CBI closes in on Chanda Kochhar, husband in ICICI Bank-Videocon loan case

Former ICICI Bank MD & CEO Chanda Kochhar. File photo
The Central Bureau of Investigation (CBI) has named ICICI Bank’s former managing director and chief executive officer (MD and CEO) Chanda Kochhar and her husband Deepak Kochhar, along with his firms, as “accused” in the Rs 3,250-crore Videocon loan case. 

The first information report (FIR) registered on Thursday said the accused, including Videocon Industries (VIL) and its chairman and MD, Venugopal Dhoot, sanctioned certain loans to private companies in a criminal conspiracy and cheated ICICI Bank to the tune of Rs 1,730 crore.

Explaining the modus operandi, the CBI said ICICI Bank sanctioned credit facilities of Rs 3,250 crore to several companies belonging to Videocon group such as Trend Electronics, Century Appliances and others which were in violation of the Banking Regulation Act, Reserve Bank of India rules and the bank’s credit policy. The Rs 3,250-crore credit amount was part of a total loan of Rs 40,000  crore sanctioned to the Videocon group by a 20-bank consortium.

The agency said it had investigated the quid pro quo where Dhoot made an investment of Rs 64 crore in Deepak Kochhar’s NuPower Renewables through his firm Supreme Energy (SEPL). Dhoot also transferred the same to Pinnacle Energy managed by Kochhar through a “circuitous route” between 2010 and 2012. 

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The CBI on Thursday conducted raids at Videocon’s headquarters in Mumbai and an office in Aurangabad. It also searched Kochhar’s  NuPower Renewables and Supreme Energy offices at Nariman point in Mumbai.  The CBI probe has also reached the current and former brass of the ICICI Bank including K V Kamath, Sandeep Bakhshi, N S Kannan, Zarin Daruwala, Rajiv Sabharwal, Sonjoy Chatterjee and Homi Khusrokhan. According to the CBI, these people who were part of the various credit committees of ICICI Bank, sanctioned loans to the Videocon group in violation of the bank’s credit policy.

“These loans amounting to Rs 1,575 crore were sanctioned on various dates (2009-2011) by these committees having senior officials of ICICI Bank. The loans have turned non-performing assets (NPA) resulting into the wrongful loss to ICICI Bank and wrongful gain to the borrowers and accused persons,’’ the CBI said in the FIR naming all the people mentioned above. 
These committees had sanctioned loans to Videocon group companies such as Millennium Appliances (Rs 175 crore), Sky Appliances (Rs 240 crore) Techno Electronics (Rs 110 crore), Applicomp India (Rs 300 crore) and Videocon Industries (Rs 750 crore).

These loans were credited to repay unsecured loan availed by these companies from VIL.  Further, the Rs 750-crore loan was sanctioned to VIL for refinancing purposes, the agency said. Sources in the CBI said the agency would soon summon and question all the people named in the FIR, which has come 10 months after a preliminary enquiry (PE) was registered to probe an alleged nexus between Dhoot and Kochhar family. 

Modus Operandi

During the investigation, it was found that between 2009 and 2011, ICICI Bank had sanctioned six high-value loans to various Videocon group companies. In August 2009, rupee term loan (RTL) of Rs 300 crore credited to Videocon International Electronics (VIEL) was in contravention of rules and policy by bank’s sanctioning committee. It said Chanda Kochhar, one of the members of the sanctioning committee, was in criminal conspiracy to cheat ICICI Bank. She showed dishonesty by abusing her official position in sanctioning a loan in favour of VIEL, the agency noted. 

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The CBI probe also reveals a money trail, saying that this loan was disbursed to VIEL on September 7, 2009, and the next day Dhoot transferred an amount of Rs 64 crore to Kochhar’s firm Nupower through his company SEPL. This was the first capital received by Nupower to acquire its first power plant. This transaction showed that Chanda Kochhar got “illegal gratification/undue benefits” through her husband’s firm.

Nupower was incorporated in December 2008 by Deepak Kochhar, Venugopal and Saurabh Dhoot. Later, the Dhoot brothers resigned from the company in less than a month. However, before resignation, Venugopal Dhoot allotted 19,97,500 warrants to DeepakKochhar at the rate of 10 per cent per warrant on an initial payment of Re 1. In June 2009, the shares  held by Dhoot and Deepak Kochhar’s Pacific Capital Services were transferred to SEPL, which became 95 per cent shareholder of Nupower.

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NuPower Renewables, the Mumbai office of Deepak Kochhar, where CBI conducted searches on Thursday. Photo: Kamlesh Pednekar
Similarly, Supreme Energy, which was incorporated in July 2008 by Venugopal and Vasant Kakade, had apparently resigned from the directorship and subsequently transferred the control to Kochhar by selling shares to Pinnacle. 

“It is pertinent to mention that the loans were sanctioned to Videocon group firms after Chanda Kochhar took over charge of bank CEO and MD in May 2009.’’ 

The CBI further said that in 2012, outstanding of these six major accounts (Rs 1,730 crore)  was adjusted under refinance of domestic debt. Later in 2017,  VIL and its group companies were declared NPA. 

Naming bank CEOs in a chargesheet doesn't automatically violate the fit and proper criterion of the Reserve Bank of India, according to experts. "Merely being named in an FIR doesn't violate the fit and proper criterion. It depends on the quality and nature of the FIR. If there is a subsequent conviction, that of course debars the person from holding responsible positions, but not before that," said a person familiar with the process. 

At the time of filing this story, Standard Chartered and ICICI Bank were yet to comment on the matter.

THE CHARGES AGAINST KOCHHARS

|Criminal conspiracy and cheating ICICI Bank to the tune of Rs 1,730 core
|Wrongful gains to Videocon and themselves
|Money trail shows loan disbursed to Videocon subsidiary on September 7, 2009, and the next day the firm transferred Rs 64 crore to Deepak Kochhar’s firm NuPower



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