₹946 cr loan fraud: Rana Kapoor, Cox & Kings executives granted bail

The case stems from a first information report (FIR) registered by the CBI in November 2020, based on a complaint by Ashish Joshi, then chief vigilance officer of Yes Bank

MUMBAI: A special Central Bureau of Investigation (CBI) court on Wednesday granted bail to former Yes Bank chief executive officer and managing director Rana Kapoor and several senior executives of travel company Cox & Kings in an alleged loan fraud case worth ₹946.44 crore.

Rana Kapoor

“Nothing has been placed on record by the CBI to show that the custody of applicant is necessary during the course of the trial,” special CBI judge SH Gwalani said while granting bail to Kapoor and five Cox & Kings executives – Anil Khandelwal, Naresh Jain, Manisha Amarapurkar, Subramanyam Ganesh and Hardik Valia.

The prosecution accuses Kapoor, during his stint as CEO and MD of Yes Bank, of colluding with the Cox & Kings executives and extending credit facilities to Ezeego One Tours and Travels Ltd (EOTTL), a Cox & Kings group firm, despite its weak financial position. The executives subsequently diverted the funds to discharge liabilities of the parent firm, it is alleged.

The case stems from a first information report (FIR) registered by the CBI in November 2020, based on a complaint by Ashish Joshi, then chief vigilance officer of Yes Bank.

In his complaint, Joshi stated that Yes Bank had in 2017 sanctioned credit facilities worth ₹650 crore to EOTTL, which was enhanced to ₹1,015 crore in September 2018 despite the weak financial position of the firm. The loan account became a non-performing asset in June 2019, and the bank subsequently appointed a forensic auditor whose report revealed elements of fraud in the account, Joshi stated. Accordingly, on February 14, 2020, the loan account was reported as fraud to the Reserve Bank of India, the amount involved being ₹946.44 crore.

The advocates representing Kapoor and the Cox & Kings executives sought bail for them, arguing that they had been falsely implicated in the case and did not commit any offence. Kapoor’s advocate submitted that there was no evidence to bring out the alleged offence against him, neither was there any likelihood of his fleeing the process of justice. The accused would cooperate with the investigation after being granted bail, their advicates assured the court.

The prosecution opposed the bail pleas, submitting that the promoters and executives of EOTTL had applied for loans using inflated and forged balance sheets, whereas Kapoor abused his official position and sanctioned credit facilities to EOTTL despite the latter’s weak financial condition.

Special CBI judge SH Gwalani observed that Kapoor and the other accused had not been arrested by the CBI till the time of filing the charge sheet.

“No apprehension is put forth by the prosecution to show that release of applicant on bail would cause hindrance in the progress of trial,” the court said while granting them bail.