India, Feb. 21 -- The Bombay High Court on Tuesday set aside orders issued by three public sector banks declaring chartered accountant Alok Agarwal a wilful defaulter in connection with loan defaults by Parekh Aluminex Ltd, which owes banks at least Rs.2,762 crore.

A division bench of justices Bharati Dangre and Manjusha Deshpande held that as an independent director, Agarwal could not be held liable for the company's loan defaults. The court noted that the Reserve Bank of India has clarified that non-whole-time directors, including nominee and independent directors, cannot be treated as wilful defaulters for a company's repayment failures.

Agarwal had resigned from the board on November 22, 2014, well before the alleged default period....