Ex ICICI Bank CEO Chanda Kochhar has been found guilty in a Rs 64-crore bribery scandal, exposing how power and greed led to her downfall from boardroom to courtroom.
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NEW DELHI: Recently, former ICICI Bank CEO Chanda Kochhar has been found guilty of accepting a Rs 64 crore bribe in connection with a Rs 300 crore loan sanctioned to the Videocon Group.
The appellate tribunal’s order dated July 3 confirmed what investigators had long suspected, a well-planned quid pro quo arrangement that exploited corporate governance norms and internal bank protocols.
The scandal lies in a transaction that unfolded with uncanny precision. Shortly after ICICI Bank disbursed a Rs 300 crore loan to Videocon, a Rs 64 crore payment made its way from Videocon’s entity SEPL to NuPower Renewables Pvt Ltd (NRPL), a company effectively controlled by Deepak Kochhar, Chanda Kochhar’s husband.
While NRPL was officially listed under the name of Videocon chairman Venugopal Dhoot, the tribunal highlighted that real control rested with Deepak Kochhar, who was serving as its Managing Director. The tribunal concluded that timing and flow of funds constituted direct evidence of bribery and were not coincidental.
The tribunal didn’t mince words in condemning Kochhar’s actions. As a member of ICICI Bank’s loan sanctioning committee, she was expected to disclose any potential conflicts of interest, particularly business ties between her husband and the borrower, which she failed to do.
This omission violated ICICI Bank’s internal rules and amounted to a serious breach of ethical conduct. The tribunal remarked that Kochhar’s conduct represented a clear misuse of her powerful position for personal enrichment.
The Enforcement Directorate (ED) received full backing from the tribunal, which had previously attached assets worth Rs 78 crore linked to Kochhar and her associates. In the observation, it criticised the November 2020 decision by the adjudicating authority that had ordered the release of those assets.
“The adjudicating authority ignored crucial material facts and drew conclusions that contradict the record,”
the tribunal stated, reinforcing the validity of the ED’s asset seizure.
One crucial legal point underlined by the tribunal was the admissibility of statements recorded under Section 50 of the Prevention of Money Laundering Act (PMLA). These statements, provided by witnesses and accused parties, were cited as reliable and evidentiary in nature, strengthening the case against Kochhar.
Background
In December 2022, the Central Bureau of Investigation (CBI) arrested former ICICI Bank CEO Chanda Kochhar and her husband, Deepak Kochhar, over alleged financial misconduct related to a Rs 3,250 crore loan sanctioned to the Videocon Group in 2012. The loan, later classified as a non-performing asset (NPA), formed the basis of what authorities described as a major banking fraud.
The CBI alleged that Chanda Kochhar misused her position to facilitate the loan while heading ICICI Bank. In a suspected quid pro quo arrangement, Deepak Kochhar’s company, NuPower Renewables, reportedly received financial benefits from Videocon, raising serious conflict-of-interest concerns.
Investigations suggested a direct link between the sanctioned loan and subsequent investments made by Videocon into entities associated with the Kochhar family.
“It was alleged that during Kochhar’s tenure as ICICI Bank’s CEO, she approved a loan for the Videocon Group. In return, her husband’s company, Nu Renewable, was purportedly invested in by Videocon.”
-said a legal representative aware of the case details.
CBI Arrests Declared Illegal by Bombay High Court:
After their arrest in December 2022, Chanda and Deepak Kochhar were remanded to judicial custody by a special CBI court on December 29. However, the legal landscape shifted when the Bombay High Court granted the couple interim bail on January 9, 2023, offering them temporary reprieve.
The High Court, in February 2023, not only upheld the interim bail but also criticized the CBI’s conduct. The court ruled the arrest illegal, observing that the agency had failed to adhere to due process under the Code of Criminal Procedure (CrPC).
Specifically, the court pointed to Section 41A of the CrPC, which mandates that authorities issue a notice of appearance to the accused before making an arrest, especially in cases where arrest is not immediately necessary. The provision seeks to protect individuals from arbitrary detention and emphasizes cooperation over custodial interrogation, unless deemed essential.
The Court concluded,
“It found that the arrests violated Section 41A of the Code of Criminal Procedure (CrPC), which requires issuing a notice for appearance before the concerned police officer to avoid unnecessary arrests.”
Supreme Court Notice on CBI’s Appeal:
In response to the Bombay High Court’s ruling that declared the arrest of Chanda and Deepak Kochhar as illegal, the Central Bureau of Investigation (CBI) filed an appeal before the Supreme Court. Acknowledging the gravity of the matter, the apex court issued a notice and agreed to examine the case, marking the beginning of a fresh judicial review.
This intervention by the Supreme Court is viewed as a pivotal development, as it will scrutinize the legality of the arrest, especially in light of the procedural safeguards under Section 41A of the Code of Criminal Procedure (CrPC). Central to the hearing will be whether the CBI followed due process or bypassed mandatory legal requirements designed to protect individual liberty in white-collar investigations.
The case has attracted intense public and media attention, not only because of Chanda Kochhar’s former stature as ICICI Bank’s CEO but also due to the high-value financial irregularities alleged in the Rs 3,250 crore loan to the Videocon Group. The ongoing legal battle is being closely observed by legal experts, banking regulators, and corporate governance bodies alike.
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