Yes Bank Case: CBI Custody of DHFL Promoters Extended Till 1 May

The Wadhawan brothers and others were placed in institutional quarantine at Panchgani on 9 April.

3 min read
DHFL. Image used for representational purpose.

A CBI court extended the custody of DHFL promoter Kapil Wadhawan and RKW Developers promoter Dheeraj Wadhawan in connection with the Yes Bank fraud till 1 May.

The duo were arrested by the CBI on Sunday, 26 April, from a Mahabaleshwar-based quarantine facility, nearly 50 days after booking them in a case of bribery against former Yes Bank CEO Rana Kapoor, officials said.

They were arrested with the “cooperation of district authorities of Satara on the strength of Non-bailable Warrant of Arrest issued by the Court of Special Judge, CBI Cases, City Sessions Court, Mumbai,” CBI spokesperson RK Gaur said.

Meanwhile, the special court in Mumbai on Tuesday, 28 April, rejected the bail pleas of the businessmen-brothers.

As per the ED counsel, Additional Solicitor General Anil Singh, the special court rejected the Wadhawans’ bail plea after the agency argued that the duo was not cooperating with it in the probe.

The agency had procured non-bailable warrants against them from the court on 17 March yet they did not appear before the CBI or the court, he said.

They were held by the Satara police earlier this month while allegedly violating prohibitory orders related to lockdown when a carcade carrying Wadhawan family members was stopped at Panchgani in Maharashtra.

They were kept at a quarantine facility in Mahabaleshwar by the district administration, they said.

The CBI had written to the Satara district administration to not release the duo without a No Objection Certificate from it, they said.

"On the prayer of accused persons, the Court vide order dated 18 April, 2020 had stayed the execution of NBW till 5 May, 2020, which has been vacated by the Court on 25 April, 2020 on the prayer of CBI," Gaur said.

Once the stay was cleared, the CBI team reached the Mahabaleshwar quarantine facility where the two were taken into custody.

The agency has alleged that Kapoor, 62, entered into a criminal conspiracy with Wadhawan for extending financial assistance to DHFL through Yes Bank in return for substantial undue benefits to himself and his family members through companies held by them, they said.

According to the CBI FIR, the scam started taking shape between April to June, 2018 when Yes Bank invested Rs 3,700 crore in short-term debentures of the scam-hit Dewan Housing Finance Corporation Ltd (DHFL).

In return, Wadhawan allegedly “paid kickback of Rs 600 crore” to Kapoor and family members in the form of loans to DoIT Urban Ventures (India) Pvt Ltd held by the wife and daughters of Kapoor, they said.

DHFL is already facing a separate probe for allegedly siphoning off Rs 31,000 crore out of the total bank loans of Rs 97,000 crore using shell companies.

The special court in Mumbai on Tuesday, 28 April rejected the bail pleas of the businessmen. As per the ED counsel, Additional Solicitor General Anil Singh, the special court rejected the Wadhawans' bail plea after the agency argued that the duo was not cooperating with it in the probe.

“We told the court that they are not cooperating. When we call them for questioning they dont come. They go for holiday with full family in five cars from Khandala to Mahabaleshwar despite a lockdown,” Singh said. “Besides, this is a multi-layered case and requires much questioning. Therefore, their custodial interrogation is required,” he added.

Singh also said that there existed every possibility of the Wadhawans tampering with evidence if they were let out on bail. “The court took note of our arguments and agreed their custody was required,” Singh said.

On 27 April, a special CBI court in the city had remanded Kapil and Dheeraj Wadhawan to custody of the agency till 29 April in connection with the Yes Bank scam. The ED will get the duo's remand after their CBI custody ends, Singh said.

As per the two agencies, UPPCL illegally invested its Employee Provident Fund in DHFL between March 2017 and December 2018, and money from such investment was used by the Wadhawans for personal gains.

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