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Explained: Who is Dilip Chhabria, and why has Mumbai police arrested him?

Dilip Chhabria is a well-known name when it comes to modified vehicles and his trademark 'DC' design has been much sought after and has several celebrities as his clients.

Written by Mohamed Thaver , Edited by Explained Desk | Mumbai | Updated: January 14, 2021 12:20:00 pm
Who is Dilip Chhabria and why did Mumbai police arrest him?His company Dilip Chhabria Designs Pvt Ltd was incorporated in 1993 and launched the DC Avanti in 2016 after formal certification by the Automotive Research Association of India (ARAI) in March 2015. They have sold almost 120 such cars across the country and world.

The Mumbai police on Monday arrested celebrity car designer and manufacturer Dilip Chhabria in connection with allegations of cheating and forgery made against him.

Who is Dilip Chhabria?

Dilip Chhabria is a well-known name when it comes to modified vehicles and his trademark ‘DC’ design has been much sought after and has several celebrities as his clients. He is also credited with launching DC Avanti, known as India’s first sports car in 2016. His company Dilip Chhabria Designs Pvt Ltd was incorporated in 1993 and launched the DC Avanti in 2016 after formal certification by the Automotive Research Association of India (ARAI) in March 2015. They have sold almost 120 such cars across the country and world.

Why did Mumbai police place Dilip Chhabria under arrest?

Joint commissioner of police (crime) Milind Bharambe on Tuesday said that they have found that nearly 90 DC Avanti vehicles manufactured by Dilip Chhabria Designs Pvt Ltd (DDCPL) were used for fraudulent financing. They found that multiple loans averaging Rs 42 lakhs each were availed on these cars by DDCPL. The company would pose as customers for their own manufactured cars and get loans from Non-Banking Financial Companies (NBFCs) which were not repaid. Such vehicles were later sold to other customers after availing financing by fraudulent means without the customer’s knowledge.

Was there also a registration scam involved?

Yes. The police found that most of the 90 vehicles were registered with two or at times three RTO’s of various states. For example, the complainant in the case is a Tamil Nadu based person whose DC Avanti machine and chassis number were registered with Tamil Nadu and Haryana RTO as well. The police believe that they would use these multiple registration numbers to avail more loans which they did not intend to repay.

Dilip Chhabria produced before a ourt in Mumbai on Tuesday.
(Express Photo: Ganesh Shirsekar)

How did the scam come to light?

It came to light after the Tamil Nadu person who had purchased the DC Avanti – worth Rs 42 lakh – committed a traffic violation. When he was being challaned, the traffic officer told him that his vehicle was showing as registered in Haryana as well. On checking with the vahan website, he found that indeed the vehicle was registered with two RTO’s. Since he had purchased the sports car from Chhabria, he kept trying to contact him but the latter was evaside. It was then that he came to Mumbai to confront him when the Mumbai police received a tip off about it and took the complainant’s statement and registered an FIR against Chhabria.

Is there a lacunae in the system that allowed two RTO’s to assign registration numbers to the same chassis and machine number?

Yes. As per the law, one chassis and machine number can be registered from one RTO at one point. It cannot be registered at two places. The police will be writing to the concerned RTO’s so that they can plug loopholes in the system.

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Are the police suspecting involvement of others?

Apart from those at Chhabria’s company, the police are investigating the involvement of three–four NBFC’s that gave them loans. In some cases the police found that the NBFC had authorised the loan even before the vehicle was registered. The police suspect some NBFC employees may have known about the scam and will soon call them for questioning.

The police also spoke about investigating customs evasion. How is that linked to the case?
The police have found that several parts like the engine for the vehicle were imported from abroad. Also some of the vehicles that they sold to citizens of other countries were done so at a lower value than the ones sold in India. The police believe it could be linked to customs duty evasion and will be investigating the same.

Has Chhabria fallen foul of the law in the past?

While there has been no police case registered against him in Mumbai as per cops, he was sued by cricketer Dinesh Karthik in 2015 when the latter approached the consumer court stating that Chhabria’s company has not refunded the Rs 5 lakh he had paid as booking amount even after he did not find the vehicle satisfactory after doing a test drive and returned it

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