The Bombay High Court on 9 June rejected an interim plea by the Lilavati Kirtilal Mehta Medical Trust to restrain HDFC Bank from making statements about it, in the trust's Rs 1,000 crore defamation suit, holding the bank's statements to be factually accurate and directing the trust to pay Rs 5 lakh in costs to the bank.
LEGAL FINDINGS
Justice Somasekhar Sundaresan held that the bank's statements that the trust and its trustee Prashant Mehta owed the bank money, and that the bank had initiated recovery and enforcement action, were factually accurate and could not be called defamatory.
The court ordered the trust to pay ₹5 lakh in costs to HDFC Bank, calling the application "one more in this long chain of proceedings" aimed at derailing the bank's recovery efforts. The statements at issue said that Prashant Mehta and his family owed substantial sums to the bank and had engaged in numerous vexatious legal proceedings; the court found them supported by Debt Recovery Tribunal recovery certificates and earlier judicial orders.
"Gagging both sides would be contrary to the constitutional default position of free speech that is truthful," the court said, noting that the bank's statements were issued after media organisations approached it for comment.
STATUS OF THE SUIT
The ruling dealt only with the interim application; the underlying Rs 1,000 crore defamation suit remains pending.