Mumbai, June 1: The Central Bureau of Investigation (CBI) on Monday arrested Amitabh Jhunjhunwala, former Vice Chairman of Reliance Capital and former Group Managing Director, for his role in connection with a Rs 2,929.05 crore bank loan case registered on the complaint of the State Bank of India against M/s Reliance Communications Limited.
CBI secures court approval for arrest
On Monday, Jhunjhunwala, who was lodged in Tihar Central Jail in connection with a money laundering case, was produced before the Special CBI Court in compliance with a production warrant issued by the court earlier this month.
Upon his production, CBI prosecutor A. Limosin moved pleas seeking permission to formally arrest Jhunjhunwala and subsequently sought his custody for interrogation.
The pleas were opposed by defence lawyers Reeti Upadhyay and Mudit Jain, who contended that, as per the production warrant, the accused was required to be produced before the court on June 5. They argued that his production before the scheduled date was illegal.
The court rejected the defence arguments and allowed the CBI to arrest Jhunjhunwala. However, since the hearing continued until court closing time, Jhunjhunwala was ordered to be sent to Arthur Road Prison. The CBI subsequently completed the formal arrest process later in the evening.
He is expected to be produced before the court again on Tuesday, when the agency will seek further custody.
Case relates to alleged Rs 2,929 crore bank loss
The CBI had registered a case against Reliance Communications (RCom), Anil D. Ambani, and unknown others on a complaint by the State Bank of India (SBI), alleging that although the bank had sanctioned credit facilities to the company, it suffered a wrongful loss of around Rs 2,929.05 crore due to alleged fraudulent activities by the accused borrowers.
According to the CBI, Jhunjhunwala was the Group Managing Director of the Reliance Communications group and was responsible for overseeing important functions such as corporate finance, banking, utilisation of funds, and related activities.
The agency alleged that he coordinated with senior bank officials for securing loans and played a key role in obtaining credit facilities from various banks.
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The agency further claimed that, based on his directions, loan funds received from banks were managed and utilised by other officials of the RCom group. The CBI alleged that the funds were misutilised, resulting in wrongful losses to the banks.
As the company failed to repay the dues, the loan accounts were classified as non-performing assets (NPAs).
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