NEW DELHI: On Wednesday, the Enforcement Directorate (ED) highlighted significant irregularities in the financial dealings of Indiabulls Housing Finance Ltd, now referred to as Sammaan Capital Ltd. This comes as an NGO informed the Supreme Court that the Ministry of Corporate Affairs (MCA) overlooked numerous corporate governance violations by IHFL, disregarding adverse reports from the market regulator, SEBI.
Despite strong objections raised by senior advocate Harish Salve, representing Indiabulls, a bench comprising Justices Surya Kant, Ujjal Bhuyan, and N K Singh directed a ‘responsible officer’ from MCA to present original documents related to IHFL in court on November 19. The bench expressed, “We wish to examine the original records from the ministry concerning the irregularities noted by SEBI. We want to understand in which cases the MCA has been so lenient in condoning these corporate governance violations.”
Additional Solicitor General S V Raju and advocate A Venkatesh Rao informed the Supreme Court, stating, “There are serious concerns with this case.” The bench instructed the ED to clarify the CBI’s affidavit that suggested prima facie evidence of money laundering activities involving IHFL and required the ED to detail its subsequent actions.
For the NGO, Prashant Bhushan elaborated on the allegedly covert operations of IHFL in collusion with various realtors and banks. Salve described the case as ‘blackmail litigation,’ asserting the petition was a mere replication of a prior, dismissed petition. Salve noted that the entire loan amount had been fully recovered, while A M Singhvi mentioned that seven agencies had investigated allegations against IHFL and cleared its name.
Bhushan reminded the bench that a Justice Kant-led panel had recently sanctioned the CBI to file FIRs against seven realtors for misusing the subvention scheme to defraud homebuyers. He alleged that Indiabulls conspired with the Vatika group to similarly deceive flat buyers, with SEBI submitting a comprehensive report to the MCA on these and other IHFL irregularities, which the MCA then compounded.
The ED’s status report shed light on IHFL’s allegedly fraudulent dealings with Yes Bank and Dewan Housing Finance Corporation involving proceeds of crime worth ₹5,333 crore, transactions with Gautam Thapar-led Avantha Group involving ₹307 crore, and dealings with Americorp Group that borrowed ₹9,480 crore from IHFL to artificially inflate share prices, resulting in profits of ₹532 crore.
