Why is it not filed in Mumbai? Delhi High Court on Anil Ambani companies' petition against ED attachment

The Delhi High Court on Friday remarked that it may not have the jurisdiction to hear the petitions filed by two Anil Ambani group companies against the attachment of their properties by the Enforcement Directorate (ED) in connection with a money laundering case

Justice Purushaindra Kumar Kaurav remarked that the company is based in Mumbai and therefore, the proceedings should be instituted there. 

“Why should we entertain here? Why should it not go to Mumbai?” the Court said. 

Senior Advocate Siddharth Aggarwal appeared for the companies – Reliance Realty and Campion Properties Limited – and stressed that the Delhi High Court can hear the pleas and that they have a case.

Meanwhile, advocates Zoheb Hossain and Vivek Gurnani appeared for the ED and stated that the adjudicating authority (AA) under the Prevention of Money Laundering Act (PMLA) is already seized of the matter and that the petitioners should make their arguments before the authority.

After hearing the case briefly, Justice Kaurav asked the petitioners to file brief notes on maintainability. 

The case will be heard next on January 30. 

According to reports, the ED has provisionally attached properties worth over several thousand crores linked to various entities of the Reliance Anil Ambani Group under Section 5(1) of the PMLA.

The ED is probing Anil Ambani’s companies over alleged misuse of bank loans by them over accusations involving loan evergreening, diversion to related parties, routing through shell entities and siphoning of funds, leading to major non-performing assets (NPAs) and fraud declarations by banks.

“From around 2010-12 onwards, RCOM [Reliance Communications] and its group companies raised thousands of crores from Indian banks, of which ₹19,694 crore still remains outstanding. These assets turned NPA, with five banks having declared RCOM’s loan accounts as fraud. ED investigation revealed that loans taken by one entity from one bank were utilized for repayment of loans taken by other entities from other banks, transfer to related parties, and investments in mutual funds, which was in contravention to the terms and conditions of the sanction letter of the loans,” the ED has claimed.