Former ICICI Bank MD And CEO Prima Facie Misused Her Official Position : PMLA Court Summons Chanda Kochhar And Husband

Special Judge Abhijeet Nandgaonkar has issued process against all the 11 accused in the case, including the Videocon Industries Ltd's Managing Direction VN Dhoot, Kochhar and her husband; and summoned them for the offences under section 4 (money laundering) of the PMLA. This may mark the beginning of a trial against the accused.

"After going through the submissions, written complaints and statements recorded under PMLA, it appears that, accused Ms. Chanda Kochhar had misused her official position in granting loan to accused Mr. V.N. Dhoot and/or Videocon group companies and got illegal gratification/undue advantage through her husband accused Mr. Deepak Kochhar, per-se quid-pro-quo web-transactions, created by the accused persons through various companies for siphoning off money and proceeds of crime." The judge observed while issuing process.

The case has now been adjourned to February 12.

The ED's probe is based on a case registered 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 as on April 26, 2012.

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.

The agency has alleged that NRPL was incorporated on December 24, 2008 with Deepak Kochhar, V.N. Dhoot and Saurabha Dhoot as its first directors. Before resigning from the company, a year later, Dhoot allotted 19,97,500 warrants to Deepak Kochhar at the rate of Rs.10/- per warrant, on an initial payment of Rs.1/- per warrant.

Subsequently, on June 6, 2009 shares of NRPL held by Dhoot and Kochhar were transferred to SEPL, which became 95% shareholder of NRPL. SEPL was another company incorporated with Dhoot as its director in 2008, however, a year later he sold his shares to Pinnacle Energy (PE) managed by Deepak Kochhar.

Kochhar started her career with the bank in 1984 and rose to the rank of MD & CEO in 2009. The complaint states that despite knowing that Deepak Kochhar is closely associated with Dhoot, Chairman and Managing Director of Videocon Industries Ltd., Kochhar had neither disclosed this fact nor recused herself from the sanctioning committee of ICICI bank while sanctioning the loan to Videocon.

It is alleged that Kochhar's flat situated at CCI, in Mumbai, was purchased from the proceeds of crime for a mere Rs. 11 lakh when the actual value of the property was Rs. 5 crore.

The court said "hence, material gathered and produced by ED constitutes the commission of schedule offence, which gave rise to register the offence bearing No.ECIR/02/HIU/2019, dt.31.01.2019 for the offence under Section 3 r/w Section 70 punishable under Section 4 of Prevention of Money Laundering Act. Hence, I am of the opinion that this material is sufficient to proceed against the accused persons," the court noted.

Deepak Kochhar, who continues to be in prison after his bail application was rejected last month, will be served a copy of the summons in prison.

The Kochhars through her lawyers has maintained that the Rs. 64 crore was an equity investment, and unrelated to the bank's loans to Videocon Group firms.