A Dubai International Financial Centre (DIFC) court has ordered BR Shetty, founder of the collapsed NMC Healthcare, to pay $46 million to the State Bank of India (SBI). The court found that Shetty repeatedly lied under oath about signing a personal guarantee for a $50 million loan. Justice Andrew Moran described his testimony as “an incredible parade of lies” and said his evidence was “incoherent and nonsensical.”
Background of the Case
NMC Healthcare, once the largest private healthcare company in the UAE, collapsed in 2020. The company went into administration in April 2020 after more than $4 billion in hidden debt was discovered. The problem began in December 2019 when investment firm Muddy Waters reported financial irregularities in NMC.
Before the collapse, NMC had made regular loan repayments until January 2020. In February 2020, it defaulted on interest payments. Shetty resigned as joint non-executive chairman on February 16, 2020. SBI sent formal demand notices in April and May 2020, but Shetty claimed he never received them. The bank filed a lawsuit in May 2020. Court proceedings were delayed because of the pandemic. Shetty finally filed his defense in October 2022.
Court Proceedings and Evidence
The court case was about whether Shetty signed a personal guarantee in December 2018 for a $50 million loan to NMC. Shetty denied signing it. He claimed the signature was fake and said he had never met the bank’s CEO, who had witnessed the signing.
During the trial, the court looked at an email sent by Shetty in May 2020. In the email, he acknowledged discussions with SBI about the guarantee and asked for time to check the documents. The judge said this proved that Shetty knew about the guarantee and had admitted signing it.
SBI CEO Anantha Shenoy testified that he went to NMC’s Abu Dhabi office on December 25, 2018, to witness Shetty sign the guarantee. He showed photographs and a meeting report from January 2019, showing Shetty thanking the bank for the loan. Shetty tried to claim the photos were coincidence, but the court rejected his explanation.
Shetty also made unusual claims, including that NMC employees held contests to copy his signature, and the prize was “the suffering he is being caused now.” The court heard handwriting evidence. SBI’s expert said there was strong proof that Shetty signed the guarantee. Shetty’s expert said the evidence was inconclusive. The judge preferred SBI’s expert testimony.
Court Judgment
The court ordered Shetty to pay SBI $45,997,554.59, including interest up to the judgment date. Additional interest will accrue at 9% per year until the full amount is paid. The judge concluded that Shetty had lied multiple times and that the evidence clearly showed he was responsible for the personal guarantee.
Judge said – For all of the foregoing reasons, I am satisfied that Mr Shetty signed his Personal Guarantee on 25 December 2018 and is bound by its terms. The Claimant is therefore entitled to Judgment against him on its claim, for the whole amount now claimed as principal and interest, as calculated and set forth in its updated claim and interest calculation until the date of Trial, the 29 September 2025. This is the amount of USD 45,945,333.26. In addition, the Bank is entitled to further pre-judgment interest accruing at the daily rate of USD 5,802.37 to the date hereof, being in total, USD 52,221.33. Accordingly, there shall be judgment for the Claimant against the fifth Defendant Dr Shetty in the total amount of USD 45,997,554.59.
Court Order PDF
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