New Delhi, August 22, 2026 : The Economic Offences Wing (EOW) of the Delhi Police has arrested Aswath Reddy N., Managing Director of Electrical Energy Equipments India Pvt. Ltd. (EEE), in connection with an alleged ₹9.31 crore payment diversion case involving materials supplied for Bangalore Electricity Supply Company Ltd. (BESCOM) projects.
Reddy was arrested after the Delhi High Court on June 9, 2026 rejected his anticipatory bail plea, citing the nature and gravity of the allegations. The EOW had registered the case on September 8, 2025 following a complaint by Visual Technologies India Pvt. Ltd. (VTI).
After his arrest, Reddy was brought to Delhi on transit remand and produced before the Chief Judicial Magistrate, South-East District, Saket Courts, on August 19. The EOW sought six days of police custody, citing the need for further investigation. The court granted two days of custody, observing that interrogation and confrontation with bank statements, GST records and other material could assist the investigation.
The case stems from an August 8, 2024 Memorandum of Understanding between EEE and VTI under which VTI was to supply materials for BESCOM projects in Karnataka. VTI has alleged that it supplied materials worth approximately ₹9.31 crore after being assured that payments received from BESCOM would be routed through an escrow account.
BESCOM Payment Diversion Case; Delhi Court Grants Police Custody
According to the allegations, the escrow mechanism was not operationalised and payments received from BESCOM were instead routed to another account.
During proceedings before the Delhi High Court, BESCOM told investigators that no payment had been released into an escrow account, that no invoices raised by EEE remained pending with BESCOM and that no outstanding amount was payable by BESCOM.
The High Court noted that these facts, prima facie, did not support the position advanced by Reddy and declined to grant him anticipatory bail.
Following the arrest, the EOW is examining the alleged money trail, including payments received from BESCOM, the bank accounts into which the funds were credited, subsequent transfers and the identities of the ultimate beneficiaries.
Investigators are also examining the alleged escrow arrangement, GST records, invoices and different versions of a Purchase Order dated August 21, 2024.
The Delhi High Court had earlier taken note of a dispute over the authenticity of the Purchase Order relied upon during the proceedings. The court observed that while the MoU provided for Delhi jurisdiction, the Purchase Order relied upon by Reddy contained a Bengaluru jurisdiction clause, a discrepancy the court said could not be overlooked while considering the anticipatory bail plea.
The High Court also rejected the argument that the dispute was essentially civil or commercial in nature. It observed that the existence of a civil dispute does not, by itself, dilute allegations of fraud or cheating where the ingredients of a criminal offence are prima facie made out.
The court, considering the nature and gravity of the allegations, dismissed Reddy’s anticipatory bail application.
The matter also has related proceedings in Karnataka concerning cheques issued in transactions between the parties. An order dated June 10, 2026 passed by the II Additional Civil Judge and JMFC, Tumakuru, records that the accused remained absent and that a non-bailable warrant was reissued. The court also noted that, despite opportunities, PW-1 had not been cross-examined.
In a separate cheque matter, proceedings were subsequently sought to be closed after the complainant informed the court that the entire cheque amount had been received from the accused.
The allegations remain subject to investigation and adjudication by the competent courts. The arrest and police custody do not, by themselves, establish criminal liability.
