The Supreme Court has expressed dissatisfaction over the slow progress of investigations into financial irregularities involving Indiabulls Housing Finance Limited, now Sammaan Capital Ltd.
New Delhi, India Jul 28, 2026 ALN: The Supreme Court on Tuesday came down heavily on the Central Bureau of Investigation (CBI) and the Delhi Police’s Economic Offences Wing (EOW) over the lack of progress in probing allegations of financial irregularities involving Indiabulls Housing Finance Limited (IHFL), now renamed as Sammaan Capital Ltd. A Bench of Chief Justice of India (CJI) Surya Kant, Justice Joymalya Bagchi and Justice V. Mohana expressed dissatisfaction that despite earlier directions, neither the CBI nor the EOW had apprised the top court about the status of the investigation or the steps taken towards registration of a regular case.
The Supreme Court's intervention highlights ongoing concerns about the efficacy and timeliness of investigations into financial crimes in India, particularly in the context of high-profile corporate entities. Indiabulls Housing Finance Limited, which has undergone a rebranding to Sammaan Capital Ltd, has been under scrutiny for various allegations, including financial misconduct and irregularities that have raised alarms among regulators and the public alike. The court's remarks come at a time when there is heightened scrutiny of corporate governance and accountability in the financial sector, especially in light of previous scandals that have shaken investor confidence.
During the proceedings, the court questioned why the investigating agencies had failed to indicate whether any criminal offence was made out despite examining the matter for several months. “What has CBI done from January to July? We don’t want to hold an investigation against innocent people. Let them have the courage to say because money returned, no offence is made out,” the CJI Kant-led Bench observed during the hearing. This statement reflects the court's concern about the balance between thorough investigation and the rights of individuals, emphasizing the need for a just approach in handling such sensitive matters.
Additional Solicitor General S.V. Raju, appearing for the CBI, submitted that the investigation was continuing and that the Serious Fraud Investigation Office (SFIO) had also commenced its probe. The mention of the SFIO's involvement indicates the complexity of the case, as multiple agencies are often required to assess different aspects of financial misconduct, including fraud, violations of securities laws, and corporate governance issues.
The ASG sought two weeks’ time to obtain instructions and file a comprehensive status report detailing the progress made by the investigating agencies. This request for additional time is not uncommon in complex investigations, as authorities often need to coordinate their efforts and gather extensive documentation and testimonies. However, the court's willingness to summon the heads of these agencies reflects a growing impatience with perceived delays and a desire for accountability at the highest levels of the investigative bodies.
Recording the assurance given by ASG Raju, the top court deferred further hearing. In its order, the CJI Kant-led Bench said that it was inclined to summon the heads of these agencies over their failure to comply with its earlier directions but deferred the move after the Centre’s law officer assured the top court that the latest developments would be placed on record. This indicates that the court is prepared to take more drastic measures if it feels that the agencies are not acting with the urgency and seriousness that the situation demands.
Appearing for the petitioner, advocate Prashant Bhushan submitted that the CBI’s affidavit filed in January had referred to findings of the Enforcement Directorate (ED) and the Securities and Exchange Board of India (SEBI), which allegedly revealed siphoning of funds. This highlights the interconnected nature of financial investigations, where findings from one agency can significantly impact the investigations of others. The involvement of multiple agencies also raises questions about jurisdiction and the effectiveness of their coordination.
He added that the Delhi Police EOW had already registered certain FIRs and that the CBI was considering clubbing five cases flagged by the ED with the Yes Bank investigation. The mention of Yes Bank, a significant player in the Indian banking sector that has faced its own issues in recent years, underscores the potential ripple effects of the Indiabulls case on broader financial stability and investor trust.
Bhushan further informed the apex court that a former Indiabulls promoter had shifted to London and reiterated the plea for the constitution of a Special Investigation Team (SIT) to conduct a comprehensive probe. The request for an SIT indicates the seriousness of the allegations and the perceived need for an independent and thorough investigation, separate from the standard procedures of the CBI and EOW. The relocation of key individuals involved in the case to jurisdictions outside India can complicate matters, as it raises issues of extradition and international cooperation in legal matters.
On the other hand, senior advocates Mukul Rohatgi, Abhishek Manu Singhvi, and Nalin Kohli, appearing for the respondents, denied any wrongdoing. Their defense underscores the contentious nature of such investigations, where allegations can often lead to significant reputational damage even before any legal conclusions are reached. The legal representatives' insistence on their clients' innocence reflects a broader issue in corporate governance, where the presumption of innocence must be balanced against the need for accountability.
The petition filed by Citizens Whistle Blower Forum (CWBF) seeks a court-monitored SIT probe into alleged financial irregularities, including round-tripping of funds, violations of the Companies Act, and siphoning of money by the promoters of the erstwhile Indiabulls Housing Finance Ltd, now Sammaan Capital Ltd, and its subsidiaries. The CWBF's involvement highlights the role of civil society in advocating for transparency and accountability in corporate governance. Whistleblower protections and the encouragement of public reporting of misconduct are crucial for fostering an environment where financial irregularities can be addressed effectively.
The plea alleges that several companies which received substantial loans from the housing finance company had negligible paid-up capital, common directors, overlapping addresses, and no genuine business operations, and that the funds were ultimately routed back to entities linked to the promoters. Such allegations, if substantiated, suggest a complex web of financial transactions designed to obscure the flow of money and evade regulatory scrutiny. This situation raises important questions about the robustness of regulatory frameworks in preventing financial misconduct and ensuring that corporate entities operate transparently and responsibly.
In November last year, the Supreme Court had also pulled up multiple investigating agencies, including the CBI, SEBI, and the Ministry of Corporate Affairs, for adopting a “friendly approach” in dealing with the allegations. The apex court had then expressed concern over the slow pace of the investigation, asked SEBI to avoid “double standards,” questioned the CBI over its failure to register an FIR, and directed the agencies, including the ED and SFIO, to submit status reports after coordinating their investigations. This previous reprimand indicates a pattern of frustration from the judiciary regarding the handling of financial investigations, particularly in cases involving high-profile corporate entities. The Supreme Court's insistence on accountability and transparency in these matters reflects a broader commitment to uphold the rule of law and protect the interests of investors and the public.
The ongoing situation surrounding Indiabulls and the investigations into its financial practices serves as a critical reminder of the need for vigilance in corporate governance and the importance of robust regulatory mechanisms to deter financial misconduct. As the case unfolds, the implications for stakeholders, including investors, employees, and regulatory bodies, will be closely monitored. The outcome may influence future regulatory reforms and the approach of investigative agencies in handling complex financial crimes, ultimately shaping the landscape of corporate accountability in India.
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