Contents
| Acquittal / Discharge in criminal trials: | |
| Acquittal in NDPS despite presumption – version of witnesses not challenged by the prosecution. | |
| Acquittal due to shoddy investigation and grave contradictions. | |
| Acquittal of an Accused convicted based solely on criminal conspiracy. | |
| Acquittal in Section 302 IPC due to contradictions. | |
| Discharge in Prevention of Corruption Act, 1988 – no illegal gratification. | |
| On Prevention of Money Laundering Act, 2002: | |
| Lifting of Provisional Attachment Order on deposit of money. | |
| Anticipatory Bail granted. | |
| Anticipatory Bail granted after filing of Complaint. | |
| Anticipatory Bail granted on parity. | |
| On bail / anticipatory bail | |
| Bail in offence under Section 447 Companies Act, 2013 – Provisions of Section 212(6) of the Companies Act 2013 considered in light of Article 21 of the Constitution of India. | |
| Bail in GST / Economic Offence after filing of Complaint – Denial of bail must be the exception rather than the rule. (Amount involved – Rs. 122.28 Crores). | |
| Bail in GST / Economic Offence –(Amount involved – Rs. 138.71 Crores). | |
| Anticipatory bail due to contradiction in Complaint with FIR and delay of one year in registering FIR. | |
| On Quashing of FIR / Complaint | |
| Complaint rejected for want of sanction – question to be considered immediately if facts of the case so demand. | |
| Quashing of FIR, as the same was registered by overreaching the order, albeit, interim, passed by the High Court – All further proceedings pursuant to declaration of the petitioner/Company to be a wilful defaulter were stayed and the aspect of wilful default was being re-considered. | |
| FIR quashed qua Corporate Debtor in view of Section 32A of the Code. | |
| On ancillary aspects related to criminal trials | |
| Permanent exemption in CBI trials – gravity of offence affecting the economy of the country are not to be relied upon. | |
| Section 452 Cr.P.C. is applicable to immovable properties. | |
| On Look Out Circulars | |
| On territorial jurisdiction to challenge a Look Out Circular –A mere fact that the Look Out Circular has been issued at Delhi does not create or vest territorial jurisdiction in the Courts at Delhi. | |
| Purpose of Look Out Circular. | |
| Court can examine the reasons provided by the authority for the issuance of a LOC. | |
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This newsletter covers key updates relating to Criminal Law and related aspects.
Acquittal / Discharge in criminal trials:
Acquittal in NDPS despite presumption – version of witnesses not challenged by the prosecution:
Factual background:
Offence – Section 20(b)(ii)(C) of the Narcotic Drugs and Psychotropic Substances Act, 1985.
The case of the prosecution was that on 31.05.2014, the Station House Officer (SHO for short) of Chakarbhata Police Station received a secret information that the appellant and his friend Reena Das, were carrying ganja in the dickey of a car bearing registration no.CG04HA4850 and were travelling from Raipur to Pendra Road; that the SHO recorded this information in Rojnamcha Sanha, prepared Mukhbir Suchana, forwarded the said information to the higher officer, proceeded to the spot, stopped the car, served a notice under Section 50 of the Act, conducted a search and found 47.370 Kgs. of ganja kept in three bags in the dickey of the car; that after weighing the contraband and preparing Panchnama, the SHO collected samples from each of the three bags, sent them to Forensic Science Laboratory (‘FSL’ for short) and after receipt of the Report, filed a chargesheet against the appellant as well as his friend Reena Das for an offence punishable under Section 20(b) of the Act.
Findings:
If independent witnesses come up with a story which creates a gaping hole in the prosecution theory, about the very search and seizure, then the case of the prosecution should collapse like a pack of cards. (Para 18)
The independent witnesses who turned hostile, not only denied having witnessed anything, but also came up with a plausible explanation as to how their signatures found place in the documents mentioned by PW-7. According to both the independent witnesses they went to the police station in connection with some other dispute relating to the members of the Sindhi community. These 2 witnesses claimed to be elected counsellors of the local Panchayat and this claim was not challenged by the Additional Public Prosecutor in cross examination. Therefore, the case on hand is not a routine, run-of-the-mill matter where independent witnesses are won over and they had no explanation to offer about their signatures in the Panchanama. (Para 25 and 31)
The timeline of the prosecution story:
| On 31.05.2014 at 16.50 hours | PW-7 (Investigating Officer and Complainant) received information from one Mukhbir. |
| PW-7 prepared Exhibit P-5 and completed the other formalities | |
| On 31.05.2014 at 17.10 hours | PW-7 sent notices to the independent witnesses. Note: This notice directs the witness to appear at 17:10 hrs. Witness was at 1 kms away, therefore there was no way PW-7 could have expected the witness to be available at the place of incident at same time, that is, 17.10 hours. |
| PW-7 departed to the place of incident. (Distance: 7-8 kms from Police Station to the place of incident) | |
| (Missing Link) | No reply given by PW-7 about the time of arrival of the independent witnesses at the Police Station. (Houses of the independent witnesses were approximately 1 Km from PS) |
| On 31.05.2014 at 17.15 / 17.17 hours | PW-7 reached the place of incident in 5-7 minutes approximately. (This is despite the distance from 7-8 kms) |
| (Missing Link) | No evidence given by PW-7 about the time of reaching of independent witnesses at the place of incident. |
| On 31.05.2014 at 17.55 / 17.57 hours | PW-7’s team waited at the place of incident for 40 minutes, after which the accused reached the place of incident. |
| On 31.05.2014 at 18.00 hours | Notice (Exhibit C-2) served on the Appellant under Section 50 of the Act, showing time as 18.00 hours. Consent Panchnama of the Appellant (Exhibit C-3) agreeing to be searched by the police officer. Search Panchnama of the accused (Exhibit C-4) refers to the presence of witnesses at the time of search. Note: Stated that the contents of notice Ex. C-2 were read over to Appellant in presence of witnesses. Ex. C-3 mentions the name of witnesses. Ex. C-4 refers to the presence of witnesses. But independent witnesses denied their presence and participation. |
PW-7 is completely silent about the time when the witnesses reached the Police Station or the place of incident. (Para 28).
