Supreme Court Directs Time-Bound Probe into ADAG Loan Fraud: ED Report Reveals Rs 2983 Cr Debts of Anil Ambani Group Settled for Mere Rs 26 Cr via “Project Help” Through 8 NBFCs; CBI & ED Must Complete Investigation in 4 Weeks

The Supreme Court on Monday took serious note of an Enforcement Directorate report revealing that debts worth Rs 2983 crores owed by certain companies of the Anil Dhirubhai Ambani Group (ADAG) were settled in insolvency proceedings for a mere Rs 26 crores. The Court observed that all such acquisitions were facilitated by 8 Non-Banking Finance Companies through a mechanism termed “Project Help”.

A bench comprising Chief Justice of India Surya Kant, Justice Joymalya Bagchi and Justice Vipul Pancholi was hearing a petition filed by EAS Sarma seeking a thorough investigation into the alleged loan fraud exceeding Rs 40,000 crores by ADAG companies.

Solicitor General Tushar Mehta informed the Court that a Special Investigation Team comprising an Additional Director, two Deputy Directors, four Assistant Directors/Investigating Officers of the ED, forensic analysts and two staff members of Bank of Baroda has been constituted. The probe into 8 cases has already commenced and some documents have been seized.

The bench emphasised the need for a fair, dispassionate and time-bound investigation. The Solicitor General assured the Court that every effort would be made to complete the investigation within 4 weeks.

From the ED’s affidavit, the Court noted that claims of approximately Rs 2983 crores were extinguished for a total settlement of Rs 26 crores. The report highlighted how insolvency petitions were deliberately initiated through unrelated lenders, with all funding for IBC acquisitions arranged through the group of 8 NBFCs.

The CBI affidavit disclosed that 7 cases are under investigation, including the roles of public servants. Properties worth Rs 15,000 crores have been attached.

In its order, the bench stated:

“This is a case where senior functionaries of the investigating agencies must join hands and make vigorous attempts to unearth the irregularities/illegalities or the connivance of public functionaries, specially the financial institutions, if any, in giving undue benefit… It is imperative upon the CBI and the ED to complete the investigation in a most dispassionate, fair, transparent and independent manner and take the ongoing investigations to logical conclusion in a timebound manner.”

The Court directed all banks, financial institutions and other concerned agencies to extend full cooperation to the ED and make available necessary information. In case of any reluctance, resistance or delay, the ED has been asked to submit a report to the Court.

Senior Advocate Mukul Rohatgi, appearing for Anil Ambani, submitted that a representation has been made to the banks for resolution, but the banks are hesitant due to the pendency of the case. The CJI observed that the Court has not stopped any dialogue and banks may willingly engage as it could help them wriggle out of consequences.

Advocate Prashant Bhushan, for the petitioner, pointed out that despite a SEBI report flagging a fraudulent scheme orchestrated by Anil Ambani and key managerial personnel of RHFL to siphon off public funds, no substantial arrests have been made. The Solicitor General countered that 4 arrests have already been effected and arrests cannot be made randomly.

The CJI deprecated the earlier reluctance shown by the investigating agencies and stressed that the investigation must inspire confidence of the Court and all stakeholders.

The matter has been kept pending for further monitoring.

Cause Title: EAS Sarma v. Union of India and others | W.P.(C) No. 1217/2025