Ex-DHFL director Kapil Wadhawan gets bail, court pleads for delay in trial

Mumbai:

A special CBI court on Thursday granted bail to Kapil Wadhawan, former director of erstwhile mortgage lender Dewan Housing Finance Corporation Ltd (DHFL), in an alleged loan fraud case related to Yes Bank.

Special Judge AC Dagga, in his order in Mumbai, observed that economic crimes have a negative impact on society but the accused cannot be “imprisoned together for years without the slightest glimmer of hope that the trial will begin”.

Prolonged detention before conviction of a crime should not be allowed as it violates the constitutional right to life and personal liberty, the court noted.

Kapil Wadhawan was arrested in the fraud case on April 26, 2020 and has been in judicial custody since then. However, he is unlikely to be released from prison as the former DHFL director is yet to get bail in another case pending against him.

DHFL, once a leading mortgage lender, was acquired by Piramal Group under the Insolvency and Bankruptcy Code (IBC) in 2021 after the company faced a debt crisis.

The case relates to the Yes Bank-DHFL scam of around Rs 4,000 crore, in which the private lender’s co-founder Rana Kapoor was alleged to have entered into a criminal conspiracy with the then promoters of DHFL, including Kapil Wadhawan.

The Central Bureau of Investigation (CBI) has alleged that Yes Bank invested Rs 3,983 crore in DHFL (by subscribing to debentures issued by the housing finance company).

Later, the bank gave loans to DHFL in lieu of bribes worth Rs 600 crore to be paid to the companies held by Kapoor and his family members, the central probe agency said.

Apart from this scam, Kapil Wadhawan has also filed charges in various cases registered by the CBI and the Enforcement Directorate (ED).

Lawyer Vijay Aggarwal, representing Kapil Wadhawan, had argued that his client deserves bail considering the length of time he has spent in custody alone and the fact that there is no likelihood of trial any time soon begins.

Wadhawan has been in custody for more than four years and charges have already been filed against him. Subsequently, the investigation agency filed three more supplementary chargesheets, emphasized lawyer Aggarwal.

The investigation into the case is still ongoing, which shows that despite a delay of more than four years, there is no likelihood that proceedings will be initiated, he said.

Vijay Aggarwal claimed that all other accused arrested earlier in the case, including real estate entrepreneurs Sanjay Chabbaria and Avinash Bhosale and Dheeraj Wadhawan, another DHFL promoter, have been released on bail.

Therefore, for the sake of equality, Kapil Wadhawan deserves to be released on bail, argued the lawyer.

However, the CBI opposed the bail application saying the economic offense was of a large scale and caused a huge loss to the public.

Therefore, the matter must be taken seriously as it affects the country’s economy as a whole, the agency said.

After examining all submissions, the court emphasized that it was undisputed that economic crimes had a negative impact on the country and society.

“But at the same time, it cannot be said that the defendant must be imprisoned together for several years without the slightest glimmer of hope that the trial will begin. In this case, this violates Article 21 of the Constitution (see on protection of life and personal liberty), the judge said.

The court said there must be a balance “between the right to individual freedom and the interest of society.”

The court further highlighted the delay in the trial and stated: “The fact remains that there is no hope of the trial commencing and no likelihood of its completion within a stipulated time.” The judge emphasized the defendant’s right to a trial speedy procedure.

“In this matter, the accused is in custody for about four-and-a-half years without being tried and the co-accused, who plays a major role in the crime, namely Rana Kapoor, has been released on bail,” the court said.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)