Justice Yashwant Varma at Center of Cash Scandal and Bank Fraud Allegations

New Delhi: Justice Yashwant Varma of the Delhi High Court has come under the spotlight following allegations of unaccounted cash discovered at his residence and his prior involvement in a 2018 bank fraud case. The unfolding controversy has raised serious concerns about judicial integrity and sparked calls for greater transparency.

CBI Probe and Sugar Mill Fraud
The Central Bureau of Investigation (CBI) had named Justice Varma in a First Information Report (FIR) linked to Simbhaoli Sugar Mills in 2018. At the time, Varma was a non-executive director of the company, which was accused of defrauding the Oriental Bank of Commerce (OBC) through a fraudulent loan scheme. The alleged scam involved disbursing ₹148.59 crore to 5,762 farmers for agricultural purposes, with the funds routed through Simbhaoli Sugar Mills. By 2015, OBC declared a loss of ₹97.85 crore, prompting the CBI investigation.

In December 2023, the Allahabad High Court ordered a fresh probe into loans extended to the company between 2009 and 2017, questioning the role of bank officials and the lack of due diligence. Acting on these orders, the CBI reopened its investigation in February 2024. However, the Supreme Court stayed this order in March 2024.

Fire and Cash Discovery at Varma’s Residence
The controversy deepened when a fire broke out at Justice Varma’s official residence in Lutyens Delhi on March 14, 2025. Firefighters discovered unaccounted cash — allegedly ₹15 crore — scattered among burnt jute sacks. A staff member claimed the destroyed materials included court-related documents, but the cash recovery raised alarms. The Delhi Fire Chief, Atul Garg, denied any cash recovery, adding further confusion.

Judicial Response and Transfer
Following the incident, the Supreme Court Collegium, led by Chief Justice of India Sanjiv Khanna, ordered Justice Varma’s transfer back to the Allahabad High Court. While the transfer was described as a preliminary step, sources indicated that stricter actions could follow pending the inquiry’s findings.

Public Outcry and Calls for Reform
The judiciary has been left shaken by the revelations. Delhi High Court Chief Justice DK Upadhyaya expressed dismay, calling for measures to protect judicial integrity. Senior advocate Kapil Sibal urged reforms in judicial appointments to prevent such incidents, while former Solicitor General Harish Salve questioned the conflicting narratives surrounding the case.

“If the allegations are false, it’s unjust to transfer him. If they’re true, a transfer is too lenient. The inquiry must be transparent,” Salve stated.

As the investigation unfolds, the incident has reignited discussions on judicial accountability, casting a shadow over India’s judicial system.