RCOM bank loan fraud case: SC directs ED to form SIT

The Supreme Court on Wednesday directed the Enforcement Directorate (ED) to constitute a Special Investigation Team (SIT) to probe allegations of large-scale bank loan fraud involving Reliance Communications (RCOM), its group companies and businessman Anil Dhirubhai Ambani, stressing that the investigation must be taken to its logical conclusion.

A Bench of Chief Justice Surya Kant, Justice Joymalya Bagchi and Justice Vipul M. Pancholi said the seriousness of the allegations warranted a senior-level probe by the ED.

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“ED is well advised to constitute a SIT comprising senior officers and take all the measures so that the ongoing probe is taken to a logical conclusion,” the Court observed in its order.

During the hearing, the Court also recorded an undertaking by Anil Ambani’s counsel that he would not leave the country without the Court’s permission. The assurance was noted after concerns were raised about the possibility of Ambani travelling abroad while the investigation was ongoing.

“He will not leave without the permission of this court,” Senior Advocate Mukul Rohatgi, appearing for Ambani, assured the Bench.

Recording this, the Court noted: “SG has assured that all preventive action will be taken to not hinder the probe. Mr Rohatgi assured that his client will not leave the country without leave of this court.”

In addition to directing the ED to form a SIT, the Court also instructed the Central Bureau of Investigation (CBI) to thoroughly examine whether any collusion or conspiracy by bank officials facilitated the alleged fraud.

“It is imperative for CBI to probe the conduct of bank officials to check if funds were released with the collusion of bank officers. We direct that the CBI must look into the nexus, collusion, conspiracy, if any, and for that purpose, all lawful measures to take the investigation to its logical end be adopted,” the Court said.

The Bench expressed concern over submissions indicating delays in the investigations by both agencies. While refraining from making any final observations at this stage, it emphasised the need for prompt and impartial action.

“It may not be appropriate for us to express any opinion at this stage except to observe that there has been an unexplained delay on the part of the ED… Both agencies have taken their own time to take action. We expect both agencies to act promptly, independently, fairly and in a dispassionate manner,” the Court said.

The Court directed the ED and the CBI to file status reports within four weeks, and orally indicated that it would expect regular updates thereafter.

“We expect that your agencies must act fairly and independently and very skillfully. We would like to have status reports every month. In four weeks, let us see how you take the investigation to a logical conclusion. Such a huge amount has been siphoned!” the CJI said, addressing Solicitor General Tushar Mehta.

As the hearing concluded, the Bench added, “We are hopeful that CBI and ED will do their job.”

The matter arises from a public interest litigation filed by former Union Secretary E.A.S. Sarma, who has sought a court-monitored investigation into the alleged fraud. The plea alleges that between 2013 and 2017, RCOM and its subsidiaries—Reliance Infratel and Reliance Telecom—availed loans exceeding ₹31,500 crore from a consortium of banks led by the State Bank of India.

Relying on forensic audit reports, the petition claims large-scale diversion of funds through related-party transactions, circular routing and evergreening of loans. It also highlights a nearly five-year delay by SBI in acting on a forensic audit report received in 2020, contending that the delay raises serious concerns of institutional complicity.