The Central Bureau of Investigation has registered a case against Essel Group Chairman Subhash Chandra and others over loans worth around Rs 980 crore obtained from LIC Housing Finance Limited (LICHFL). The lender has alleged a total loss of around Rs 1,322 crore in its complaint to the CBI.
The FIR alleges criminal conspiracy, cheating, criminal breach of trust and extending undue benefits. The case was registered based on a complaint filed by LICHFL with the CBI headquarters.
Two Loans Worth Around Rs 980 Crore
The CBI case relates to two loan facilities sanctioned by LIC HFL to different borrower entities. According to the complaint, the first loan of around Rs 500 crore was sanctioned to Vasant Sagar Properties Pvt. Ltd. and its co-borrower, Pan India Infra Projects Pvt. Ltd. LICHFL had sanctioned a loan of around Rs 500 crore to the companies under a Takeover and Top-up Facility for business expansion.
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The loan subsequently turned into a non-performing asset (NPA), with the outstanding amount allegedly reaching around Rs 570.5 crore.
The second loan facility, worth around Rs 480 crore, was provided to Digital Subscriber Management and Consultancy Services Pvt. Ltd. and its co-borrower, Spirit Infra Power and Multi Ventures Pvt. Ltd. The loan was sanctioned against rental income. This facility also subsequently turned into an NPA, with the outstanding amount standing at around Rs 507.25 crore.
Subhash Chandra Guaranteed Both Loans
According to LIC HFL's complaint, Subhash Chandra guaranteed the Rs 500 crore loan on March 28, 2018, and submitted a net-worth certificate as part of the loan-sanction process.
The certificate, issued by DIM & Co. on March 28, 2018, put Chandra's net worth as of March 31, 2017, at $6,197.62 million, or around Rs 59,113 crore.
For the second loan, another net-worth certificate submitted to LIC HFL put Chandra's net worth at around Rs 40,562 crore. The certificate was issued by chartered accountants MPJ & Co. on July 6, 2018.
LIC HFL has alleged that these inflated net-worth certificates were used to obtain the loan facilities.
Net Worth Discrepancy At Centre Of Investigation
According to the LICHFL complaint, both loans later defaulted, following which personal insolvency proceedings were initiated against Chandra under the Insolvency and Bankruptcy Code (IBC). The CBI FIR alleges that during the proceedings, Chandra disputed the net worth figures shown in the certificates submitted during the loan process.
In 2024, Chandra reportedly put his net worth at around Rs 31.79 crore. He also allegedly said that even in 2017-18, his net worth was not more than Rs 40,000 crore.
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The CBI will investigate the large gap between the net worth figures in the certificates submitted to LICHFL and those cited by Chandra during his insolvency proceedings. It will examine whether his net worth was deliberately overstated to help secure the loans, whether the loans were approved and disbursed based on those certificates, and whether the documents submitted to LICHFL were accurate.
The agency will also look into the role of those who prepared, submitted and relied on the certificates, and how the documents were verified before the loans were sanctioned.
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