FIR against Experion Developers & Experion Capital for rigging insolvency process

In a major law enforcement action, the Economic Offences Wing (EOW), Delhi Police on Monday registered a case under Sections 420 and 120B of the Indian Penal Code, 1860 against M/s Experion Developers Private Limited (EDPL), M/s Experion Capital Private Limited (ECPL), and others, following a formal complaint filed by the Directorate of Enforcement (ED), under Prevention of Money Laundering Act, 2002.

The FIR, registered at the Economic Offences Wing, PS Mandir Marg, New Delhi, arises from what the ED has characterised as a systematic manipulation of the Corporate Insolvency Resolution Process (CIRP) of M/s Dignity Buildcon Private Limited (DBPL) — a company owning approximately 27.86 acres of prime land in Sector 62, Golf Course Extension Road, Gurugram, valued conservatively at over Rs 630 crore.

According to the ED’s complaint, which forms the basis of the FIR, EDPL and its related entity ECPL — both wholly-owned subsidiaries of the AT Capital Group controlled by Arvind Tiku — orchestrated a multi-layered scheme to capture DBPL’s insolvency process at near-zero cost.

While EDPL itself had obtained a stay on the CIRP from the Delhi High Court ostensibly to challenge the IBC — its own related entity, ECPL, simultaneously used the stay period to acquire the majority debt position in the Committee of Creditors (CoC).

ECPL purchased Standard Chartered Bank’s Rs 490 crore exposure in DBPL for a mere Rs 160 Crore, vaulting to 49.3 % voting rights in the CoC. This fact was never disclosed to the NCLT.

Not satisfied with a bare majority, ECPL then acquired the Blackstone Group’s debenture holdings in DBPL for Rs 25 crore against admitted claims of Rs 58 crore, pushing its CoC voting share to 60%. It then proceeded to acquire 61% of the Security Receipts of the XXXIX Trust — the vehicle through which Alchemist ARC (holding 35.4% CoC votes) had structured its position — for a mere Rs 18.02 crore.

Through this acquisition, ECPL gained de facto control over Alchemist ARC’s voting discretion in the CoC, giving the Experion group combined influence over ~95% of CoC votes.

The ED’s complaint records that ECPL wrote to Alchemist ARC on 24.01.2023, directing it to consult ECPL before voting on any resolution plan. Most damningly, Sachin Gupta, the Authorised Representative of Alchemist ARC, admitted in his statement recorded under Section 50 of the PMLA on 23.08.2024 that ECPL compelled Alchemist ARC to vote in favour of EDPL’s resolution plan. With the CoC under its control, EDPL’s bid of Rs 660 crore was approved — despite competing bids of Rs 760 Crore (Madhav Dhir/Alok Dhir) and Rs 709 crore (M3M Group) being substantially higher.

The legitimate bidders were effectively disenfranchised by a manipulated voting process.

The ED’s analysis of EDPL’s payment flows reveals that of the totalRs 445 Crore stated to have been paid to creditors under the resolution plan, Rs 261.8 crore flowed back to ECPL (for its 60% CoC stake) and Rs 38.92 crore flowed back to ECPL (for its 61% Security Receipt position) — meaning the Experion group essentially paid itself with plan proceeds.

The net effective outflow by the Experion group for acquiring a Rs 630+ Crore land asset was a fraction of the stated plan value.

The land in question had already been attached by the ED, in connection with the diversion of approximately Rs 150 crore from Religare Finvest Limited (RFL) by the Singh brothers (Malvinder Mohan Singh and Shivinder Mohan Singh), funds used to purchase this very land.

The attachment was confirmed by the Adjudicating Authority (PMLA) on 27.08.2021 and confiscation was prayed before the Special PMLA Court. The manipulation of DBPL’s CIRP to vest this attached asset in a related entity of the resolution applicant adds a further dimension of brazenness to the fraud.

A source close to the matter said registration of this FIR by EOW Delhi on the ED’s complaint is a watershed moment. “For the first time, the full contours of the Experion fraud — the manufactured stay, the hostile CoC capture, the coercion of Alchemist ARC, the circular money flows — have been set out in a criminal complaint that now carries the force of a registered FIR. The higher bidders who were shut out of a fair process, and the creditors who were cheated, are entitled to expect swift investigation and prosecution,” he added.