HDIL promoters apply for bail, claim they have served half of max sentence

MUMBAI: The promoters of Housing Development and Infrastructure Limited (HDIL) Rakesh Wadhawan and Sarang Wadhawan have approached the special PMLA (Prevention of Money Laundering Act) court for bail, contending that they have spent almost three and a half years in prison – half of the maximum sentence provided for the offence of money laundering.

In the plea filed through their lawyer Sagar Shetty, Wadhawans said that they were arrested on October 17, 2019, which means they have spent 1,294 days in prison in connection with the money laundering case registered against them in the Punjab and Maharashtra Co-operative (PMC) Bank fraud case.

“It is pertinent to note that the maximum punishment under the provisions of the PML Act is 7 years. It is stated that the 2005 Amendment Act adds a new Section 436A to the Code of Criminal Procedure to establish that if an under-trial prisoner has been detained for a period lasting up to one-half of the maximum period of the imprisonment provided for the alleged crime, he should be released on bail by providing personal bond, with or without sureties,” the bail plea stated.

The Enforcement Directorate (ED) on Thursday filed its reply on the plea of Rakesh Wadhawan claiming that the agency has already registered three more cases of money laundering for three different corresponding criminal cases against him. The other cases included the Patra Chawl redevelopment case, a case related to redevelopment of a property at Andheri and a case connected with a loan taken from fraud-hit Yes Bank and on that ground pleaded for rejection of his bail.

The agency informed the court that it will file its reply to Sarang Wadhawan’s bail plea on May 16.

The Economic Offences Wing of the Mumbai police had on September 30, 2019, registered an offence in connection with the alleged fraud at the multi-state cooperative bank having 137 branches in six states.

According to the RBI, PMC Bank had masked 44 problematic loan accounts involving advances to the tune of ₹7,457.49 crore – mostly extended to HDIL, by tampering with its core banking system, and the accounts were accessible only to limited staff members. The bank had created 21,049 fictitious accounts to ensure its master data tallied with the loan disbursals of ₹7,457.49 crore, RBI had stated in an affidavit filed in response to some other petitions before the HC.