The Mumbai Police Economic Offences Wing (EOW) has found no evidence of criminal wrongdoing by former IndusInd Bank executives in connection with the ₹1,950 crore and ₹258 crore accounting discrepancies that had come under scrutiny earlier this year.
According to EOW sources quoted by CNBC-TV18, the initial ₹1,950 crore entry—responsible for a sharp correction in the bank’s stock—was determined to be a genuine accounting error rather than a case of fund diversion, manipulation, or fraud.
As part of its preliminary enquiry (PE), the agency also evaluated a separate ₹258 crore entry flagged in an audit by Grant Thornton. The audit report had suggested that this amount may have been selectively used to lift the bank’s net interest income in quarters where the financial performance was below expectations.
However, EOW officials have now confirmed that the ₹258 crore entry too appears legitimate, with no signs of irregularities or siphoning of funds.
“We have written to the banking regulator regarding a couple of queries that we had. Based on their reply, we will come to a conclusion. There is currently no further enquiry we are doing. No criminal conduct found so far,” EOW officials told CNBC-TV18.
The agency had earlier questioned former senior leaders including ex-MD & CEO Sumant Kathpalia, ex-Deputy CEO Arun Khurana, and CFO Gobind Jain. Investigators have since ruled out any fraudulent activity by them.
Mumbai Police has also approached the Reserve Bank of India (RBI) for clarification on some technical matters before formally concluding the inquiry.
With no evidence of criminality or fund siphoning established, the preliminary enquiry is expected to be closed soon, and sources indicate that there is no basis to file an FIR in the case.
