VGN Projects Estates is a well-known real estate developer in and around Chennai. During the year 2013, SBI, led by a consortium of banks, proceeded under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI Act) on the Stressed assets of the Hindustan Tele-printers Ltd (HTL) which were attached under the SARFAESI Act. In July 2013, M/s. VGN Developers Limited (now M/s. VGN Projects Estate Pvt Ltd) purchased the said land for a sum of Rs. 272 crores, which is Rs. 22 crores higher than the reserve price of Rs. 250 crores.
Central Bureau of Investigation (CBI) filed an FIR in RC MA1 2016 (a 0050) against Leon Terattil (the then-chief manager of SBI) on December 28, 2016, Ramadoss (then chief manager, SBI), D.P. Gupta (Chief Operating Manager, HTL), Pratish (MD, VGN) and VGN developers P ltd, on the basis of an anonymous complaint, for an offence under sections 120(b), 420 IPC, and 13(2) R/W 13(1)(d) of the Prevention of Corruption Act. The CBI FIR alleged that the said property was sold for less than the guideline value of Rs. 387 crores, resulting in a loss of Rs. 115 crores to the Government of India.
Based on the CBI FIR, the Enforcement Directorate ( ED ) filed an ECIR No. CEZO/01/2017, and ED attached the property by provisionally attaching by order dated February 13, 2018. ED filed an original complaint no. 897/2018 before the adjudicating authority in New Delhi to confirm their provisional attachment. VGN moved the Supreme Court seeking for direction to complete the CBI investigation in a time-bound manner and to file their final report as soon as possible as VGN had suffered greatly in terms of financial hardships and innocent homebuyers were suffering.
On 29/04/2019 CBI filed their closure report before the CBI court stating that no prosecutable evidence was found and hence they closed their case and the same was also accepted by the CBI court on 30/04/2019 acquitting all parties. In the meantime, ED filed their complaint before the Principal sessions Judge; the same is pending as C.C.No.56/2018 before CBI filed the closure report .VGN filed a quash petition in Crl.O.P.No.9796 of 2019 before the High Court of Madras seeking to quash the Criminal Complaint No.56 of 2018 and the same was dismissed on 04/10/2019 .
VGN preferred an SLP before the Supreme Court of India in the year 2019 against the High Court order. In the Supreme Court, the ED has presented before the Chief justice and explained that considering the peculiar facts of the case, all proceedings may be stayed.
On July 27, 2022, the Supreme Court on its Judgment stated that these appeals/petitions are de-tagged and ordered to be listed separately before the appropriate Bench as the impugned judgment in the concerned case dealing with the prayer for bail/discharge/quashing. This relief will have to be decided on a case-to-case basis. Accordingly, these matters are listed separately before the appropriate Bench. The Registry to do the needful in this regard.
Based on the judgment, VGN case SLP 10627/2019 was listed before Honorable Justice Sanjay Kishan Kaul and Justice Abhay S Oka on 2/12/2022, and the Honorable Bench quashed the entire proceedings of the ED against its Managing Director, Pratish Vedhappudi and the company M/s VGN Projects Estates, stating that ED Proceedings will not survive as the predicate offence filed by the CBI has been closed and accepted. The judgment is a huge relief to the promoters and the company.
