The Bombay High Court has rapped the CBI for "improper" handling of the IDBI loan default case relating to the now-defunct Kingfisher Airlines and also reserved order on bail plea of two senior bank officials.
Justice Sadhana Jadhav reserved order till March 14 on the bail plea filed by former Chairman and Managing Director of IDBI Yogesh Agarwal and Deputy Managing Director B K Batra.
The duo were arrested by CBI on January 23, a day before the agency filed a charge sheet in the case. Nine accused have been arrested by CBI so far.
The judge pulled up the CBI for its failure to follow legal procedures in arresting the accused and dealing with them during the course of investigations.
The high court observed that the prime accused and former Kingfisher Airlines chairman Vijay Mallya was allowed to escape abroad.
Opposing their bail plea, the CBI sought further custody of the two IDBI officials on the ground that probe was already in progress. However, the judge asked the CBI to justify its plea of seeking further custody of the duo.
The court also questioned the manner in which both the accused had been arrested, without serving them prior notice.
"The CBI had not sought their custody even once during the initial probe but had picked them up a day before the charge sheet was filed," the judge observed.
The judge said that offences such as these are 'white collar' crimes and hence the argument of the CBI that the accused would tamper with evidence does not hold good in this case.
But if the agency was to keep them in jail suspecting that they were hard core criminals, then the CBI must justify its action, Justice Jadhav observed.
A sessions court had last month rejected the bail plea of Agarwal and Batra. However, the duo moved the high court for bail saying that even 40 days after their arrest the agency had not called them for questioning. Both argued that they could not be kept in judicial custody for an indefinite period.
The court has reserved order on their bail plea.
The IDBI allegedly showed "undue favour" to KFA in the matter of sanction and disbursement of short-term loans of Rs 150 crore in October 2009 and Rs 200 crore in November 2009, and another corporate loan of Rs 750 crore in November 2009.
It was alleged in the CBI charge sheet that a significant portion of the disbursed facility (loan) was diverted by Kingfisher to service their existing debt with other banks, and was also diverted to settle the documentary bills discounted by Bank of Baroda.
Significant amounts were also allegedly remitted out of India on the pretext of payment of lease rental and purchase of aircraft parts, while Rs 3.45 crore were paid into the bank account of Kingfisher in London, said the CBI charge sheet.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)