A single judge Bench on Tuesday had not accepted YES Bank’s contention in the matter, saying a letter of comfort dated May 31, 2016, given by the promoters to avail of loans from the lender, could not be construed as a letter of guarantee.
had lent the amount to Essel Group promoters in 2016 to buy shares in its own unit Veria International. One of the promoter family members, Punit Goenka, who is ZEEL's managing director and chief executive officer, had provided a letter of comfort as a guarantee against the loan, the lender said in its petition to the Bombay High Court.
“Neither ZEEL nor its subsidiary have borrowed funds from YES Bank for an alleged $50 million loan. The loan was availed by a promoter group entity and there are delays in the said loan due to liquidity stress, which have further precipitated due to the pandemic,” a company spokesperson said.
YES Bank loans, including those given to Essel Group, are being investigated by the Enforcement Directorate
(ED), officials said. In March, Essel Group promoter Subhash Chandra
had appeared before the ED.