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A special CBI court in Mumbai has transferred a cheating case involving around INR 140 crore against Guruashish Construction Pvt Ltd and its directors Rakesh Wadhawan and Sarang Wadhawan to a magistrate's court after corruption charges under the Prevention of Corruption Act were dropped. The decision followed a Central Bureau of Investigation probe which found no involvement of public servants in the alleged fraud related to a loan from Union Bank of India. Since special CBI courts handle cases involving public officials, the matter will now proceed before a magistrate's court for further trial under criminal law provisions.
A special Central Bureau of Investigation (CBI) court in Mumbai has transferred a cheating case involving around INR 140 crore against Guruashish Construction Pvt Ltd and its directors Rakesh Wadhawan and Sarang Wadhawan to a magistrate's court after corruption charges under the Prevention of Corruption Act (PCA) were dropped. Advertisement
The order was passed by Special CBI Judge B Y Phad after the court noted that no public servants were named as accused in the chargesheet filed by the investigation agency. Since the jurisdiction of a special CBI court under the Prevention of Corruption Act applies mainly to cases involving public officials, the judge ruled that the matter should be heard by a magistrate's court.
The case had originated from a complaint filed by Union Bank of India, which alleged that the company and its directors had caused a loss of around INR 140 crore to the bank through cheating and criminal conspiracy linked to a loan facility. The complaint was submitted by Debraj Bag, who was serving as Deputy General Manager of the bank at the time.
According to the investigation, Guruashish Construction had obtained financial facilities from the bank but allegedly failed to utilise the funds in accordance with the sanctioned purpose. The bank claimed that the actions of the accused resulted in financial losses and therefore approached authorities seeking a criminal investigation into the matter.
During the probe, the CBI filed chargesheets against Guruashish Construction Pvt Ltd, its directors Rakesh Wadhawan and Sarang Wadhawan, and Housing Development and Infrastructure Ltd (HDIL). The agency invoked provisions related to criminal conspiracy, cheating, forgery and the use of forged documents under the Indian Penal Code.
However, while examining the evidence, the investigation did not find any material linking bank officials or other public servants to the alleged offence. The complainant also informed the court that an internal review had been carried out by the bank to examine whether any staff members were responsible for lapses in the loan process.
The review concluded that no bank official was found accountable for the alleged fraud. Based on this finding, the complainant conveyed that there was no objection to the court accepting the CBI's final report in relation to the absence of corruption charges.
The CBI's investigation also named several additional accused entities in connection with the case. These included Jitendra Mehta of Mehta Developers, Dinshaw Trapinex Builders, Emerald Realtors, Educational and Scientific Equipment Pvt Ltd, Satyam Realtors and Sapphire Land Development Pvt Ltd.
Authorities have earlier linked Guruashish Construction to other financial and real estate controversies in Mumbai. The company has been associated with Housing Development and Infrastructure Ltd, which has been under scrutiny in multiple cases related to financial irregularities. Among the most widely discussed projects connected to the group is the redevelopment of Patra Chawl in Goregaon, which has been the subject of investigations over alleged misuse of funds and redevelopment delays.
With corruption charges under the Prevention of Corruption Act now removed and no public servants involved in the case, the special CBI court concluded that it could no longer continue hearing the matter. As a result, the case has been transferred to the chief judicial magistrate's court in Mumbai, where proceedings related to cheating, conspiracy and forgery will continue under the relevant provisions of criminal law.
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