SC Orders CBI Probe into Indiabulls Deals
The Supreme Court has asked the Central Bureau of Investigation (CBI) to examine all six allegations of dubious transactions involving Indiabulls Housing Finance Limited (IHFL) and related entities. The allegations were flagged by the Enforcement Directorate (ED).
The court’s directive came after the ED referred to six allegations, with five aspects being probed by the Economic Offence Wing (EoW) of the Delhi Police.
Allegations and Investigations
The law officer, Additional Solicitor General S V Raju, stated that the CBI has filed an application before a special PMLA court in Mumbai seeking permission to probe the sixth issue, pertaining to the alleged routing of ₹1,575 crore.
The bench, comprising Chief Justice Surya Kant and justices Joymalya Bagchi and V Mohana, directed the special judge in Mumbai to decide the CBI’s application within two weeks.
They will then submit a progress report to the Supreme Court.
Court’s Directions
The court noted that the EoW has given a clean chit in all five allegations probed by the Delhi Police agency, but the bench directed the CBI to independently inquire into these allegations, irrespective of the conclusions.
Related: Glass architecture pushes design boundaries
The CBI is expected to submit a report to the court on its findings, which will provide clarity on the involvement of Indiabulls and its related entities in the alleged dubious transactions.
The directions came in a petition filed by the ‘Citizen Whistle Blower Forum’, which relied on the ED’s findings alleging suspicious loan transactions, diversion of funds, share-price manipulation, and evergreening of loans involving Indiabulls-linked entities.
Advocate Prashant Bhushan, appearing for the petitioner, submitted that a Reserve Bank of India (RBI) circular mandates that bank frauds involving more than ₹50 crore must be investigated by the CBI.
Bhushan claimed that the six allegations in the ED complaint prima facie disclosed fraud, criminal conspiracy, diversion of funds, and evergreening of loans funded through public money.
One of the allegations concerned loans of nearly ₹1,693 crore advanced to entities of the Americorp Group.
Bhushan stated that the loan funds were allegedly routed back into shares of Indiabulls entities, generating profits through manipulated share-price movements.
Related: Old tech drains budgets unseen
The ED’s findings also concerned alleged diversion of funds and suspicious transactions relating to the Palais Royale project.
The CBI’s investigation will shed more light on these allegations.
The court’s decision to direct the CBI to investigate the allegations is a significant development in the case.
The petitioner NGO has alleged large-scale irregularities in the affairs of Indiabulls Housing Finance Limited, claiming that the company and its erstwhile promoters advanced dubious loans to entities owned by large corporate groups.
These loans were allegedly used to increase the personal wealth of the promoters, raising concerns about the company’s business practices and the regulatory oversight of its activities.
