CBI clears NDTV founders in 2017 loan fraud case, cites no wrongdoing

The Central Bureau of Investigation (CBI) has officially closed its 2017 corruption and fraud case against NDTV founders Prannoy and Radhika Roy, clearing them of all charges related to an alleged Rs 375 crore loan fraud involving ICICI Bank.

Contrary to earlier speculations that the case was dismissed due to insufficient evidence, the CBI’s closure report confirmed that the investigation found no wrongdoing by the Roys or their company, M/s RRPR Holdings Private Limited, The Wire reported.

The case centred on accusations that the loan, which was granted by ICICI Bank in 2008, had violated banking laws and was part of a conspiracy to cheat the bank. However, the CBI concluded that the loan was a routine business transaction and that there were no irregularities in its sanctioning.

The investigation also noted that ICICI Bank had extended similar loans to other companies under comparable conditions during that period, establishing that the NDTV loan was not an isolated case.

In its findings, the CBI referred to clarifications from the Reserve Bank of India (RBI), which confirmed that loans issued under the Non-Disposal Undertaking-Power of Attorney (NDU-POA) arrangement, such as the one in question, did not violate banking regulations. The RBI also clarified that the practice had been used by the bank in about 30 cases, involving loans totalling up to Rs 15,000 crore.

Further, the CBI addressed concerns about the Roys' failure to disclose the pledge of shares to the Securities and Exchange Board of India (SEBI). It concluded that the relevant SEBI regulations, which would have required such a disclosure, were introduced after the loan was taken.

As a result, there was no obligation for the Roys to seek SEBI’s permission to arrange the loan. Similarly, the investigation dismissed concerns about the need for approval from the Ministry of Information and Broadcasting (MIB) for the pledge of shares, citing policy guidelines that did not require such permission in this context.

The CBI also investigated the reduction in the interest rate on the loan, which had been a point of contention. The investigation revealed that the decision to lower the interest rate from 19% to 9.65% was not an isolated incident but part of a broader practice within ICICI Bank, which had reduced interest rates for 83 other loan accounts during the same period. This decision was based on the borrower’s financial performance and the prevailing market conditions at the time.

Regarding a subsequent loan taken by the Roys from M/s VCPL, the CBI found that the laws allegedly violated had not come into effect until years after the loan was disbursed, rendering the accusations moot.

This case has concluded against the backdrop of the 2022 takeover of NDTV by the Adani Group, following the resignation of the Roys from the company's management.