ED Pushes for Legal Merits in Maharashtra Bank Scam Discharge Pleas
The Enforcement Directorate (ED) has formally requested a special court to decide the discharge applications filed by MLA Rohit Pawar and 11 other accused in the Maharashtra State Co-operative Bank (MSCB) money laundering case based solely on legal merits. This move comes after the ED's efforts to oppose closure reports submitted by the Mumbai Police's Economic Offences Wing (EOW) were unsuccessful.
ED Acknowledges EOW Closure Reports
In its detailed reply to the court, the ED acknowledged that the EOW's closure reports in the alleged Rs 25,000 crore MSCB scam have been accepted. The agency also referenced the rejection of its intervention applications and urged the court to proceed with hearing and deciding the discharge applications on their substantive legal grounds.
"In view of consideration of the same, it is requested to the… Court that the said discharge applications may please be heard and decided on merit and appropriate orders be passed," the ED stated in its submission.
Background of the MSCB Scam Case
The ED's investigation was initiated based on the EOW's FIR, which alleged a massive financial fraud. In 2023, the ED filed its first chargesheet against Jarandeshwar Sugar Mills Ltd concerning the purchase of Jarandeshwar Sugar Co-operative Mill. This chargesheet mentioned connections to Ajit Pawar and Sunetra Pawar but did not name them as accused. Subsequently, a supplementary chargesheet was filed naming NCP MLA Prajakt Tanpure, among others.
The ED has accused the involved parties of cheating, misconduct, and money laundering in the auctioning of sugar mills. It linked suspicious transactions to prominent figures including Ajit Pawar, Sunetra Pawar, Shiv Sena's Arjun Khotkar, and companies associated with NCP (SP) leaders Rohit Pawar and Tanpure.
EOW's Closure Reports and ED's Challenges
On January 20, 2024, the EOW submitted a second closure report, providing a clean chit to the late Ajit Pawar, Deputy Chief Minister Sunetra Pawar, and their nephew Rohit Pawar. Notably, Ajit Pawar was serving as Deputy CM in the Mahayuti government at the time of this submission.
The ED highlighted that the EOW had initially filed a closure report in 2020, stating no criminal offence was made out. After reopening the probe in 2022, the EOW filed the second closure report in early 2024. The ED attempted to intervene by sharing additional material, but in February 2026, the court accepted the closure report and dismissed the ED's second intervention plea.
Legal Significance and Supreme Court Ruling
The ED's stance is particularly significant in light of a Supreme Court ruling from July 27, 2022, which held that proceedings under the Prevention of Money Laundering Act (PMLA) cannot continue without a predicate or scheduled offence. In this case, the EOW's investigation serves as the scheduled offence underpinning the ED's money laundering prosecution.
Details of the Alleged Scam
The alleged scam involves 31 district central co-operative banks under the MSCB umbrella. These banks, many of which were headed by influential politicians, are accused of granting loans to cooperative sugar factories in violation of established norms. After these factories defaulted, the MSCB auctioned their assets to recover dues.
It is alleged that the auction process was manipulated, resulting in several sugar mills being sold at undervalued prices to relatives or associates of bank office-bearers. This purported manipulation caused significant financial losses to the bank.
ED's Prosecution and Ongoing Legal Battles
In its reply to the discharge pleas, the ED outlined the case timeline, noting that it filed a main prosecution complaint in 2023 under the PMLA, followed by three supplementary complaints. The special court took cognisance of the money laundering case on multiple dates between mid-2023 and mid-2025.
During this period, the ED shared details of financial irregularities and transactions with the EOW. The agency sought permission to present additional material before the court, but its application was rejected on technical grounds. This rejection has been challenged before the Bombay High Court, where the matter remains pending.
Current Court Proceedings
The special court heard arguments on the discharge pleas on Tuesday and has adjourned the matter to April 13 for further proceedings. The ED's request for a merits-based decision underscores the ongoing legal complexities in this high-profile financial scandal.
