The PMLA Court has granted bail to the accused involved in sanctioning loans to ineligible borrowers citing medical grounds.
The Applicant, Amar Mulchandani was the chairman of Seva Vikas Co- operative Bank from the year 1997-2003 and 2009 to 2020. He made his family members and associated persons directors of Seva Vikas Co-operative Bank in order to run the bank single handedly and to sanction the loans without any resistance from another board of Directors ofSeva Vikas Co-operative Bank.
As majority of the board of directors of bank were handpicked by him and were acting as per the direction of Amar Mulchandani, loans were sanctioned by Amar
Mulchandani without holding any meeting or consent of the Board of Directors. Loan proposals were approved in the personal office of Amar Mulchandani and signatures of board of directors on the minutes were obtained by Amar Mulchandani once in a year.
The entire process of loan sanctioning starting from proposal till sanctioning of loans was controlled by Amar Mulchandani.
It was alleged that the accused has flouted banking norms in sanctioning loans to ineligible borrowers without ascertaining their repaying capacity. Loans were sanctioned by taking blank signed documents and the same were filled up by his employees by putting in factually incorrect information. Several loan malpractices were undertaken by him like overvaluation of mortgaged properties, evergreening of loan accounts etc. Amar Mulchandani had sanctioned the loans to ineligible borrowers by flouting the banking norms ni lieu of kick backs of 20 percent of sanctioned loan amount in cash. Blank signed cheques were utilized to withdraw the commission amount in cash on the date of disbursement.
As the loans were sanctioned and obtained with a criminal intention, no proper repayments were made in these loan accounts and subsequently these loans were declared NPA by the bank. Despite the anomalies pointed out in RBI scrutiny, he continued with his malpractices with the ulterior motive of personal enrichment.
It was alleged that there was no monitoring or reporting of high value cash transactions undertaken in various loan accounts. This reflects that not just sanction of loan but also the transactions in accounts were undertaken with the consent of Amar Mulchandani. As a result, 124 loan account were declared NPA by the SVB wherein, misappropriation ofRs 429.57 Crore was observed which accounted for 92% of the loans of SVB. Resultantly, RBI had appointed an Administrator in June 2021 and finally the license of the bank was cancelled in October 2022.
Hence, the accused was involved in generation and acquisition of Proceeds to Crime to the tune of Rs 429.57 Crore. Sh. Amar Sadhuram Mulchandani has directly indulged in the process or activity connected with Proceeds of Crime to the tune of Rs 429.57 Crore.
The Applicant sought regular bail under Section 483 of the Bhartiya Nagarik Suraksha Sanhita, 2023 and Section 439 of CrPC read with Section 45 of PMLA.
Dr. Sujay Kantawala, the Counsel for the accused, submitted that he was 67 years old and suffers from cardiac ailments having faced three cardiac events including a recent episode and bypass conducted in July, 2021. The Applicant is also diagnosed with kidney ailment Stage-3, the severity of which would put the Applicant at risk of complete kidney failure. The Applicant submits he suffers from neurological ailment triggered by diabetes which requires daily institutionalized physiotherapy.
Dr. Kantawala further submitted that the twin limitations on grant of bail in Section 45(1) of PMLA, with three vital considerations.
Firstly, section 45(1) of PMLA specifically contemplates that a person who “is sick or infirm” may be released on bail if the Special Court so directs;
Secondly, the petitioner is 67 years old and has spent nearly a year and three months in custody; and
Lastly, based on the medical evaluation which has been provided by the Medical Team at Sir J J Group of Hospitals, Mumbai, it is evident that the petitioner fulfils the threshold required for being enlarged on bail.
The department opposed the bail stating that
The court granted the bail to the accused citing medical grounds.
Case Details
Case Title: Amar Sandhuram Mulchandani Versus Directorate Of Enforcement
Case No.: Special Case No. 673 Of 2023
Date: 13/01/2025
Counsel For Accused: Dr. Sujay Kantawala
