Supreme Court Expresses Shock Over Corporate Fund Siphoning, Vows Strict Monitoring
The Supreme Court of India, on Friday, voiced profound concern and described it as very shocking that public money is being systematically siphoned off by corporate houses. The apex court emphasized that it should not adopt a lenient stance towards such entities, highlighting the gravity of financial misconduct affecting public funds.
Bench's Stern Observations During Jet Airways Case Hearing
A bench comprising Chief Justice of India Surya Kant and Justice Joymalya Bagchi made these pointed remarks while hearing a plea filed by the Bank of India. The bank's petition challenged the Bombay High Court's decision to quash its classification of Jet Airways founder Naresh Goyal's bank account as fraud. The bench underscored the seriousness of the allegations, indicating a need for rigorous scrutiny in such matters.
Solicitor General's Submission and Legal Arguments
Solicitor General Tushar Mehta, representing the bench, argued that the Bombay High Court had erred in overturning the bank's decision to declare Goyal's account as fraudulent. This legal contention forms the core of the ongoing dispute, with the bank seeking to uphold its initial classification based on alleged financial irregularities.
Naresh Goyal, who was arrested by the Enforcement Directorate in September 2023, faces charges of money laundering and siphoning off loans amounting to Rs 538.6 crore that were extended to Jet Airways. His counsel countered the bank's plea by submitting that the High Court's order was based on a concession made by the bank itself, and therefore, the bank should not be permitted to challenge it in the Supreme Court. The lawyer referenced paragraph 10 of the High Court judgment, which noted that the bank had stated it would not act further on the fraud classification or the related show-cause notice dated July 1, 2025.
Supreme Court's Decision to Monitor Proceedings
In response, the Supreme Court bench deemed the allegations extremely serious and announced its intention to monitor the proceedings closely. The bench expressed a desire to ascertain where the siphoned money had been parked, signaling a proactive judicial approach to uncover the trail of diverted funds. After a brief hearing, the court deferred the proceedings at the request of the Solicitor General, allowing for further legal preparations.
Background of the High Court's Ruling
The Bombay High Court had previously quashed the show-cause notice issued by the Bank of India to Naresh Goyal on July 1, 2025. However, it granted the bank the liberty to issue a fresh show-cause notice, providing an opportunity for a revised legal approach. This backdrop sets the stage for the Supreme Court's intervention, as it seeks to ensure that justice is served in cases involving significant public financial interests.
The Supreme Court's firm stance reflects a growing judicial vigilance against corporate malfeasance, particularly when it involves the misuse of public funds. By vowing to monitor the case, the court aims to uphold accountability and transparency in financial dealings, sending a clear message to corporate entities about the consequences of such actions.
