New Delhi: The Supreme Court has approved the dismissal of the criminal case against the promoters of Sterling Biotech Limited for non-payment of bank loans, provided they deposit ₹5,100 crore as full and final settlement with the lending banks and investigating agencies.
This order was recently uploaded by a bench of Justices J.K. Maheshwari and Vijay Bishnoi on November 19. The Supreme Court had approved a petition filed by Hemant S. Hathi and Chetan Jayantilal in 2020.
The bench directed that the amount be deposited on or before December 17. The petitioner’s writ petition seeking a direction to quash the proceedings is granted leave. This action will be effective upon the deposit of ₹5,100 crore as full and final payment on a mutually agreed basis on or before December 17, 2025.
This is in addition to the ₹3,507.63 crore already deposited by them and the ₹1,192 crore recovered by the banks through proceedings under the Insolvency and Bankruptcy Code (IBC), 2016. The bench said, “This amount shall be deposited in the Registry of this Court on or before the date specified in clause (i) above, so that the petitioners can deposit it in different installments and dates. Upon receipt, the amount shall be kept in a short-term interest-bearing fixed deposit account in any nationalized bank until it is cleared.”
The bench stated that the amount deposited upon submission of the claim will be distributed to the respective lending banks on a proportionate basis according to their outstanding amounts. The Registrar (Judicial Administration) will verify the details of the outstanding amount and proportional entitlement and distribute the amount to the respective banks’ accounts accordingly. The Registrar is free to seek the assistance of accounting staff if required.
The bench stated that the petitioner’s case, relating to the loan amount for which the FIR was filed and the OTS was approved, would be resolved through a consensual full and final settlement, and the case would be closed.
The Supreme Court stated, “These directions are based on the specific facts of this case. Therefore, they will not be considered as a precedent. Therefore, both writ petitions are allowed and will be considered settled as per the conditions stated above. If there are any pending applications, they will be considered settled.”
The Supreme Court stated that it was clear that the amount of embezzlement in the FIR was ₹5,383 crore, and the OTS with banks for all the petitioner’s Indian companies was ₹3,826 crore and for the foreign companies acting as guarantors was ₹2,935 crore, bringing the total amount to ₹6,761 crore.
The bench noted that the petitioner has voluntarily deposited a portion of this amount under various heads, including the orders of this court, amounting to approximately ₹3,507.63 crore, leaving a balance of ₹3,253.37 crore.
The bench stated in its order, “The lending banks initiated proceedings before the National Company Law Tribunal under the Insolvency and Bankruptcy Code, 2016. This resulted in the recovery of ₹1,192 crore. However, from the total amount disclosed in the OTS, which was higher than the amount disclosed in the FIR, the remaining outstanding amount is ₹2,061.37 crore.”
The bench noted that, as stated in the November 18, 2025, order, and after consultation with the lending banks, the investigating agencies, through the Solicitor General, sought ₹5,100 crore in a sealed cover towards the outstanding dues/recoveries that are the subject matter of the FIR and other criminal proceedings.
The Supreme Court stated, “The petitioners wish to end the cases related to attachment under the CBI, ED, PMLA, Fugitives Act, SFIO, Black Money Act, and Income Tax Act. The petitioners have agreed to deposit the requested amount, respecting the proposal of the Solicitor General on behalf of the government. The petitioners have agreed to deposit this amount as full and final payment to the lending banks and to drop all proceedings against them.”
The bench stated that it is clear that this court has believed from the outset that if the petitioners are willing to deposit the amount stipulated in the OTS and the public money is returned to the lending banks, there will be no benefit in continuing the criminal proceedings.
The court stated, “The course of action appears to be patently illogical, aimed at saving public money and interest and recovering the embezzled amount.” The Supreme Court stated that considering the specific facts and circumstances of this case, discretion should be exercised in granting relief and ordering the quashing of all proceedings.
