The Bombay High Court has granted default bail to Kapil and Dheeraj Wadhawan, the promoters of Dewan Housing Finance Limited (DHFL), who have been in jail for over four years in connection with the Yes Bank money laundering case.
Court’s Reasoning for Bail
Justice Milind Jadhav, while delivering the verdict, stated that keeping the Wadhawan brothers in custody for four years and nine months without trial violates their fundamental right to a speedy trial under Article 21 of the Constitution. He highlighted that there is no likelihood of the trial starting soon.
The Court also referred to Section 436-A of the Code of Criminal Procedure (CrPC), which states that an undertrial prisoner should be released if they have served more than half of the maximum sentence prescribed for the offence. The ruling clarified that once this condition is met, the “twin conditions” of the Prevention of Money Laundering Act (PMLA) do not apply, and the accused is entitled to bail.
Arguments by Both Sides
The Wadhawan brothers’ legal team, led by Senior Advocate Amit Desai, argued that their prolonged detention, along with delays in the Enforcement Directorate’s (ED) investigation, justified their release on bail. They emphasized that despite being in custody for a long period, the ED had not completed its investigation.
On the other hand, the ED’s counsel argued that the Wadhawans themselves contributed to the delay by filing multiple legal applications. However, the Court rejected this argument and stated that the right to bail is the norm, while refusal is an exception—especially when the accused have already spent a significant time in custody.
Background of the Case
The Wadhawan brothers were initially granted bail in August 2020 by the Bombay High Court. However, the Supreme Court later overturned this decision.
The case involves allegations that Kapil and Dheeraj Wadhawan conspired with others to defraud a consortium of 17 banks, led by Union Bank of India. The complaint states that:
- The accused fraudulently secured loans worth ₹42,871.42 crore from these banks.
- A large portion of the money was allegedly siphoned off through falsified DHFL financial records.
- The alleged fraud resulted in a ₹34,615 crore loss to the banks between January 2010 and December 2019.
Legal Representation
The Wadhawan brothers were represented by Senior Advocate Amit Desai along with Advocates Gopalkrishna Shenoy, Kushal Mor, Pooja Kothari, Janaki Garde, and Raghav Dharmadhikari, briefed by Rashmikant and Partners.
The Enforcement Directorate (ED) was represented by Advocates Hiten Venegaonkar, Aayush Kedia, and Diksha Ramnani, while Advocate HJ Dedhia appeared for the State.
Conclusion
With this order, the Bombay High Court has reaffirmed the principle that prolonged pre-trial detention should not become a punishment in itself. The ruling underlines the importance of ensuring a fair trial while upholding constitutional rights.