A serious doubt is cast on the very search and seizure allegedly made by PW-7. (Para 32)
Though right from the beginning, the co-accused Reena Das (A-2) was implicated at every stage, but notice under Section 50 only on the Appellant and not on the co-accused. PW-7 also omitted deliberately or otherwise, to record, (i) the consent Panchnama of co-accused; (ii) the search Panchnama of the co-accused; and (iii) the recovery Panchnama in relation to the co-accused. This led to the Special Court acquitting the co-accused. It is quite strange that, (i) the information received by PW-7, (ii) the FIR; and (iii) the charge-sheet implicated the co-accused, but the prosecution accepted the finding of the Special Court that there could have been no recovery from the co-accused despite the fact that she was also travelling in the same car. (Para 33)
Though Section 54 raises a presumption and burden shifts on accused, but to raise presumption, it must first be established that a recovery was made from the accused. (Para 34)
[Sanjeet Kumar Singh Vs. State of Chhattisgarh, 2022 SCC OnLine SC 1117 decided on 30.08.2022 by Hon’ble Supreme Court of India]
Acquittal due to shoddy investigation and grave contradictions:
Factual background:
The case of the prosecution is that, on 24.08.1979, around 6 : 30 p.m., Shri Iqbal Bahadur Saxena, Principal of the Chandra Shekhar Azad Inter-College, Giani, Uttar Pradesh1, since deceased was sitting with his family physician and private practitioner Dr. Asghar Ali2 in the verandah outside his office, situated in the college campus. He sent his security guard Fazal Maseeh3 to fetch an empty bottle of medicines from his residence, also within the college campus. As PW-1 was returning with the bottle, the three accused, Gullu @ Rajesh (A-1), Vimal Kumar @ Chunnoo (A-2), and Munuwa @ Satish (A-3), are alleged to have entered the verandah from the south, fired gunshots at the Deceased as well as at PW-6, and fled towards the north of the building. PW-6 went to his dispensary located nearby and sought the help of Mahendra Kumar, a compounder at his dispensary, to bring the Deceased who had become unconscious, to the dispensary on a cot for administering first-aid. After that, the Deceased was put on a bullock cart along with the cot to proceed to Police Station Aliganj. PW-6 is supposed to have followed on another bullock cart.
Findings:
Glaring inconsistencies in evidence and crucial lapses in prosecution case – Certain glaring contradictions that cannot be ignored. (Para 11 and 12):
- Contradiction and doubt regarding authorship of FIR by deceased:
| PW-1 | PW-6 |
| Deceased authored the FIR and handed it over to the police. (Stated in cross-examination) | FIR was orally dictated by the Deceased and scribed by PW-4. (Stated in examination-in-chief) |
The other connected fact casting doubt on the way FIR was registered, is the delay of three days caused in its receipt in the Court.
- Doubt about the conduct and testimony of the eye-witnesses:
- Contradiction in the testimony of PW-1 fundamentally challenges the premise that PW-1 was an eye-witness –
| PW-1 (initial stage) | PW-1 (cross-examination) |
| PW-1 initially denied being a witness to the actual commission of the crime: “The shot was fired, when I had gone inside. When I brought an empty bottle, I saw accused Vimal Kumar, Munua and Gullu fleeing. These persons were fleeing southwards. When I saw accused persons fleeing, I had reached in verandah of the office.” | Later, in his cross-examination, PW-1 stated that: “It is not so that as soon as I reached near stairs of the verandah carrying an empty bottle, the accused persons fired shots. And after firing shots in my presence, the accused persons fled northwards” |
Aforementioned contradictions and significant improvements in the testimony, cast doubts about his presence at the alleged place of occurrence of the crime. At least one thing is clear, he has not witnessed the accused firing at the Deceased. (Para 15)
- Concerns relates to PW-1’s presence at PS –
PW-1 deposed that his thumb impression was taken on the FIR. However, there is no such thumb impression at all on the document.
- Contradiction regarding timing –PW-1 reached the Aliganj police station on foot, remained there for about 25-30 minutes, and after that returned to the village Giani by 8-9 p.m.This statement is curious, as the FIR itself was registered at 8 : 30 p.m.
Furthermore, it is surprising then that PW-1, who walked the distance of 3 km to the police station, reached there well in time and observed the several aspects related to the matter. (Para 17)
- Curious conduct of PW-1 –
It is curious that he did not accompany the Deceased to the railway station and eventually the hospital when he was in a critical condition, given that he resided with the Deceased within the campus and had been working there for 10-12 years. (Para 17)
- Unnatural conduct on part of the eye-witness PW-6 –
Injuries on PW-6 were simple in nature, despite which, immediately after the incident, PW-6, a doctor who admittedly maintained close relations with the deceased, instead of being with the Deceased, went to his own house and rested. (Para 19)
Later, he accompanied the Deceased to the police station to report the crime instead of escorting the Deceased to a hospital to administer proper treatment, even when it has been admitted that the deceased was in a very serious condition, having suffered seven gunshot injuries and oozing blood. (Para 19)
- Uncertainty about the place of occurrence of the crime –
Deceased alleged to be shot while sitting on a Chair in front of the verandah (stated by FIR, as well as the evidence of PW-1 and PW-6), and blood was oozing out from him (stated by PW-1). (Para 20)
But, no blood found on the chair or the floor, as stated by Inspector Chob Singh (PW-7), as stated during cross-examination). (Para 20)
It is unnatural that not even single drop of blood could be traced or recovered from the chair or the floor. (Para 21)
- Inconsistencies in the two dying declarations of the Deceased:
There are inconsistencies in the two dying declarations of the Deceased, as to the motive of the crime, the place of the incident, and the presence of other persons at such place.
