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What is the story about?
The Enforcement Directorate (ED) has arrested Ashok Kumar Pal, Chief Financial Officer of Reliance Power Ltd (RPL), in connection with a ₹68 crore fake bank guarantee (BG) racket linked to a Solar Energy Corporation of India (SECI) tender, sources told CNBC TV18.
Pal was taken into custody late Friday night after extensive questioning at the ED's Delhi office. He was produced before a special court on Saturday (October 11) morning, where the agency sought two days' custody. Sources said he will now be produced before the court again on Monday.
The allegations
Sources said ED has alleged that Pal played a crucial role in the diversion of funds and submission of a forged bank guarantee to SECI during a tender for Battery Energy Storage System (BESS) projects.
As the CFO of Reliance Power — a listed company with over 75% public shareholding — Pal was authorised under a board resolution to finalise and execute bid-related documents. Investigators allege he abused this authority to facilitate the fraudulent BG submission.
"He was central to the planning, supervision, funding, and concealment of the forged BG scheme used in the SECI tender," sources said.
The ED has alleged that the fake guarantee, valued at ₹68.02 crore, was purportedly issued by FirstRand Bank, Manila, though no such branch exists in the Philippines. The anomaly triggered deeper scrutiny that eventually exposed the larger fraud network, sources said.
Use of a fake vendor and forged domains
Investigations have also alleged that Pal played a key role in selecting Biswal Tradelink Pvt Ltd (BTPL) — a small company operating from a residential address — to provide the fake bank guarantee. The entity had no credible background or track record in handling such financial instruments.
BTPL's director, Partha Sarathi Biswal, is already in judicial custody in connection with the same case.
The ED further alleged that the forged documents were routed through spoofed email domains resembling those of legitimate Indian banks. These included lookalike domains such as s-bi.co.in, lndianbank.in, lndusindbank.in, and pnblndia.in, among others.
Sources said these fake domains were created to impersonate official bank communications, enabling the circulation of forged letters of guarantee that appeared authentic.
Diversion of funds
Beyond the fake BG, Pal is alleged to have facilitated the diversion of funds through bogus transport invoices worth several crores of rupees, sources added.
ED alleged that he approved these payments via Telegram and WhatsApp, operating outside Reliance Power's internal SAP/vendor management systems — a move believed to be aimed at avoiding internal audit scrutiny.
Sources said this layer of concealment points to premeditated financial manipulation, raising concerns about internal governance controls within the company, are some other allegations levelled by ED.
Implications for listed companies
The case has broader implications for corporate governance and compliance standards among India's listed entities.
Reliance Power, a public company where retail investors hold a majority stake, faces reputational and regulatory challenges if the allegations are proven.
"This is not merely a case of financial forgery — it's a breach of trust with shareholders," said a senior corporate law expert. "When a listed company's senior management is implicated, it raises serious questions about oversight and board vigilance."
The ED is now examining whether the proceeds of the fraud were diverted for personal gain or layered through intermediaries. Sources said the probe could widen as forensic audits trace the money trail linked to the fake BG network.
The ED's case forms part of its ongoing drive to crack down on financial fraud involving fake bank guarantees and shell entities, which have surfaced across multiple sectors in recent years.
Pal was taken into custody late Friday night after extensive questioning at the ED's Delhi office. He was produced before a special court on Saturday (October 11) morning, where the agency sought two days' custody. Sources said he will now be produced before the court again on Monday.
The allegations
Sources said ED has alleged that Pal played a crucial role in the diversion of funds and submission of a forged bank guarantee to SECI during a tender for Battery Energy Storage System (BESS) projects.
As the CFO of Reliance Power — a listed company with over 75% public shareholding — Pal was authorised under a board resolution to finalise and execute bid-related documents. Investigators allege he abused this authority to facilitate the fraudulent BG submission.
"He was central to the planning, supervision, funding, and concealment of the forged BG scheme used in the SECI tender," sources said.
The ED has alleged that the fake guarantee, valued at ₹68.02 crore, was purportedly issued by FirstRand Bank, Manila, though no such branch exists in the Philippines. The anomaly triggered deeper scrutiny that eventually exposed the larger fraud network, sources said.
Use of a fake vendor and forged domains
Investigations have also alleged that Pal played a key role in selecting Biswal Tradelink Pvt Ltd (BTPL) — a small company operating from a residential address — to provide the fake bank guarantee. The entity had no credible background or track record in handling such financial instruments.
BTPL's director, Partha Sarathi Biswal, is already in judicial custody in connection with the same case.
The ED further alleged that the forged documents were routed through spoofed email domains resembling those of legitimate Indian banks. These included lookalike domains such as s-bi.co.in, lndianbank.in, lndusindbank.in, and pnblndia.in, among others.
Sources said these fake domains were created to impersonate official bank communications, enabling the circulation of forged letters of guarantee that appeared authentic.
Diversion of funds
Beyond the fake BG, Pal is alleged to have facilitated the diversion of funds through bogus transport invoices worth several crores of rupees, sources added.
ED alleged that he approved these payments via Telegram and WhatsApp, operating outside Reliance Power's internal SAP/vendor management systems — a move believed to be aimed at avoiding internal audit scrutiny.
Sources said this layer of concealment points to premeditated financial manipulation, raising concerns about internal governance controls within the company, are some other allegations levelled by ED.
Implications for listed companies
The case has broader implications for corporate governance and compliance standards among India's listed entities.
Reliance Power, a public company where retail investors hold a majority stake, faces reputational and regulatory challenges if the allegations are proven.
"This is not merely a case of financial forgery — it's a breach of trust with shareholders," said a senior corporate law expert. "When a listed company's senior management is implicated, it raises serious questions about oversight and board vigilance."
The ED is now examining whether the proceeds of the fraud were diverted for personal gain or layered through intermediaries. Sources said the probe could widen as forensic audits trace the money trail linked to the fake BG network.
The ED's case forms part of its ongoing drive to crack down on financial fraud involving fake bank guarantees and shell entities, which have surfaced across multiple sectors in recent years.
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