Rs 60 crore fraud case: Raj Kundra blames demonetisation for loan default

Businessman and actor Shilpa Shetty’s husband, Raj Kundra, has claimed that demonetisation in 2016 was a key reason he was unable to repay a Rs 60 crore loan.

This statement was made during his interrogation by the Mumbai Police’s Economic Offences Wing (EOW) in connection with a fraud case filed by businessman Deepak Kothari.

Related news: Rs 60 crore cheating case: Raj Kundra paid part of fraud amount to Bipasha Basu, Neha Dhupia, Ekta Kapoor as fees, say police

Kothari alleges that Kundra and Shetty borrowed Rs 60 crore under a loan-cum-investment agreement related to a now-defunct online shopping venture.

Instead of using the funds solely for business, the couple is accused of diverting large sums for personal use and failing to repay the amount.

According to a report by The Indian Express, Kundra told investigators that over Rs 20 crore was spent on advertising, while another significant portion was invested in operations and staffing.

However, the business reportedly suffered major setbacks following the government's decision to ban Rs 500 and Rs 1,000 currency notes in 2016.

The platform operated primarily on a cash on delivery model, which collapsed when consumers lacked cash, leading to substantial losses.

This isn't the first explanation Kundra has provided. Earlier, he claimed that parts of the loan were used to pay fees to actresses Neha Dhupia, Bipasha Basu, and his wife Shilpa Shetty.

Investigators have also traced some of these funds to transactions involving banned streaming platforms like Alt Balaji, adding further scrutiny to the case.

In a related development, the couple recently moved the Bombay High Court to quash a Look Out Circular (LOC) issued against them in connection with the FIR. However, the court denied them permission to travel abroad, including to Los Angeles, unless they deposit Rs 60 crore.

The High Court also refused to pause the LOC. The matter has been adjourned until October 14.