When for example user shares illegal or unrelated files to the channel topic, can i remove such user so other users does not see him?
I can see ban option, but does it work like that? I can still see that banned user as admin.

If you have a higher permission than someone else in the room, you can ban them. But you can not ban anyone with higher (or equal?) permission to you. The admin/owner is the maker of the channel and has absolute authority over the channel, they can not be banned. If you have the level to ban someone and you do, that person is removed from the channel and cant be seen in the channel by anyone.

Thanks, I suppose that when i send banned person a personal message with reason of ban (so they can reply me back to object) and then i ban them, then they will be able to reply to me, even in banned status.