DHFL bank fraud: Court denies bail to businessman in Rs 34,615-crore scam

A Delhi court has denied bail to businessman Ajay Ramesh Nawandar in a Rs 34,615-crore bank fraud case involving Dewan Housing Finance Limited (DHFL), on account of his possible influence on both evidence and witnesses.

The court held that the accused was prima facie complicit at some stage in the diversion of the humongous funds originating from the loans.

In the present facts, the Court is inclined to decline the bail not because the offences are economic in nature but on account of the investigation into the present offences being intricate, the accused prima facie being complicit at some stage of the handling/diversion of the humongous funds originating from the loans, a strong likelihood of him tampering with evidence and the foreseeable possibility of him influencing witnesses if admitted to bail, Special Judge Vishal Gogne said.

The Central Bureau of Investigation (CBI) had earlier conducted searches at Nawandar's premises and recovered a large collection of uber-luxury watches worth crores of rupees, including Rolex Oyster Perpetual, Cartier, Omega, and Hublot, and two paintings worth Rs 33 crore, the officials said.

The agency claimed that items belonged to former DHFL CMD Kapil Wadhawan and former director of the company Dheeraj Wadhawan, who allegedly defrauded banks to the tune of Rs 34,615 crore, making it the biggest such case probed by the agency.

These were allegedly purchased using the proceeds of the scam and kept at Nawandar's premises to evade recovery and seizure by enforcement agencies, the officials said.

In an order passed on August 20, the court noted that the accused was prima facie engaged in a concerted effort, to receive the paintings from the principal accused, Dheeraj Wadhawan, keep them in his safe-keeping and may have been in the process of selling them.

This alleged conduct of the accused also shows a current/present effort to continue dealing with the allegedly diverted funds/derivatives from these funds. It is, therefore, not a stereotyped assertion for the CBI to be claiming that the applicant if released on bail, may tamper with the evidence, the judge said.

Senior Advocate Vikas Pahwa, appearing for the accused, had claimed before the court that the alleged recovery of the paintings from the accused could not be associated with the conspiracy, if any, at the inception of the above offences.

The accused has neither been cited as a promoter/director/official of the DHFL or its associate companies nor had he been projected by the CBI to have been instrumental in the arrangement/disbursal/utilisation of the loan amounts in question, he said.

The application, moved by advocate Hemant Shah, further claimed that the accused was ready to abide by any condition imposed by the court, and added that there was no possibility of him fleeing away from justice as he was a well-rooted person in the society.

It further submitted that since much of the evidence to be collected was essentially in the form of an electronic money trail, the accused could not be presumed to be in a position to tamper with the same.

The CBI had alleged that Nawandar was acting as a conspirator aiding and abetting the Dewans to hide the proceeds of the crime and was in the process to dispose of these items when he was arrested by the agency.

The CBI registered the case on June 20 on a complaint from the Union Bank of India (UBI), the leader of a 17-member lender consortium that had extended credit facilities to DHFL to the tune of Rs 42,871 crore between 2010 and 2018.

The bank has alleged that Kapil and Dheeraj Wadhawan, in a criminal conspiracy with others, misrepresented and concealed facts, committed a criminal breach of trust, and abused public funds to cheat the consortium to the tune of Rs 34,615 crore by defaulting on loan repayments from May 2019 onwards, CBI said.

An audit of DHFL's account books showed that the company allegedly committed financial irregularities, diverted funds, fabricated books, and round-tripped funds to "create assets for Kapil and Dheeraj Wadhawan", using public money, it said.