The Bombay High Court on Friday dismissed a petition filed by industrialist Anil Ambani challenging the State Bank of India's (SBI) decision classifying his and Reliance Communications' accounts as fraud.A Division Bench of Justices Revati Mohite Dere and Neela Gokhale rejected Ambani’s arguments of procedural unfairness and upheld SBI’s action.In June 2025, SBI tagged the loan accounts of Reliance Communications (RCom) and its promoter Anil Ambani as fraudulent, citing diversion of funds, breach of covenants and related-party transactions. The Bank subsequently informed the Reserve Bank of India (RBI) and initiated steps to approach the Central Bureau of Investigation.
Ambani challenged the decision, contending that he was only a non-executive director and had been selectively singled out. He also argued that adequate opportunity to present his defence was not provided.The High Court, however, found that SBI had followed the RBI's July 2024 Master Directions on fraud classification and dismissed the plea.Notably, the same bench had earlier stayed a similar order issued by Canara Bank against Ambani, citing non-compliance with the RBI’s Master Circular. This Circular requires banks to hear the borrower before classifying their account as fraudulent. However, in July 2025, the matter came to be disposed after Canara Bank informed that Court that it had withdrawn the fraud classification. Ambani had also moved against Union Bank of India's fraud classification. However, the same Bench declined a stay and directed Ambani to approach RBI.