Supreme Court Flags ED, CBI Delay In Probing Alleged Reliance Communications Loan Fraud

The Supreme Court on Wednesday raised concerns over what it described as an unexplained lack of urgency by the Enforcement Directorate and the Central Bureau of Investigation in examining alleged loan frauds connected to Reliance Communications Ltd, its associated companies and promoter Anil Ambani.

The case pertains to suspected misuse of public funds estimated at around Rs 40,000 crore.

A Bench led by Chief Justice of India Surya Kant instructed the ED to constitute a Special Investigation Team comprising senior officials.

The court further directed both central agencies to complete the investigation in a structured and time-bound manner.

The Bench, also comprising Justices Joymalya Bagchi and Vipul M Pancholi, made it clear that it was not issuing any punitive directions at this stage.

Nevertheless, it underlined that the magnitude of the alleged financial irregularities necessitated a prompt and independent investigation.

The court ordered the ED and the CBI to submit comprehensive status reports within four weeks, detailing the steps taken so far and the future course of action.

During the proceedings, senior advocate Mukul Rohatgi, representing Reliance Group chairman Anil Ambani, assured the apex court that his client would not travel abroad without its prior approval.

The assurance came in response to apprehensions expressed by the court regarding the possibility of the accused leaving the country before the probe concludes.

After examining a sealed report submitted by the CBI, the court noted that the agency had registered an FIR based on a complaint from the State Bank of India.

The Bench questioned why the CBI had lodged only one FIR despite receiving similar complaints from multiple banks, and observed that each lending transaction required independent scrutiny.

Scrutiny of Bank Officials Ordered

The Supreme Court directed the CBI to examine the role of bank officials and determine whether they sanctioned loans through collusion, conspiracy or abuse of official position.

Appearing for the ED and the CBI, Solicitor General Tushar Mehta told the court that investigators had found evidence of forged bank guarantees during the probe and had registered an ECIR against RCOM. He also informed the Bench that the ED was examining investments made by Yes Bank in Reliance group entities.

The hearing took place against the backdrop of recent action under the Prevention of Money Laundering Act, including the provisional attachment of assets worth Rs 1,885 crore.

The Supreme Court said the matter would be taken up again after four weeks once the agencies place their status reports on record.

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