EOW issues LOCs against Shilpa Shetty, Raj Kundra in ₹60 cr cheating case

The recent case of fraud being investigated by EOW stems from a complaint by Deepak Kothari, a 60-year-old Mumbai-based businessman and director of Lotus Capital Financial Services. Kothari alleged that between 2015 and 2023, Shetty and Kundra diverted funds he had provided, to expand their business, for personal purposes

MUMBAI: The Economic Offences Wing (EOW) of the Mumbai police has issued Look-Out Circulars (LOCs) against actor and entrepreneur Shilpa Shetty and her husband, businessman Raj Kundra, in connection with a ₹60.48 crore cheating case linked to their now-defunct company, Best Deal TV Pvt. Ltd, a home-shopping and online retail platform.

Shilpa Shetty and her husband, businessman Raj Kundra (UNI)

Officials said the step was taken to ensure the couple, who often travel abroad, do not leave the country while the probe is underway.

Curiously, EOW’s move on Friday comes on the back of the closure of Shetty’s well-known restaurant Bastian Bandra, which was opened in 2016, and remained among the most profitable restaurants in the country. Shetty made the announcement on her Instagram stories on Wednesday morning, and deleted it when media was abuzz linking the restaurant’s closure with the ₹60.48 crore fraud. Later in the day, Shetty posted that Bastian Bandra will “shift to” Bastian Beach Club in Juhu, while the Bandra outlet will give way to Ammakai (mother’s hand), a specialty south Indian restaurant which will source from heirloom recipes. Both restaurants will open in mid-October.

The recent case of fraud being investigated by EOW stems from a complaint by Deepak Kothari, a 60-year-old Mumbai-based businessman and director of Lotus Capital Financial Services. Kothari alleged that between 2015 and 2023, Shetty and Kundra diverted funds he had provided, to expand their business, for personal purposes.

The FIR registered in Juhu on August 13, states that Kothari was introduced to Kundra through a common acquaintance. He was informed that the couple held nearly 88% shares in Best Deal TV. Initially, Kundra sought a loan of ₹75 crore at 12% annual interest, but Kothari claimed he was later persuaded to treat the transaction as an investment to avoid taxation and promise of better returns.

Kothari said he transferred the entire money in tranches through 2015, but soon discovered that insolvency proceedings had been initiated against the company for allegedly cheating another investor. Shetty resigned as director in 2016. Despite repeated demands, Kothari alleged that Kundra delayed repayment, citing the Covid-19 pandemic.

The EOW, after a preliminary inquiry, found that the complainant’s funds had been misused. Shetty, Kundra, and an unidentified associate were booked on August 13 under IPC sections 403 (dishonest misappropriation of property), 406 (criminal breach of trust), and 34 (common intention).

Police have also summoned the auditor who examined the firm’s books before liquidation proceedings were filed before the National Company Law Tribunal (NCLT). Investigators are tracing the money trail to determine how the funds were spent.

“LOCs have been issued against Shilpa Shetty and Raj Kundra, considering their frequent foreign travel and the ongoing investigation,” an EOW officer said.