- February 4, 2026
Anil Ambani bank fraud case: If public funds are siphoned off, willingness to pay may not help, says Supreme Court
The Supreme Court on Wednesday (February 4, 2026) said even a willingness to pay up may not save those involved in an alleged bank scam linked to the Anil Dhirubhai Ambani Group (ADAG) and its promoter Anil Ambani from criminal prosecution, if the Central Bureau of Investigation (CBI) and the Directorate of Enforcement (ED) were able to unearth a deliberate intention to “siphon off” public funds.
A three-judge Bench headed by the Chief Justice of India Surya Kant directed the ED to constitute a Special Investigation Team (SIT) of senior officers to investigate the scam, while ordering the CBI to conduct a “fair, dispassionate” probe into the “nexus, connivance, conspiracy, collusion” among bank officials, authorities, and the managements of the companies.
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“If there was an intention to siphon public funds from the very beginning, such kind of offences cannot be compounded just because you are willing to pay,” Chief Justice of India Kant, heading a three-judge Bench, addressed senior advocates Mukul Rohatgi and Shyam Divan, appearing for Mr. Ambani and the ADAG, respectively.
The court was responding to a suggestion made by Mr. Rohatgi that a committee could be formed, which could look into the amount due to the banks. “I am not opposing a SIT, but the gentleman could pay rather than face prosecution… They are saying there was siphoning of money. I am denying the allegation,” the senior counsel offered.
Mr. Divan said the amounts “bandied about” in the court were not true. He sought, and was given time, to file a reply.
Solicitor General Tushar Mehta, appearing for the CBI and the ED, said the forensic auditor had pointed to the siphoning of approximately ₹40,000 crore of public money. It was “not possible to compound” if the acts involved misappropriation of public funds, Mr. Mehta said. The top law officer said the acts in question involved the giving of “forged bank guarantees”.
“In the forensic report, it is shown money was taken from one bank to pay another,” Mr. Mehta submitted.
Advocates Prashant Bhushan and Neha Rathi, appearing for petitioner E.A.S. Sarma, who has sought the constitution of an SIT and a comprehensive investigation into what he termed as “one of the biggest financial frauds in the country”, flagged the possibility of Mr. Ambani fleeing the country.
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Taking strong objection to Mr. Bhushan’s submissions, Mr. Rohatgi said he was giving a statement that Mr. Ambani had no such intentions and would remain in the country. In fact, Mr. Rohatgi said he was at the office every day.
“I am not running. I am very much here,” Mr. Rohatgi submitted on behalf of his clients. Mr. Bhushan said there was no point to a statement after the promoter flees the country.
“The gentleman who owns these companies has not been arrested to date. He is the kingpin. There are outstanding dues of ₹1.78 lakh crore, and bankruptcy proceedings have only recovered ₹15,000 crore… Only an ex-director of the company has been arrested so far, that too after the Supreme Court issued notice in the petition on January 23. Now, with the Supreme Court monitoring the case, some preventive measures have to be taken against his leaving the country,” Mr. Bhushan submitted.
The Supreme Court recorded the statement given by Mr. Mehta that the necessary preventive action would be taken to ensure the smooth conduct of the investigation.
The Supreme Court was critical of the fact that the CBI and ED delayed registering a First Information Report in the case for about five years. It noted that findings of discrepancies had come to light in a forensic audit report way back in 2020, yet an FIR was registered only in 2025.
“If the forensic auditor had said there was collusion, why was the RC [Regular Case] not registered?” Justice Joymalya Bagchi asked Mr. Mehta.
The court said it was rather “misconceived” of the Central agencies to think that a prior sanction under Section 17A of the Prevention of Corruption Act was required to initiate investigation into the alleged collusion involving bank officials and other authorities.
“The CBI and ED have taken their own time to swing into action, any further delay will not be tolerated… The ED has to constitute a SIT of senior officers and take all lawful measures to investigate the case to its logical conclusion… There has been an unexplained delay in the commencement of the investigation,” the court underscored.
The Bench also flagged how the Insolvency and Bankruptcy Code (IBC) was being used by family members to undervalue assets and acquire them at a fraction of their original market value.
“Reliance Communications Infra had ₹47,000 crore of outstanding dues. In bankruptcy, it was sold off for ₹455 crore to the brother’s company,” Mr. Bhushan submitted. Mr. Rohatgi objected, saying anyone could come forward and buy.
But the Bench took a skeptical view, saying more such cases of undervalued buying, taking advantage of the IBC platform, were making their way to the apex court.
“Unfortunately, the IBC platform is being misused like anything. You get the company and assets undervalued. Then you indulge in a kind of an auction which is also pre-planned. Friends or family come and buy. Valuation of the assets would not be even 1% of the original market value,” the Bench said.
Published – February 04, 2026 12:01 pm IST
