New Delhi: Businessman Anil Ambani has written to Union Finance Minister Nirmala Sitharaman seeking resolution of the cases against him on the same lines as was done for the Sandesara brothers in the Sterling Biotech case.
On Monday, the letter was placed before the Supreme Court as part of a supplementary affidavit filed by Ambani in a Rs 40,000 crore bank loan fraud case.
In the Sterling Biotech case, the Supreme Court had in November last year agreed to drop all criminal proceedings against the fugitive Sandesara brothers in a multi-crore bank fraud case if they deposit Rs 5,100 crore with the top court’s registry by 17 December. In an extraordinary decision, it had approved a structured institutional settlement and quashed cases against the company and its promoters.
In his letter to Sitharaman, the Anil Dhirubhai Ambani Group (ADAG) chairman sought the constitution of a high-powered committee of independent legal and financial experts to consolidate what he describes as a “pure commercial matter” between lenders and borrowers involving his company.
The 17 March letter said that the lenders in the Sterling Biotech case negotiated “willingly” with the accused who were declared fugitive offenders and had left India. Despite the fugitive status, the lenders and government departments such as the Central Bureau of Investigation, the Enforcement Directorate and Serious Fraud Investigation Office (SFIO), SEBI and Income Tax Department were parties to the full final settlement.
Ambani however sought to distinguish himself from the Sandesara family and stated that if a structured resolution was achievable in far more adverse circumstances—for individuals residing outside the jurisdiction—it is pragmatically and legally possible in his case, both on merits and equity.
“With great humility, may I submit that the Reliance Group and I are materially superiorly placed than fugitive companies and fugitive families. I have not been a declared fugitive. To the contrary, I have given an undertaking to the Honourable Supreme Court that I will not leave the country without the permission of the Honourable court,” read his letter to the finance minister.
Ambani’s counsel, senior advocate Mukul Rohatgi, told the court that his client had made a representation to the banks, who are hesitant to have a dialogue due the pendency of the case.
During the brief hearing on Monday, a bench led by Chief Justice of India Surya Kant noted from a report of the Enforcement Directorate that debt worth Rs 2,983 crore of certain companies of ADAG were settled in insolvency proceedings for merely Rs 26 crore. All these acquisitions were facilitated by 8 Non-Banking Finance Companies through ‘Project Help’, the court noted.
On being told that a Special Investigation Team (SIT) was in place to probe the case, the court recorded in its order that: “This is a case where senior functionaries of the investigating agencies must join hands and make vigorous attempts to unearth the irregularities/illegalities or the connivance of public functionaries, specially the financial institutions, if any, in giving undue benefit (to ADAG).”
It added: “While we do not express any opinion on the merits of the allegations, all that we wish to observe is that it is imperative upon the CBI and the ED to complete the investigation in a most dispassionate, fair, transparent and independent manner and take the ongoing investigations to logical conclusion in a timebound manner.”
The court gave the SIT four weeks to complete the investigation.
Ambani’s letter to the Sitharaman talks about the “clear precedent” in Sandesara resolution where no penal interest or overdue interest was charged and principal dues were crystalised and subjected to one-time settlement as mutually negotiated.
Consequently, the court directed the Enforcement Directorate to release all seizures, withdraw all look out circulars and open-ended non-bailable warrants as well as delete names of individuals from the list of fugitives.
While providing information on the ADAG’s Rs 15,000 crore seized assets, Ambani’s letter to the finance minister touched upon two systemic crises his company suffered—one in 2012, triggered by the collapse of India’s telecom sector pursuant to the top court’s judgement in the 2G case, and the IL&FS collapse in 2018 triggered by a sector-wide liquidity freeze across all NBFCs and housing finance companies.
“Reliance Capital maintained a top-end ‘AAA’ credit rating continuously from September 2008 to October 2018, with the first default occurring only in October 2019 as a direct consequence of the IL&FS-triggered liquidity mismatch,” Ambani’s letter said.
(Edited by Gitanjali Das)