Yes Bank - DHFL: Bombay High Court rules trial in CBI and PMLA cases against Rana Kapoor, Kapil Wadhawan should be heard by PMLA Court

The Bombay High Court today ruled that the trials against Yes Bank founder Rana Kapoor and DHFL promoter Kapil Wadhawan in cases probed by the Central Bureau of Investigation (CBI) and Enforcement Directorate (ED) will be conducted together in a special ED court..Justice RG Avachat passed the order placing reliance on an order passed by the Supreme Court in the Rana Ayyub case. The High Court said that since the highest court has laid down the law in such matters, the same has to be followed..The CBI's case is that between April to June 2018, Yes Bank had invested around ₹4,727 crores in short-term non-convertible debentures of DHFL. The bank subsequently sanctioned a term loan of ₹750 crores to a DHFL group firm. In return, Kapoor had received a kickback of ₹600 crores from DHFL in the form of a loan to his family firm, Do It Urban Ventures (India) Private Limited, CBI alleged. .Kapoor and Wadhawan both moved the High Court challenging an order of a sessions court refusing to transfer the CBI trial to the PMLA court.The accused had initially approached the principal sessions judge seeking a transfer of the case. The principal judge had, however, held that since Kapoor and Wadhawan were the accused, they could not file such a request with the court. Only the agency could file such a request, the sessions court had held.The sessions judge had added that such a request has to be made before the CBI judge where the scheduled offences were being tried. The ED, thereafter, filed an application before the CBI Court, which was also rejected by the Court in July 2021..In view of these orders, both the accused and the ED approached the High Court challenging the same.The two accused claimed that the PMLA court was competent to try offences alleged by the CBI and as well as the ED under the PMLA. “The intention of Legislature in contemplating trial of the cases under the scheduled offence and the offence under Section 4 PMLA by the same court is that accused should not face multiple prosecutions and the dual agony of trial as the case registered by the Enforcement Directorate is nothing but an off shoot of the main scheduled offence case and the substratum of the both the cases remain the same,” the accused-petitioners stated. The petitioners further contended that it would save them the agony of dual trial if both trials are combined, considering that there were a number of common persons accused, common witnesses and common documents in both cases. .While the ED did not object to the transfer, the CBI contended that there was no notification which permitted PMLA courts to try offences under the Prevention of Corruption Act..A detailed order will be made available later.