The Central Bureau of Investigation (CBI) has registered a First Information Report (FIR) against Essel Group chairman Subhash Chandra and three other individuals in connection with an alleged ₹1,322 crore fraud involving LIC Housing Finance (LICHFL).
Officials confirmed on Saturday that the investigation focuses on two loans totaling ₹980 crore, which were reportedly obtained from LICHFL using certificates that allegedly inflated Chandra's net worth. These facilities subsequently turned into defaults.
Allegations of Inflated Net Worth
The complaint outlines two specific facilities: a ₹500-crore loan extended to Vasant Sagar Properties Pvt Ltd, with Pan India Infraprojects Pvt Ltd as co-borrower, and a ₹480-crore facility sanctioned to Digital Subscriber Management and Consultancy Services Pvt Ltd, with Spirit Infrapower and Multiventures Pvt Ltd as co-borrower.
Both loans, sanctioned around 2018, were reportedly backed by continuing guarantees executed by Subhash Chandra. The FIR alleges that Chandra submitted net worth certificates valuing his assets at approximately ₹59,000 crore and ₹40,562 crore for these transactions, respectively.
However, the agency's complaint highlights a significant discrepancy. During subsequent personal insolvency proceedings in 2024, Chandra reportedly declared his personal net worth at only ₹31.79 crore, stating that his net worth in 2017-18 was no more than ₹40,000 crore.
Collusion and Misappropriation Claims
The CBI's FIR further alleges that Chandra conspired with the four borrower entities, along with their officers and directors, to mislead LICHFL into advancing the loans. It claims that false documents were created to present an inflated net worth, and that the loan funds were subsequently misappropriated.
This development comes amidst Chandra's ongoing personal insolvency proceedings before the National Company Law Tribunal (NCLT). Earlier this week, a special five-member NCLT bench stayed the approval of a repayment plan, citing a lack of clear majority in an earlier decision. The bench also issued an order restraining Chandra from alienating any of his assets.
LICHFL, among other creditors, had opposed the proposed repayment plan, which suggested a personal payment of ₹6.25 crore by Chandra as guarantor, alongside ₹1,494 crore from the principal borrowing companies. LICHFL argued that the plan was unviable and unlawful, offering only a minimal amount against admitted claims totaling around ₹22,006 crore.
There was no immediate comment from Chandra or the other accused named in the FIR following the CBI's registration of the case.