Delhi HC lifts travel curbs on IFFCO, Indian Potash chiefs in CBI probe

What the Record Shows

The Delhi High Court, per its order dated 13 January 2026 in W.P. (Crl) 2199/2021 and W.P. (Crl) 2200/2021, quashed the look-out circulars issued against Dr U.S. Awasthi, then managing director and chief executive of the Indian Farmers Fertiliser Cooperative Limited (IFFCO), and P.S. Gahlaut, then managing director of Indian Potash Limited (IPL). Justice Neena Bansal Krishna held that the grounds required to keep a look-out circular alive were absent, observing that both men had joined the investigation when summoned and had a record of returning from foreign travel.

The circulars had been sought in connection with a Central Bureau of Investigation case, RC No. 221/2021/E0009 dated 17 May 2021, and a linked Enforcement Directorate money-laundering investigation, ECIR No. DLZP-I/43/2021 dated 20 May 2021. The CBI FIR alleges that fertilisers and raw materials were imported at inflated prices so that a higher government subsidy could be claimed. No court has recorded any finding of guilt, and the matter remains under investigation.

Both executives have denied wrongdoing. The court recorded their submission that "no money has come to the account of the Petitioner from any of the co-accused", and noted that they had joined the search and seizure proceedings. IFFCO has previously said it was extending cooperation to the agencies. This report treats every allegation below as exactly that, an allegation the agencies must still prove.

How It Worked

On the CBI's allegation, as summarised in the High Court order, the two cooperatives imported fertiliser and raw materials, potash in particular, through intermediaries at prices inflated above the true landed cost during the period 2007 to 2014. IFFCO's wholly owned Dubai subsidiary, Kisan International Trading FZE, is named in the FIR as a conduit for those imports.

The alleged purpose, per the FIR, was twofold. The inflated import price was used to claim a larger nutrient-based subsidy from the Government of India, and the margin between the real and the invoiced price was, the ED case states, routed back as commission to persons connected to the accused. The order records the ED's figure of about USD 114.32 million, roughly Rs 685 crore, said to have been received as illegal commission, of which around Rs 481 crore is attributed in the ED case to a group linked to a co-accused and about Rs 204 crore to accounts said to be connected to overseas-resident family members named as co-accused.

The procedural history is set out in the order. The CBI registered its FIR on 17 May 2021 and carried out search and seizure operations; the ED opened its ECIR three days later and, per the order, filed a prosecution complaint on 30 July 2021, on which the special court took cognizance on 7 August 2021. Look-out circulars were issued against the two managing directors, who then moved the High Court in 2021 seeking their quashing and permission to travel abroad. The court finally decided the petitions in January 2026. The offences alleged are under Sections 120B and 420 of the Indian Penal Code and Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, with the parallel ED investigation under the Prevention of Money Laundering Act, 2002.

Who Lost Money

The party said to have lost, on the agencies' case, is the public exchequer: the fertiliser subsidy is paid by the Government of India, and the CBI alleges that inflated import invoices caused it to pay more than it should have. The ED puts the alleged illegal commission at about Rs 685 crore, but that figure is an investigative estimate of money said to have been diverted, not an adjudicated loss, and no court has tested it.

Beyond the exchequer, the ultimate consumers of IFFCO and IPL fertilisers are the country's farmers, in whose name the subsidy exists. It is worth stressing what has not happened: no recovery has been ordered against the two executives, no confiscation has been confirmed by a court, and the seizures made during the 2021 searches remain part of an unfinished investigation. Readers following how enforcement outcomes actually land can track the wider pattern through the enforcement archive.

Where It Stands Now

As of the latest official record, the position has moved in the petitioners' favour on one narrow point and is otherwise unchanged. The look-out circulars were quashed on 13 January 2026, subject only to the two men keeping the trial court informed of their residence and travel plans. That is a ruling about the conditions of an investigation, not about the merits of the allegations.

The underlying investigation continues. The order records that "the investigation and the scrutiny of the documents, is still being in progress", the ED's prosecution complaint has been taken on file, and no CBI chargesheet could be confirmed as filed at the time of the order. An FIR and a prosecution complaint contain allegations, not findings of guilt; the accused are presumed innocent until proven guilty, and due process continues. For a sense of how probes and interim orders can run for years before any final finding, see our report on the SEBI interim order against a former IndusInd chief executive.

What It Means

The case is a window into how India's fertiliser subsidy is policed. Under the nutrient-based subsidy regime the government reimburses part of the cost of imported fertiliser, so the invoiced import price directly affects the public money paid out. That design is what the CBI alleges was exploited here; whether it was is now for the agencies to prove and a court to decide.

For anyone reading enforcement news, the practical takeaway is about reading the stage correctly. A look-out circular is an investigative restraint, not a verdict; an FIR names suspects, it does not convict them; and an ED prosecution complaint being taken on file starts a trial, it does not end one. The gap between an accusation and a finding can be years wide, as the near five-year run of this matter shows. The Supreme Court's recent move to make the CBI the lead agency on organised online fraud, covered in our report on digital arrest scams, is a reminder that investigation-stage news is the start of a process, not its conclusion.

FAQ

What did the Delhi High Court decide on 13 January 2026?

The court quashed the look-out circulars issued against the IFFCO and Indian Potash managing directors, holding that the grounds for keeping them in force were absent and that both had joined the investigation. It did not rule on the merits of the CBI or ED allegations, which remain to be proved.

What do the CBI and ED allege?

The CBI FIR alleges that fertilisers and raw materials were imported at inflated prices between 2007 and 2014 to draw a higher government subsidy, and the ED alleges that about Rs 685 crore was routed back as illegal commission. These are allegations under investigation; no court has recorded any finding on them.

Does this mean the people named are guilty?

No. An FIR and an ED prosecution complaint contain allegations, not findings of guilt. The accused are presumed innocent until proven guilty, and due process continues. Both executives have denied wrongdoing and, per the court's order, have joined the investigation.

Has a chargesheet been filed?

The ED filed a prosecution complaint on 30 July 2021, on which the special court took cognizance on 7 August 2021, per the High Court order. The order records that the CBI investigation was still in progress, and no CBI chargesheet could be confirmed as filed.

Where can I read the official order?

The Delhi High Court order dated 13 January 2026 in W.P. (Crl) 2199/2021 and 2200/2021 is published on Indian Kanoon and linked below.

This report is based on the order of the Delhi High Court dated 13 January 2026 in P.S. Gahlaut vs Union of India and the case record reviewed on 3 August 2026.