CBI files chargesheet against former BoI CMD in DHFL case
Mumbai, India – April 27, 2020: DHFL Promoters Kapil and Dheeraj Wadhawan accused in Yes bank fraud cases, have been taken into CBI Custody and has been produced in session court from CBI Headquarter BKC Bandra in Mumbai, India, on Monday, April 27, 2020. (Photo by Vijayanand Gupta/Hindustan Times)
New Delhi: The Central Bureau of Investigation (CBI) has filed a charge sheet against Alok Kumar Misra, former chairman and managing director (CMD) of Bank of India and Oriental Bank of Commerce, along with 33 other individuals and companies while exonerating 49 other companies originally named as accused in the largest ever bank fraud – worth nearly ₹35,000 crore — allegedly committed by Dewan Housing Finance Ltd (DHFL), run by brothers Kapil and Dheeraj Wadhawan, people familiar with the development said.
Misra allegedly benefited to the tune of ₹1.5 crore from DHFL in the form of a discounted flat for his son in Mumbai for sanctioning loans in his capacity as head of of BOI and OBC (merged with Punjab National Bank in 2020), according to CBI. He headed BOI from 2009 to 2012 and OBC from 2007 to 2009.
The agency has claimed Misra also remained director in DHFL for about eight months in 2019.
“Misra got benefit of approximately ₹1.5 crore in lieu of showing favour to DHFL in granting sanction of loans in the capacity of CMD of Bank of India and Oriental Bank of Commerce. He also remained director of DHFL for about eight months in 2019 and got one flat in the name of his son in Santa Cruz, Mumbai for ₹2.26 crore whereas the market value of flat was ₹3.79 crore to ₹4.12 crore and the value as per circle rate was ₹3.25 crore. Thus, DHFL provided him a flat at a lower rate in order to oblige him and he got benefit of ₹1.5 crore,” said a senior officer, quoting details from the charge sheet filed earlier this month.
Officials said a probe against Misra was initiated after obtaining sanction under section 17A of the prevention of corruption act (mandatory for investigating a public servant), but that a sanction under section 19 of PC Act (mandatory for prosecuting a public servant) is still pending.
Misra did not respond to a text message and hung up on a call seeking comment.
A Delhi court took cognizance of the charge sheet on April 27.
CBI’s allegation is that between January 2010 and December 2019, a consortium of 17 banks extended credit facilities worth ₹42,871 crore to DHFL. The Wadhawans siphoned off the funds to shell companies/paper entities, known as ‘Bandra Book Entities’, and caused a loss of ₹34,926 crore to the consortium.
Others named in the latest charge sheet include those companies and individuals who helped Wadhawan brothers to divert funds.
Advocate Vijay Aggarwal, who represents Wadhawans and several other accused in the case, refused to comment on the latest charge sheet.
Currently, Kapil Wadhawan is in jail and Dheeraj Wadhawan is in a hospital. DHFL’s ownership has since changed after it was taken over and sold under India’s bankruptcy code.
In its investigation, the federal agency found that 49 of 131 companies originally named in the first information report (FIR), filed in June 2022 were “genuine” borrowers without any bad intentions on their part.
It has identified genuine loan transactions worth ₹13,425 crore in the case, out of which ₹5,836 crore has already been repaid by these 49 companies either to DHFL or Resolution Professional. Based on CBI’s findings, the court last week exonerated these companies from any criminal liability.
“The probe has revealed that 56 loan transactions done by 49 companies were actually existing and are genuine/real borrowers without any bad intention on their part. These companies entered into actual loan transactions with DHFL by submitting sufficient securities, mortgaging various properties etc. as per Reserve Bank of India (RBI) guidelines and by following due procedure and by completing the necessary formalities even by deposit of securities, creating mortgage etc and there was nothing on their part that loan amount taken by them was misused or siphoned by Wadhawan brothers,” said a second officer sharing details of charge sheet.
“Most of those companies have already repaid the loan either to DHFL or to the Resolution Professional,” this officer added, requesting anonymity.
The court noted in its order of cognizance on April 27 that “CBI is permitted to close investigation against these 49 companies”. “No further action is required against any of such companies for any criminal offences under Indian Penal Code or PC Act,” the court said.
In its first charge sheet in the case, filed in October 2022, CBI had named 74 accused (18 individuals including Wadhawans and 56 companies) and submitted 61,000 pages of documents in 6 trunks and a list of 215 witnesses.
The probe has revealed that DHFL had given loan of about ₹11,765 crores to approximate 87 shell companies, out of which 81 belonged to companies of Wadhawan Group. These companies were not recorded in company’s books of accounts and instead the amount was shown as loan given to 2,60,315 fictitious persons without any documentation, security or even loan applications.
With its latest charge sheet, CBI has filed 2,70,000 pages of fresh documentary evidence in 20 trunks in the court and a further list of 521 new witnesses to prove its case.
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