The Supreme Court on 31 August refused to interfere with the Bombay High Court's order permitting HDFC Bank Ltd. and former Lilavati trustee Rajesh Mehta to intervene in proceedings concerning allegations of extortion, fabrication and corruption linked to recovery proceedings before the Debt Recovery Tribunal, Mumbai.

A Bench of Justices M.M. Sundresh and Prasanna B. Varale dismissed the plea filed by Prashant Mehta and other trustees, noting that the writ and interim applications were listed before the Bombay High Court on 4 September 2026. The top court, however, requested the High Court to expedite the hearing. It stated:

"We are not inclined to interfere with the impugned order passed by the High Court, especially in view of the fact that the writ petition along with the interim applications are listed for hearing before the High Court on 4th September, 2026. However, we request the High Court to make an endeavor to expedite the hearing of the matter."

The matter arises from recovery proceedings initiated by HDFC Bank against late Kishor Mehta before the Debt Recovery Tribunal, Mumbai. On 5 February 2020, the Recovery Officer ordered Kishor Mehta's arrest and detention in civil prison for allegedly failing to disclose his assets.

Kishor Mehta challenged the order before the Bombay High Court. On 27 March 2023, the High Court remanded the matter to the Recovery Officer for fresh consideration.

The trustees subsequently approached the Bombay High Court on 14 January 2025, challenging the alleged illegal impleadment of parties and coercive proceedings before the Debt Recovery Tribunal. An FIR was registered at Bandra Police Station on 31 May 2025 against senior HDFC Bank management under Sections 406, 409 and 420 of the Indian Penal Code, which concern criminal breach of trust and cheating.

The petitioners also relied on an alleged extortion letter dated 7 May 2026, purportedly sent by Rajesh Mehta to his 84-year-old mother. According to the petition, the letter stated that pending proceedings before the Debt Recovery Tribunal and the Bombay High Court would be “sorted” if certain terms were accepted.

Opposing the intervention applications filed by HDFC Bank and Rajesh Mehta, the trustees argued:

“The Petitioners submit, in no uncertain terms, that permitting the proposed accused to participate as intervenors at this threshold stage is a brazen and calculated attempt to convert a preliminary/public-law proceeding concerning investigation into an adversarial proceeding between the complainants and the very persons complained against.”

HDFC Bank filed its intervention application on 22 July 2026, while Rajesh Mehta filed his application on 17 August 2026. The Bombay High Court thereafter permitted both applications and granted the petitioners time to file their replies.

The petitioners also relied on the Supreme Court's 29 May 2026 order concerning allegations surrounding the “Cash Diary”. In that order, the Court had prima facie observed that the allegations in the FIRs could be examined by the concerned investigating officers.

Accordingly, the Supreme Court declined to interfere with the Bombay High Court's order and dismissed the plea.

For Petitioners: Sidharth Luthra, Navin Pahwa, Sr. Advocates, Advocates Tarun Mehra, Monish Bhatia, Ankit Singhal, Mohd. Naved, Shivendra Singh, AOR, Aryama Singh Rajput

For Respondents: Advocates Utsav Trivedi, Manini Roy, Sanjana Rai, Kaushitaki Sharma, Tas Law, AOR

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Case Title :  PRASHANT MEHTA & ORS VERSUS UNION OF INDIA & ORS.Case Number :  Petition(s) for Special Leave to Appeal (Crl.) No(s). 16024- 16025/2026CITATION :  2026 LLBiz SC 286
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