The ongoing dispute between BharatPe and the Centrum group over the ownership, transfer and proposed conversion of warrants in Unity Small Finance Bank has reached the Delhi High Court once again. BharatPe’s parent company, Resilient Innovations Private Limited, has approached the High Court alleging that Centrum Financial Services Limited and JBCG Advisory Services Private Limited transferred and created encumbrances over substantial quantities of Unity Bank warrants without obtaining the consent allegedly required under the parties’ Shareholders’ Agreement. The petition has been filed under Section 9 of the Arbitration and Conciliation Act, 1996, seeking urgent interim protection against further dealings in the disputed warrants. Justice Tushar Rao Gedela issued notice in the matter on September 9, 2026, and the case is next scheduled to be considered on October 1.
The latest proceedings form part of a broader dispute between BharatPe and Centrum concerning their respective interests in Unity Small Finance Bank. Unity Bank was established in 2021, following the reconstruction of the erstwhile Punjab and Maharashtra Cooperative Bank. BharatPe, through Resilient Innovations, holds a 49 per cent stake in Unity Bank, while Centrum Financial Services holds the remaining 51 per cent. BharatPe states that it invested approximately ₹746 crore in the bank, including funds used towards repayment of depositors of the erstwhile PMC Bank. The relationship between the two shareholders has subsequently given rise to disagreements over the bank’s capital structure, warrants and the rights available to each shareholder under the Shareholders’ Agreement.
The present petition specifically concerns warrants issued by Unity Small Finance Bank. According to the Bar & Bench report, approximately 190 crore warrants were allotted to Centrum in November 2021. BharatPe’s latest complaint is that substantial portions of these warrants were subsequently transferred or encumbered without obtaining BharatPe’s prior written consent. The company has therefore asked the High Court to restrain Centrum and JBCG from transferring, marketing, dealing with or creating further encumbrances over Series 1 and Series 2 warrants unless BharatPe provides the consent allegedly required under the Shareholders’ Agreement.
BharatPe has also sought directions against Unity Small Finance Bank itself. The company wants the bank restrained from registering or giving effect to any transaction involving the disputed warrants if such transaction has been undertaken without BharatPe’s prior written approval. Thus, the petition is not confined merely to the conduct of Centrum or JBCG. BharatPe is also seeking to ensure that the bank does not recognise or implement transactions which it claims violate contractual restrictions contained in the Shareholders’ Agreement.
A central issue in the dispute is the interpretation of the Shareholders’ Agreement executed between the parties. In the earlier proceedings concerning Unity Bank’s proposed capital restructuring, BharatPe relied upon Clauses 6.11(d) and 8 read with Schedule 2 of the agreement. These provisions concern “Reserved Matters”—corporate decisions which, according to BharatPe, cannot be taken up or approved by the bank’s Board without the required consent of both shareholder groups. The company has maintained that changes affecting the bank’s capital structure and certain dealings in securities, including warrants, fall within these contractual protections.
The present dispute is therefore closely connected with the contractual rights negotiated when Unity Small Finance Bank was established. BharatPe’s position is that the Shareholders’ Agreement did not merely regulate voting rights after a transaction had been placed before the Board. According to the company, certain matters could not even be placed before the Board for consideration without the prior written consent stipulated by the agreement. The company is now relying upon similar contractual protections to challenge the alleged transfer and encumbrance of warrants.
BharatPe has alleged that JBCG transferred approximately 6.74 crore Series 1 warrants and four crore Series 2 warrants. It has further alleged that JBCG and Centrum created encumbrances over approximately 15 crore Series 1 warrants and 16.92 crore Series 2 warrants. According to BharatPe, these transactions were undertaken without its prior written consent. These are allegations made by the petitioner and remain to be adjudicated in the proceedings.
One particular transaction highlighted by BharatPe concerns eight crore Series 2 warrants allegedly pledged by JBCG to Vistra ITCL (India) Limited, acting as trustee for UTI Alternatives. BharatPe claims that JBCG raised approximately ₹200 crore against those warrants and subsequently transferred four crore of them to UTI Alternatives schemes. BharatPe has placed this transaction before the High Court as an example of what it describes as unauthorised dealing with the securities. Whether these transactions were contractually prohibited and whether BharatPe’s consent was legally required are matters that will be considered in the proceedings.
The petition also raises questions concerning the prices at which the warrants allegedly changed hands. BharatPe has pointed out that Centrum had originally subscribed to the warrants at Re 0.01 per warrant and subsequently transferred 50 crore warrants to JBCG at Re 0.16 per warrant. BharatPe has further stated that it reasonably believes JBCG later offered those warrants onward at approximately ₹26 per warrant. These price differences have been highlighted by BharatPe in support of its broader concerns regarding the manner in which the warrants were dealt with. At this stage, however, these assertions are part of BharatPe’s case and have not been finally determined by the High Court.
The latest litigation also follows an earlier Section 9 proceeding before the Delhi High Court involving Unity Bank’s proposed conversion of Series 1 warrants. In July 2026, Justice Tushar Rao Gedela had granted interim protection to BharatPe in relation to a proposal to increase Unity Bank’s authorised share capital and amend its Memorandum of Association so that the warrants could be converted into Compulsorily Convertible Preference Shares. The Court had held at that stage that the proposed action fell within the “Reserved Matters” under the Shareholders’ Agreement and could not be placed before the Board without BharatPe’s prior written consent.
