New Delhi: Pulling up the adjudicating authority for “conveniently ignoring” facts and materials on the record, the PMLA appellate tribunal upheld the attachment of banker Chanda Kochhar’s properties, including a flat in Mumbai, by the Enforcement Directorate (ED).
Going further into the details of the case, the tribunal found “substance” in allegations of a quid pro quo transaction in which Deepak Kochhar’s firm allegedly received Rs 64 crore from the Videocon Group after ICICI sanctioned a loan of Rs 300 crore to the group.
The tribunal was disposing of an appeal filed by the ED, challenging the adjudicating authority’s order that quashed its attachment of a Mumbai flat owned by the firm of Deepak Kochhar, Chanda Kochhar’s husband, and Rs 10.5 lakh in cash. The adjudicating authority is empowered to decide the provisional attachment orders passed by the ED to attach proceeds of crime generated by the accused in a money laundering case.
The ED had initiated a probe against Kochhar based on an FIR by the Central Bureau of Investigation (CBI), which booked the couple, Videocon head Venugopal Dhoot, among others, for allegedly causing a loss of Rs 1,730 crore to ICICI Bank through loans in violation of banking norms.
The CBI was said to have found that ICICI Bank, during Kochhar’s tenure as CEO, had disbursed six high-value loans to Videocon Group amounting to Rs 3,250 crore between June 2009 and October 2011, including a term loan of Rs 300 crore in August 2022 when she was part of the bank’s loan-sanctioning committee.
Deepak Kochhar was arrested by the ED in September 2020, but he is out on bail.
“It may be true that the issue will be determined by the trial court, but we find a prima facie case against the respondents for commission of the offence of money laundering and, therefore, the provisional attachment order is justified,” the appellate tribunal said in its order dated 3 July, while setting aside the adjudicating authority’s November 2020 decision.
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‘Long association with Videocon’
A year after registering the case, the ED provisionally attached several immovable properties linked to the Kochhars and Deepak Kochhar-founded NuPower Renewables Pvt Ltd (NRPL), as well as cash, in January 2020.
The provisional attachment, however, was rejected by the adjudicating authority following which the ED challenged the order before the tribunal.
The adjudicating authority had accepted the couple’s argument that Deepak Kochhar owned the flat in Mumbai since 1996 and that it had never been transferred to anyone else’s name; hence, the ED had erroneously attached the property.
On the other hand, the tribunal pulled up the adjudicating authority for accepting the argument that Chanda Kochhar was unaware of her husband’s firm’s dealings with the Videocon Group, as it “conveniently ignored” the long association between them.
The tribunal noted that Deepak had incorporated a firm in March 1992, in which Chanda was allotted more than 2,000 shares by September 1994.
In the same financial year, Dhoot allegedly invested approximately Rs 10 crore in the firm. This firm was later merged with one in which Dhoot held majority shares, and the trio of Dhoot and Kochhars became majority shareholders of the merged firm, Credential Finance Ltd.
“The relation of Chanda and Deepak Kochhar with the Videocon Group of Companies was thus from the year 1994-95 but conveniently ignored by the adjudicating authority,” the tribunal noted.
It further observed that the attached flat belonged to the Videocon Group in some capacities before it was finally transferred to a family trust of Kochhars in 2016.
The flat was owned by Credential Finance Ltd until 2009, which was subsequently transferred to a Videocon Group company for the period between 2009 and 2016. Eventually, it was transferred to Kochhar’s family trust for Rs 11 lakh only.
“The document regarding transfer of flat to the trust has been ignored by the adjudicating authority, coupled with the fact that the value of the flat was Rs 5.25 crore which came to QTAPL for a consideration of Rs 3.25 crore vide transfer deed dated 04.08.2009. The transfer of the flat to the family trust was only for a consideration of Rs11 lakh. It was nothing but the proceeds of crime,” the tribunal observed.
It also reiterated that the NRPL, which got Rs 64 crore from the Videocon Group, was incorporated in December 2008—much before the ICICI Bank sanctioned the loans under Chanda Kochhar’s watch.
(Edited by Tony Rai)