PMLA case: Former ICICI Bank CEO Kochhar gets bail, but can't leave country

Former ICICI Bank CEO and MD Chanda Kochhar outside a court in Mumbai on Friday Photo: Kamlesh Pednekar
Former ICICI Bank chief Chanda Kochhar was granted bail by a special court on Friday, in connection with ICICI-Videocon money laundering case. Kochhar who is among the accused in the matter, appear before the court seeking bail, where she was asked to deposit Rs 5 lakh as a bond and not to leave the country without prior permission of the court.

“She is ready to abide by all the terms and the condition of the court releasing on bail. The applicant (Kochhar) is a respectable citizen and conferred Padma Bhushan award. Therefore, being permanent resident having deep root in the society, there is no apprehension that applicant will flee away from justice, said PMLA judge Abhijeet Nandgaonkar while grating bail.

Earlier this month, a special court of Prevention and Money Laundering Act (PMLA) agreed to proceed the trial in the matter against Kochhar, her husband Deepak Kochhar and others following the cognisance of the material evidences submitted by the Enforcement Directorate (ED) along ‘with the prosecution complaint or chargesheet.

Special court also cited Kochhar’s January 5, 2020 petition in the Supreme court wherein she had requested to quash the ED case against her. However, the matter is pending but during the hearing solicitor general refrain ED to take any coercive step against the Kochhar.

Meanwhile, ED who filed chargesheet in the case found Kochhar instrumental in generation and acquisition of proceeds of crime. “Kochhar has committed the offence of money laundering as defined under Section 3 of PMLA and punishable under Section 4 of the said Act, by being actually involved and knowingly a party in acquisition of the proceeds of crime through the company of her husband (Nupower Renewables) and her family trust (Quality Advisors) and attempted to indulge in projection of proceeds of crime as untainted property, federal agency said in the chargesheet. 

Business Standard has reviewed the copy.

According to ED, Kochhar forced Videocon group chairman Venugopal Dhoot to take care of her husband’s (Deepak Kochhar’s) interest by putting money in the Windpower Project of her husband. If he had not agreed for the proposal  that would have been detrimental for his loan proposals pending with ICICI Bank. He would not have transferred funds to NRPL, if the loan proposal of Rs. 300 crore of VIEL had not been sanctioned / disbursed by ICICI Bank. So, accordingly Dhoot diverted the loan funds amounting to Rs. 64 crores to Nupower.  

ED establishes total proceeds of crime of Rs 78 crore (including book value of the flat). The equal amount has been provisionally attached by the agency. Meanwhile,  Letter of Request has been also issued to four countries to probe other aspect such as suspected funds received to Nupower from Mauritius-based Firstland Holdings.

It further revealed that Kochhar who was the part of the credit committee had received 28 loans proposal from Videocon group, of which 8 proposals amounting to Rs 5,394 crore were sanctioned after she became CEO of the ICICI bank. These were tagged as “urgent proposals” without the comment of bank’s risk management team. 

The agency underlined that as part of design, the shareholding of Nupower held by Pacific Capital (shareholder) and was then transferred to Supreme Energy before transfer of proceeds of crime of Rs. 64 crore to Nupower. “She ceased to be the authorised signatory in DBS bank account of  Pacific, just after a week of receipt of funds from Supreme. She never disclosed her connection with Pacific to the bank. 

ED also highlighted the close link between Kochhar and Dhoot, said that Kochhar’s posh CCI, churchgate flat, was created from proceeds of crime, which was acquired by her family trust, Quality Advisor, from Videocon Group in mere Rs. 11 lakh against the market value of Rs 5.28 crore in 1996. “This flat is nothing but undue advantage / proceeds of crime paid or transferred by Dhoot / Videocon Group for the benefit of Kochhar and her family. 

Investigation also revealed that Deepak Kochhar was beneficially owning multiple companies in which his employees and relatives and even driver and gardener are dummy shareholders and directors, so that he could execute multiple accounting entries for concealing, layering of proceeds of crime.

Infact, Deepak was following all the events at the ICICI bank indicating “intricate linkage” between him and Chanda actions to project the receipt of proceeds of crime as genuine transactions. Events like appointing Cyril Amarchand Mangaldas to conduct internal audit in 2016 are among them. 

Interestingly, the Reserve Bank in its 2018 scrutiny report had flagged conflict of interest on part of both Kochhar and the private lender, as advocates and solicitor for term loan agreement between ICICI and Videocon under debt consolidation was Cyril Amarchand Mangaldas and Suresh Shroff. The same firm was also appointed by the bank board to probe alleged quid pro quo arrangement between Kochhar and Videocon.

Testimonies of officials in bank also revealed that as on March 2020, the total principal outstanding for the bad loan accounts towards Videocon was Rs 2812 crore. The Bank was never holding the assets equivalent to outstanding principal amounts since classifying them to NPA to till date. 

The agency arrested Deepak last September after it filed a criminal case for money laundering based on the CBI case against Kochhar, Dhoot and others. ED alleged that Rs 64 crore out of a loan amount of Rs 300 crore term loan sanctioned by bank’s committee headed by Kochhar to Videocon International Electronics was diverted to Nupower in 2009, a day after disbursement of loan. 

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