The Supreme Court has directed the CBI and Enforcement Directorate to file status reports on ongoing probes into the alleged RCom–Anil Ambani banking fraud, following claims of large-scale fund diversion, delayed action by banks, and regulatory lapses.
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NEW DELHI: The Supreme Court heard a plea seeking a court-monitored investigation into an alleged massive banking fraud involving Reliance Communications (RCOM), Anil Ambani, and other group entities, and directed the CBI and Enforcement Directorate (ED) to file status reports on the ongoing probes.
The case, described as “even bigger and more complex than the Indiabulls fraud”, involves allegations of large-scale siphoning of public money and structured financial manipulation, with loans allegedly worth over ₹1.5 lakh crore being written off.
Appearing for the Union government, Solicitor General Tushar Mehta informed the Court that the Centre is not opposing the petition. He submitted that a forensic audit had already revealed diversion and siphoning of funds for purposes other than those for which loans were sanctioned.
Following the audit findings, State Bank of India has lodged an FIR with the CBI, he added.
The Solicitor General further clarified that although the audit report had earlier been challenged on a technical ground, claiming its signatory was not a chartered accountant, there is no stay on the fraud declaration, and the writ petition challenging it was later withdrawn.
Senior Advocate Prashant Bhushan, appearing for the petitioner, highlighted the scale and gravity of the alleged fraud, calling the transaction structure a “web of fraudulent dealings”.
He pointed out that Bank of Baroda and the CBI registered an FIR only in June 2025, despite the bank having received the audit report as early as 2020. According to Bhushan, banks had detected siphoning of funds back in early 2020 itself, yet decisive criminal action was delayed.
He also raised concerns that no public servant has been named in the FIR so far, despite the magnitude of the alleged scam involving public sector banks.
Bhushan urged the Court to first direct the CBI and ED to place status reports detailing the action taken so far.
Court’s Directions
Taking note of the submissions, the Supreme Court recorded that Anil Ambani and his group companies (Respondents 4 and 5), though served, have not appeared before the Court.
Granting a last opportunity, the Court permitted them to enter an appearance and directed the Registry to issue fresh notices to Anil Ambani and the concerned group entities.
Since Respondents 1–3 have already appeared through the Solicitor General, the Court directed the CBI and ED to file status reports on the progress of the investigation. The Court allowed that if the probes are incomplete, the reports may initially be filed in sealed cover.
The matter has been directed to be listed again after 10 days.
Background
Earlier, the Supreme Court issued notice to the Centre, the Enforcement Directorate (ED), the Central Bureau of Investigation (CBI), and businessman Anil Ambani on a PIL seeking a court-monitored probe into alleged large-scale banking fraud involving Reliance Communications (RCom) and group entities.
The petition, filed by former Union Secretary EAS Sarma, alleges fund diversion, falsification of accounts, and collusion between group companies and lending institutions, with the alleged misconduct tracing back to 2007–08.
Appearing for the petitioner, Senior Advocate Prashant Bhushan described the matter as one of the largest corporate frauds in India, pointing out that despite early detection, the CBI registered an FIR only in August 2025. He contended that existing probes by the CBI and ED cover only a limited portion of the alleged offences.
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A Bench led by Chief Justice BR Gavai, along with Justice Vinod Chandran, directed all respondents to file their replies within three weeks, while noting the request for updated status reports on the investigations.
The PIL relies on a forensic audit relating to loans of ₹31,580 crore extended to RCom and its subsidiaries between 2013 and 2017, allegedly revealing diversion of funds, related-party transfers, circular transactions, and irregular banking activity. It also raises concerns over the alleged use of shell entities, sham financial instruments, and a five-year delay by SBI in acting on the audit findings.
The petitioner has sought a comprehensive, Supreme Court-monitored investigation encompassing alleged violations under multiple economic and criminal laws
Case Title:
EAS SARMA vs. UNION OF INDIA & ORS.
WP (C) No. 1217/2025
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