| First dying declaration | Second dying declaration |
| The FIR, as recorded by the Deceased at the Police Station on 24.08.1979. | Recorded by PW-5 after medical certification from PW-9 on 25.08.1979. |
| The incident took place in front of the gate of his quarters, in front of which, A-3’s flour mill is located. | |
| The three accused came from the flour mill, and A-1 and A-2 fired a shot with a revolver while A-3 held him fastened. | |
| It states that at 6:30 p.m., the three accused came and fired at him and PW-6 with a pistol because he was a witness in a case against A-2. | He stated that he had rusticated A-2 from college after he failed in the 11th standard, and this motivated the crime. |
| At the relevant time and place, his peon Sakhar Ali Beg and 5-6 other persons were also present. |
The second dying declaration comprising far too many additions and improvements, was correctly rejected by the Trial and the High Court. (Para 27)
First dying declaration also not safe to act upon, as deceased was not certificated to be medically fit, was in a semi-conscious condition and his condition was serious.
- Non-production of material evidence:
- Deceased is alleged to be wrapped with tehmand, but the said cloth, tehmand, was not produced by the prosecution. (Para 22)
- The non-production of blood-stained clothes is equally fatal. (Para 22)
- It was incumbent upon the prosecution to examine the ballistic experts to prove whether the gunshots came from one or different guns. The prosecution however, failed to examine ballistic experts or even produce the empty cartridges. (Para 23)
- Shoddy investigation:
The prosecution has failed to make material recoveries from the place of the occurrence of the crime.
- The prosecution has neither produced the empty cartridges from the scene of the crime, nor the pellets from the Deceased’s body. (Para 23)
- The prosecution has not been able to recover any weapons alleged to have been used in the incident. (Para 23)
Lack of such material recoveries compounds doubts about the story of the prosecution in the manner that they have set out.
[Munuwa Vs. State of U.P., 2022 SCC OnLine SC 1097 decided on 26.08.2022 by Hon’ble Supreme Court of India]
Acquittal of an Accused convicted based solely on criminal conspiracy:
Factual background:
The case of the prosecution is that, upon transfer of the existing Branch Manager Shri R.K. Makore, Senior Manager Shri K.R. Lydia (hereinafter referred to as ‘PW-4’) was given the additional charge as Manager-in-Charge. As he was on leave for attending a meeting in the Regional Office, Gwalior, another employee Shri Sushil Kumar Verma (hereinafter referred to as ‘PW-10’) was given the additional charge as Manager-in-Charge. Guna is a very small branch of the Central Bank of India but on 11.06.2004 a large amount of Rs. Fifteen Lakhs came into the custody of the Bank, and everybody in the Bank was aware of this fact. The next day, 12.06.2004, happened to be a Saturday, and after the transactions were completed and the branch was closed at 5.45 p.m., it reopened only on Monday, i.e., 14.06.2004 at 10.30 a.m., intervening Sunday being a holiday. As the commission of theft and other offences occurred after Saturday evening at 5.45 p.m. and before 10.30 a.m. on Monday, and the locks of the building were not broken, all the transactions before and after the closure became relevant to detect the crime.
Findings:
A-1 and A-2 were convicted, which conviction was found proper by the Hon’ble Supreme Court. (Para 17)
There was neither any overt act attributable to the Appellant, nor any recovery of stolen property from him. The conclusion drawn against him is only for the reason that he was in exclusive possession of the set of keys used to open the locks of the main gate, the grill of the strong room and the safe inside it on 14.06.2004. Hence, his conviction and sentence were based exclusively on the charge of conspiracy u/s 120B IPC. (Para 18)
The Office Manual of the Bank provides that cash was to be stored in the strong room of the Bank, guarded by a Dual Control System, where locks are secured by two keys operable successively and separately. (Para 19)
Acquittal ordered as:
- The main gate, grill gate of the strong room, as well as the safe was sought to be opened by PW-5 and Manager-in-charge PW-10, but the locks allegedly could not be opened with the set of keys in possession of PW-10. It opened with the keys with the Appellant. Precisely what caused the locks to not open with the keys of PW-10 is not explained. (Para 20)
- The fact that these locks could be opened by the key in possession of the Appellant cannot by itself lead to an inference that he alone was responsible for enabling A-1 and A-2 to access the safe to commit the offences. The very purpose and object of the dual lock system is to prevent any single custodian from accessing the strong room and the safe. (Para 20)
- The key movement register was not seized or produced by the prosecution on the premise that it was practically never used. (Para 21)
- Clause 2.1.6 of the Office Manual stipulates that both the key holders are jointly responsible for the contents of the strong room and the safe. Under these circumstances, we are of the opinion that the Appellant cannot be solely held accountable for the failure to comply with the Office Manual, and for this reason the Appellant’s exclusive possession of the keys cannot render him culpable of the offences as mentioned earlier. (Para 21)
- Trial Court glossed over the lapse on the part of PW-10. The questionable observation of the Trial Court are “Thus the witness did not get the lock locked by the authorised person as per the rule of the bank, but the lock was locked by unauthorised person. But the errors committed by the witness do not exempt the accused from the consequences of the crime.”. (Para 22)
- Further, prosecution completely failed in adducing any evidence to indicate the existence of any agreement between the Appellant on the one hand and A-1 and A-2 on the other. The link necessary for proving the charge of conspiracy is entirely missing. (Para 23)
The charge of conspiracy alleged by the prosecution against the Appellant must evidence explicit acts or conduct on his part, manifesting conscious and apparent concurrence of a common design with A-1 and A-2. (Para 25) There is no physical manifestation of such a concurrence extractable from surrounding circumstances, declarations, or the conduct of the Appellant. (Para 28)
The Trial Court, as well as the High Court, proceeded on the basis of mere suspicion against the Appellant. (Para 26)
[Ram Sharan Chaturvedi Vs. State of M.P., 2022 SCC OnLine SC 1080 decided on 25.08.2022 by Hon’ble Supreme Court of India
Acquittal in Section 302 IPC due to contradictions:
Factual background:
Appellants convicted for offences under sections 302/450/34 of the Indian Penal Code, 1860.
