New Delhi: In the ICICI Bank-Videocon loan controversy, the Appellate Tribunal under the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act (SAFEMA) has found former ICICI Bank CEO Chanda Kochhar guilty of accepting a ₹64 crore bribe in exchange for approving a ₹300 crore loan to the Videocon Group in 2009.

The tribunal’s ruling overturns the earlier clean chit granted by the PMLA Adjudicating Authority and lends support to the Enforcement Directorate's (ED) provisional attachment of Kochhar's assets. The Tribunal stated that the transaction amounts to a prima facie case of money laundering.

Conflict of interest and bribe trail

The Tribunal pointed to a clear conflict of interest in Kochhar’s involvement in the loan approval. It noted that shortly after the loan was disbursed to a Videocon entity, ₹64 crore was traced to NuPower Renewables Pvt. Ltd. (NRPL), a company promoted by Kochhar’s husband, Deepak Kochhar. This amount was routed via Supreme Energy Pvt. Ltd. (SEPL), a firm reportedly linked to Videocon’s promoter Venugopal Dhoot.

The Tribunal said that while the final determination lies with the Trial Court, there is sufficient preliminary evidence to justify the attachment of assets under money laundering provisions.

Tribunal rejects Kochhar’s defence

In its order, the Appellate Tribunal rejected Chanda Kochhar’s justification for presiding over the committee meeting that approved the ₹300 crore loan. The Tribunal observed:

“We are not able to accept the justification offered by Chanda Kochhar for presiding over the committee meeting that sanctioned the ₹300 crore loan to the Videocon Group.”

It further stated that Kochhar could not claim ignorance of her personal relationship with the borrower and that her involvement in the loan process violated ICICI Bank’s internal policies.

Link between Videocon funds and NuPower

The Tribunal highlighted that immediately after the disbursal of the ₹300 crore loan, ₹64 crore was diverted to NRPL. Deepak Kochhar, who was managing NRPL, held 95% shares in SEPL, which controlled NRPL.

It was further noted that VN Dhoot resigned from SEPL on 15 January 2009, transferring control of the company to Deepak Kochhar.

Criticism of adjudicating authority

The Tribunal criticised the PMLA Adjudicating Authority for ignoring essential evidence and relying on irrelevant factors. It stated that the Authority focused excessively on NRPL’s shareholding structure while ignoring Deepak Kochhar’s role as Managing Director and his control over the company.

The order referenced the statement of VN Dhoot, recorded under Section 50 of the Prevention of Money Laundering Act (PMLA), 2002, where he categorically stated, “Deepak Kochhar was running the affairs of the company.”

Asset attachment and legal proceedings

In January 2020, the ED provisionally attached assets worth ₹78 crore belonging to the Kochhars. This decision was overturned by the Adjudicating Authority in November 2020. The Appellate Tribunal’s latest ruling now reinstates the ED’s attachment order.

Deepak Kochhar was arrested by the ED in September 2020 and later released on bail. In December 2022, both Chanda and Deepak Kochhar were arrested by the Central Bureau of Investigation (CBI). However, in January 2023, the Bombay High Court granted them interim bail.

In a landmark ruling in February 2024, the High Court declared their arrest unlawful and an abuse of power.

(agency inputs)