On September 7, Deepak Kochhar, the husband of former ICICI Bank CEO, Chanda Kochhar, was taken in Enforcement Directorate (ED) custody until September 19. Armed with fresh evidence against him, the ED produced him before the special PMLA Court (Prevention of Money Laundering Court) for his remand hearing in the noon.
According to media reports, the evidence relates to six loans worth Rs 1,875 crore that ICICI bank sanctioned to Videocon Group between June 2009 and October 2011.
Allegations against Deepak Kochhar and Videocon
According to the allegations, Deepak and Chanda Kochhar laundered money in the loans ICICI Bank gave to Videocon. These loans later turned out into non-performing assets.
CBI, ED, SFIO, and income tax department are conducting parallel investigations against Deepak and Chanda Kochhar in this case.
The case came to light when the CBI registered an FIR against the Kochhars and Videocon over alleged irregularities in the dealings between ICICI Bank and Videocon.
Moreover, according to these allegations, Dhoot invested crores in NuPower a few months after his loan was illegally sanctioned.
According to ED, Videocon made investments into companies held by Deepak Kochhar in exchange for these loans after their disbursal was cleared by the then CEO of ICICI Bank, Chanda Kochhar. In the wake of these allegations, she took early retirement in October 2019.
The Ministry of Corporate Affairs and the tax department concluded in their report that Rs 64 crore of payment was illegally received by Deepak Kochhar from Videocon through various layered transactions. While the transactions were filed under 'business expenses' by Kochhar's company, the ministry suggested they were not genuine. Moreover, according to the report, the Videocon group had no serious intention of recovering these funds.
Chanda's standing in the case
Allegedly, Chanda Kochhar had abused her official position to approve a loan worth Rs 3,250 crore for Videocon in 2012 for a deal that concerned NuPower Renewables, Deepak Kochhar's company.
The FIR against her also alleged that she accepted "illegal gratification through her husband". It is to be noted that Videocon made investments in NuPower Renewables right after it granted their loans.
Videocon Chief, Venugopal Dhoot claimed Chanda Kochhar did nothing illegal. He said its wrong to assume that they would use their personal ties to gamble in criminal acts. He added that he knew all the 12 people on the panel and Chanda Kochhar was not the only one who cleared the loan.
ED is also now investigating some loans sanctioned under the leadership of Chanda Kochhar, including Sterling Biotech, Essar Steel Minnesota, Bhushan Steel, and Power Limited for alleged bribery. However, so far, Deepak Kochhar hasn't been linked to any of these cases.
Timeline of ICICI Bank-Videocon Case
The probe started in 2016 when Arvind Gupta, an investor in both the firms, Videocon Group and ICICI Bank, raised concerns about alleged loan irregularities.
Gupta wrote to authorities like RBI and even Prime Minister, but his complaint garnered no attention at the time.
Fast forward to March 2018, another whistle-blower complained that the delay in recognising impairment of several loan accounts between 2008 and 2016 was a deliberate action to save on provisioning costs. The whistle-blower filed the complaint against the bank's top management that quickly garnered the attention of many agencies.
However, the same month, the bank came out with a statement saying they had full faith in Chanda Kochhar. The statement was given after Chanda's alleged role in approving the loan to Videocon group was under scrutiny.
Later that month, CBI filed an internal query and questioned Chanda's husband and his brother, Deepak and Rajiv Kochhar. Meanwhile, ICICI Bank continued to defend Chanda who was facing quid pro quo allegations.
April 2018 saw the Serious Fraud Investigation Office (SFIO) getting involved in the case and they sought permission from the Ministry of Corporate Affairs for a probe.
In May 2018, the Securities and Exchange Board of India (SEBI), shot a notice in which they asked Chanda Kochhar and the bank to explain the bank's dealing with Videocon group. They were asked to submit their responses by June 7.
In the wake of rising pressure, by the end of May, ICICI also launched a probe into the matter.
On July 5, SEBI asked Kochhar and bank again to reply to showcase notice by July 10 when they failed to do it previously.
On October 10, Kochhar sought early retirement from her post and the bank approved with the promise that it would not affect the investigation in any manner.
On January 24, CBI registered a case against Chanda Kochhar, her husband Deepak Kochhar, and the MD of Videocon Group Venugopal Dhoot over irregularities in sanctioned loans.
January 30 marked the day when the BN Srikrishna panel found that Chanda Kochhar had, in fact, violated the bank's code of conduct. As soon as the report was released, the bank took away all the bonuses paid to Kochhar between April 2009 and March 2018.
In February 2019, she was handed the termination letter by the bank.
By the end of 2019, Kochhar had filed a petition against the bank claiming her termination was illegal, untenable, and unsustainable in law.
In January, the Enforcement Directorate attached the assets worth more than Rs 78 crore belonging to Kochhar family.
The Bombay High Court, in March, dismissed the petition that challenged Kochhar's termination.
Earlier in June, CBI booked Venugopal Dhoot, MD, Videocon for cheating millions from one of the leading lenders of the country.
Finally, on Monday, Deepak Kochhar was arrested by ED after conducting the latest round of questioning. The agency had said they found evidence against Deepak Kochhar, however, they did not disclose any other information.
Details about the arrest
The agency arrested Deepak Kochhar under sections of Prevention of Money Laundering Act (PMLA) after a round of questioning. During the session, he was confronted with the fresh evidence that emerged about his money trail. However, Deepak was not cooperative with the investigation, that's why he was placed under arrest.
Vijay Aggarwal, Deepak's lawyer in an interview to the Print said, "The arrest is illegal as my client has been cooperating in the investigation. The offences are punishable for imprisonment up to 7 years only, so he cannot be arrested like this when he has always joined the investigation on the summons."
First Published: IST