FM Sitharaman says he will investigate the arrest of Fino Payments Bank MD under the GST Act

Finance Minister Nirmala Sitharaman

Replying to a social media post by former CFO and board member at Infosys, Mohandas Pai, she replied, “Thanks for sharing this. I will check.” In his post, Pai asked: “How can a CEO of a regulated bank be arrested for an issue with a business partner?” He also wonders whether this is not an exaggeration. “The Finance Ministry has given immense powers to GST. What is the protection for citizens against misuse,” he further asked, seeking the Finance Minister’s intervention.

On Saturday, the bank in a stock exchange filing informed about the arrest of Rishi Gupta, Managing Director and Chief Executive Officer, under the provisions of Section 132(1)(a) and 132(1)(i) of the CGST and SGST Act, 2017. Further, a special board meeting was convened on Saturday to appoint Ketan Merchant, Chief Financial Officer of the bank, as the head of the organization to continue and oversee the day-to-day operations in the absence of Gupta. “The bank is actively taking appropriate measures to address and overcome the above situation,” it said.

It was stated that the investigation relates to business partner(s) of the bank and not to GST compliance. “The bank is working with the authorities to provide all necessary information. There is currently no impact on the bank,” the bank said.

On Saturday, Merchant said: “The bank wishes to convey that we have strong corporate governance, a compliance framework and robust processes. As a regulated entity, we comply with all laws, including GST. The matter relates to a GST investigation relating to program managers who have relationships with other banks, including Fino Payments Bank Limited.” He further stated that the bank and Gupta had nothing to do with the actions of the program managers.

“We have full confidence in the country’s judiciary and will continue to provide full cooperation and assistance to the authorities in the ongoing process. We would like to further assure our customers, investors and all our stakeholders that our business operations will continue uninterrupted and there will be no impact on our services. We are committed to delivering on our customer centricity,” Merchant said.

Published on February 28, 2026