Lilavati Trust alleges HDFC Bank CEO Jagdishan took ₹2.05 crore in unaccounted cash from former hospital trustees to harass the father of a current Trust member; bank denies claim as baseless
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According to the Trust, the alleged payment was made during a period when it says a group of former trustees held unauthorised control of the hospital and its finances | Photo: X
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HDFC Bank, in an exchange filing on Sunday, stated that the Mehta family, through the Lilavati Kirtilal Medical Trust, which has filed a complaint against the bank’s MD&CEO, Sashidhar Jagdishan, is attempting to obstruct and undermine legitimate recovery proceedings related to substantial, long-outstanding dues owed by Splendour Gems, owned by the Mehta family. The bank has “unequivocally” rejected and condemned the “malicious and baseless” allegations levelled against Jagdishan, while stating that the allegations are completely false, outrageous and constitute a gross misuse of the legal process.
Additionally, the bank has stated that it will continue to pursue all lawful remedies to recover public funds and address the retaliatory actions taken by the Mehta family as well as to defend the reputation and integrity of the Bank, its Directors and other employees. HDFC Bank remains dedicated to upholding its reputation for corporate governance and ethical conduct, the bank further said.
According to the bank, in 2001, Splendour Gems defaulted on loan facilities granted in 1995 by HDFC Bank along with the other consortium banks. Despite a recovery certificate issued by the Debt Recovery Tribunal in 2004 and subsequent enforcement actions, the dues remain substantially unpaid. The outstanding dues towards HDFC Bank, including interest, amount to approximately INR 65.22 crore as on May 31, 2025.
In response to ongoing recovery proceedings, members of the Mehta family have initiated multiple legal actions and complaints against HDFC Bank and its senior officials. These include criminal complaints, minority rights petitions, and representations to regulatory authorities—all of which have been dismissed or are under legal challenge. HDFC Bank firmly believes that these allegations are retaliatory in nature and have mala fide intention solely at evading repayment of long-standing dues, the bank said.
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The LKMM Trust, which runs Mumbai’s Lilavati Hospital, on Saturday called for “immediate suspension and prosecution” of Jagdishan, alleging his direct involvement in financial fraud, criminal conspiracy, and evidence tampering. The Trust has accused him of receiving unaccounted cash for “harassing” a trustee’s father. LKMM Trust members said they were seeking action against Jagdishan based on the May 30 orders of the metropolitan magistrate’s court in Bandra and a resultant FIR filed by the Bandra police station. Business Standard has reviewed a copy of the FIR and the court order.
“The outrageous and preposterous allegations are strongly and categorically denied,” said a HDFC Bank spokesperson, in response to a Business Standard query, adding that their MD & CEO is being targeted by unscrupulous persons who are abusing the legal process to thwart the recovery of the long outstanding loan due to the bank from recalcitrant defaulters.
“The trustee, Prashant Mehta, and his family members owe substantial amounts to HDFC Bank which were never repaid. Recovery and enforcement actions have been taken by the bank over two decades and at every stage Prashant Mehta and his other family members have launched numerous vexatious legal actions,” the spokesperson said.
The official said that after failing at all levels, including the Supreme Court, they have now resorted to the recent “mala fide personal attacks” on Jagdishan with the sole objective of “intimidating and bullying” him and the bank from recovering all outstanding loans. The spokesperson said the bank is committed to pursuing legal remedies and options to defend its MD & CEO’s reputation.
“The Bank is confident that our judicial process will recognise the fraudulent intention and devious objectives of the trustee and officials of Lilavati Trust of tarnishing the image of the bank and its MD and CEO,” the spokesperson said.
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According to the court order, the Bandra police station was asked to file an FIR against Jagdishan and seven others in a criminal case. LKMM claimed that apart from Jagdishan, other accused include one Chetan Mehta, along with Rashmi and Niket Mehta and four other accused in the said case.
The Trust alleged that Jagdishan received Rs 2.05 crore in unaccounted cash from former trustees of the hospital for the sole purpose of harassing the father of one of the current members of the Trust. The petitioners have alleged that the transaction was recorded in a hand written diary which the current members recovered. The court sought more evidence available in the matter, to which the LKMM said that the erstwhile members had likely destroyed all evidence in the matter.
It claims this payment forms part of a wider pattern of misconduct involving misuse of charitable funds, preferential treatment, and suppression of internal complaints. The FIR invokes several sections of the Indian Penal Code, including those related to criminal breach of trust and conspiracy.
The Trust has also alleged that a Rs 1.5 crore offer was made to the hospital staff under the pretext of CSR funding, which it claims was aimed at influencing internal processes.
According to the Trust, the alleged payment was made during a period when it says a group of former trustees held unauthorised control of the hospital and its finances. The Trust has further alleged that Jagdishan’s involvement helped facilitate this group’s actions.
The current FIR is among the several filed in connection with the LKMM Trust’s operations. The Trust has pointed to three earlier FIRs as part of what it describes as a broader pattern of financial irregularities, including misappropriation of funds to the amount of Rs 11.52 crore, claims of Rs 85 crore being siphoned off under the guise of legal fees, and alleged unauthorised procurement of medical and pharmacy equipment valued at Rs 1,243 crore. All three cases are currently under investigation.
In its statement, the Trust has urged the Reserve Bank of India (RBI), the Securities and Exchange Board of India (Sebi), and the Ministry of Finance to take immediate action. It has called for the suspension of Jagdishan from all executive and board positions, a forensic audit of all transactions between HDFC Bank and the Trust, and the disclosure of any legal expenses incurred by the bank in his defence.
Additionally, the Trust has sought a bar on Jagdishan from holding office in any Sebi-regulated entity while investigations are ongoing. The Trust maintains that the current board’s actions are aimed at restoring financial transparency and that its complaint is not part of a personal dispute, but a larger issue of public accountability.
Lilavati Hospital was built by Kishor Mehta in 1997 and later his brother Vijay Mehta’s family members were slowly inducted into the board of trustees. The LKMM Trust is a registered charitable institution with a long-standing presence in Mumbai’s healthcare sector. It claims to spend crores annually on subsidised or free treatment, including for victims of terror attacks and army personnel injured in combat operations. Both Kishor and Vijay Mehta have now passed away.
The tussle, surrounding forgery and other irregularities, between the old and new members of LKMM Trust is not new.
Earlier in March, Lilavati Hospital’s Executive Director Param Bir Singh and Kishor Mehta’s son Prashant Mehta held a press conference about the findings of a forensic audit into the workings of the Trust. They alleged a diversion of Rs 1,200- Rs 1,500 crore fund by the former trustee’s family, apart from claims of black magic rituals being conducted within the hospital premises. Investigations into these complaints are ongoing.
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