Findings:
Unbelievable conduct of the alleged eye-witness – PW-2 proceeds further to say that after allegedly beating her son, the appellants “…fled away from the house… ” and that her son sustained injuries on the head and neck, with blood oozing from his nose, mouth and ear. Curiously, PW-2 however says that “…Due to fear I did not take him to the hospital. … “. This, in our view, is singularly unbelievable. Despite her son allegedly oozing blood from his mouth, nose and ear, PW-2, not being a stranger or passer-by but the mother, would definitely have called for some help and ensured that her son received medical attention. (Para 18)
Upon a combined reading of her examination-in-chief and cross-examination, there is no clarity as to whether PW-2 became unconscious once she brought her son to the hospital, or subsequently; or, as to when the police recorded her statement; or, when she regained consciousness, to be able to affix her thumb impression on the statement so recorded. (Para 20)
There is no explanation as to who called Dr. Khan to PW-2‟s house at night; and that if a doctor had indeed attended to her son that night, with the state she describes her son was in, why he was not moved to the hospital by calling the police. (Para 21)
Contradictions in the statements noted in Para 21, 22 and 23.
The said contradictions are not insignificant or immaterial but go to the root of the narrative which PW-2 has sought to draw-up in relation to the incident on that fateful night. (Para 25)
There are also contradictions in the testimony of PW-2 when compared with her statement recorded under section 161 Cr.P.C. (Para 26)
[Film Kaur @ Ginni Vs. State (Govt. of NCT Delhi) in Crl. A. 511 of 2022 decided on 22.08.2022 by Hon’ble High Court of Delhi (Ld. Division Bench)]\
Discharge in Prevention of Corruption Act, 1988 – no illegal gratification:
Factual background:
The criminal case was registered, inter alia, under Section 13(1)(c) and 13(1)(d) r/w 13(2) Prevention of Corruption Act, 1988.
Appellant was working as an Executive Engineer (Electrical) (“EE”) in the Accelerated Power Development Reforms Program (“APDRP”) Wing of Jharkhand State Electricity Board (in short “JSEB”) from 07.12.2004.
During his tenure as EE, one Ramjee Power Construction Limited (hereinafter “RPCL”) was awarded a contract of work under APDRP vide work order dated 27.01.2005.
JSEB, subsequently, decided to make internal enquiry into handling the work contract given to RPCL. On the basis of the said enquiry, allegations of malpractice and financial irregularity were levelled against the Appellant and some others.
The Secretary, JSEB vide letter dated 30.07.2010, made a request to the Director General of Vigilance Bureau (“DGP”) to lodge an FIR against the Appellant and FIR was lodged against the Appellant and other officers of the JSEB.
Findings:
At the time of taking a decision by the JSEB on 06.02.2007 and 07.02.2007, the Appellant was neither involved nor was part in the proposal or the decision-making process. The question of termination of contract in the opinion of the Board was dropped and the recourse to complete the work within the extended time was agreed in place of going in for arbitration/Court of Law. (Para 12)
In the said facts, merely preparing a subsequent agenda dated 08.06.2007, seeking instructions for appointment of an Arbitrator would not bring the Appellant within the purview of culpability for commission of the alleged offences. (Para 12)
Court had reason to believe that the decisions, if any, taken by the JSEB and other higher officials were after perusal of the complete noting in the file. (Para 12)
FIR was registered because it was difficult for the JSEB to implement the interim arbitral award due to financial difficulty, a roving and fishing enquiry was conducted, in consequence of which, Secretary, JSEB vide letter dated 30.07.2010 and Smt. Rajbala Verma (then Vigilance Commissioner) vide letter dated 03.09.2010, requested the DGP, Vigilance Bureau to register an FIR against the Appellant. (Para 13)
Court failed to understand as to why the same person, who had approved the implementation of award as a member of the Board, had later as Vigilance Commissioner, recommended initiation of prosecution against the Appellant, who had merely prepared the agenda for appointment of an arbitrator and had nothing to do with the approval of the award and payment of money. (Para 13)
Astonishingly, most of the senior officials, who approved various decisions regarding extension of time, appointment of arbitrator and implementation of arbitration award and consequent payment to RPCL have not been arrayed as accused. (Para 13)
It seems that an attempt has been made to implicate the Appellant for the decisions in which prima-facie, he did not have any role to play, nor do his acts establish any culpability regarding the alleged offences. (Para 13)
FIR was already quashed against the co-accused Umesh Kumar, Financial Controller – III. (Para 15 and 16)
As per the FIR allegations, it is alleged that Umesh Kumar and the present Appellant had made the payment of Rs. 4,89,24,788/- against the gross value of Rs. 7,89,84,826/- without approval of the competent authority. In this regard, the allegation against the Appellant is that he suggested that part payment of the arbitral award may be made to RPCL from the working fund, on refundable basis since there was no fund available in the Power Finance Corporation Account. It is not the case of the prosecution that the Appellant had made payment to the agency. However, it can be inferred that the Appellant has suggested the possible mode of payment in furtherance of the Board’s office order no. 243 dated 16.03.2006, after passing of the arbitral award which was required to be paid alongwith interest, but to satisfy the award by noting, the said suggestion was made. In our view, this itself is not sufficient to implicate the Appellant. (Para 16)
During the investigation, no incriminating material or money was seized from the house of the Appellant. Further, it is not a case where allegations of illegal gratification or disproportionate assets have been successfully found by prosecution against the Appellant. On the contrary, when the Income Tax Department had assessed the block income tax return for seven years, the Department recorded a refund Rs. 8843 to the Appellant after detailed scrutiny of the records. (Para 17)
It is a well settled law that at the time of framing of the charges (i) the Court must apply it’s judicial mind on the material placed on record, (ii) the Court is also not expected to mirror the prosecution story, but to consider the broad probabilities of the case, weight of prima-facie evidence, documents produced and any basic infirmities etc. (Para 18)
Alleged offences cannot be prima-facie established against the Appellant as neither had he been entrusted with funds of JSEB nor he had fraudulently or dishonestly deceived senior officials of the JSEB to cause any benefit to RPCL or any wrongful loss to JSEB and no evidence of illegal gratification or disproportionate assets has been found against the Appellant. (Para 18)
[Pushpendra Kumar Sinha v. State of Jharkhand, 2022 SCC OnLine SC 1069 decided on 24.08.2022 by Hon’ble Supreme Court of India (Three Judge Bench)]
On Prevention of Money Laundering Act, 2002:
Lifting of Provisional Attachment Order on deposit of money:
Factual background:
Alleged proceeds of crime in the hands of Mrs. Mamta Aggarwal, was quantified at Rs.15,00,000, out of which Rs. 4,75,000/- was found lying in the account of M/s Capstone and the balance amount of Rs. 10,25,000/- was identified in the hands of the Petitioner, as a consequence of which the land in question came to be attached.
