The Delhi High Court on January 31, 2026, refused to grant either regular or interim bail to Ashok Kumar Pal, the former Chief Financial Officer (CFO) of Reliance Power Ltd, in a money laundering case involving an alleged forged bank guarantee of Rs 68.20 crore submitted to the Solar Energy Corporation of India (SECI) for a tender.
Pal has been in custody since October 10, 2025. Justice Madhu Jain dismissed his bail applications, stating that, given the nature of the allegations and the evidence presented by the Directorate of Enforcement (ED), the accused was not entitled to bail at this stage. The trial court had previously rejected his regular bail plea on March 11, 2026.
The ED's investigation centres on a forged bank guarantee, endorsements, and confirmations submitted to SECI during the tender process. Justice Jain noted, “Having regard to the nature of the allegations and the material relied upon by the Directorate of Enforcement, including statements recorded under Section 50 of the PMLA, documentary material and electronic communications collected during investigation, this Court is unable to record satisfaction that there are reasonable grounds for believing that the applicant is not guilty of the offence alleged.” The Court also stated that the conditions under Section 45 of the Prevention of Money Laundering Act (PMLA) were not met at this juncture.
The judge further explained that a detailed evaluation of the evidence or conclusive findings on disputed facts are not required at the bail consideration stage. “The material relied upon by the Directorate of Enforcement cannot be entirely disregarded and has to be evaluated in light of whether it reveals a prima facie case,” the Court declared.
The High Court rejected Pal's arguments that he lacked knowledge of the alleged forgery, acted solely in his official capacity, initiated the complaint that resulted in a Central Bureau of Investigation (CBI) FIR, and did not receive any proceeds of crime, noting these issues require thorough evaluation during trial.
The ED opposed the bail application by referencing WhatsApp communications obtained during the probe, which indicated that Pal forwarded a revised bank guarantee draft and altered the issuing bank's details from “FirstRand Investment Limited, USA” to “FirstRand Bank, Manila, Philippines.” The agency stated that Reliance Power Ltd had engaged M/s Biswal Tradelink Private Limited to arrange the bank guarantee related to the SECI tender, and substantial funds were transferred between the parties. The ED alleged that the submitted bank guarantees and related documents were forged and integral to the investigation.
Senior Advocate N Hariharan, with Siddharth Yadav, Alok Kumar, and Varun Chandok, represented Ashok Kumar Pal. The defence highlighted that Pal had been in custody since October 2025, with the case still at a pre-cognisance stage. They argued against prolonged detention without trial, given that cognisance had not yet been taken.
Senior Advocate Hariharan cited Supreme Court judgments affirming that Article 21 of the Constitution, which protects the right to life and personal liberty, holds precedence over the twin conditions in Section 45 of the PMLA. The defence also asserted that no proceeds of crime had been generated and that Pal operated strictly in his professional capacity. It was noted that the maximum penalty under the PMLA is seven years, and Pal had already spent approximately eight months in custody. The defence emphasised Pal's cooperation with investigators and that his statement had been recorded before arrest.
The bail plea was heard by a vacation bench after liberty was granted by the Supreme Court, having originally been scheduled for July 8.
Advocate Zoheb Hossain, Special Counsel for the ED, argued that the allegations were grave, involving the use of a fabricated bank guarantee, which constitutes offences under the PMLA. The ED claimed that eight months' custody did not amount to prolonged detention under Section 45 of the PMLA and stressed that the Act's special provisions prevail over general law.
The petitioner maintained that the dispute arose from the provision of a bank guarantee as earnest money deposit to SECI within tender requirements, and contended the forged bank guarantee from FirstRand Bank was procured inadvertently. The petitioner stated, “There is no gainsaying that the intention of the Applicant, acting on behalf of Reliance NU BESS Limited, was bona fide since the inception of the transaction, for he derives no benefit by knowingly procuring a forged BG. Thus, ‘intent’, a prerequisite of Sec. 3 of PMLA, 2002, evident from the use of the expression ‘indulge or knowingly assists or knowingly is a party’, stands obliterated qua the Applicant.”
The defence further claimed that Pal's arrest was illegal because it failed to meet the twin tests of “justifiable reasons to believe” and “necessity for arrest”.