Bombay HC Quashes Summons to Chanda Kochhar in Octroi Case; Proceedings to Continue Against ICICI Bank

The Bombay High Court has quashed the criminal summons issued by a Pune court to former ICICI Bank chief Chanda Kochhar, the then Deputy Managing Director, a member of the bank’s legal department and the Branch Manager of ICICI Bank’s Bund Garden branch, in a case alleging octroi evasion on imported gold coins. The court, however, made it clear that the case against ICICI Bank as an institution will continue.

The order was passed by Justice Neela Gokhale, who was hearing a petition filed by the bank and its senior officials seeking to quash the criminal complaint pending before the Judicial Magistrate First Class (PMC), Pune, and the summons issued on November 20, 2009.

According to the complaint filed by the Pune Municipal Corporation (PMC), ICICI Bank had imported gold bullion and coins between April 1, 2006 and August 31, 2009, into Pune city limits without paying the requisite octroi.

The PMC alleged violations of Sections 398 and 401 of the Bombay Provincial Municipal Corporations Act (BPMC Act) and asserted that the bank had brought the gold into the city for distribution without paying statutory dues.

The High Court examined the statutory scheme governing municipal offences and the conditions under which vicarious liability can be imposed on company officials.

Justice Gokhale noted that, under Section 398, an offence is made out only when goods are imported without payment of octroi with the intention of defrauding the Corporation. She further observed that Section 401 creates vicarious liability for directors and officers only where specific material shows their involvement in the company’s actions at the relevant time.

The Court held that the PMC’s complaint failed to attribute any specific act or role to the individual officers, making it insufficient to sustain criminal proceedings against them.

“A plain reading of the complaint does not demonstrate any role specifically attributed to any of the Petitioner Nos.2 to 5. The said Petitioners are the directors, CEO, authorised signatory, branch manager, etc. of the Petitioner No.1-Bank. Although the statutory regime of the BPMC Act attracts the doctrine of vicarious liability, prosecution against the Petitioner Nos.2 to 5 cannot continue in the absence of any averment ascribing a specific role attributed to them,” the Court said.

Clarifying the legal threshold for municipal offences, the Court said, "Section 398 of the BPMC Act thus, can be invoked if (i) any vehicle, animal or goods, liable to octroi, are imported into the city limits; (ii) the payment of toll or octroi is not made and (iii) the non-compliance is with an intention of defrauding the Corporation.”

Justice Gokhale also reiterated the principle that, even where the statute contemplates vicarious liability, a company’s directors or officers can be prosecuted only when the complaint contains specific allegations about their role.

The High Court thus held, “In view of the facts and circumstances of the present case and the settled legal position, the complaint bearing Criminal Case No. 236 of 2009 against Petitioner Nos.2 to 5 is quashed and set aside. Consequently, the summons dated 20th November 2009 issued to the Petitioner Nos.2 to 5 is also quashed. Complaint against the Petitioner No.1-Bank remains as it is.”

Case Title: ICICI Bank Limited and Ors v. State of Maharashtra and Anr

Bench: Justice Neela Gokhale

Order Date: 8 December 2025