Held:
It is not disputed that the total proceeds of crime stand quantified at Rs. 15,00,000/-, out of which only Rs. 10,25,000/- has been found to have been secreted in the hands of the petitioner. In that view of the aforesaid matter, subject to the Petitioner depositing a sum of Rs. 10,25,000/- before the competent Adjudicating Authority, the provisional attachment of the plot of land shall stand lifted subject to further orders being passed in the writ petition.
[M/s BLA Power Private Limited & Ors. Vs. Palash Bhoyar, Deputy Director, Directorate of Enforcement & Anr. in W. P. (C.) 8421 of 2021 decided on 01.09.2022 by Hon’ble High Court of Delhi/
Anticipatory Bail granted:
Facts:
Learned counsel appearing for the petitioner submits that petitioner is innocent and has falsely been implicated in the case only on suspicion. Petitioner is simply a farmer and he has not acquired any movable or immovable property in his name or in the name of his family members. During the course of investigation under PMLA only single account in the name of petitioner in the ICICI bank was found and during the relevant period, between 2012-2018 cash deposit in the said account was only Rs 5,18,827/- and the fund was generated through agricultural products, money obtained from his ancestral property and few government schemes. Petitioner has got no connection with Pintu Ram and his family members.
[Bharat Bhushan Vs. State of Bihar in CM No. 38939 of 2021 decided on 22.08.2022 by Hon’ble High Court of Patna]
Anticipatory Bail granted after filing of Complaint:
Held:
7. It is an admitted fact that against the applicants herein investigation has been completed and complaint was filed before the learned trial Judge. It is clear from the order sheet of the trial Court dated 03.08.2019 that, this Court had directed the concerned trial Judge not to proceed against the applicants and, pursuant to that order, he did not start the trial and the case was fixed for further proceeding. As the revision petitions filed by the applicants herein were dismissed on 17.06.2022, the learned trial Judge issued bailable warrant against the applicants.
8. The applicants have filed copy of the statements of previous trial, in which they are made prosecutions witnesses, and the same shows the applicants herein have supported the prosecution case against Alok Kumar Agrawal and others. As per respondent, the tainted money was seized from the possession of applicants so, a complaint under Sections 3 & 4 of PMLA was filed against them. Looking to the list of witnesses and documents filed by the prosecution, it is clear that trial will take long time to its final conclusion as the trial is still in preliminary stage. Applicants are old age persons. As per prosecutions reply, the further investigation is ongoing and if any material collected by the Presiding Officer, they file supplementary complaint in this case.
9. Under these circumstances, the application filed by the applicants under Section 438 of the Code of Criminal Procedure is allowed.
[Vijay Kumar Singh Thakur Vs. Enforcement Directorate in MCRCA No. 949 of 2022 decided on 23.08.2022 by Hon’ble High Court of Chhattisgarh]
Anticipatory Bail granted on parity:
Held:
Considering the facts and circumstances of the case, the fact that complaint has already been filed; co-accused persons have been granted anticipatory bail by this Court vide order dated 23.8.2022 in MCRCA No.949/2022; there is no apprehension of the applicant absconding or tampering with the evidence or influencing the witnesses and that conclusion of the trial is likely to take some time, without commenting anything on merits of the case, this Court is inclined to release the applicant on anticipatory bail. Accordingly, the application is allowed. (Para 6)
[Vinod Malewar Vs. Enforcement Directorate in MCRCA No. 898 of 2022 decided on 29.08.2022 by Hon’ble High Court of Chhattisgarh]
On bail / anticipatory bail:
Bail in offence under Section 447 Companies Act, 2013 – Provisions of Section 212(6) of the Companies Act 2013 considered in light of Article 21 of the Constitution of India:
Factual background:
The petitioner has been granted bail on 25 November 2021 by a Single Judge of the High Court of Judicature at Allahabad at the Lucknow Bench in connection with certain proceedings initiated by the Enforcement Directorate.
Out of 69 accused, 41 are companies and 28 are individuals.
There are number of foreign accused who are yet to appear before the Special Court (Companies Act) Kanpur, comprising of entities as well as individuals. (Nine are in UAE, six in Hongkong, four in Singapore and one in UK)
The Special Court has issued summons for the third time which has been made returnable on 4 June 2022.
Date of arrest – 19.03.2020
Date of Complaint – 15.05.2020
Findings:
Twenty accused are abroad, out of which, nine are in UAE, six in Hongkong, four in Singapore and one in UK.
Special Court has issued summons on 11 September 2020, 1 February 2021, 15 November 2021 and 16 February 2022. The position as it emerges is that despite successive summons, service has not been effected on the foreign entities.
Appellant has been in custody as an under-trial for two years and five months.
Moreover, it has been submitted that except for the appellant, no other private accused continues to be in custody.
