The Ministry of Finance stated on 17 October 2026 that the Central Government is legally permitted to dilute or divest its stake in IDBI Bank. This clarification follows reports regarding 2003 legislative debates; the Ministry noted that an amendment to restrict stake dilution was rejected and not included in the final IDBI (Repeal) Act, 2003. The Ministry cited a 17 December 2018 Delhi High Court ruling which confirmed that parliamentary statements cannot override enacted law to prevent the government from reducing its shareholding. The release does not say when this takes effect as it is a clarification of existing legal status.
Key points
- Delhi High Court ruled on 17 Dec 2018 that the government can dilute its stake in IDBI Bank
- The IDBI (Repeal) Act, 2003 contains no prohibition against reducing government shareholding
- Statements made during parliamentary debates cannot be used to legally block disinvestment
When it applies
- Delhi High Court decision in All India IDBI Officers’ Association v. Union of India & Others
Who it affects
- Central Government
Refers to
- IDBI (Repeal) Act, 2003
- All India IDBI Officers’ Association v. Union of India & Others