The Bombay High Court, in an order made available on February 19, came down heavily on the Central Bureau of Investigation (CBI) over the manner in which the agency handled the loan fraud case involving former ICICI Bank chief Chanda Kochhar and her husband Deepak Kochhar.
Calling out the course of action taken by CBI in the case as “without application of mind and due regard to the law”, the court pulled up the agency for such “abuse of power”.
The former Managing Director and Chief Executive Officer of the ICICI Bank and her husband were arrested by the CBI in December 2022 in the Videocon loan fraud case.
It may be noted here that a division bench had on February 6 held the Kochhars’ arrest as illegal. It had also confirmed the bail given to the duo in January 2023 by another bench’s interim order.
CBI failed to to “demonstrate the existence of circumstances or supportive material based on which the decision to arrest was taken,” the court’s order said.
That makes the arrests illegal, it added.
The CBI had contended that the Kochhars were arrested because they were not cooperating with the probe. The Bombay HC dismissed the agency’s contention on the basis that the accused “had a right to remain silent during interrogation”.
The order said, “The right to silence emanates from Article 20(3) of the Indian Constitution, which gives an accused the right against self-incrimination. Suffice it to say that exercise of the right to remain silent cannot be equated with non-cooperation.”
The court slams CBI
After their arrest, the Kochhar’s immediately moved the high court seeking the agency’s declared illegal. They also sought bail by way of an interim order.
They were granted bail in January 2023, with the court observing that the CBI had made the arrest “casually and mechanically and without application of mind”.
The bench noted that section 41A of the Criminal Procedure Code (CrPC) was introduced to avoid routine arrests. This section limits the power to arrest when the accused complies with the notice to appear for questioning. It also mandates that arrests can only be made when the police are absolutely sure.
The agency was within its power to question the accused, but its actions were not “wholly immune from judicial reviewability”, the court noted. “The court can consider whether the reasons for deprivation of liberty are rational, reasonable or fanciful,” it added.
The bench also noted the time lag between the FIR and the questioning, saying that the FIR in the case was registered in 2019, and the Kochhars were summoned for interrogation only in 2022. “Despite the gravity of the offence, the petitioners (Kochhars) were not interrogated or summoned for a period of over three years from the date of registration of the crime,” it observed.
Videocon loan fraud case: A blow-by-blow account
In the case, the CBI had also arrested Videocon group founder Venugopal Dhoot, later given bail in January 2023 by way of an interim order.
As per CBI’s allegations, ICICI Bank had sanctions loans worth Rs 3,250 crore to Videocon Group entities, in violation of the Banking Regulation Act, Reserve Bank of India’s guidelines, and ICICI’s own rules.
The accused in the case included Chanda Kochhar and Dhoot along with Nupower Renewables (NRL) managed by Deepak Kochhar, Supreme Energy, Videocon International Electronics Ltd and Videocon Industries Ltd.
The CBI further claimed that as quid pro quo, between 2010 and 2012, Dhoot made an investment — in a circuitous manner — of Rs 64 crore in Nupower Renewables through Supreme Energy Pvt Ltd (SEPL) and transferred SEPL to Pinnacle Energy Trust managed by Deepak Kochhar, PTI reported quoting CBI’s charge sheet.
