Subramanian Swamy moves Delhi HC

seeking probe against Axis Bank- Max Life

deal

BJP leader Subramanian Swamy on Thursday

urged the Delhi High Court to order a probe into
an alleged fraud committed by Axis Bank to make
“undue profits” through sale and purchase of
shares in Max Life Insurance.

A bench of Acting Chief Justice Manmohan and

Justice Manmeet PS Arora listed the public
interest litigation (PIL) for further hearing on
March 13 after senior counsel appearing for Axis
Bank said they had not been served a copy of the
plea.

Swamy, a former BJP MP, has sought a direction

from the court for constituting a committee of
experts to investigate the matter, asserting that the
“rot” in private sector banks should be brought to
light.
In his petition, Swamy has alleged Axis Bank
made undue profits totalling Rs 4,000 crore from
the sale and purchase of equity shares of Max Life
in a non-transparent manner and in violation of the
applicable regulations.

“Axis Bank sold its stake of 0.998% shares of Max

Life in March 2021 to MFSL (Max Financial
Services Ltd) & Mitsui Sumitomo International at
Rs 166/- per share. Subsequently, in a very short
span of time i.e., in March-April 2021 itself, Axis
Bank Limited and its group entities acquired
12.002% shares from MFSL at price range of Rs
31.51 – Rs 32.12 per share,” the petition said.

“12.002 % of shareholding in Max Life is bought

by the Axis Bank group companies at Rs. 31.51 /
Rs. 32.12 per share at total consideration of 736
crores, which is evidently below the fair market
value. On simple calculation, resulting in undue
profits/gains from the purchase on the sale of
equity shares of Max Life in non-transparent
manner, Axis Bank has unlawfully gained approx.
Rs. 4000 Crores,” the petition claimed.
The plea said even insurance sector regulator
IRDAI imposed a penalty of Rs 3 crore on Max
Life but this amount is “negligible” against the
total “fraud” of Rs 4,000 crore by Axis Bank
resulting in unlawful gains.

“It is, therefore, prayed that this Hon’ble Court

may intervene by directing investigation by a
Committee of Experts appointed by it, as also by
directing the formulation of proper and
comprehensive guidelines in accordance with the
recommendations of such Committee, to prevent
such future acts/transactions of such nature and to
regulate the arrangements entered into between
banks or other financial/ insurance institutions,”
the petition said.

It said “rampant corruption” in the banking and

insurance industry and the executive’s “manifest
unwillingness” to take requisite action gravely
impairs the right of the people to live in a
corruption-free society.

EoM.