CBI arrests DHFL Director Dheeraj Wadhawan in Rs 34,000 cr bank fraud case

Wadhawan was arrested in Mumbai on Monday night and was presented before a special court on Tuesday, which remanded him to judicial custody, said a report in the media.

He and his brother, Kapil Wadhawan, had earlier been arrested in the case on July 19, 2022.

The Central investigative agency filed a chargesheet against 75 entities, including the Wadhawan brothers, on October 15, 2022.

They were granted "statutory" bail from the special court on December 3, 2022, on the grounds that the investigation was incomplete and the charge sheet filed was piecemeal. This order was upheld by the Delhi High Court as well.

The CBI had challenged the bail order in the Supreme Court, which overturned the decision, noting that the Special Court and the High Court had "committed serious error of law" by ignoring the legal precedents established by the top court.

Meanwhile, Dheeraj Wadhawan had managed to get an interim bail on medical grounds from the Bombay High Court for a separate matter, citing that he was undergoing treatment at Lilavati Hospital.

On May 2, the Bombay High Court regularised this bail and extended his protection from CBI arrest for one week. The CBI arrested Wadhawan after this protection period ended.

Currently, three people—Dheeraj Wadhawan, his brother Kapil Wadhawan, and Ajay Nawandar—are in judicial custody.

The CBI had charged the Wadhawans and others following a complaint from the Union Bank of India, which led a 17-member lender consortium that provided DHFL with credit facilities totalling Rs 42,871 crore between 2010 and 2018.

The chargesheet alleges that Kapil and Dheeraj Wadhawan, connived with others, misrepresented and concealed facts, committed criminal breach of trust, and misused public funds, cheating the consortium out of Rs 34,615 crore by defaulting on loan repayments from May 2019 onwards.

The CBI claims the company engaged in financial irregularities, diverted funds, fabricated books, and round-tripped funds to "create assets for Kapil and Dheeraj Wadhawan" using public money.

DHFL's loan accounts were declared non-performing assets at various times by the lender banks, officials said.

When allegations of siphoning funds at DHFL surfaced in January 2019, lender banks appointed KPMG on February 1, 2019, to conduct a "special review audit" of DHFL's activities from April 1, 2015, to December 31, 2018.

The audit revealed fund diversions disguised as loans and advances to related entities and individuals associated with DHFL and its directors.

The CBI alleged that Rs 29,100 crore was disbursed to 66 entities linked to DHFL promoters, with Rs 29,849 crore still outstanding. These transactions were primarily investments in land and properties.