Appellant has been granted bail by the Lucknow Bench of the High Court of Judicature at Allahabad in connection with a complaint lodged by the Enforcement Directorate on 25 November 2021.
Having regard to the position as it remains regarding non-service of the summons on foreign entities, the period of custody already undergone and no immediate possibility of the trial commencing, we are of the considered view that the appellant would be entitled to the grant of bail.
Having duly considered the provisions of Section 212(6) of the Companies Act 2013, we are of the view that in the facts of the present case, the appellant ought to be granted the benefit of bail under Section 439 of the Code of Criminal Procedure 1973 since the right to an expeditious trial is protected under Article 21 of the Constitution.
[Sujay U. Desai Vs. Serious Fraud Investigation Office in Criminal Appeal No. 1023 of 22 decided on 25.07.2022 by Hon’ble Supreme Court of India]
Bail in GST / Economic Offence after filing of Complaint – Denial of bail must be the exception rather than the rule. (Amount involved – Rs. 122.28 Crores):
Factual background:
An investigation into business activities of firms has revealed that a group of persons have colluded and connived with each other to make a network of fake firms and defraud the state exchequer. All these below mentioned individuals have made a total of 40 firms and have evaded tax amounting to Rs. 122.28 Crores. The common Email-ids, Phone numbers and PAN cards have been used in all these firms to get the registrations and pass on the fraudulent Input tax Credit (ITC) to various beneficiary firms.
Date of arrest: 13.03.2021.
Complaint was filed under Section 132 (1) (a), (b) & (c) of Central Goods & Services Tax Act, 2017 and Punjab Goods & Services Tax Act, 2017.
Charge is of cheating and dishonestly inducing delivery of property, forgery for the purpose of cheating using as genuine a forged document.
Courts below rejected the bail on two grounds, offence alleged very serious involving deep rooted planning in which, huge financial loss is caused to the State exchequer and possibility of the accused persons tempering with the witnesses.
Findings:
Bail is not to be denied to satisfy the collective sentiments of a community or as a punitive measure.
Broadly speaking (subject to any statutory restrictions contained in Special Acts), in economic offences involving the IPC or Special Acts or cases triable by Magistrates, once the investigation is complete, final report / complaint filed and the triple test is satisfied then denial of bail must be the exception rather than the rule. However, this would not prevent the Court from granting bail even prior to the completion of investigation if the facts so warrant.
Petitioners were arrested on 13.03.2021 and the complaint came to be filed on 12.05.2021. Therefore, as on date they have undergone a total custody period of approximately 01 year and 06 months. The maximum sentence that could be awarded would be 5 years.
As yet, even the charges have not been framed and as many as 66 prosecution witnesses are yet to be examined. Therefore, at any rate, the trial cannot be concluded any time soon. Further no serious apprehension has been expressed by the prosecution of the petitioners being flight risks, or that they would tamper with the evidence or influence witnesses in case bail was granted to them. Even otherwise the evidence is primarily documentary in nature and in custody of the State.
[Maninder Sharma Vs. State Tax Officer in CRM-M-24033-2021 decided on 31.08.2022 by Hon’ble High Court of Punjab & Haryana]
Bail in GST / Economic Offence – (Amount involved – Rs. 138.71 Crores):
Factual background:
The registration of 39 suppliers of M/s. Madhav Copper Limited has been cancelled ab initio on the ground that those registered dealers were fictitious entities. Hence, the Input Tax Credit (ITC) availed from these registered dealers were not available to M/s. Madhav Copper Limited. On completion of the investigation, Criminal Complaint for the offences punishable under Section 132(1)(c) of the GGST Act, 2017 and CGST Act, 2017 read with Section 120B of the Indian Penal Code was filed against the Applicant and M/s. Madhav Copper Limited.
Date of arrest: 23.02.2022.
Findings:
Taking into consideration the maximum punishment for the alleged offence and the provisions of compounding the offences, this Court deems it just and proper to exercise discretion is exercised in favour of the applicant, as trial will take its own time to conclude.
[Nileshbhai Natubhai Patel Vs. State of Gujarat in R/CR.MA/11390/2022 decided on 05.08.2022 by Hon’ble High Court of Gujarat]
Anticipatory bail due to contradiction in Complaint with FIR and delay of one year in registering FIR:
Factual background:
Complainant made a complaint on 08.10.2020 at PS Malviya Nagar, New Delhi against her sister-in-law alleging that she instigated lies against her to the complainant’s husband, but there was no mention of the incident of 13.12.2019.
Findings:
There are contradictions in the complaint of the Complainant dated 08.10.2020 and the FIR. In the complaint of 08.10.2020, the complainant has not mentioned anything regarding the incident of 13.12.2019 or regarding the involvement of accused, Ryan Sequeira. The FIR has been filed after a delay of one year. While the same may not be enough for quashing of the FIR, they are enough for upholding the grant of anticipatory bail vide order dated 14.01.2021. The Ld. Session Court has correctly held that there is no misuse of the bail conditions by the Respondent no. 2. (Para 46)
[Ryan Sequeira Vs. State of NCT of Delhi & Anr. in W.P. (Crl.) 612 of 2021 decided on 31.08.2022 by Hon’ble High Court of Delhi]
On Quashing of FIR / Complaint:
Complaint rejected for want of sanction – question to be considered immediately if facts of the case so demand:
Factual background:
Ld. ACMM directed for the summoning of the Petitioner for the offence punishable under Sections 218/466 of IPC.
The Ld. MM vide impugned order dated 28.07.2014 rejected the application filed by Petitioner under Section 197, on the ground that the sanction under Section 197 of Cr.P.C. is only required when the offence is purported to have been done by the accused while acting or purporting to act in the discharge of his official duties. According to the impugned order, whether the petitioner was acting under the due discharge of official duties or not is a matter of trial which cannot be decided at the stage of issuing summon, as the same requires leading of evidence from both the sides.
