New Delhi, Sept 5: The Central Bureau of Investigation (CBI) has registered a case against Essel Group founder and former chairman Subhash Chandra and others in connection with alleged irregularities surrounding loans totalling nearly Rs 980 crore sanctioned by LIC Housing Finance Ltd (LICHFL), officials said.
The case was registered on the basis of a complaint filed by LICHFL with the federal probe agency. The allegations include criminal conspiracy, cheating, criminal breach of trust and causing wrongful loss, among other offences.
A key aspect of the investigation is the substantial difference between the net worth figures attributed to Chandra in documents submitted during the loan process and the financial position he subsequently disclosed during insolvency proceedings.
According to the complaint, Chandra had stood as guarantor for two separate loan facilities. In one case, a loan of around Rs 500 crore was sanctioned to Vasant Sagar Properties Pvt Ltd and its co-borrower Pan India Infra Projects Pvt Ltd.
Documents submitted in connection with the facility included a net worth certificate issued by DIM and Co. The certificate, dated March 28, 2018, assessed Chandra’s net worth as of March 31, 2017, at $6,197.62 million, a figure equivalent to several tens of thousands of crores of rupees.
The second matter relates to a loan facility of about Rs 480 crore involving Digital Subscriber Management and Consultancy Services Pvt Ltd and co-borrower Spirit Infra Power and Multi Ventures Pvt Ltd.
In this case too, Chandra had furnished a personal guarantee. A separate certificate issued by chartered accountants MPJ & Co in July 2018 reportedly placed his net worth at more than Rs 40,000 crore.
Both loan accounts subsequently turned irregular and went into default, following which insolvency proceedings were initiated against Chandra under the Insolvency and Bankruptcy Code.
The CBI has flagged Chandra’s subsequent financial disclosures as an important element of the case. During the insolvency process, he reportedly disputed the earlier valuation of his assets and declared a net worth of around Rs 31.79 crore for 2024.
The sharp variation between the figures recorded in the loan-related documents and those disclosed later has prompted the agency to examine whether his financial position was deliberately overstated to facilitate the sanction of the loans.
The investigation will also examine the role of the companies involved, guarantors, professionals who prepared or certified the financial documents and officials responsible for evaluating them.
The agency is expected to verify the authenticity and basis of the net worth certificates, examine how the figures were accepted during the loan appraisal process and determine whether the funds were utilised for the purposes for which they were sanctioned.
The CBI will also investigate the circumstances that led to the subsequent defaults and ascertain whether there was any coordinated effort among the borrowers and other persons associated with the transactions.
The registration of an FIR marks the beginning of the investigation, and the allegations against the accused are yet to be established in court.