That earlier dispute is important because the warrants at the centre of the present proceedings are linked to the same capital structure controversy. The Series 1 warrants were issued in 2021 and were scheduled for conversion into CCPS by October 2026. The respondents had argued in the earlier proceedings that the warrants would lapse if they were not converted within the prescribed period and that the bank therefore needed to increase its authorised share capital to facilitate their conversion. BharatPe, on the other hand, argued that the proposed change involved matters protected by the Shareholders’ Agreement and could not proceed without its consent.
The respondents had also maintained in the earlier case that conversion of the warrants into CCPS would not give the warrant holders voting rights and therefore would not have the dilutionary consequences alleged by BharatPe. They contended that the warrants had already been validly issued in 2021 and that the present corporate action merely facilitated their conversion. BharatPe disputed this interpretation and maintained that the proposed restructuring would have a substantial impact upon its economic and shareholder position. The earlier order provided interim protection while the contractual dispute proceeded towards arbitration.
The latest petition takes the contractual dispute a step further by focusing on transactions involving the warrants before their proposed conversion. BharatPe contends that even if the warrants had been validly issued, their subsequent transfer or creation of security interests remained subject to contractual restrictions. According to the company, the Shareholders’ Agreement governs dealings in the securities and requires the necessary consent before transactions affecting the parties’ agreed rights can be undertaken. The respondents may contest this interpretation when they file their replies before the High Court.
The proceedings are being conducted under Section 9 of the Arbitration and Conciliation Act, 1996. Section 9 enables a party to an arbitration agreement to seek interim measures of protection from a court in appropriate circumstances. Such proceedings are generally concerned with preserving the subject matter of the dispute or preventing actions that could undermine the effectiveness of the eventual arbitral process. BharatPe has invoked this jurisdiction because the underlying contractual dispute is intended to be resolved through arbitration.
BharatPe formally invoked arbitration on August 11, 2026 and nominated former Supreme Court judge Justice Vineet Saran as its nominee arbitrator. The resort to arbitration means that the contractual dispute between the parties is ultimately intended to be determined through the arbitral mechanism contemplated by their agreement. The present Delhi High Court proceedings are therefore interim proceedings connected with that arbitration rather than a final adjudication of all substantive claims concerning ownership, transfer or validity of the warrants.
The procedural response of the Delhi High Court in the latest case is presently limited. Justice Tushar Rao Gedela issued notice on September 9 and granted the respondents two weeks to file their replies. BharatPe has been given three days thereafter to file its rejoinder. The matter has been listed for consideration on October 1. Consequently, the latest order should not be understood as a final judicial finding that Centrum or JBCG acted unlawfully. The allegations will have to be answered by the respondents and considered by the Court in accordance with the applicable contractual and legal framework.
The dispute is significant because the warrants represent an important component of Unity Small Finance Bank’s capital structure and the disagreement comes at a time when the Series 1 warrants are approaching their scheduled conversion deadline. The earlier proceedings had already brought the relationship between BharatPe and Centrum under judicial scrutiny over the proposed conversion and capital restructuring. The new petition adds a separate dimension by questioning the manner in which portions of the warrants were allegedly transferred or encumbered before the dispute could be resolved.
From a corporate-law perspective, the litigation illustrates the importance of shareholder agreements in joint ventures and regulated financial institutions. While corporate decisions ordinarily operate through the statutory powers of a company’s Board and shareholders, contractual arrangements between investors can create additional consent requirements for specified categories of decisions. The precise scope of those contractual restrictions, particularly in relation to warrants and their transfer or encumbrance, is likely to remain central to the dispute between BharatPe and the Centrum group.
The case also demonstrates the interaction between corporate contracts and arbitration proceedings. BharatPe is not merely seeking damages or a declaration after an alleged breach has occurred. Through the Section 9 petition, it is seeking immediate protective orders designed to prevent further transactions involving the disputed securities while the contractual dispute proceeds. The respondents, in turn, will have the opportunity to present their interpretation of the Shareholders’ Agreement and the circumstances surrounding the warrant transactions.
For Unity Small Finance Bank, the dispute potentially affects the manner in which transactions involving its warrants are recognised and implemented. BharatPe is specifically asking the Court to restrain the bank from registering or giving effect to transactions which, according to BharatPe, were undertaken without the consent required by the Shareholders’ Agreement. The bank has therefore been impleaded in the proceedings alongside Centrum and JBCG.
Ultimately, the Delhi High Court has not yet decided whether the alleged transfers and encumbrances were unauthorised or whether BharatPe’s consent was legally mandatory in each instance. The immediate development is that the Court has taken up BharatPe’s Section 9 petition, issued notice to the respondents and fixed the matter for further consideration on October 1, 2026. BharatPe alleges that substantial quantities of Unity Bank warrants were transferred or encumbered without its approval, while the respondents will have an opportunity to contest those allegations and explain the legal and contractual basis of the transactions.
The latest litigation therefore represents another stage in the continuing shareholder and contractual dispute surrounding Unity Small Finance Bank. With BharatPe holding 49 per cent and Centrum holding 51 per cent, the interpretation of their Shareholders’ Agreement assumes particular importance. The High Court’s eventual consideration of the present interim application will determine what protective measures, if any, are appropriate while the parties pursue arbitration. For now, the Court has only issued notice, and the substantive allegations regarding the warrant transfers and encumbrances remain pending adjudication.
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