'We're A Victim, Not Accused': Sammaan Capital After Karnataka HC Quashes ED Case

Sammaan Capital, formerly known as Indiabulls Housing Finance, said on August 18 that it has no connection to allegations being probed by investigating agencies, asserting that the company is a victim rather than an accused in the case involving its former promoter.

The statement came after the Karnataka High Court quashed proceedings initiated by the Directorate of Enforcement (ED) against the company in a money laundering case, following a rehearing of the matter.

In its statement, Sammaan Capital said there are no allegations against the company itself, and that the Supreme Court has directed the Central Bureau of Investigation (CBI) to probe allegations concerning the erstwhile promoter. The company said the ED has clarified that Sammaan Capital is a victim, and that the FIR being investigated by the CBI pertains to the former promoter, not the company.

"After receiving clean-chits as far as Sammaan Capital Limited is concerned, the matter is over: the Company is not, and has never been, an accused in this case," the statement said, adding that the company continues cooperating with authorities investigating the erstwhile promoter and others.

The company noted that it severed all ties with former promoter Sameer Gehlaut after he exited the company and sold his entire stake in 2023. It said the business now operates under a new promoter, International Holding Company PJSC (IHC), an Abu Dhabi based sovereign linked investor that has put in $1 billion, among the largest foreign investments in India's NBFC sector, and now controls the company's board.

Sammaan Capital said the Supreme Court had earlier clarified it had not expressed any view on the merits of allegations against the company, and reiterated the same position in the recent hearing.

The Karnataka High Court had indicated last week that it would quash the ED proceedings against Sammaan Capital, but decided to rehear the matter on August 17 after learning of related proceedings pending before the Supreme Court involving IHFL.

Justice M Nagaprasanna noted in the order that an affidavit filed by the ED confirmed the Supreme Court proceedings were unconnected to the Enforcement Case Information Report under consideration in the Karnataka High Court, according to Bar and Bench.

Additional Solicitor General Aravind Kamath, representing the ED, told the court that the Supreme Court matter related to the Indiabulls and Yes Bank fraud case, while the ED's proceedings before the Karnataka High Court were based on separate offences registered in the state.

The court had earlier observed that four of the five predicate offences linked to the case had concluded without any conviction. In the fifth case, police had filed a closure report in 2022, which the trial court had not yet accepted due to the complainant's repeated non-appearance despite the matter being listed ten times.

Citing the Supreme Court's ruling in Vijay Madanlal Choudhary versus Union of India, the court quashed the ED proceedings against Sammaan Capital.

Senior Advocate Prabhuling Navadgi, representing Sammaan Capital, submitted that the Supreme Court proceedings concerned IHFL's founder director Sameer Gehlaut and did not pertain to Sammaan Capital. The company was also represented by Senior Advocate Dhyan Chinnappa, along with advocates Chintan Chinnappa, Laksh Khanna and Venkatesh Kamath.