Daijiworld Media Network – Mumbai
Mumbai, Oct 14: B R Shetty, founder of NMC Healthcare and UAE Exchange, has filed a $15 billion lawsuit against state-owned Bank of Baroda and 25 other defendants in the Bombay High Court, alleging that the bank and certain officials facilitated fraudulent transactions linked to the collapse of his business empire.
According to reports, the suit, filed on October 13, seeks $5 billion in direct damages, $5 billion in consequential damages, including losses from business opportunities, and another $5 billion in compensation for alleged reputational damage and loss of goodwill. Shetty has also sought annual interest of 18% on the first $10 billion claimed.
The lawsuit names Bank of Baroda, 10 of its officials, former NMC executives Prasanth Manghat and Promoth Manghat, their associates and two Indian companies, among others.
Allegations against the bank
Shetty has alleged that Bank of Baroda officials helped facilitate the diversion of funds from NMC group companies, ignored repeated anti-money laundering alerts and processed transactions based on instructions and signatures that he claims were forged or unauthorised.
The suit alleges that the bank's systems generated more than 100 alerts concerning suspicious transactions involving NMC group accounts, but that these did not result in adequate investigations or action to prevent the transactions. It also accuses the bank of extending credit without sufficient security and failing to properly disclose lending exposure to auditors.
Shetty has further challenged personal guarantees attributed to him, alleging that the signatures were forged and that the bank pursued recovery proceedings against him on the basis of those documents. The allegations have not been established in court.
Bank of Baroda's response
Bank of Baroda said on Wednesday that it had not been formally served with the lawsuit and could not comment on pleadings that had not been tested in court. The lender said it would firmly defend itself and take all necessary steps to protect its interests if served with the case.
The bank also said it was pursuing recovery and enforcement proceedings in India and the United Arab Emirates against Shetty over outstanding dues of approximately 28 billion USD (Rs 2,800 crore). It said it had obtained several decrees in the recovery proceedings and would not face any immediate liability from the new suit unless a court order or accounting requirements necessitated otherwise.
The lawsuit comes about three months after Bank of Baroda agreed to pay $600 million to settle litigation brought by NMC's administrators over claims arising from the healthcare group's collapse. The settlement resolved those claims without any admission of liability or wrongdoing by the bank.
NMC's collapse
NMC Health, once one of the largest private healthcare providers in the Gulf region, entered administration in 2020 after the discovery of billions of dollars in previously undisclosed borrowings. Its total debt was subsequently reported at approximately $6.6 billion, far exceeding earlier estimates.
The collapse triggered investigations and legal proceedings involving lenders, former executives and other parties across several jurisdictions.
Shetty's latest lawsuit seeks to establish the alleged role of Bank of Baroda and other defendants in the transactions and events leading to the group's downfall. The claims remain subject to legal examination, and the bank has said it will contest the case.