Shares of state-owned Bank of Baroda (BoB) fell 3.47 per cent to ₹229.35 on the BSE on Wednesday after B R Shetty, founder of NMC Healthcare, filed a $15 billion lawsuit against the state-owned lender and 25 other defendants in the Bombay High Court, alleging fund diversion, concealed liabilities and forged personal guarantees.
BoB said it had not been served with the suit and could not comment on pleadings that remained untested in court. “If and when the Bank is served, the Bank will defend the suit firmly and take all steps necessary to protect its interests,” it said.
The bank said the allegations were also the subject of proceedings before the Abu Dhabi Global Market (ADGM) Court, where judgment was reserved against Shetty and former NMC chief executive Prasanth Manghat in proceedings involving fraud, wrongful trading and fraudulent trading. The proceedings against BoB were discontinued following a settlement with NMC Group’s joint administrators.
BoB said it was pursuing recovery and enforcement proceedings against Shetty in India and the UAE for outstanding dues of about ₹2,800 crore and had obtained several decrees against him. The Karnataka High Court restrained Shetty from dealing with or alienating his assets in 2021. In subsequent proceedings before the National Company Law Tribunal, Shetty asserted that he was insolvent and unable to meet the bank’s dues, BoB said.
The bank added that a similar suit filed by Shetty in the Supreme Court of the State of New York was dismissed in July 2024. It said it would continue to pursue its legal strategy and take all necessary steps to protect its interests.
Shetty has sought $5 billion each in direct and consequential damages from the defendants jointly and severally, and a further $5 billion from BoB for alleged reputational damage and loss of goodwill. He has also sought interest at 18 per cent a year.
The suit names 10 current and former BoB officers, former NMC and UAE Exchange/Finablr executives Prasanth and Promoth Manghat, their wives and other associates. It also names Avitis Super Speciality Hospitals and SMARD Building Solutions, two Indian entities that Shetty alleges hold assets acquired with diverted funds.
The allegations against BoB include ignoring anti-money laundering alerts, extending credit without adequate security, facilitating transactions through supplier accounts allegedly used for round-tripping and concealing lending exposure from auditors. The suit also alleges that certain bank officials accepted gifts and failed to act on warning signs despite internal scrutiny. These allegations have not been established in court.
In July, BoB agreed to pay $600 million, or about ₹5,700 crore, to settle litigation brought by NMC Health entities and their joint administrators over the collapse of the healthcare group. The settlement resolved the claims against the bank without any admission of liability or wrongdoing.
NMC Health, once the Gulf’s largest private healthcare provider, entered administration in 2020 after billions of dollars in previously undisclosed debt came to light, triggering cross-border litigation involving its founder, former executives and lenders.
