A Special Court under the Prevention of Money Laundering Act (PMLA) in Panchkula has dismissed the bail application of Aam Aadmi Party (AAP) leader Deepak Singla in a bank fraud case. Singla, who serves as AAP’s Goa in-charge and contested the Vishwas Nagar constituency in Delhi in 2020 and 2025, was arrested on May 18.
Background of the Case
On May 8, 2018, the Central Bureau of Investigation (CBI) registered an FIR for bank fraud based on a complaint by Oriental Bank of Commerce (OBC). It was alleged that M/s Mahesh Timber Private Limited had established a wholly owned subsidiary in Singapore, which was availing credit facilities from banks there, backed by standby letters of credit issued by the Consortium of Banks in India.
According to the CBI, the company, in conspiracy with private persons, fraudulently enhanced Foreign Letters of Credit (FLCs), resulting in a wrongful loss of approximately Rs 155.21 crores to OBC. During the investigation, the principal outstanding amount against the company was found to be Rs 239.46 crore. A charge sheet was filed on August 10, 2020.
ED Investigation and Allegations
The Enforcement Directorate (ED) also recorded an Enforcement Case Information Report (ECIR) in the matter on September 5, 2019. It alleged that the accused, in conspiracy with a senior OBC manager, inflated FLCs to Rs 173.03 crore against the original value of Rs 21.47 crore. Further investigation revealed that forged bills of entry, bills of lading, and other import documents were allegedly used to siphon off funds.
The ED told the court that Singla is the brother of co-accused Raman Singla, director of Amazon Exports Pte Ltd (a shell firm), and the nephew of main accused Ashok Kumar Mittal, a director of Mahesh Timber Private Limited. It claimed that Deepak Singla actively participated in the alleged conspiracy relating to fraudulent enhancement of FLCs, generation of proceeds of crime, and their subsequent laundering through interconnected firms and layered financial transactions.
“Deepak Singla held directorial and managerial positions in various entities linked with the fraud, including M/s Mahesh Timber Private Limited and M/s Traffic Media India Private Limited,” said the ED.
The agency further alleged that Rs 2.82 crore was transacted in a circular manner through accounts linked to Deepak Singla and co-accused Ashok Mittal, in a “structured manner designed to disguise the beneficial ownership and criminal origin of the funds.”
Recovery of Cash and Non-Cooperation
During a search operation at Deepak Singla’s premises, the ED recovered Rs 25 lakh in cash and SGD 6,000 on May 18. He was remanded to ED custody on May 20. His arrest and remand have been challenged before the Punjab and Haryana High Court.
Rs 143 Crore Yet to Be Traced
Opposing bail, ED Special Public Prosecutor Harneet Singh Oberoi argued that approximately Rs 143 crore, which had been siphoned off, remained to be traced, and that further investigation was necessary for a just and fair determination of the matter. The court was told that while recording his statement in custody, Deepak Singla made evasive denials to 150 of 165 queries. He intentionally did not provide the password for his seized mobile, which the ED believes contains incriminating material.
High-Value Transactions Remain Unexplained
The court was further informed that there was no explanation for the Rs 60 lakh received into Deepak Singla’s account from Ragni Shyam, which was subsequently transferred to M/s Traffic Media India Private Limited. Similarly, Rs 1.05 crore was credited to his account by M/s Kayo International, operated by his wife, and was subsequently transferred to Jai Durga Enterprises, which was under the control of the co-accused in the case. He remained evasive about the Rs 1.41 crore credited to his account by Jai Durga Enterprises, the ED claimed.
Defense Arguments and Court’s Decision
Deepak Singla’s counsel argued that the investigation in this case was initiated eight years ago, and all the material now sought to be presented was already available to the ED, but after sleeping over it for eight years, Deepak Singla was arrested. It was claimed that when other accused, who held an equal or higher role, had not even been arrested, Deepak Singla was at least entitled to bail.
However, on June 6, the Special Court held that the ED had left the further investigation open in its Prosecution Complaint and Supplementary Complaint filed in the case, and that this aspect would not entitle Deepak Singla to the “grant of bail.”
