New Delhi, Oct 18 : A Delhi court on Saturday dismissed a petition challenging the arrest of Ashok Kumar Pal, Chief Financial Officer (CFO) of Reliance Power Limited, a company owned by industrialist Anil Ambani.

The Patiala House Court rejected the plea, which questioned the legality of Pal's arrest by the Enforcement Directorate (ED).

Pal, a close aide of Ambani, was arrested on October 11 under charges of money laundering in connection with a fake bank guarantee case linked to the Anil Dhirubhai Ambani (ADA) Group.

According to the ED, Pal played a central role in diverting company funds and submitting fake bank guarantees worth over Rs 68 crore to the Solar Energy Corporation of India (SECI), allegedly to defraud a public sector enterprise. He is currently in judicial custody.

Following his arrest, Pal resigned from his position as CFO of Reliance Power. The ED's investigation stems from a Central Bureau of Investigation (CBI) FIR related to alleged financial irregularities involving Yes Bank and several ADA Group entities.

The probe pertains to loans worth around Rs 3,000 crore disbursed by Yes Bank between 2017 and 2019, which were allegedly misused. The ED has claimed that the total exposure of Reliance Group companies in the case could be as high as Rs 17,000 crore.

In July, the ED carried out searches at 35 locations linked to the Reliance Group, covering more than 50 companies and 25 individuals suspected to be involved.

The Bombay High Court recently upheld the State Bank of India's (SBI) decision to classify the loan accounts of Anil Ambani and Reliance Communications as 'fraud,' terming the bank's action legally valid and well-reasoned.

On June 13 this year, SBI tagged the loan accounts of Reliance Communications (RCom) and its promoter, Anil Ambani, as fraudulent. The bank cited diversion of funds, breach of covenants, and related-party transactions as the reasons behind its decision, approaching the Central Bureau of Investigation (CBI) for action.

/IANS