Conman Sukesh Chandrashekar Case: Delhi HC permits ED to sell 26 luxury cars owned by his wife

The Delhi High Court on Tuesday upheld a decision allowing the Enforcement Directorate (ED) to sell 26 high-end luxury cars. These cars were allegedly purchased by conman Sukesh Chandrashekar's wife, Leela Paulose, using money obtained through illegal activities.

The court noted that vehicles lose value over time due to natural decay, affecting their worth and functionality. Therefore, the ED was instructed to place the money from the sale of the cars in an interest-bearing fixed deposit.

Leena Paulose, the wife of Chandrashekar and also arrested in a Rs 200 crore extortion case, filed a plea against a trial court's decision allowing the ED to sell the vehicles. Nevertheless, Justice Swarana Kanta Sharma dismissed her plea and unequivocally stated that the vehicles could be sold according to the law.

The trial court also allowed a representative from the Delhi Police or Economic Offences Wing to participate in the car auction process.

The high court noted that if a car remains stationary in a warehouse for years, its condition can deteriorate. During the hearing, the court explained, "Environmental factors, like weather conditions, contribute to this decay, leading to rust and corrosion. Rust, in particular, can severely damage a vehicle's structure and other components."

The court also pointed out the costs associated with upkeep and maintenance.

“Mechanical components of a vehicle also suffer from decay, requiring frequent and expensive maintenance to keep it operational, especially in the present case, where the vehicles involved are 26 high-end luxury cars such as Rolls Royce, Ferrari, Range Rover etc,” it added. 

The Prevention of Money Laundering Act (PMLA) permits the sale of seized vehicles. Putting the proceeds into a fixed deposit helps address issues of depreciation and usage, benefiting both the accused and the investigating agency by preventing resource wastage.

“For the accused, if the trial concludes in his favour after several years, he would receive the monetary value rather than a decayed, non-operational, rusted vehicle, almost reduced to junk. This ensures the accused does not suffer any financial loss due to the prolonged judicial process. For the investigating agency, this approach ensures that the value of the seized properties will be available to the investigating agency if the trial concludes in their favour,” the court said.

Paulose's lawyer argued that she had been suffering from depression and memory loss due to over 16 months of isolation in jail. She could only recall the registration numbers of two cars, the Rolls Royce Ghost and Brabus.

According to Paulose, these cars were bought in 2018, before the alleged crime, and therefore could not have been purchased with criminal proceeds. She also claimed that she is being targeted because she is Chandrashekhar's wife.

Paulose stated she had an independent business of buying and selling cars, with most having legally valid loan agreements.

The ED questioned Paulose's memory, noting that while she could recall valid loan agreements, she could only remember the registration numbers of two cars.

“A reasonable human being, who can purchase 26 luxurious cars, would have not only the documents and the details of her own income, but all the details of expenditure incurred on purchasing/ maintaining such luxury cars. Mrs Paulose, however, has placed no documents before this court to support her claims over the cars in question," the court stated.

The court added, "Further, she cannot be allowed to take shelter under the pretext that her incarceration in the jail is responsible for distress and depression leading to memory loss, more so when there is no medical evidence to support her claim,” Justice Sharma said.

The Delhi Police previously registered an FIR against Sukesh Chandrashekar for allegedly defrauding the spouses of former Ranbaxy promoters, Shivinder and Malvinder Singh, of Rs 200 crore. Chandrashekar is also accused in several other cases across the country.

Both Chandrashekar and his wife, Leena Paulose, were arrested by the Delhi police under the Maharashtra Control of Organised Crime Act (MCOCA). They are also implicated by the ED in a money laundering case.