ED files money laundering case against Subhash Chandra

New Delhi: The Enforcement Directorate has booked media baron Subhash Chandra in a money laundering case linked to an alleged loan fraud that reportedly caused a loss of Rs 1,322 crore to Life Insurance Corporation Housing Finance Limited, officials said on Monday. Chandra is accused of inflating his net worth to obtain loans from LICHFL and later defaulting on them. The case has been registered under the Prevention of Money Laundering Act, based on a CBI FIR.

Reacting to the development, a spokesperson for Zee Entertainment Enterprises Ltd said the ED case has been filed against Chandra in his personal capacity and has no connection with the company or its functioning. “The company would like to state that the matters pertain to Dr Subhash Chandra and the promoter entities and have no bearing on ‘Z’ or its operations in any manner,” the spokesperson said. The CBI had earlier registered a case on the basis of a complaint filed by LICHFL, following which the ED took cognisance and launched the money laundering probe.

In its complaint, which formed part of the CBI FIR, LICHFL alleged that Chandra submitted net-worth certificates to secure approval and disbursal of two loans amounting to Rs 980 crore. The default on these loans, the lender said in its August complaint, led to a loss of Rs 1,322 crore. LICHFL was also among the creditors that approached the National Company Law Appellate Tribunal, challenging a recent NCLT repayment plan that allowed creditors to recover only about Rs 6.5 crore from Chandra’s personal estate against total claims of around Rs 22,006 crore.

The complaint relates to a Rs 500 crore facility extended to Vasant Sagar Properties Private Limited, with Pan India Infra Projects Private Limited as co-borrower, and a Rs 480 crore facility extended to Digital Subscriber Management and Consultancy Services Private Limited, with Spirit Infra Power and Multi Ventures Private Limited as co-borrower. According to the complaint, the Rs 500 crore Vasant Sagar loan was sanctioned as a home-entity loan for takeover, top-up and business expansion, and was secured by a continuing guarantee executed by Chandra on March 28, 2018. The Rs 480 crore digital facility was sanctioned as a rental-discounting loan under a rental-securitisation scheme through another loan account, and was also secured by a continuing guarantee executed by Chandra, the FIR alleged.

The lender said the net-worth certificate submitted by Chandra and issued by DJM and Co on March 28, 2018, stated his net worth at around Rs 59,000 crore. LICHFL further said the digital facility was sanctioned partly on the basis of another net-worth certificate submitted by Chandra, issued by chartered accountants MPJ and Co on July 6, 2018, which placed his net worth at Rs 40,562 crore. Both loans later turned into defaults, according to LICHFL.

The CBI complaint also states that during later proceedings under the Insolvency and Bankruptcy Code, 2016, Chandra denied the net worth figures mentioned in the certificates submitted to LICHFL. In those proceedings, the industrialist reportedly valued his net worth at Rs 31.79 crore in 2024 and at no more than Rs 40,000 crore in 2017-18, the FIR says. “Subhash Chandra had thus, acting in collusion with the borrowers, Vasant Sagar Properties Pvt Ltd, Pan India Infraprojects Pvt Ltd, Digital Subscriber Management and Consultancy Services Pvt.

Ltd, and Spirit Infrapower and Multiventures Pvt Ltd and their officers and directors, defrauded and cheated LICHFL into advancing the loans to the borrower entities, which have since misappropriated the same,” the FIR alleges. The former Rajya Sabha MP is also accused of creating false documents to show inflated and inaccurate net worth figures in order to deceive LICHFL into releasing the funds to the borrower companies. Orissa POST – Odisha’s No.1 English Daily