Supreme Court sought responses from Centre, Telangana, CBI, ED and SFIO on a plea seeking independent probe into alleged multi-crore corporate fraud involving collusion with authorities and a figure. The bench issued notices to Union ministries after hearing submissions.
NEW DELHI: The Supreme Court requested responses from the Centre, Telangana, CBI, ED, and SFIO regarding a petition demanding an independent investigation into a multi-crore corporate fraud that allegedly involves collusion between state authorities and a senior judicial figure.
A bench led by Chief Justice Surya Kant and Justice Joymalya Bagchi acknowledged the submissions made by lawyer Ashwini Upadhyay and subsequently issued notices to various Union ministries, including those of home affairs, finance, law and justice, and corporate affairs.
The court also sent notices to central investigative agencies, including the CBI, ED, and the Serious Fraud Investigation Office (SFIO).
The petition, filed by Saurabh Agarwal, director of Bengal Cold Rollers Pvt Ltd, claims that there was a sophisticated scheme in which the suspended management of an insolvent company allegedly siphoned off nearly Rs 150 crore, leveraging high-level “judicial influence” to delay insolvency proceedings by over 30 months.
The petition also referenced proceedings at the National Company Law Appellate Tribunal (NCLAT) in Chennai. It noted that NCLAT member Justice Sharad Kumar Sharma recused himself in open court after revealing that he had reportedly been approached by a sitting chief justice of a high court for a “favourable order” for the suspended directors of the corporate debtor, KLSR Infratech Limited.
According to the plea, Justice Sharma even demonstrated his mobile phone, showcasing call logs and messages from the “revered member” of the higher judiciary to the counsel present in court.
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The plea focuses on KLSR Infratech Limited, which was admitted into the Corporate Insolvency Resolution Process (CIRP) in July 2023. Despite a statutory moratorium and the suspension of its board, the petition alleges that suspended directors manipulated records with the Ministry of Corporate Affairs (MCA) to reflect the company’s status as “active” instead of “under CIRP.” This manipulation enabled them to raise fresh loans totaling Rs 148.87 crore from various banks, using company assets as collateral.
The company also purportedly secured government tenders worth approximately Rs 6,000 crore during the insolvency period without the authorization of the interim resolution professional (IRP).
The petition further stated that when the petitioner and another creditor refused to withdraw their claims, the suspended management utilized their “proximity to power” in Telangana to launch a targeted attack.
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The plea claims that state tax authorities initiated “malicious” GST proceedings, conducted illegal searches, and even arrested a family member of the petitioner using “fabricated documents” on plain paper.
These actions were described as “arm-twisting tactics” aimed at coercing a settlement.
Filed through Ashwani Kumar Dubey, the petition seeks a CBI and SFIO investigation into the alleged collusion among state authorities, the KLSR Infratech management, and any judicial interference involved. It also calls for an ED investigation into possible money laundering by the suspended directors.
Additionally, the petition requests that the NCLAT registrar release video recordings and transcripts from the August 13, 2025, proceedings where the judicial influence was disclosed and urges the MCA to promptly update the company’s status to “under CIRP” to prevent further asset stripping.
Case Title: Saurabh Agarwal v. Union of India & Ors.
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