Supreme Court Criticizes ED For "Unexplained Delay" In ₹40,000 Crore Anil Ambani Group Fraud Case; Orders Formation of SIT

The Supreme Court expressed strong dissatisfaction with the "unexplained delay" by the Enforcement Directorate (ED) and the procedural lapses of the Central Bureau of Investigation (CBI) regarding the alleged siphoning of ₹40,000 crores by the Anil Dhirubhai Ambani Group (ADAG).

The Court was hearing a Public Interest Litigation (PIL) seeking a comprehensive investigation into various banking institutions regarding alleged bank fraud involving the ADAG and its promoter, Anil Ambani.

It was directed that the ED must immediately constitute a Special Investigation Team (SIT) of senior officers to conclude the probe. The Court further criticized the CBI for merging multiple bank complaints into a single FIR, noting that each unique set of facts constitutes an independent offence.

The Bench comprising Chief Justice Surya Kant, Justice Joymalya Bagchi and Justice Vipul Pancholi ordered, "Having gone through the counter-affidavit of the Enforcement Directorate, it appears to us that the aforesaid Agency must look into every possible financial transaction suspected to be which might have led to siphoning of the funds and determine the estimated value of the proceeds of crime. In this regard, the Enforcement Directorate is well advised to constitute a special investigation team (SIT) comprising its senior officers and take all lawful measures to take the ongoing investigation to a logical conclusion. It may not be appropriate for us to express any opinion at this stage except to observe that there has been an unexplained delay on the part of the ED."

Advocate Prashant Bhushan appeared for the Petitioner, Senior Advocate Mukul Rohatgi appeared for Anil Ambani, Senior Advocate Shyam Divan appeared for the Anil Ambani Dhirubhai Ambani Group, and Solicitor General of India Tushar Mehta appeared on behalf of the CBI and ED.

"We may hasten to add that both agencies, namely ED and CBI, have already taken their own time in swinging into action and any further delay will not bring, and the further delay...and we therefore expect that both agencies will act promptly, independently, fairly, and in a discretionary manner as per the status reports by both the agencies to be filed within four weeks, post the matter for further consideration and so on so forth", the Court ordered.

Advocate Prashant Bhushan, appearing for the Petitioner, highlighted that despite Bank of Baroda detailing the siphoning methods, no complaint was registered until 2025. He alleged that the Enforcement Directorate (ED) report indicated at least ₹26,000 crores were moved offshore, yet the "kingpin" remained at large. Bhushan further argued that the Insolvency and Bankruptcy Code (IBC) process was being misused, a sentiment echoed by the CJI, who remarked that assets were often undervalued and bought back by family members.

In response to the allegations of delay, the SG stated that public officials were also under investigation for potential collusion. Mehta also informed the Court that approximately ₹40,000 crores were allegedly siphoned off.

The Bench said, "The Enforcement Directorate has also filed an affidavit. In some of the substances, the Affidavit suggested that the investigations for the purpose of detecting the offences under PMLA, as well as in the affairs of the group companies, are going on. It was pointed out that ECIR has been registered in relation to the Reliance Commercial Finance Limited and the Reliance Home Finance Limited. The investments made by Yes Bank between 2017 to 2019 in non-convertible debentures and commercial papers of both RCFL and RHFL were being examined. According to ED, it has been found that RHFL borrowed public funds from 33 banks/financial institutions and committed a default of Rs. 7,523.36 crores. It was further claimed that 33 lenders have been able to recover only Rs. 2,106.28 crores, the net default of Rs. 5,407.18 crores, which constitutes the proceeds of crime."

"Three individuals who have been associated with the aforesaid company have been arrested. The Enforcement Directorate has further explained that it has searched 46 premises, issued 13 POs and has attached 204 properties valuing Rs. 12,012.45 crores", the Court added in its order.

The Court questioned the Central Bureau of Investigation (CBI) for registering only a single FIR based on a State Bank of India complaint, noting that complaints from other banks involved separate transactions and warranted individual FIRs. The Court remarked that the current approach did not conform to procedural law.

With regard to the actions taken by the CBI, the Court ordered, "Similarly, a report in sealed cover has been filed by CBI, which has been opened and perused. It seems that a formal FIR was registered on the basis of a complaint received from the State Bank of India. According to CBI, the complaints received from banks/financial institutions are also being investigated by enlarging the scope of the said FIR. Such a report adopted by CBI, apparently, does not seem to be in conformity with the procedural law as each complaint, even if it pertains to defalcating of public funds, is based upon its own unique set of facts and therefore would constitute an independent defence."

"Furthermore, it is imperative from the CBI to investigate the conduct of the bank authorities as to whether the financial assistance was released from collusion with the management of the companies in default. In this vein, the reference by CBI to Section 17A of the PC Act is totally misconceived to direct that, regardless of any such provision, the CBI must look into the nexus/collusion/connivance/conspiracy, if any, and for that purpose, all lawful measures to take in the investigation to its logical conclusion be adopted", it added.

Senior Advocate Mukul Rohatgi proposed the formation of a committee to settle the dues as an alternative to prosecution. However, the CJI rejected the idea of a committee, stating that the court expected the ED and CBI to perform an independent and fair job without further impediments.

The court specifically addressed the conduct of banking management, directing the CBI to investigate whether financial assistance was released through collusion. The Court dismissed reliance on Section 17A of the Prevention of Corruption Act as "misconceived" in this context, ordering that the investigation into bank connivance must proceed regardless of such provisions.

"As regard to the default committed by RCFL, it is pointed out that 21 banks/ financial institutions have been defaulted to the tune of Rs. 6,282.57 crores, as out of Rs. 8,226.05 crores, only a sum of Rs. 1,945.48 crores has been paid. Another ECIR...has been registered in relation to Reliance Commercial Finance Limited, interrelia, pointing out that the total outstanding amount is Rs. 40,185.55 crores, which constitutes the proceeds of crime. It seems that one ex-director of the company has been arrested recently and is in custody till 7th February, 2026", the Court noted in the order.

During the proceedings, the Court also remarked on the "misuse" of the Insolvency and Bankruptcy Code (IBC), following submissions that Reliance Communications, with debts of ₹47,000 crores, was sold for a fraction of its value. While Senior Advocate Shyam Divan claimed that two group companies had repaid ₹20,000 crores, the SG countered that authorities must verify if these repayments were funded by loans diverted from other group entities.

"Since your Lordship is now monitoring this matter, there is now serious apprehension that the owner of all these companies, my Lord, the person who owns these companies, he may flee the country. Now, they have not arrested him. They have not even issued a check out circular which will prevent him from fleeing the country. So many people, my Lord, with tens of thousands of crores outstanding have fled the country", Bhushan submitted before the Court.

To which Rohatgi replied, "There are several LOCs. I have not gone. I have not attempted to go. I am working in my office in these companies even today."

Following concerns raised by Bhushan regarding the risk of the accused fleeing the country, Rohatgi stated that Anil Ambani will not leave the country without permission from the court.

Accordingly, the matter is now listed for a further date.

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