In an affidavit submitted to the Delhi High Court, the Citizens Whistle Blower Forum stated that Yes Bank, a private-sector lender founded by Rana Kapoor, advanced “dubious” loans amounting to at least Rs 5,698 crore to various companies of the Indiabulls group and others owned by its founder and promoter, Sameer Gehlaut. Publicly available documents reveal that many of these loans were issued after the respective companies had reported a negative net worth. The affidavit stated that “in order to return the favour,” Indiabulls Housing Finance Limited (IHFL), the flagship of the Indiabulls group, lent a sum of Rs 2,034 crore to seven companies owned, directly or through subsidiaries, by family members of Rana Kapoor, who is also the promoter of Yes Bank.
The affidavit noted that 14 companies part of the Indiabulls group received loans from Yes Bank. In effect, the affidavit accused Yes Bank of lending money over the course of a decade while Rana was at its helm, and stated that in turn, IHFL routed money into companies controlled by Bindu Kapoor, Rana’s wife, and their daughters, Radha, Rakhee and Roshni—as a result, converting public money into private wealth.
Gagan Banga, the vice chairman and managing director of IHFL, told me that ten of the 14 companies are owned by Gehlaut and have no other connection to the Indiabulls group. The other four companies—Indiabulls Housing Finance, Indiabulls Ventures, Indiabulls Distribution Services and Indiabulls Consumer Finance—are part of the Indiabulls group. According to the figures in the affidavit, Yes Bank lent at least Rs 2,698 crore to the ten firms owned by Gehlaut and Rs 3,000 crore to the four Indiabulls companies. The Indiabulls group has submitted its response to the allegations, accusing the petitioners of “misleading” the court and noting that as of 21 October, only Rs 1,417 crore was outstanding, while the rest had been paid back.