Delhi HC Dismisses IREO-Linked PMLA Petitions; Advocate Fined Rs. 1.25 Lakh for Misleading Court
Court finds no lapse in ED’s money laundering probe under PMLA; penalizes advocate for suppressing facts and misusing writ jurisdiction.
The Delhi High Court dismissed a series of writ petitions filed by Advocate Gulshan Babbar concerning alleged corporate mismanagement and financial fraud by the IREO Group of Companies and its directors. The petitions, which sought court-monitored investigations by agencies such as the Enforcement Directorate (ED), CBI, and SFIO, were found to be “not maintainable” on grounds of false statements, concealment of facts, and lack of legal standing.
Justice Manmeet Pritam Singh Arora, while delivering the verdict, held that Babbar had no locus standi to approach the Court under Article 226 as he was not an aggrieved party, nor a homebuyer, nor had any direct interest in the IREO projects. In fact, the Court observed that Babbar had falsely claimed in some of his petitions that he was a homebuyer whose hard-earned money was siphoned off by the IREO Group.
The court also imposed a cost of Rs. 1.25 lakh on Babbar for abusing judicial process. “The petitioner approached the Court with unclean hands by suppressing the pendency of similar writ petitions, making false declarations, and misrepresenting judicial orders,” the Court noted. The cost is to be deposited with the Delhi High Court Legal Services Committee.
The petitions centered around allegations of massive fund diversion, including Rs. 600 crore allegedly siphoned off by IREO and routed through shell companies to overseas entities. However, the ED clarified that it had already registered an Enforcement Case Information Report (ECIR) and filed prosecution complaints, with attachments worth Rs. 1,376 crore already made. The agency argued that investigations were ongoing and judicial interference was unwarranted.
The IREO Group has been under the scanner of various enforcement agencies following complaints from hundreds of homebuyers alleging non-delivery of homes despite substantial payments. The ED’s investigation revealed that over Rs. 1,300 crore collected from customers had been diverted, and properties were attached accordingly. In some instances, shell companies were allegedly used to funnel money overseas.
Justice Arora concurred, citing Supreme Court precedents that discourage courts from monitoring investigations unless exceptional circumstances exist. The Court found that ED’s ongoing probe, including attachments and arrests, showed no inaction or bias warranting intervention.
While Babbar’s petitions projected public interest, the Court clarified that none of them complied with the Delhi High Court (PIL) Rules, 2010, and could not be treated as genuine public interest litigation. Instead, the Court noted a pattern of repetitive, overlapping, and misleading filings.
The Court was particularly critical of Babbar’s failure to disclose prior petitions on the same subject and of misquoting previous judicial orders to buttress his claims. “Such conduct is reprehensible, particularly when the petitioner is an advocate,” the Court said.
Case Details
Case Title: Gulshan Babbar Advocate Versus State Of Nct Of Delhi
Case No.: W.P.(CRL) 614/2024 & CRL.M.As. 5673/2024, 38670/2024
Date: 02nd July, 2025
Counsel For Petitioner: Himanshu Upadhyaya
Counsel For Respondent: Amol Sinha
Mariya is the Senior Editor at JurisHour. She has 5+ years of experience on covering tax litigation stories from the Supreme Court, High Courts and various tribunals including CESTAT, ITAT, NCLAT, NCLT, etc. Mariya graduated from MLSU Law College, Udaipur (Raj.) with B.A.LL.B. and also holds an LL.M. She started as a freelance tax reporter in the leading online legal news companies like LiveLaw & Taxscan.
