Bombay High Court Directs IndusInd Bank to Transfer Rs 66 Crore FD to Lilavati Hospital Trust
The Bombay High Court has issued a significant order, compelling IndusInd Bank to encash a fixed deposit worth approximately Rs 66 crore, including accrued interest, and transfer the funds to the Lilavati Kirtilal Mehta Medical Trust. This trust is responsible for managing the renowned Lilavati Hospital in Bandra, Mumbai.
Court Hearing and Bank's Stance
A bench presided over by Justice Makarand Marnik heard the petition filed by the Lilavati Hospital Trust on April 16. The fixed deposit in question, amounting to Rs 65.68 crore, had matured on June 6, 2024. However, IndusInd Bank had refused to release the funds without an order from the joint charity commissioner, citing an ongoing dispute among the trustees of the trust.
The bank's insistence on this procedural step created a deadlock, prompting the trust to seek judicial intervention to access the matured deposit.
Judicial Reasoning and Order
The judges of the Bombay High Court firmly rejected the bank's argument, stating that the existence of a trusteeship dispute was "hardly of relevance" in this matter. They emphasized that the bank's primary obligation was to honor the matured fixed deposit as per the terms agreed upon with the trust.
To address any potential concerns, the trust's advocate submitted that Charu Mehta, the permanent trustee for life, would file a formal undertaking. This undertaking includes a crucial clause where the trust agrees to indemnify IndusInd Bank against any future claims related to the fixed deposit, thereby protecting the bank from legal liabilities.
Court's Directives and Timeline
Based on this assurance, the court issued clear directives to IndusInd Bank:
- Encash the fixed deposit of Rs 65.68 crore along with all accrued interest.
- Transfer the total amount, estimated to be around Rs 66 crore, to the Lilavati Hospital Trust's account at Union Bank of India.
- Complete this transfer within three days from the filing of the indemnity undertaking by the trust.
This order ensures that the funds are swiftly made available to the trust, which is crucial for the operational and financial needs of Lilavati Hospital, a key healthcare institution in Mumbai.
Implications and Context
The ruling highlights the judiciary's role in resolving financial disputes efficiently, especially when they involve essential public services like healthcare. By prioritizing the release of funds over procedural delays related to internal trust disputes, the court has facilitated the uninterrupted functioning of the hospital.
This case also underscores the importance of clear legal frameworks for trusts and banks in handling large financial instruments, ensuring that such matters are resolved without compromising the services provided by critical institutions.
