2024 (2) TMI 1428 - HC - Indian Laws

Illegal gratification - Legality of the arrest - Seeking quashing of FIR registered u/s 120 B and Section 420 of the Indian Penal Code and Section 7 and 13(2) r/w. 13(1)(d) of the prevention of Corruption Act 1988 - seeking quashing of arrest of the petitioners being in violation of settled tenets of law under Section 46 and 41A (3) of Cr.P.C. - seeking quashing of remand order and subsequent orders passed by the learned Special Judge CBI - sanction of credit facilities/ high value loan to the Videocon Group of Companies promoted by Venugopal Dhoot in violation of the Banking Regulation Act under RBI guidelines and the credit policy of the Bank. HELD THAT - Section 41A was inserted to avoid routine arrests. This section mandates issuance of notice where the arrest of a person is not required under Sub Section (1) of Section 41. This provision casts an obligation on such person to comply with the provision and further restricts the power to arrest when such person complies or continues to comply with the terms of notice unless the police officer is of the opinion that the arrest is necessary and further mandates to record to reasons for the arrest. In Satyendra Kumar Antil 2022 (8) TMI 152 - SUPREME COURT the Apex Court has observed that Sections 41 and 41A are facets of Article 21 of the Constitution of India and the Investigating Agencies and their officers are duty bound to comply with the mandate of the said provisions as well as the directions issued in Arnesh Kumar vs. State of Bihar 2014 (7) TMI 1143 - SUPREME COURT . The scope and ambit of Section 41 and 41A as well as the dictum of the Apex Court in Satyender Kumar Antil Arnab Goswami etc was considered by the co-ordinate Bench of this Court while granting interim bail to the petitioners for non compliance of the mandate of Section 41A - the interim order does not substantially decide the rights liability or lis between the parties and that the interim order is always subject to the final order which will adjudicate the final rights and liabilities of the parties. Hence there can be no gainsaying that the prima facie observation or tentative view expressed at interim stage is not binding at the final adjudication. There can be no dispute that it is within the domain of the Investigating Agency to interrogate the accused and to arrive at a subjective satisfaction on the issue of arrest. The satisfaction of the investigating agency is subjective in nature and the Court cannot go into the reasonableness of the reasons of arrest and or substitute its objective opinion for the subjective satisfaction. Nevertheless the subjective satisfaction is not wholly immune from judicial reviewability. In the instant case the preliminary enquiry relating to the sanctioning of loan to the Videocon Group of Companies in violation of Banking Regulations and Guidelines since the year 2009 to 2012 was registered in the year 2017. The petitioners were questioned in the course of the preliminary inquiry and subsequently the FIR was registered on 22.01.2019. The petitioners were named as accused in the said FIR for the alleged offences of criminal conspiracy and cheating - in compliance with the notice dated 15.12.2022 under Section 41A the petitioners appeared before the Investigating Agency on 23.12.2022. It is on this date that they were placed under arrest on the ground of non co-operation and purportedly to unearth the entire gamut of conspiracy which led to sanctioning of term loan of Rs. 1875 Crores to financially beleaguered Videocon Group of Companies between June 2009 to April 2012. The allegations that the petitioners are involved in the conspiracy similarly the gravity of the offence and alleged quid pro quo were to the knowledge of the Investigating Agency as on the date of the registration of the FIR. The FIR states that the loan sanctioning Committees of ICICI Bank had sanctioned loan to Videocon Group of Companies. Some of the senior officials of ICICI Bank were also named in the first information report and it was stated that the role of these senior officers of the sanctioning committee was also required to be investigated. Thus the involvement of the other bank officials in the conspiracy was not discovered in the course of the investigation but were to the knowledge of the Investigating agency as on the date of registration of the FIR despite which the Investigating Agency did not feel the need to arrest and interrogate the petitioners for a period of over three years. The Investigating agency has not been able to demonstrate existence of circumstances or supportive material on the basis of which the decision to arrest was taken. Absence of such circumstances information or material which is the sine qua non for the decision of arrest reduces the provision a dead letter and renders the arrest illegal. In the instant case the petitioner Chanda Kochhar was arrested before sunset. Hence sub section (4) of Section 46 is not attracted. The decisions relied upon are therefore distinguishable. The case diary reveals that the arrest was in presence of a lady police officer. There is nothing on record to prima facie indicate that the petitioner was physically touched by a male police officer. No complaint in this regard was made to the Judge before whom the petitioner was produced for remand - there was no contravention of Section 46 or 60A Cr.P.C. The arrest of the petitioners is held to be illegal for breach of mandatory provision under Section 41A Cr.P.C. Hence the petition is allowed.

Summary

Issues Involved:
1. Quashing of FIR No. RCBDI/2019/E/0001.
2. Legality of the arrest of the petitioners.
3. Validity of the remand orders dated 24.12.2022 and subsequent orders.

Issue-wise Detailed Analysis:

1. Quashing of FIR No. RCBDI/2019/E/0001
The petitioners initially sought to quash the FIR registered under Section 120B and Section 420 of the Indian Penal Code and Section 7 and 13(2) r/w. 13(1)(d) of the Prevention of Corruption Act, 1988. However, during the hearing, the petitioners decided not to press this prayer. The challenge was then restricted to the legality of the arrest and the remand orders.

2. Legality of the Arrest of the Petitioners
The petitioners argued that their arrest violated the mandatory provisions of Section 41A of the Cr.P.C. They had cooperated with the investigation, complied with the terms of the notice under Section 41A, and provided requisite information. Despite this, they were arrested on 23.12.2022. The court examined the compliance with Section 41A, which mandates that if a person complies with the notice, they should not be arrested unless the police officer records reasons for the necessity of the arrest.

The court noted that the petitioners were interrogated multiple times and had cooperated with the investigation. The arrest was made in a routine manner without reasonable satisfaction and without satisfying the requirements of Section 41 of Cr.P.C. The court cited several precedents, including Arnesh Kumar v. State of Bihar (2014) and Satender Kumar Antil v. CBI (2022), emphasizing that the police must record reasons for arrest and that non-compliance with Section 41A would entitle the accused to bail.

The court found that the reasons recorded for the arrest, such as "not disclosing true and correct facts," were inadequate and contrary to the mandate of Section 41(1)(b)(ii) of Cr.P.C. The court held that the arrest was not in accordance with the law, and non-compliance with the mandatory provisions of Section 41A and 60A of Cr.P.C. warranted the release of the petitioners on bail.

3. Validity of the Remand Orders Dated 24.12.2022 and Subsequent Orders
The court examined whether the remand orders complied with the requirements set forth by the Supreme Court in Arnesh Kumar. The court observed that the remanding judge must record their satisfaction, which should reflect in the order. The remand orders in question did not conform to this requirement. The court noted that the petitioners were arrested without any new material discovered during the investigation, and the arrest was based on the same material known to the investigating officer at the time of issuing the notice under Section 41A.

The court concluded that the remand orders were invalid due to the lack of proper satisfaction recorded by the remanding judge, as required by law.

Conclusion
The court held that the arrest of the petitioners was illegal due to the breach of mandatory provisions under Section 41A of Cr.P.C. The interim bail granted to the petitioners was confirmed, and the petitions were allowed in terms of prayer clause (b), which sought the quashing of the arrest and remand orders. The petitions and interim applications were disposed of accordingly.