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The Supreme Court has directed the Ministry of Corporate Affairs to present original records related to the closure of objections against Indiabulls Housing Finance Limited, now Sammaan Capital Limited. The matter involves claims of financial irregularities and large-scale loans routed through corporate entities. Senior advocates for Indiabulls denied any wrongdoing, while the petitioner NGO highlighted possible misuse of loans and compounding of violations. The court also referred to the Central Bureau of Investigation's observations on the matter.
The Supreme Court has asked the Ministry of Corporate Affairs to provide original records concerning the closure of alleged irregularities identified by the Securities and Exchange Board of India (SEBI) in the affairs of Indiabulls Housing Finance Limited (IHFL), which now operates as Sammaan Capital Limited. The bench, comprising Justices Surya Kant, Ujjal Bhuyan, and N Kotiswar Singh, directed the ministry to deputize a senior official to present the original reports at the next hearing. The court aims to understand how many objections were compounded and the manner in which they were resolved. Advertisement
Justice Surya Kant highlighted the unusual nature of closing hundreds of objections and instructed the MCA to furnish detailed documentation. In addition, the court asked the Enforcement Directorate (ED) to clarify its position regarding money laundering allegations based on the Central Bureau of Investigation's observations. The CBI had noted that the allegations prima facie indicated money laundering, recommending that ED continue its investigation. The ED was also asked to explain the steps taken to register cases with the Economic Offences Wing in Delhi, as referenced in the CBI's counter-affidavit.
The case arose from a petition filed by the NGO Citizens Whistle Blower Forum, alleging large-scale financial irregularities and dubious loan disbursements by Indiabulls. Advocate Prashant Bhushan, representing the NGO, argued that IHFL had advanced loans totaling around INR 400 crore to real estate companies, including one with a net worth of only INR 1 lakh, which received loans of INR 1,000 crore. Bhushan referred to SEBI findings showing multiple violations compounded in a single day, with a penalty of just INR 37 crore imposed.
Senior advocates Harish Salve, Mukul Rohatgi, and Abhishek Singhvi, representing Indiabulls and its promoters, rejected these allegations. They argued that all investigating agencies, including the Reserve Bank of India, found no wrongdoing. Salve termed the petition "blackmail litigation" and questioned the NGO's motives. The court allowed these exchanges but emphasized the need to examine the original records to determine the full picture.
Past proceedings showed that the CBI, as of late July, had not found irregularities in IHFL's loan disbursements and was not investigating the company. Earlier, the Supreme Court had pulled up the CBI for failing to appear in the matter despite receiving notice. The bench has scheduled the next hearing to review the submitted records and determine further steps in the case.
Source: PTI
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