The Enforcement Directorate’s (ED) investigation against former ICICI Bank managing director (MD) Chanda Kochhar and her husband Deepak Kochhar, who was arrested on Monday night, reveals how both of them were working in tandem as part of a conspiracy to disburse a loan to Videocon group and then used an “elaborate web of entities” for layering the bribe amount of Rs 64 crore.
Kochhar, according to the agency, not only actively indulged in laundering the proceeds of the crime and projecting it as ‘untainted’, but also continued to enjoy the laundered sum.
Kochhar was arrested at 8.06 pm in ED’s Mumbai office following which the agency informed Chanda Kochhar over the phone that her husband had been arrested.
In its remand paper submitted before a special Prevention of Money Laundering Act (PMLA) court on Tuesday while seeking a 14-day custody, ED said that Kochhar’s arrest is “qualitatively more elicitation orientated” and was necessary since he was non-cooperative and needed to be taken to Delhi to confront with voluminous evidence and decipher the money trail.
HT has accessed the remand paper.
The ED added that the persons examined by it in the case are linked to various “sham transactions” and several documents have been recovered showing details of other companies controlled by Kochhar.
Kochhar has been sent to ED custody until September 19.
However, Kochhar’s lawyer, Vijay Aggarwal, argued that the arrest was illegal.
“The arrest of my client is illegal. The arrest and remand will not stand scrutiny in higher courts. ED has arrested him after joining the investigation and giving 10,000 pages of documents after two years and that too in a seven-year punishable offence, which is illegal,” Aggarwal told HT.
The ED probe, whose details have been accessed by HT, has revealed that after ICICI Bank disbursed a loan of around Rs 300 crore — Rs 283.45 crore was the actual disbursed amount — to Videocon International Electronics Ltd (VIEL) on September 7, 2009, Rs 64 crore were transferred to Kochhar’s company NuPower Renewables Ltd (NRL) through Supreme Energy Pvt Ltd (SEPL) the very next day.
NRL was started by Videocon’s founder, chairman and MD Venugopal Dhoot and Kochhar.
Though initially, Dhoot had started SEPL, later he had transferred its control to Kochhar.
The agency has prepared an elaborate flowchart on how the money moved from Videocon’s various companies and bank accounts to reach NRL, a company controlled, owned and managed by Kochhar from 2012.
Referring to Chanda Kochhar’s role, ED’s remand paper said: “The rate of interest charged by the ICICI Bank on the said Rs 300 crore loan, which was later refinanced on April 26, 2012, was more than 12% per annum, since disbursement of this loan, which at times increased to more than 14% per annum”.
ED said: “The accounting entries were made in the books of SEPL by creating provisioning of Rs 32 lakh (of the Rs 64 crore transferred by VIEL to NRL through SEPL) and its reversal follows a pattern of events in ICICI Bank pertaining to allegations against Chanda Kocchar”.
It added: “Chanda Kochhar was part of the decision-making process and chairperson/member of the recommending/sanctioning committees for other loans sanctioned to Videocon Group by ICICI Bank.”
The SEPL, ED said, was acquired by Pinnacle Energy, a family-run trust of Kochhar.
“…an elaborate structure/web of entities was created to ostensibly hold this amount of Rs 64 crore. Loan funds travelled from VIEL to NRL through SEPL, but two intermediaries were brought in for the purpose of layering,” it claimed.
The money was used by Kochhar for the purchase of properties such as wind farm projects of 33.15 mega-watt (MW) capacity, the agency stated.
ED has further claimed that Kochhar was given multiple opportunities to rebut the allegations against him but his stand has been contrary to the records of the case. “He also wilfully withheld information that was in his exclusive knowledge,” the remand paper stated.
The agency has also identified a transaction in Kochhar’s company from abroad.
ED officials hinted that Dhoot and Chanda Kochhar might also be called soon for questioning on the basis of Kochhar’s custodial interrogation.