Supreme Court of India has denied bail to Rana Kapoor, the founder of Yes Bank, in connection with a high-profile money laundering case that has sent shockwaves through the country's banking system. The court also expressed concerns over the prolonged duration of the investigation by the Enforcement Directorate (ED) and questioned the agency's progress in the 3,642 crore Rupees ($490 million) scam.

The case revolves around allegations of money laundering that led to a crisis at Yes Bank, ultimately prompting the Reserve Bank of India (RBI) to intervene in order to safeguard investors' interests. Justice Sanjiv Khanna, presiding over the case, remarked, "This case rocked the Indian banking system. Yes Bank went into difficulty and the RBI had to step in to protect investors."

The Supreme Court's decision to deny bail came after it raised questions about the prolonged timeline of the ED's investigation. Justice Khanna emphasized the need for prioritizing cases involving significant stakes and numerous individuals. "You have to take cases on priority where there are heavy stakes and a large number of persons involved. There is something wrong if the ED investigation is taking so long," the court stated.

The Additional Solicitor General (ASG) representing the Enforcement Directorate attributed the delays in the investigation to the complexities of the case. The ASG highlighted the challenge of obtaining information from foreign countries and the involvement of numerous shell companies.

Senior advocate Abhishek Manu Singhvi, representing Rana Kapoor, argued in favor of his client's release, asserting that Kapoor's extended detention was unjustified. Singhvi emphasized that while the bank faced difficulties, it should not serve as a reason to detain an individual indefinitely. Kapoor has been in custody since March 8, 2020, and has already surpassed the minimum sentence duration.

In response, the Supreme Court expressed concerns that granting bail might lead to prolonged trial proceedings. The court asserted that once bail is granted, the trial could become interminable. Despite Singhvi's arguments, the Supreme Court rejected the plea to entertain Kapoor's request for bail. Kapoor subsequently withdrew his plea, marking over three years of his incarceration.

Rana Kapoor was initially taken into custody in March 2020 in connection with a money laundering case related to DHFL (Dewan Housing Finance Corporation Limited). The Enforcement Directorate had registered an Enforcement Case Information Report (ECIR) against Kapoor.

In a separate development in July, the Securities and Exchange Board of India (SEBI) issued a notice to Rana Kapoor, demanding a payment of Rs 2.22 crore ($298,000) in relation to the mis-selling of Yes Bank's AT1 bonds. The notice warned of potential arrest and asset attachment if the payment was not made within 15 days.

The denial of bail to Rana Kapoor highlights the gravity of the allegations and the ongoing efforts to address financial misconduct in India's banking sector. The case continues to draw attention as authorities work to unravel the complexities surrounding the money laundering scandal.