Supreme Court Stays Bombay High court’s bail in Yes Bank Fraud case

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The Supreme Court on Thursday (3rd September 2020) stayed the bail order granted by Bombay High Court to the promoters of Dewan Housing Finance Corporation (DHFL) Kapil Wadhawan and Dheeraj Wadhawan until October 7 in connection with the incident of fraud at YES Bank.

A Bench led by Justice Sanjay Kishan Kaul while remaining in the August 20 judgement of the Bombay HC, said it would look into the legal issues involved in the bail plea. It said the legal issues related to the remand duration need to be investigated threadbare.

According to justice Sanjay Kishan Kaul, there are two problems. The first question is whether, when calculating the 60 days, the date on which the accused is remanded should be omitted. The second question is whether weekends should be left out. Such are the topics that we want to explore and explain.

Although the brothers were remanded to custody on May 14, on July 13, the Compliance Directorate (ED) filed its indictment sheet.

The ED had been approaching the supreme court against the bail order from the HC. Bail was issued on a technical basis after the agency failed to file its case for the prosecution that is equivalent to a charge sheet within the required 60-day period. The trial court, however, ordered the brothers to surrender their passports to the investigators, and each deposit Rs 1 lakh as protection.

The ED said the day the accused is remanded should be ruled out when measuring the 60 days. Wadhawans’s claimed, however, that the 60-day duration would begin from the day they were remanded to custody. The HC has embraced the stand of the brothers.

The CBI probe had disclosed that YES Bank had invested Rs 3,700 crore in short-term debentures not redeemed by DHFL. At the same time, it is said that Kapil Wadhawan paid Kapoor and his family members a kickback of Rs 600 crore in the garb of a DHFL builder loan to DoIT Urban Ventures, which is owned by Kapoor’s three daughters.

Kapoor, who was then the head of the management credit committee for Yes Bank, also approved a Rs 750 crore loan to a DHFL group company in 2018. This loan amount was given to RKW Developers managed by Dheeraj Wadhawan, although the risk management team at the bank had highlighted many and important issues in the proposal.

The ED charge sheet named 19 individuals and organisations including Rana Kapoor, his wife Bindu, and three daughters-Rakhee, Roshni, and Radha-as well as Morgan Credit, YES India Money, Wadhawans’s and their related companies. In India and abroad, ED has also provisionally attached properties worth 2,203 crores from both Kapoor and the DHFL promoters.

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