Bombay High Court Reviews ED’s Attachment Order in Videocon-ICICI Money Laundering Case

The Bombay High Court has expressed reservations regarding the Enforcement Directorate's (ED) decision to provisionally attach assets owned by businessman Deepak Kochhar in connection with the alleged Rs 64-crore money laundering case involving Videocon and ICICI Bank. During proceedings on Monday, a division bench of Justices Bharti Dangre and Shyam Chandak scrutinized the agency's actions, seeking precise justification for valuing the seized properties at around Rs 33 crore and extending the attachment beyond the claimed proceeds of crime.

The court was hearing appeals filed by Kochhar and Axis Bank contesting the attachment order, emphasizing the requirement for proportionality under relevant legal provisions. The bench specifically requested the ED to articulate the exact valuation date, benchmark criteria, and computational methodology applied, highlighting potential discrepancies in the scope of properties included relative to the alleged tainted amount of Rs 64 crore.

Counsel for the ED cited previous findings from the Appellate Tribunal and relied on depreciated book values from 2019 assessments of NuPower Renewables' power assets to support the attachment's breadth. Nevertheless, the bench maintained its demand for a comprehensive and transparent breakdown, suggesting that any demonstrated overreach could result in partial relief by restricting the attachment to assets equivalent to the specified proceeds.

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Senior advocates representing Kochhar and the bank contended that utilizing outdated 2019 valuations inappropriately broadened the attachment, arguing instead for application of fair market values from the 2009 acquisition period, which would necessitate fewer properties to secure the equivalent amount. The court indicated a preliminary opinion that attachments exceeding directly traceable proceeds or their proportionate value may not withstand legal scrutiny under the Prevention of Money Laundering Act.

Stemming from 2017 allegations of quid pro quo involving ICICI Bank's loan to Videocon Group and subsequent investments into Kochhar-linked entities, including a Rs 64-crore transaction and a Mumbai flat, the case has seen Deepak Kochhar arrested by both ED in 2020 and CBI in 2022 before obtaining bail. The ongoing hearings underscore debates on evidentiary standards and procedural fairness in financial crime probes.

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