Findings:
The pivotal issue, i.e., the applicability of Section 197 of the Code needs careful consideration. (Para 7)
- There cannot be any universal rule to determine whether there is a reasonable connection between the act done and the official duty, nor is it possible to lay down any such rule. (Para 7)
- One safe and sure test in this regard would be to consider if the omission or neglect on the part of the public servant to commit the act complained of could have made him answerable for a charge of dereliction of his official duty: if the answer to this question is in the affirmative, it may be said that such act was committed by the public servant while acting in the discharge of his official duty and there was every connection with the act complained of and the official duty of the public servant. (Para 8)
- It is not necessary that they must act in their official capacity but even where a public servant purports to act in their official capacity, same would attract provisions of S. 197. (Para 12)
- The test to determine a reasonable connection between the act complained of and the official duty is that even in case the public servant has exceeded his duty if there exists a reasonable connection it will not deprive him of the protection. (Para 16)
- For invoking protection u/s 197 of the Code, the acts of the accused, complained of, must be such that the same cannot be separated from the discharge of official duty. (Para 20)
If the Court at the initial stage itself is satisfied that an act alleged against an accused is in the discharge of his official function, the requirement of sanction would get attracted immediately. If the act has a reasonable relation to the duty of the accused, the question of sanction may arise immediately. (Para 20)
The act of the petitioner clearly falls within the scope of Section 197 of Cr.P.C., so as to attract the requirement of obtaining sanction immediately at the time of taking cognizance. (Para 27)
As stated above there is no doubt that a question of sanction can arise at any stage of proceedings but the same gets attracted immediately at the time of taking cognizance, if the facts of the case or act of the accused, are so intricately connected to his official function that it cannot be segregated. There is no legal bar to always postpone the requirement of sanction at a later stage. (Para 30)
The complaint of respondent No. 2 is rejected for want of sanction with liberty to proceed afresh after obtaining sanction from the competent authority. (Para 35)
[B. K. Parchure Vs. State in Crl. M. C. No. 5536 of 2014 decided on 18.08.2022 by Hon’ble High Court of Delhi]
Quashing of FIR, as the same was registered by overreaching the order, albeit, interim, passed by the High Court – All further proceedings pursuant to declaration of the petitioner/Company to be a wilful defaulter were stayed and the aspect of wilful default was being re-considered:
Factual background:
The Accused company was sanctioned an open cash credit limit of Rs.137.50 crores by the Indian Bank. By 30.06.2018, the Company closed the loan by paying it in full to the Indian Bank and as on 01.10.2018, it had excess ad hoc limit of Rs.13.75 crores.
When things stood thus, on 09-01-2019 a GST raid was conducted against the 1st petitioner/Company and all the records were seized and directions were issued to the Banks not to interact with the Company. Due to this problem, the loans of the 1st petitioner insofar as they pertain to the Banks i.e., Indian Bank and Bank of Baroda slipped into becoming a Non-Performing Asset (NPA).
A forensic audit was sought to be conducted of the accounts with the consortium of Banks covering the period from 26-09-2017 to 31-05-2019.
On 14-02-2020 the Indian Bank issued a communication to the petitioners informing them that the Bank has taken a decision to declare the Company as ‘wilful defaulter’ and a notice with regard to the same was issued upon the petitioners on 20-02-2020. This was called in question before this Court in Writ Petition No. 4777 of 2020. This Court by its order dated 02-03-2020 stayed all further proceedings initiated by the Bank which was to be in operation till the next date of hearing.
Pending the aforesaid writ petition, the other member of the consortium namely Bank of Baroda gave its consent to the Indian Bank which was the leader of the consortium for filing of a complaint with the CBI in terms of its communication dated 09-03-2020. It is here the respondent/CBI comes into the picture.
Findings:
Circular called as Reserve Bank of India (Frauds Classification and Reporting by Commercial Banks and Select FIs) Directions 2016 was issued by the Reserve Bank of India on 1st July 2016 in furtherance of the said circular (Para 12) and the Master circulars issued by RBI are binding upon consortium of Banks. (Para 11)
The petitioners had been declared to be wilful defaulters by communications dated 14-02-2020 and 20-02-2020 by invoking the aforesaid circulars. They were called in question before this Court in Writ Petition No.4777 of 2020. This Court granted an interim order of stay of all further proceedings pursuant to declaration of the petitioner/Company to be a wilful defaulter. The interim order was operating up to 15-04-2021. (Para 14)
The entire issue of declaration of the petitioner as wilful defaulter and subsequent action of registration of a crime was on the basis of the declaration of the petitioner to be a wilful defaulter or a fraudulent borrower. That having been stayed by this Court and the stay being in operation up to 15-04-2021, the 2nd respondent concealing the said fact of pendency of the case, could not have registered the crime, as the basis for registration of crime was the account being slipped into NPA on whatever score it would be, and the declaration of the petitioner as wilful defaulter having been stayed, it could not have appeared before the Court without divulging the fact that a complaint had already been registered before the CBI, get the matter disposed of, to re-consider the very root that led to registration of the crime. If the very root is to be reconsidered according to the Bank, it can hardly be justified as to how a crime could be registered in the teeth of subsistence of interim order during the pendency of the writ petition and subsistence of reconsideration at the hands of the 2nd respondent/Bank. It is not the merit of the matter that needs consideration at the hands of this Court, but it is the act of the 2nd respondent/Bank in trying to overreach the interim order of this Court by registering the crime. (Para 15)
[Steel Hypermart India Pvt. Ltd. Vs. Central Bureau of Investigation and Anr. in Criminal Petition No. 919 of 2021 decided on 02.08.2022 by Hon’ble High Court of Karnataka]
FIR quashed qua Corporate Debtor in view of Section 32A of the Code:
Finding:
Through Section 32A of IB Code, the insulation is provided to corporate debtor and to its properties as they would be susceptible to investigations or proceedings related to criminal offences committed by its, prior to the commencement of a CIRP, which would lead to imposition of liabilities and restrictions on the corporate debtor and its properties even after they were lawfully acquired by a resolution applicant or a successful bidder respectively. Section 29A read with section 35(1) (f), places restrictions on related parties of the corporate debtor from proposing a resolution plan and purchasing the property of the corporate debtor in the CIRP and liquidation process respectively. The proceedings under the IB Code are designed to ensure maximization of value, that requires transfer of the corporate debtor to bonafide persons, where position is safeguarded by ring-fencing them from prosecution and liabilities under offences committed by erstwhile promoter etc. When bonafide persons, takes over the management of the corporate debtor, they should not be penalized for the action of erstwhile management of the corporate debtor. Thus, VOFL as a going concern and its properties would not be liable for the alleged fraud of the earlier management.
