The Supreme Court of India on Wednesday, 4th February, took a firm stand in the Anil Dhirubhai Ambani Group (ADAG) bank fraud case, as it ordered the Enforcement Directorate (ED) to form a Special Investigation Team (SIT) to investigate serious irregularities related to Reliance Communications, its group companies and industrialist Anil Ambani.
The court also noted that it has been assured that Anil Ambani will not leave the country without its permission.
#BREAKING Anil Ambani won't leave the country without the permission of the #SupremeCourt, his lawyer Senior Adv Mukul Rohatgi tells the Court.
— Live Law (@LiveLawIndia) February 4, 2026
The statement was made in the petition seeking investigation into bank fraud by Anil Dhirubhai Ambani Group Companies.#AnilAmbani pic.twitter.com/Mv79zOWQ2F
The order was passed by a bench headed by Chief Justice of India Surya Kant, along with Justices Joymalya Bagchi and Vipul Pancholi. The bench stated that the ED must constitute a dedicated SIT of senior officers and that the investigation must be taken to its “logical conclusion”.
The court also made it clear that all necessary steps must be taken so that the investigation is not delayed or disrupted in any manner.
Anil Ambani was told not to leave India
During the hearing, there were apprehensions that Anil Ambani may leave the country during the course of the ongoing investigation. In response to this, Anil Ambani’s lawyer, senior advocate Mukul Rohatgi, told the court that his client would not leave the country without the court’s permission.
“He will not leave India without the leave of this court,” Rohatgi told the court, following which the bench recorded this assurance in its order.
Solicitor General Tushar Mehta pointed out that there have been instances in the past where such assurances have not been sufficient. This led to some sharp exchanges in the court, but the bench made it clear that the government has assured that all preventive measures would be taken to ensure that the investigation takes place smoothly.
CBI asked to investigate the role of bank officials
The court also pulled up the Central Bureau of Investigation (CBI) and asked it to expand its investigation. The bench asked the CBI to investigate if there was any role of bank officials in the sanctioning or release of funds.
The court said that the CBI must investigate any possible nexus, collusion, or conspiracy between the borrowers and the bank officials, and must take all legal steps to reach the end of the investigation.
The judges also expressed concern over the slow pace of investigation by both agencies and pointed out that there had been unexplained delays, especially on the part of the ED.
Status reports are sought every month
Taking note of the seriousness of the matter, the Supreme Court directed both the ED and the CBI to file detailed status reports within four weeks. The bench also said it expects regular monthly updates on how the investigation is progressing.
“This is a huge amount of public money. We expect the agencies to act promptly, independently and fairly,” the court observed while addressing the Solicitor General.
The bench added that based on a status report filed by the CBI, the FIR was initially registered only on a complaint by the State Bank of India (SBI), and was later expanded to include complaints from other banks. The court noted that this approach did not appear proper.
Arguments from both sides
The case is being heard on a petition filed by former Union Secretary EAS Sarma, who has sought a court-monitored investigation. Sarma has argued that the investigations conducted so far are not sufficient.
Representing Sarma, advocate Prashant Bhushan told the court that the FIR was registered in 2025 and the first arrest came only recently, even though this is one of the biggest corporate fraud cases in the country.
On the other hand, Mukul Rohatgi and senior advocate Shyam Divan, appearing for ADAG companies, denied claims of fund diversion. They said insolvency and bankruptcy processes should not be seen as criminal acts and also stated they were not opposing the formation of an SIT.
The Solicitor General countered this by saying banks had carried out forensic audits through independent auditors, which clearly pointed to the misuse of funds.
Court flags misuse of insolvency process
During the hearing, the bench also made strong oral remarks on how the insolvency process is being used. Chief Justice Surya Kant noted that assets often get undervalued and companies are later picked up by related parties through what appears to be pre-planned auctions.
“The haircut is phenomenal,” the court remarked, with the government also telling the bench that it is closely examining issues related to the Insolvency and Bankruptcy Code (IBC).
What is the ADAG Bank Fraud case?
The ADAG bank fraud case is connected with loans of ₹31,580 crore taken between 2013 and 2017 by Reliance Communications and its subsidiaries, including Reliance Infratel and Reliance Telecom. The loans were sanctioned by a set of banks headed by SBI.
According to the petition, a forensic audit ordered by SBI found that large amounts were used for purposes other than what the loans were approved for. These included repayment of other loans, transfers to connected entities, investments in mutual funds and fixed deposits that were quickly withdrawn, and circular transactions meant to keep loans running.
The petition further highlights that the forensic audit report was received by SBI in October 2020, but the complaint was filed only in August 2025, which raises serious doubts about the delay.
The Supreme Court has now made it clear that only strict monitoring and a focused investigation can ensure accountability in a case involving such large public funds.
