Judgment :

Krishna Rao, J.

1. The petitioners have initially challenged the show cause notices dated 16th April, 2024 wherein the bank directed the petitioners to show cause as to why the account of the petitioners shall not be declared as “fraud” and during pendency of the writ application, the respondent bank issued an order declaring the account of the petitioners as “fraud”.

2. The petitioners contended that the respondent failed to act in accordance with its statutory obligations and responsibilities in terms of the Reserve Bank of India Master Directions.

3. It is further contended that the show cause notices issued by the respondent are without any jurisdiction and is arbitrary, perverse and violation of principles of natural justice. It is submitted that the respondent bank failed to furnish either the purported Forensic Audit Report or the documents relied in the show cause notices.

4. It is submitted that the petitioners do not have access to the record of the SREI Entities since October, 2021 and the petitioners are not in a position to deal with and respond to the allegations made in the show cause notices.

5. Mr. Ratnanko Banerjee along with Mr. Jishnu Chowdhury, Learned Senior Advocates representing the petitioners, submit that the show cause notices have been issued on the basis of the Forensic Audit Report by mechanically and selectively reproducing certain parts thereof without context or basis and the respondent failed to provide a copy of Forensic Audit Report or the copies of the documents on the basis of which the Forensic Audit Reports were prepared.

6. Mr. Banerjee submits that in the absence of each and every documents on the basis of which the allegations have been made against the petitioners in the show cause notices are being made available to the petitioners and a reasonable time is given to the petitioners, the petitioners will not be in a position to give appropriate reply to the show cause notices.

7. Mr. Banerjee in support of his submissions, has relied upon the judgement in the case of Hemant Kanoria Vs. Bank of India passed in WPA No. 28329 of 2023 dated 2nd February, 2024 and submits that in the said case, the Coordinate Bench of this Court held that a show-cause notice is to be issued, enumerating the exact offences alleged against the borrower/ Director. If any, Forensic Audit Report or other document forms on the basis of the show-case notice, the same is to be served along with the show cause notice.

8. Mr. Banerjee further relied upon the judgment in the case of Milind Patel Vs. Union Bank of India and Others reported in 2024 SCC OnLine Bom 745 and submits that the Division Bench of the Bombay High Court held that it is now well settled that due compliance with principles of natural justice must essentially entail compliance with the obligation to provide access to the material on which the allegations are based.

9. Mr. Banerjee submits that upon receipt of personal hearing notices, the petitioners have filed a detailed reply informing the respondent that the petitioners have not received the entire documents and the details of the documents mentioned in the reply but instead of receipt of the request of the petitioners, the respondent has not supplied the documents to the petitioners and have passed the impugned order declaring the loan account of the petitioners as “fraud”.

10. Mr. Dhruv Dewan, Learned Advocate representing the respondent submits that the show cause notice was issued on 16th April, 2024 and the petitioners have filed the writ petition on 13th May, 2024 and reply to the show cause notice was filed on 22nd May, 2025, after personal hearing of the petitioners. He submits that second notice for personal hearing was issued on 22nd October, 2025 and the petitioners have filed reply on 10th November, 2025, thereafter the impugned order is passed on 19th December, 2025.

11. Mr. Dewan has relied upon the judgment in the case of Hemant Kanoria (supra) and submits that the Coordinate Bench