Published Oct 26, 2026 | 2:37 PM ⚊ Updated Oct 26, 2026 | 2:37 PM
Supreme Court
The directors of Ind Barath Power Gencom Limited, who are facing allegations of diverting bank loans and committing fraud using forged documents, faced a setback in the Supreme Court.
The apex court dismissed the quash petitions filed by Andhra Pradesh Deputy Speaker Kanumuru Raghu Rama Krishna Raju, Dumpala Madhusudhana Reddy, Ambedkar Rajkumar Ganta, and others seeking the cancellation of the FIR registered against them.
A two-judge bench comprising Justice Dipankar Datta and Justice Sheel Nagu delivered this key verdict regarding the case on Monday, 26 October.
During the hearing of the case registered by the CBI in 2021, Senior Advocate Siddharth Dave, appearing for the petitioners, argued that the FIR was registered against them solely based on a forensic report, and claimed that the allegation of fabricating records for term loans was untrue.
He also brought to the bench’s attention that the Madras High Court had not considered the arguments relating to independent directors in this matter.
Responding to this, the bench led by Justice Dipankar Datta questioned the petitioners’ counsel as to why these arguments were not raised when the quash petition was originally filed before the High Court.
After hearing arguments from both sides, the bench made it clear that it could not interfere in the investigation process at the current stage. It clarified that the investigation would continue as usual, given the existing orders directing the Investigating Officer (IO) to complete the probe and file a chargesheet within 16 weeks.
The Supreme Court also clarified that the observations (findings) made earlier by the High Court while dismissing the quash petitions were solely for the purpose of disposing of those petitions. The verdict stated that the High Court’s remarks would have no bearing on the independent investigation conducted by the Investigating Officer.
Accordingly, the court announced the dismissal of the petitions filed by Kanumuru Raghurama Krishna Raju, Indira Priyadarshini, Ramadevi, Madhusudhana Reddy, Ambedkar Rajkumar Ganta, Narayana Prasad, and others.
The Central Bureau of Investigation (CBI) registered a case on March 24, 2021, over alleged irregularities in the utilisation of loans extended to Ind Barath Power Gencom Limited (A1). Based on a complaint filed by the State Bank of India (SBI), the case involves allegations of fraud amounting to ₹237.84 crore. A forensic audit reportedly raised several concerns regarding coal stock accounting, utilisation of loan funds, transfers to associate companies, supporting documents for operational expenses and the handling of revenue accounts controlled by lenders.
Ind Barath Power Gencom Limited operates a coal-based power project in the Thoothukudi region of Tamil Nadu. The project comprises three units of 63 MW each, with a total installed capacity of 189 MW.
According to the SBI complaint, the company was incorporated on July 25, 2005, and commenced commercial operations on January 25, 2010.
The company obtained credit facilities from a consortium of banks led by SBI for its power project and other business requirements. The principal allegation is that the funds were diverted from their intended purposes.
S. Ravichandran, Deputy General Manager of SBI’s Stressed Assets Management Branch in Chennai, lodged a complaint with the CBI on March 23, 2021. The CBI’s Banking Securities and Frauds Branch in Delhi registered the case the following day. The FIR against company directors Ambedkar Rajkumar, Madhusudhana Reddy, and Raghurama Krishna Raju, invoked Sections 120-B, 420, 467, 468 and 471 of the Indian Penal Code (IPC), along with Sections 13(2) and 13(1)(d) of the Prevention of Corruption Act, 1988, in connection with allegations of criminal conspiracy, cheating, forgery and the use of forged documents as genuine.
When the accused previously approached the Madras High Court seeking to quash the case, the court dismissed their petitions, stating that it could not interfere as the investigation into the economic offenses was at a preliminary stage, and emphasized that the Investigating Officer must be given a free hand.
Challenging this High Court order, the directors approached the Supreme Court, where the apex court also upheld the High Court’s orders and put an end to the quash petitions.
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(Edited by Sumavarsha)