[M/s Vimal Oils and Foods Ltd. Vs. State of Gujarat in R/CR.MA No. 11557 of 2021 decided on 24.08.2022 by Hon’ble High Court of Gujarat]
On ancillary aspects related to criminal trials:
Permanent exemption in CBI trials – gravity of offence affecting the economy of the country are not to be relied upon:
Findings:
It is nowhere laid down in CrPC that the accused has to be present on each and every date of hearing of the case. It would cause hardship to the accused and would also stand in the way of expeditious trial. (Para 41)
Provisions requiring the presence of the accused which mandate that the trial be held in his presence are enacted for the benefit of the accused. If the accused person himself does not wish to avail of the right of personal appearance on every date; if he reposes the fullest confidence in the court and in his advocate, and is confident that justice will be meted out to him even in his absence, then, provided his absence does not prejudice him in any way or hinder the progress of the trial, it is not necessary for the trial court to insist on his presence. (Para 41, 43 and 49)
One of the criteria for exercising the power under Section 205 CrPC is that personal appearance of the accused on each and every date of trial should not result in unnecessary harassment of the accused. However, the Court must ensure that exemption from personal appearance is not abused to delay the trial. (Para 44.1)
While deciding application for exemption, gravity of offence affecting the economy of the country are not to be relied upon, as these are allegations brought in the form of charge sheet, and at this stage, it cannot be said that the Accused had committed the offence(s). (Para 48)
[Mr. Y.S. Jagan Mohan Reddy Vs. Central Bureau of Investigation in Criminal Petition No. 608 of 2020 decided on 26.08.2022 by Hon’ble High Court of Telangana]
Section 452 Cr.P.C. is applicable to immovable properties:
Findings:
Judgment of Nevada Properties Pvt. Ltd. Through its Directors V. State of Maharashtra & Anr. 2019 (20) SCC 119 is applicable to S. 102 Cr.P.C., holding that said Section does not include power to attach, seize and seal immovable properties and expression “any property” appearing in S. 102 Cr.P.C. 1973 does not include immovable property.
Though immovable property cannot be seized u/s 102 Cr.P.C., but the ambit of S. 451 and 452 Cr.P.C. 173 is different. (Para 83)
Powers u/s 452 Cr.P.C., 1973 can be invoked qua immovable property in terms of S. 452 (5) Cr.P.C., 1973. (Para 87)
[Arvind Kumar Vs. Central Bureau of Investigation in Crl. M. C. 3927 of 2017 decided on 31.08.2022 by Hon’ble High Court of Delhi]
On Look Out Circulars:
On territorial jurisdiction to challenge a Look Out Circular –A mere fact that the Look Out Circular has been issued at Delhi does not create or vest territorial jurisdiction in the Courts at Delhi.
Factual background:
A Writ Petition under Article 226 of the Constitution of India r/w Section 482 Cr.P.C. was filed praying for quashing of the Look Out Circular issued by FRRO (Respondent No. 2) against the Petitioner therein.
Petitioner’s case was that he, a senior citizen, is a person of Indian Origin, is a citizen of the United Kingdom and is holding British passport bearing No. 521241201, also holding a document issued by the Government of India i.e., Overseas Citizen of India and stated to be engaged in the business of repairing and sale of watches. He also claimed that he requires constant medical attention due to various ailments.
Facts qua the aspects of jurisdiction:
- Enforcement Case Information Report was registered by the Directorate of Enforcement, Mumbai Zonal Office.
- Prosecution Complaint was pending before the Special Court, Mumbai.
- An earlier Writ Petition was filed before the Hon’ble High Court of Bombay seeking quashing of LOC.
- FRRO (Respondent No. 2) issued the LOC in Delhi.
Findings:
Whenever a suit/writ is instituted before the court, the initial issue is to be decided whether the court has jurisdiction to deal with the matter. (Para 13.1)
Mere fact that the Respondent No. 2 through the Respondent No. 6 on the request of the Respondent No. 3 issued LOC dated 10.02.2016 at Delhi does not create or vest territorial jurisdiction in courts at Delhi. No cause of action either wholly or in part has ever been arisen in Delhi for filing the present petition. This court is lacking territorial jurisdiction to entertain the present petition. (Para 13.5)
[Girish Sagar Vs. Union of India & Ors. in W. P. (Crl.) 3420 of 2019 decided on 31.08.2022 by Hon’ble High Court of Delhi]
Purpose of Look Out Circular – to track/detain the wanted person and hand them over to appropriate law enforcing agency.
Ref: Para 8 of Girish Sagar (supra).
Court can examine the reasons provided by the authority for the issuance of a LOC:
Though the scope of judicial review to interfere with the decision of the competent authority issuing a LOC is limited but it cannot be said that the decision is purely an administrative one or that in no situation can the court examine the reasons provided by the authority for the issuance of a LOC. The Court will be circumspect in interfering with the authority’s decision to issue the same but there can never be any blanket bar on the Court’s powers of judicial review to examine the authority’s decision to issue the LOC.
[Vikas Chaudhary Vs. Union Of India & Others, W.P.(C) 5374/2021 decided on 12.01.2022 by Hon’ble High Court of Delhi]
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