CBI files closure report in 2002 Hindustan Zinc disinvestment case

The CBI has filed a closure report in the 2002 Hindustan Zinc disinvestment case. A special court will now decide whether to accept it or seek further inquiry.Image used for representational purposes onlyNewdelhi,Oct 9, 2026 21:28 ISTThe CBI has filed a closure report in the case related to the 2002 disinvestment of Hindustan Zinc Ltd under the then NDA government led by Atal Bihari Vajpayee, saying the allegations in the FIR could not be substantiated during the probe, officials said. The special court will now decide whether to accept the report or order further inquiry after hearing the agency's submissions.The agency had first opened a preliminary inquiry in 2013 into the disinvestment of the "mini ratna" company in favour of a private mining major. That inquiry was closed four years later amid differences among senior CBI officials, prosecutors and the investigating officer over whether the matter should be closed or an FIR should be registered, according to the case files.In 2022, then Chief Justice of India D Y Chandrachud directed the CBI to register a regular case while hearing a public interest litigation filed in 2014 that challenged the disinvestment and alleged irregularities in the process. Following the order, the agency registered an FIR on April 28, 2022. Sources said the allegations "could not be substantiated" during the investigation and that the "facts do not demonstrate the commission of any cognisable offence".Justice Chandrachud had noted the differences of opinion within the agency as recorded in the case files. He had directed the CBI that "there is sufficient material for registration of a regular case in relation to the 26 per cent disinvestment of HZL by the Union government in 2002". "Some of the aforesaid observations of the CBI officials, who recommended the conversion of the preliminary inquiry into a regular case, satisfy this court's conscience for exercising its exceptional powers to direct the CBI to conduct an investigation into the matter," he had said. He had also said that a prima facie case for a cognisable offence had been made out and that "the registration of a regular case, followed by a full-fledged investigation, must be conducted". During the preliminary inquiry, the CBI had sought the opinion of experts who were chartered engineers. Justice Chandrachud had noted that they concluded the valuation was on the "lower side" and did not include relevant mining properties. "Allegedly, the absence of any mining engineer or geologist in the team of the asset valuers was also not understandable. Allegedly, if the valuation had been conducted properly, on the basis of the DCF method, the value would have been more than Rs 1,000 per share," he had said.The Supreme Court had also highlighted irregularities flagged in the case files over BNP Paribas' appointment as "global advisor" on January 9, 2002. The CBI could not trace the officials of the France-based bank during its inquiry. "It was found that BNP Paribas was a bank based in France, but the erstwhile company BNP Paribas Equities India Pvt Ltd (also known as BNP Prime Peregrine India Pvt Ltd) had undergone voluntary liquidation on September 5, 2001. The advisors had allegedly used the name of 'M/s BNP Paribas' during most of their correspondence and the bank was denying the details of the company and its existence," Justice Chandrachud had pointed out. CBI officials had also alleged that the valuers failed to "consider goodwill, technical know-how and various assets of HZL". These included 150 million tonnes of ore reserves across several mines, valued at Rs 80,000 crore; the Union government's earlier investment of about Rs 83 crore in Andhra Pradesh Gas Power Ltd; Rs 175 crore in advance income tax; properties worth about Rs 20,000 crore; and scrap valued at about Rs 600 crore. Chandrachud's order, citing CBI officials who had opposed closing the preliminary inquiry and sought an FIR in 2017, had said: "The value of lead and zinc mineral at the time was Rs 66,292 crore (approx). Even if 40 per cent cost of extraction process is excluded, the value would have allegedly been around Rs 39,000 crore. Yet, the valuer had valued the ore reserves at a paltry Rs 748.88 crore."With the CBI now filing its closure report, the matter has returned to the special court, which will decide whether to accept the report or call for further inquiry in the case linked to the 2002 disinvestment of Hindustan Zinc Ltd.- Ends