A special CBI court has granted bail to Kapil Wadhawan, former director of Dewan Housing Finance Corporation Ltd (DHFL), in connection with the alleged loan fraud case involving Yes Bank. The court's decision, delivered by Special Judge A C Dagga, cited the need to balance individual liberty with societal interests, particularly given the delay in the trial process.

The court acknowledged the serious nature of economic offenses, which have wide-reaching societal impacts, but stressed that prolonged detention without trial violates the constitutional right to life and personal liberty. Judge Dagga emphasised that keeping Wadhawan in custody for years without the trial beginning would be unjust.

Wadhawan was arrested on April 26, 2020, and has remained in judicial custody since then. However, he is not expected to be released immediately, as he faces other legal charges and has not secured bail in another pending case. DHFL, once a major mortgage lender, was acquired by the Piramal Group in 2021 under the Insolvency and Bankruptcy Code after facing a severe debt crisis.

The case centres on the Yes Bank-DHFL fraud, in which Yes Bank co-founder Rana Kapoor allegedly conspired with DHFL's promoters, including Kapil Wadhawan, to orchestrate a scam involving Rs 40 billion. The CBI claims Yes Bank invested Rs 39.83 billion in DHFL by purchasing debentures, and in return, DHFL agreed to pay kickbacks of Rs 6 billion to companies owned by Kapoor and his family.

Wadhawan's lawyer, Vijay Aggarwal, argued for bail, citing his client's extended time in custody and the unlikelihood of the trial beginning soon. Despite multiple chargesheets being filed and ongoing investigations, no trial has commenced after more than four years of custody. Aggarwal also highlighted that several other co-accused in the case, including real estate figures Sanjay Chabbaria and Avinash Bhosale, have already been granted bail.

The CBI opposed the bail, emphasising the magnitude of the economic crime and its impact on the public and the economy. However, the court ultimately ruled in favour of bail, stressing the accused’s right to a speedy trial and the need to balance legal rights with the gravity of the offense. 

(ET)