The Chief Judicial Magistrate (CJM) Court in Sri Vijaya Puram on Thursday granted bail to former Member of Parliament Kuldeep Rai Sharma and K. Murugan, the former Managing Director of the Andaman and Nicobar State Cooperative Bank (ANSCB), in connection with an ongoing case involving alleged irregularities in loan disbursals by the bank. The development came hours after the Calcutta High Court’s Circuit Bench at Sri Vijaya Puram granted bail to co-accused Mohammed Sajid in the same matter.
Sharma and Murugan, however, continue to remain in the custody of the Enforcement Directorate (ED) in connection with a separate money-laundering probe arising from the same alleged loan irregularities. Their release from judicial custody will depend on further orders from the ED court.
The High Court’s order, passed by Justice Ananya Bandyopadhyay, followed detailed arguments from senior advocate Milon Mukherjee (appearing virtually) with T. Harish Kumar for the petitioner, and Sumit Kumar Karmakar for the State. The petition was filed under Section 483 of the Bharatiya Nagarik Suraksha Sanhita (2023) in connection with FIR No. 14 of 2025, registered at the Crime and Economic Offences Police Station.
According to the petition, Sajid had obtained a bank loan from ANSCB’s Sri Vijaya Puram branch for purchasing four Reef Looker semi-submarine boats from Croatia. The defence maintained that he had been “falsely implicated.” The State alleged that the loan was sanctioned on the verbal assurance of co-accused Kuldeep Rai Sharma, without valid documentation, and that part of the funds were diverted through shell companies.
The charge sheet filed on September 19 stated that Sajid used a significant portion of the sanctioned loan, secured by family property, for the purchase and shipment of the boats, but only two were registered in his name. The prosecution argued that voluminous financial records were still under scrutiny and warned that the accused might attempt to influence witnesses.
After hearing both sides, the High Court observed that the investigation concerning Sajid had been completed and that “further custody is not required.” The court granted him bail on a bond with sureties and directed him to surrender his passport, report weekly to the Crime and Economic Offences Police Station, remain within the court’s jurisdiction, and refrain from tampering with evidence.
The bail granted by the High Court and the subsequent CJM order are significant developments in what has emerged as one of the largest cooperative bank investigations in the Union Territory’s history. The case has seen multiple agencies, including the CID, the Enforcement Directorate, and the Registrar of Cooperative Societies, independently examine loan records, sanction procedures, and the bank’s internal audit mechanisms.
According to officials familiar with the matter, the case revolves around allegations that several loans were disbursed in violation of established norms, often without adequate security or documentation. Investigators have described the case as a complex financial web involving front companies, fictitious borrowers, and politically connected intermediaries.
The CID probe is understood to have focused on procedural lapses and the bank’s internal accountability mechanisms, while the Enforcement Directorate’s case under the PMLA traces the alleged diversion and layering of funds.
The unfolding investigation has become a matter of keen public and institutional interest across the islands, given the prominence of the individuals and agencies involved. With multiple layers of inquiry still in progress, suggest that the coming months will be crucial in determining accountability, strengthening oversight within cooperative institutions, and restoring public confidence in the integrity of the Union Territory’s financial governance framework.
