DRT against Karvy Stock Broking.

As on December 7, 2019, Karvy Stock Broking owed Rs 81 crore to Axis Bank, which was given in the form of overdraft against shares.

Lenders are approaching the DRT after they didn’t get any relief from the Securities Appellate Tribunal (SAT).

Earlier, ICICI Bank, along with HDFC Bank, Axis Bank, and IndusInd Bank, had moved SAT to seek relief after the National Securities Depository restored client securities that Karvy had pledged with lenders back to the affected clients.

The lenders cumulatively have lent close to Rs 1,000 crore to Karvy.

Source: Business Standard