Bank Loan Scam Case: SC Cancels Bail Granted to DHFL’s Wadhawan Brothers

The Supreme Court on Wednesday cancelled the bail granted to former DHFL promoters Kapil Wadhawan and his brother Dheeraj Wadhawan in the multi-crore rupees bank loan scam case.

Justices Bela M Trivedi and S C Sharma opined that both the high court and the trial court erred in granting bail to them.

“We have no hesitation in holding that the charge sheet having been filed against the respondent accused in the prescribed time limit and the cognizance had been taken by the special court of the offences alleged committed by them, the respondents could not have claimed the statutory right of default bail under Section 167 (2) of CrPC on the ground that the investigation for other accused was pending,” stated the bench.

The court also directed the immediate custody of the Wadhawan brothers. The CBI had previously chellenged in the top court the statutory bail granted by the lower courts to Kapil and Dheeraj Wadhawan.

Additional Solicitor General (ASG) S V Raju, representing the CBI, argued that the charge sheet in the case was filed well within the 90 days statutory period, yet statutory bail was granted to the accused. According to the Code of Criminal Procedure (CrPC), an accused is entitled to statutory bail if the probe agency fails to file the charge sheet within 60 or 90 days after concluding the investigation.

In this case, the CBI filed the charge sheet on the 88th day after the FIR’s registration, and the trial court granted default bail to the accused, a decision upheld by the Delhi High Court. The CBI argued that the probe related to other aspects and against some other accused was ongoing, and the lower courts misunderstood the finality of the charge sheet, leading to the grant of default bail.

On May 30 last year, the Delhi High Court had upheld the statutory bail granted to DHFL promoters in connection with the multi-crore rupees bank loan scam case. The high court dismissed the CBI’s petition challenging the trial court order and stated that the decision to grant bail was “based on good reasoning and logic.”

The Wadhawan brothers were arrested on July 19 last year, and the high court clarified that it did not delve into the merits of the case. The charge sheet was filed on October 15, 2022, and cognizance was taken based on a complaint by the Union Bank of India. The CBI alleges a criminal conspiracy to cheat a consortium of 17 banks, leading to fraudulent loans and misappropriation of funds. The complainant asserts a wrongful loss of Rs 34,615 crore to the consortium banks.