Deepak Kochhar Approaches Bombay High Court; Seeks Quashing of Prosecution Complaint

In a plea under section 482 of the CrPC, Kochhar has sought to quash the Special PMLA court's order taking cognisance of the prosecution complaint (equivalent of the charge sheet) on January 1, 2021, against him.

The ED's probe is based on a case registered by CBI in January 2019 into alleged irregularities in 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 ED has alleged.

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 ED says in their complaint, adding that the total misappropriation is to the tune of Rs.1,730 crore as of April 26, 2012.

In his plea, Kochhar relies heavily on the Appellate Authority's order under the Prevention of Money Laundering Act that had dismissed ED's plea for confirming the attachment of their assets, on November 6, 2020.

Kochhar has alleged that the Special Court while taking cognisance of ED's complaint (charge sheet), considered ED's submissions, written complaints and statements recorded under PMLA, but did not refer to the Adjudication order which had dealt with the very same allegations in extensive details to conclude there being no quid pro quo, no proceeds of crime and no money laundering in respect of the alleged proceeds of crime valued at Rs 78,15,93,245.

The petitioner has alleged that the order taking cognisance was passed "mechanically" where the judge adopted an "evasive approach" by not dealing with the appellate authority's order.

"The findings merely on the basis of the material gathered and produced by ED without placing on record the subject detailed Adjudication order containing finding of facts by statutory authority. The opinion of the Learned Trial Court…is therefore vitiated, rendering the impugned order non-est in the eyes of law," the plea states.

Kochhar has also accused the ED of suppressing the order.

Kochhar says there exists an "umbilical cord connection" between criminal proceedings for an offence under Sections 3 & 4 of PMLA and provisional attachment/confiscation proceedings under Sections 5/8 of PMLA.

The plea compares the prosecution complaint (charge sheet) u/s 45 of the PMLA with the original complaint u/s 5(5) of the Act to demonstrate the two are identical.

What is the complaint about?

Deepak Kochhar was arrested in September 2020. The Special Court had observed that Chanda Kochhar had prima facie misused her official position in granting loans to the accused Videocon group of companies and received illegal gratification, through her husband Deepak Kochhar.

ED's investigation states that on September 9, 2009, when the first loan amount of Rs.300 crores was disbursed to Videocon, on the very next day V.N. Dhoot transferred an amount of Rs.64 crores to NuPower Renewables Pvt Ltd (NRPL) managed by Kochhar's husband, Deepak, through his company SEPL.

Adjudicating Authority

However, the adjudicating authority, held that the various companies in respect of which investigation was commenced had no reference in CBI's FIR. Chanda Kochhar could not have taken the decision to sanction any loans individually.

The Rupee Term Loan for a sum of Rs. 300 crores was in line with the Credit Policy and earlier practice of ICICI Bank and repaid by VIEL. Moreover, the investment of Rs 64 crore had no connection with the CBI FIR.

"…it is more than lucid that once a statutory authority constituted under the Act (Adjudicating Authority) records a finding that the property is not involved in money laundering and/or there are no 'proceeds of crime', it essentially leads to complete vitiation of proceedings under the Act, not only qua such property but also qua any person allegedly involved in money laundering qua such property," the plea states.

Case Title: Deepak Virendra Kochhar vs Enforcement Directorate