CBI Books Subhash Chandra, Four Firms Over Alleged ₹1,322-Crore Loan Fraud at LIC Housing Finance

The Central Bureau of Investigation has booked Essel Group promoter Subhash Chandra and four borrower companies for allegedly orchestrating a ₹1,322-crore loan fraud against LIC Housing Finance Limited. The case, registered by the agency’s Banking Securities and Fraud Branch in New Delhi following a formal complaint by the housing financier’s general manager Neeta Menghani, outlines an intricate web of inflated personal net-worth declarations, loan defaults, and subsequent asset-stripping designed to defeat debt recovery.

The roots of the investigation trace back to 2018, when the housing finance major approved two substantial credit lines totaling ₹980 crore in principal to corporate borrowers closely tied to Chandra. The first was a ₹500-crore takeover and business expansion facility granted in March 2018 to Vasant Sagar Properties Private Limited and its co-borrower Pan India Infrastructure. Months later, in August 2018, the lender sanctioned another ₹480 crore under a rental securitization scheme to Digital Subscriber Management and Consultancy Services alongside Spirit Infrapower and Multiventures. Both transactions were secured by personal guarantees executed by Chandra, whose towering paper valuation served as the primary inducement for the financial institution to release the funds.

To satisfy the lender’s risk criteria, Chandra furnished net-worth certificates depicting monumental personal wealth. One assessment, prepared by DJM & Co in March 2018, pegged his valuation at nearly $6.2 billion, or approximately ₹59,113 crore, as of the close of the 2017 fiscal year. Another certificate submitted months later by MPJ & Co reflected a personal net worth standing at ₹40,562 crore. On the strength of these staggering numbers, the credit facilities were cleared and disbursed.

The financial facade began unraveling when both borrower accounts slipped into default. The Vasant Sagar facility turned into a non-performing asset in 2021, followed by the Digital Subscriber account in late 2023, eventually ballooning into a total wrongful loss of more than ₹1,322 crore when unpaid interest and compounding statutory charges were factored in.

The critical breakthrough for investigators emerged from Chandra’s own admissions during subsequent personal insolvency proceedings initiated under the Insolvency and Bankruptcy Code. Confronted with his obligations, Chandra contradicted the very documents that had secured the credit, disowning the historical valuations and disclosing that his net worth in 2024 hovered at just ₹31.79 crore. Crucially, he admitted that even during 2017 and 2018, his wealth had never crossed the ₹40,000-crore threshold. Treating these discrepancies as evidence of deliberate deceit, criminal conspiracy, and fund diversion, the CBI has now initiated a comprehensive probe led by Additional Superintendent of Police Rajeev Ranjan to track the flow of money and uncover the role of any public officials involved in approving the credit lines.