Bombay High Court Holds HDFC Bank's Statements Were Prima Facie Truthful, Supported By Judicial Records And Made In Good Faith
The Bombay High Court has declined to grant interim injunctive relief sought by the Lilavati Kirtilal Mehta Trust and its trustee Prashant Mehta in a high-profile defamation action seeking damages of ₹1000 crore against HDFC Bank, its Managing Director and senior officials.
Justice Somasekhar Sundaresan held that the impugned statements issued by HDFC Bank regarding recovery proceedings against members of the Mehta family were, prima facie, founded on substantial material, reflected factual realities emerging from judicial and quasi-judicial proceedings, and could not be restrained at the interim stage merely because they were alleged to be defamatory.
The Court observed that while Indian law permits judicial scrutiny of a defence of justification even at the interlocutory stage in defamation actions, the material placed before it overwhelmingly demonstrated that the bank's statements were supported by existing recovery proceedings, recovery certificates, and multiple judicial findings recording attempts by members of the Mehta family to frustrate recovery efforts.
Consequently, the plaintiffs failed to establish the strong prima facie case necessary for obtaining a prior restraint on speech.
Freedom Of Speech And Right To Clarify
Justice Sundaresan emphasized that freedom of speech under the Constitution includes the right of an institution to publicly explain and defend itself when serious allegations are levelled against it.
The Court held that HDFC Bank's response emerged in the backdrop of a sustained public campaign against the bank and its senior management, including press conferences, complaints to regulators, social media publications, and criminal allegations advanced by persons associated with the plaintiffs.
The Bench found that once media organizations sought comments from HDFC Bank regarding allegations publicly circulated against it, the bank was entitled to explain its position. Such clarification, particularly by a regulated banking institution answerable to stakeholders and the public at large, could not be characterized as defamatory when the contents were prima facie borne out from the record.
Court Rejects Plaintiffs' Contentions
The Court rejected the contention that the impugned statements created a false impression that Prashant Mehta had personally borrowed money from the bank.
According to the Bench, the statements merely conveyed that Prashant Mehta and his family owed money to the bank, a proposition supported by recovery proceedings and recovery certificates issued by the Debt Recovery Tribunal after legal heirs were brought on record following the death of Kishor Mehta.
The Court held that at the interim stage, this constituted a truthful and bona fide statement.
Retaliatory Defamation Argument Rejected
A significant aspect of the judgment concerns the Court's examination of whether HDFC Bank's statements amounted to retaliatory defamation.
The Bench held that even assuming the bank considered itself targeted by serious allegations, its response did not constitute retaliatory defamation because the impugned statements were grounded in factual material and were issued to explain its position rather than merely malign the plaintiffs.
The Court noted that several judicial orders had recorded findings regarding repeated litigation initiated by members of the Mehta family in relation to recovery proceedings.
Particular reliance was placed on findings rendered in proceedings involving challenges to recovery measures and proceedings before the Maharashtra State Minority Commission, where courts had remarked upon attempts to obstruct or delay recovery efforts.
In light of such judicial findings, the Court held that HDFC Bank's assertion regarding "vexatious legal actions" could not be viewed as wholly baseless or malicious at the prima facie stage.
Role Of Lilavati Trust Examined
The Bench also considered the role played by Lilavati Trust in the public dispute.
While acknowledging that the Trust itself had no direct borrowing relationship with HDFC Bank, the Court observed that the Trust's official letterheads, social media handles, public communications, and press conferences had been actively utilized in the campaign against the bank and its officials.
Therefore, the Court found it difficult to accept the contention that the Trust remained entirely detached from the controversy.
Justice Sundaresan further observed that the publication of comments and reports by independent media organizations could not automatically be attributed to HDFC Bank. Any journalistic interpretation or characterization of events by newspapers was a matter for those publications to explain and could not be visited upon the bank merely because its statements formed part of the source material.
Court's Key Findings
- Truth remains a complete defence where statements are supported by substantial material.
- Indian courts may scrutinise the veracity of a justification defence even at the interlocutory stage.
- HDFC Bank's statements were prima facie supported by recovery proceedings and judicial findings.
- The bank's response was a bona fide clarification rather than retaliatory defamation.
- Freedom of speech includes the right of institutions to publicly defend themselves against allegations.
- Lilavati Trust actively participated in the public campaign against HDFC Bank through press conferences, communications and social media publications.
- No strong prima facie case of defamation warranting interim restraint was made out.
Court's Decision
Summarising its conclusions, the Court held that the plaintiffs had failed to establish that the impugned statements were prima facie defamatory.
The statements were supported by strong underlying material, were made bona fide in response to serious public allegations, and were issued in circumstances where the bank was justified in clarifying its position.
The Court therefore found no ground to restrain further publication of such statements or direct removal of existing publications at the interim stage.
Accordingly, the interim application seeking injunctions against HDFC Bank, its officials, and social media platforms was rejected.
Background Of The Dispute
The suit was instituted by Lilavati Kirtilal Mehta Trust and trustee Prashant Mehta alleging that HDFC Bank, its Managing Director and other officials had published defamatory statements concerning recovery proceedings involving members of the Mehta family.
The plaintiffs sought permanent and interim injunctions restraining further publication of such statements, removal of existing content from social media platforms and websites, a public apology, and damages quantified at ₹1000 crore.
The plaintiffs contended that neither the Trust nor Prashant Mehta had borrowed money from HDFC Bank and that statements suggesting they owed substantial sums to the bank were false, misleading and defamatory.
HDFC Bank opposed the plea by asserting that the statements accurately reflected ongoing recovery proceedings, the status of recovery certificates, and the extensive litigation history involving members of the Mehta family.
Case Details
Case Title: Lilavati Kirtilal Mehta Trust Through Prashant Mehta & Anr. v. HDFC Bank Limited & Ors.
Court: Bombay High Court
Bench: Justice Somasekhar Sundaresan
Case No.: Interim Application No. 3095 of 2025 in Suit No. 160 of 2025
Date of Judgment: June 9, 2026
Relief Sought: Interim injunction against alleged defamatory statements, removal of publications, public apology, and damages of ₹1000 crore.
Result: Interim Application Dismissed; no interim injunction granted against HDFC Bank or its officials.