SC stays shifting of Rakesh and Sarang Wadhwan from jail to their residence

The bench of J. Sharad A. Bobde, J. BR Gavai, and J. Surya Kant took note of the submission of solicitor General Tushar Mehta and partially stayed the order of Bombay HC decision to shift Housing Development and Infrastructure Limited (HDIL) promoter Rakesh and Sarang Wadhwan from jail to their residence. The promoters are accused of fraudulent loan disbursal scam of Punjab and Maharashtra Cooperative (PMC) Bank and are kept at Mumbai Arthur Road jail.

Bombay HC reasoned that if both the promoters will be at their residence then they would be able to better help in providing the relief to the depositors of PMC bank. HC also said that shifting from jail to residence will also ensure the cooperation of HDIL promoters to the committee formed by the court for speedy disposal of cases filed against HDIL. The other order of HC such as the sale of assets of promoters under the supervision of the HC appointed committee will remain operative. The three-member committee has been set up for valuating and sale of assets of HDIL

The solicitor general Tushar Mehta said that PMC bank scam involves Rs, 7000 crores and Bombay HC have passed unusual orders while hearing public interest litigation. He also said that allowing the accused to go home is the same as granting them bail.

The fraud at PMC Bank was discovered in September last year after the RBI found that the bank has created fictitious accounts to hide Rs. 4,355 Crore of loans. The PMC bank has masked loan accounts including HDIL by tampering the banking system. Mumbai Police’s Economic offences Wing and ED registered offence against senior bank officials and HDIL.