The Supreme Court today took an uncompromising stand on the high-profile Citizens Whistle Blower Forum case seeking an SIT probe into alleged irregularities at erstwhile Indiabulls Housing Finance Ltd (IHFL), now Sammaan Capital. The bench, comprising Justices Surya Kant, Ujjal Bhuyan, and N Kotiswar Singh, made scathing observations about the “double standards” of the Securities and Exchange Board of India (SEBI) and a surprisingly “cool attitude” from the Central Bureau of Investigation (CBI).
During the day, Sammaan Capital plunged, settling around 13 per cent lower at close.
Justice Kant’s rebuke: “Every day, we see double standards of SEBI!” The bench pointed out that while SEBI claims sole authority in certain matters such as property auctions, it appears hesitant to exercise its investigatory powers, raising concerns over possible vested interests.
CBI’s laid-back approach in the investigation drew further judicial ire, with Justice Kant remarking, “We have never seen such a friendly attitude...this is ultimately public money...there is a strong element of public interest.”
The lack of FIR
The case itself revolves around claims of fund round-tripping, violations of the Companies Act, and large-scale siphoning allegedly orchestrated by the promoters of Indiabulls, its subsidiaries, and related parties. Previous agency reports, including one from the CBI, affirmed that allegations of money laundering were “prima facie well-placed,” yet the lack of a registered FIR to kickstart a comprehensive probe was a sticking point in the latest hearing.
ASG SV Raju, representing both the CBI and the Serious Fraud Investigation Office (SFIO), briefed the Court on prior complaints and procedural efforts, but these had not triggered an investigation as expected.
Advocate Prashant Bhushan, for the petitioner, urged that a formal FIR be registered by the CBI, underlining the need for a unified effort by senior officers from the CBI, SFIO, Enforcement Directorate (ED), and SEBI.
Sammaan Capital stock performance
Investor reaction was swift, with Sammaan Capital shares plummeting by 13 per cent following the news.
The bench concluded by demanding a new affidavit from CBI and the production of EOW’s inquiry records on the ED’s complaint.
Company clarification
Sammaan Capital stated that there were no open investigations pertaining to the allegations in the PIL against the company with any investigative agency, and added that no FIR has been directed to be filed against it. It further clarified that Wednesday’s developments have “no bearing on the transaction with IHC. Both IHC and Sammaan Capital are focused on obtaining requisite permissions for speedy consummation of the transaction, which will make IHC the promoter of SCL.”
Mukul Rohatgi, Senior Advocate and counsel for Sammaan Capital, said in a statement: “The present petition before the Supreme Court does not contain any allegation against Sammaan Capital. The Court has referred to concerns raised about the previous promoter, Sameer Gehlaut, who has no shareholding or involvement in the company today. The court has clarified in its order that it has made no observations on the merits of these allegations and has merely permitted the authorities to re-examine the matter. We have no objection to this process. Since there is no allegation from any authority against Sammaan Capital, we are fully open to any inquiry the agencies may wish to conduct—once, twice, or even thrice. We have nothing to hide.”
