New Delhi: The Supreme Court on Wednesday cancelled the statutory bail granted to former Dewan Housing Finance Corporation Ltd (DHFL) promoters Kapil Wadhawan and his brother Dheeraj in the ₹34,615 crore bank loan scam case.

A bench of Justices Bela M Trivedi and SC Sharma said that the Delhi High Court and trial court ‘committed error’ in granting bail to the duo. The apex court also directed that the Wadhawan brothers be taken into custody forthwith.

Accused is entitled for statutory bail under certain conditions: HC

“We have no hesitation in holding that the chargesheet having been filed against the accused in the prescribed time limit and the cognisance had been taken by the special court of the offences allegedly committed by them, the accused could not have claimed the statutory right of default bail under Code of Criminal Procedure (CrPC) section 167 (2) on the ground that the investigation for other accused was pending,” the bench said. Under the CrPC, an accused is entitled for grant of statutory bail if the probe agency fails to file the chargesheet after the conclusion of the investigation in the case within a period of 60 or 90 days.

The CBI had previously opposed the statutory bail granted by lower courts to the brothers. Additional Solicitor General S V Raju, appearing for the central agency, had said that the chargesheet in the case was filed well within the 90-day statutory period and yet the statutory bail was granted to the accused. The chargesheet was filed on the 88th day after registration of the FIR. The trial court had granted default bail to the accused while the Delhi High Court upheld the order, underlining that it did not go into the merits of the case.

Wadhawan brothers arrested last year

The Wadhawan brothers were arrested on July 19 last year. The FIR in the case was based on a complaint made by the Union Bank of India. It was alleged that DHFL, its then CMD Kapil, the then Director Dheeraj and other accused engaged in a criminal conspiracy to deceive a consortium of 17 banks led by the Union Bank of India.

As per the case, the accused induced the consortium to approve substantial loans totalling ₹42,871.42 crore. The CBI claimed that a significant portion of the amount was purportedly siphoned off and misappropriated through alleged falsification of DHFL’s books and dishonest default on repayment.