PC Jeweller, a Delhi-based company, announced in a regulatory filing on February 7, 2023, that it is currently involved in legal proceedings with the State Bank of India, the lead bank of a consortium of 14 lenders who had advanced loans to the company. Four other banks in the consortium, IDBI Bank, Indian Bank, Bank of India, and Karur Vysya Bank, have also issued loan recall notices to the company.

The company has a history of controversies, including a case of insider trading that took place in 2018, where the founder of PCJ and his brother, as well as their children, were accused of involvement. The Securities and Exchange Board of India (SEBI) investigated the case and found them guilty, imposing a fine of Rs 1 crore on the promoters and banning them from trading the company's shares for a year. However, in April 2022, the Supreme Court overturned the SEBI and SAT orders, which led to SEBI petitioning the Supreme Court for a review in September 2022. The case is ongoing.

SEBI sought clarifications from PCJ on February 2, 2023, after the company's shares fell from Rs 48 to Rs 43.50 in one trading session. In response, PCJ informed SEBI that the lead lender, SBI, had moved the Debt Recovery Tribunal (DRT) against the company seeking full recovery of its outstanding exposure and that the matter was currently sub-judice with no clarity on the outcome.

PCJ had defaulted on loans worth Rs 3,466 crore from banks and financial institutions, which led to the banks recalling their loans. The largest lenders to PCJ include SBI with Rs 1,060 crore outstanding, Union Bank of India with Rs 530 crore, Punjab National Bank with Rs 478 crore, and Indian Bank with Rs 226 crore.

A loan recall is a process where the lender requests the return of the amount advanced to the borrower. It is generally initiated when the lender sees problems in the borrower's financial situation.