Nitin Desai Suicide Case: Edelweiss Group Chairman Moves Bombay High Court Against Abetment FIR

The group Chairman of Edelweiss Financial Services and the CEO of Edelweiss Asset Reconstruction Company Limited have approached the Bombay High Court to quash the FIR against them for allegedly abetting art director Nitin Desai’s suicide.

Rashesh Shah is the Chairman of Edelweiss Financial Services and Raj Kumar Bansal is the Managing Director and CEO of Edelweiss Asset Reconstruction Company Limited.

The pleas were mentioned before the bench of Justices Nitin Sambre and RN Laddha by Senior Advocate Amit Desai seeking an urgent hearing on Tuesday. Desai informed the court the duo merely followed the official procedure for recovery.

The duo has sought interim relief of “no coercive steps” and a stay of investigation in their petitioners under section 482 of CrPC. The final relief sought is quashing of the FIR.

Art Director Nitin Chandrakant Desai, who has worked on various Bollywood films like 1942: A love Story, Lagaan and Jodha Akbar was found dead within the premises of his own studio at Karjat on August 2, 2023. The autopsy report confirmed death by hanging.

Desai left behind a series of voice notes detailing the circumstances that led to his death.

On August 4, Desai’s wife – Naina – approached the Khalapur police station to register an FIR into Desai’s death. Following this an abetment of suicide case was registered against Shah, Bansal, an interim resolution professional Jitendra Kothari and two others under Sections 306, 34 of the IPC.

According to a statement issued by Edelweiss- Desai, the promoter of ND's Art World Pvt Ltd (NDAWPL), had taken loans of Rs.150 crore and Rs.35 crore in 2016 and 2018, respectively, from ECL Finance Ltd, a Non-Banking Financial Company, promoted by the Edelweiss Group.

The loans were primarily for financing a theme park and for repaying existing debt, besides general corporate purposes and working capital needs. "We emphasize that NDAWPL was disbursed financial assistance at prevailing market rates. It had encountered financial difficulties in 2019 and defaulted. Various attempts to improve the financial condition of the company did not bear fruit," it said.

According to the statement, the loans were then assigned to Asset Reconstruction Company Pvt. Ltd. (CFM) which had initiated various legal actions. Edelweiss ARC (EARC) acquired a portfolio of assets from CFM under an auction process which included NDAWPL and said it "merely continued with legal actions that were initiated earlier".

"The company was eventually admitted under IBC by NCLT Mumbai on 25 July. Desai's appeal against the NCLT order was dismissed by the honourable appellate tribunal (NCLAT) on 1 August, and he took his life the following morning," it said.

Desai's company had reportedly defaulted on a loan repayment of Rs. 252 crore, prompting the initiation of insolvency proceedings by the Mumbai bench of the National Company Law Tribunal. Desai's financial troubles began with loans of Rs 185 crore obtained from ECL Finance in 2016 and 2018, with repayment issues surfacing in early 2020.