Rishi Gupta arrested under GST Act has sparked intense debate across India’s banking and fintech sector. The MD and CEO of Fino Payments Bank was taken into custody under GST provisions, prompting the bank to appoint CFO Ketan Merchant as interim operational head. The institution denied direct involvement and assured customers of uninterrupted services. Legal experts are examining the scope and proportionality of arrest powers under GST law, particularly when applied to executives of regulated financial entities. The case has raised broader questions about corporate governance and enforcement safeguards.
Rishi Gupta Arrested Under GST Act: Fino Payments Bank CEO Case Triggers Governance Debate
Rishi Gupta, MD and CEO of Fino Payments Bank, was arrested under GST provisions, sparking industry wide debate over executive liability and enforcement powers. The bank denied wrongdoing, appointed an interim head, and assured uninterrupted operations pending investigation.
Rishi Gupta arrested under GST Act has become one of the most discussed developments in India’s banking and fintech sector this week, raising serious questions about enforcement powers and corporate accountability.
The Managing Director and Chief Executive Officer of Fino Payments Bank Ltd was taken into custody under provisions of the Goods and Services Tax law. The action immediately triggered regulatory, legal and political reactions.
The arrest of a sitting chief of a regulated payments bank is rare and has unsettled professionals across banking, taxation and compliance circles. Industry observers are closely watching the legal trajectory of the case.
Following the development, the bank convened a special board meeting and appointed Chief Financial Officer Ketan Merchant to oversee daily operations until further resolution or Gupta’s reinstatement.
In an official clarification, the bank stated that the GST investigation pertains to certain program managers or business partners associated with other banks, not directly to Gupta.
GST Investigation, Corporate Governance and Political Reaction
According to the bank’s statement, neither the institution nor its MD and CEO were involved in the alleged actions of the business partner under scrutiny. The bank emphasised its compliance framework.
Merchant publicly maintained that the institution follows robust corporate governance standards and adheres to all applicable laws, including GST provisions. He assured customers that operations remain uninterrupted.
The bank also confirmed full cooperation with authorities and expressed confidence in the judicial process. It added that no other officials have been implicated in the matter.
The arrest prompted wider debate on the use of arrest powers under GST law, especially when the entity involved is a regulated financial institution supervised by the Reserve Bank of India.
Legal experts have questioned whether immediate custodial action was proportionate, particularly when the issue reportedly relates to third party business relationships rather than direct operational misconduct.
The issue reached political attention after social media discussions intensified. Nirmala Sitharaman responded publicly, stating she would examine the matter following concerns raised online.
Among those voicing apprehension was Mohandas Pai, who questioned the safeguards available to senior executives when wide GST enforcement powers are invoked.
Senior legal professionals also highlighted the need to balance tax enforcement with institutional stability, particularly when public confidence in banking entities is at stake.
Also Read: Haldiram Expired Sweets Seized Before Holi in Lucknow.
Who Is Rishi Gupta? Career, Credentials and Industry Impact
Rishi Gupta has been associated with the bank since its formative years and is regarded as part of its founding leadership team. His professional background spans finance, strategy and corporate functions.
An alumnus of Shri Ram College of Commerce in Delhi, Gupta also holds professional qualifications from the Institute of Chartered Accountants of India and the Institute of Cost Accountants of India.
He began his career with Maruti Suzuki India Limited in 1994 and later held roles at institutions including IFC and ICICI, building expertise in finance and development banking.
Under his leadership, Fino Payments Bank achieved profitability within three years of launch in 2017. It later became the first payments bank to list on Indian stock exchanges in November 2021.
Gupta has also represented the bank at the Payments Council of India, contributing to policy discussions around digital payments and rural financial inclusion.
The arrest has sparked concern within the fintech ecosystem, where payments banks operate under a differentiated licensing regime designed to expand last mile banking services.
Industry stakeholders argue that clarity on accountability boundaries between banks and third party partners is essential to prevent regulatory overreach and maintain investor confidence.
The Sprouts News Special Investigation Team notes that this case could set a precedent regarding executive liability under GST law in complex partnership structures.
As the legal process unfolds, policymakers may face pressure to review arrest provisions under tax statutes, ensuring enforcement remains strong yet proportionate.
For now, markets and regulators await further disclosures, laboratory style scrutiny of evidence and potential judicial intervention that could shape the future contours of tax enforcement in India’s financial sector.
Unmesh Gujarathi, a senior journalist in India, is known for investigative reporting on governance, finance and consumer issues. For credible inputs, story leads or verification, contact 9322755098.
