Bombay High Court Declares CBI Arrest Of Chanda Kochhar, Husband In ICICI Bank Fraud Case As 'Illegal', Confirms Interim Bail Order

The Bombay High Court on Tuesday declared former ICICI bank CEO and MD Chanda Kochhar and her husband Deepak Kochhar's arrest in the 'ICICI Bank - Videocon Loan Fraud Case' as illegal and confirmed an interim order on their release last year.

Justice Anuja Pabhudessai passed the order.

The duo was released by an interim order in January, 2023 after a coordinate bench held their arrest was prima facie not in accordance with section 41A and section 41(1)(b)(ii) of the CrPC.

The bench rejected the reasons cited by CBI for arrest in the arrest memo in December 2023 which included non-cooperation and non-disclosure of true facts of the case. The court also observed that the judge failed to properly record his own satisfaction while granting their custody to CBI.

It held that "merely because an accused does not confess, it cannot be said that the accused have not co-operated with the investigation."

"Article 20(3) is an essential safeguard in criminal cases and is meant to be a vital safeguard against torture and other coercive methods used by investigating agencies. Hence, merely because an accused does not confess, it cannot be said that the accused have not co-operated with the investigation," the bench had added.

The CBI approached the Supreme Court against this interim order granting bail. However, the SC directed the CBI to argue the matter before the HC leading to the present round of arguments.

The duo had approached the HC in two separate petitions and sought quashing of the FIR by the CBI and remand orders in the case regarding irregularities in loans granted to Venugopal Dhoot's Videocon Group by ICICI Bank between 2009-2012. They sought interim relief of release.

They were booked under Sections 120B and 420 of the IPC and Sections 7, 13(2) r/w 13(1)(d) of the Prevention of Corruption Act.

However, they dropped the prayer seeking quashing of the FIR as the CBI has already filed the chargesheet in the case.

Their petition questioned the timing of the arrest as their son's wedding was scheduled in January itself. Kochhars' only son was scheduled to be married on January 15, 2023 and functions were to start shortly. This leads to the belief, that to be arrested on the eve of the wedding of her son, after 4 years of the FIR despite the settled law was actuated by malafides, the plea had said.

The Case

The CBI began investigating the couple in January 2018 after reports that Videocon's Dhoot paid a firm he had allegedly set up with Deepak and two relatives, six months after his firm got a Rs 3,250 crore loan from ICICI Bank in 2012.

The irregularities were with regard to the grant of six high-value loans worth around Rs 1,575 crore to five firms of the Videocon Group between June 2009 and October 2011. The loans were granted in contravention of the rules and policy of sanctioning committee, the agency has alleged.

The CBI said that these loans were later termed as non-performing assets resulting in wrongful loss to ICICI bank and wrongful gain to the borrowers and accused persons. The total misappropriation is to the tune of Rs.1,730 crore as of April 26, 2012.

After the FIR was registered in 2019, Deepak Kochhar was summoned over eight times and submitted nearly 2500 pages of evidence, according to the petition. Chanda Kochhar has said she was summoned for the first time earlier this year and was arrested soon after she was summoned for the second time.

Arguments

Senior Advocate Amit Desai for Chanda Kochhar submitted that she hadn't been summoned till July 2022. However, once summoned, she appeared. When summons were issued to her the second time, on December 15, 2022, she appeared on December 23, 2022 and after a perfunctory interrogation she was arrested, Desai said.

Section 41A of the CrPC, provides that a notice of appearance before police officer is required to be given in certain type of offences. “The law mandates that a person who complies with the notice must not be arrested unless the officer records reasons”, Desai said.

Desai argued that Kochhar didn't know what was happening with her husband's business. He also pointed out that the Apex Court refused to interfere with the Bombay HC bail order in the PMLA case.

Desai further said that the officer who arrested Kochhar is a male officer, and the arrest memo doesn't show presence of a lady officer. He added that there was no sanction before registering FIR as mandated under section 17A of the Prevention of Corruption Act.

Advocate Kuldeep Patil appeared for the CBI. He argued that the Kochhars should have made an application before the trial court first.

He argued that the arrest was for proper investigation as Kochhars have been giving evasive answers to investigating officer's pointed questions. When people are confronted, only then the truth comes out, he added.

Appearances – Sr Advocate Amit Desai, Rohan Dakshini and Pooja Kothari for Chanda Kochhar

Advocate Kuldeep Patil for CBI