TMI Blog2019 (9) TMI 570X X X X Extracts X X X X X X X X Extracts X X X X ..... rvation demonstrates non-application of mind on the part of the Court even under Section 439 of the Cr.P.C., even if we keep aside the question of satisfaction of the mandatory requirements under Section 212(6)(ii) of the Companies Act. The High Court has failed to apply its mind to all the circumstances that were required to be considered while granting bail, particularly in relation to economic offences - Matter remanded to High Court with a request to the High Court to decide the bail application afresh at an early date, in accordance with law. - CRIMINAL APPEAL NO. 1381 OF 2019 (@ S.L.P. (CRL.) NO. 7437 OF 2019 - - - Dated:- 12-9-2019 - Justice N. V. Ramana, Justice Mohan M. Shantanagoudar And Justice Ajay Rastogi JUDGMENT Mohan M. Shantanagoudar, J. Leave granted. 2. The instant appeal challenges the grant of bail to Respondent No. 1 by the High Court of Delhi in Bail Application No. 1971/2019 in C.C. No. 770/2019, vide the order dated 14.08.2019. 3. The case of the prosecution primarily hinges on the commission of fraud punishable under Section 447 of the Companies Act, 2013 (for s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 212(6)(ii), (7) and (8) of the Companies Act. The operation and effect of this order (save for his interim release) had been stayed by this Court in appeal, vide order dated 04.09.2018. 5. Respondent No. 1 applied for regular bail under Section 439 of the Code of Criminal Procedure, 1973 (for short the Cr.P.C. ), which was dismissed by the Special Judge (Companies Act), Dwarka District Courts, Delhi, vide order dated 06.06.2019. The Investigation Report was submitted by the Appellant to the MCA on 27.06.2019, and after obtaining sanction from the MCA, the Petitioner filed the Complaint before the Special Court on 01.07.2019. It may be pertinent to note that as per Section 212(15) of the Companies Act, the Investigation Report filed under Section 212(12) of the Companies Act is deemed to be a report filed by a police officer under Section 173 of the Cr.P.C. (i.e. the charge-sheet). Respondent No. 1 filed another application under Section 439 of the Cr.P.C. before the Special Judge, which was dismissed vide order dated 02.08.2019. It is pertinent to note that both these orders take note of the mandatory nature of Section 212(6) (ii) of the Companies Act perta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find, has not been adverted to at all in the impugned order. There is prima facie substance in the grievance of the appellants that the High Court has failed to consider matter such as the nature of gravity of the alleged offence. Moreover, we find that in the course of the impugned order, the High Court even proceeded to recall certain observations made by it in another case (Poonam Malik v. Union of India [W.P.(Crl.) No.2384 of 2018] order dated 10th August 2018). It was submitted that in light of these peculiar circumstances, there exists no reason to grant bail to Respondent No. 1 on the ground of parity with Neeraj Singal. It was further submitted that the nonarrest of various other co-accused was not pertinent to deciding whether Respondent No. 1 should be released on bail. Learned Solicitor General also sought to impress upon us the magnitude of the offence, arguing that economic offences form a class apart, particularly cases such as the instant one, which have resulted in not only a substantial loss to banks but also a huge blow to the national economy. In such cases, the Court must account for several factors while granting bail, especia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ences found in other penal statutes) which were punishable with imprisonment for three years or more, and this Court had struck down this provision as unconstitutional mainly on the ground that the aforesaid classification did not seem to have a rational nexus to the object of that legislation. However, the Parliament had subsequently amended Section 45 of the PMLA, imposing the twin conditions for bail for offences under the PMLA itself, and not for offences found in Schedule A. It was further submitted that after the said amendment, Section 45 of the PMLA had become in pari materia with Section 212(6) of the Companies Act, as the latter section also imposed the twin conditions for offences under Section 447 of the Companies Act itself. 8. On the other hand, learned Senior Counsel Shri Kapil Sibal, appearing on behalf of Respondent No. 1, submitted that once investigation is over and a chargesheet has been filed, as has been done in the present case, the nature of allegations may not be a factor to decide if bail is to be granted. Instead, in such cases, the Court must consider whether the applicant has been cooperating in the investigation, and whether there is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Nikesh Tarachand Shah (supra), Section 45 of the PMLA had been held unconstitutional not only under Article 14, but also under Article 21 of the Constitution, as the said section made drastic inroads into the fundamental right of liberty without there being a compelling state interest. However, without going into the question of the constitutionality of Section 212(6) of the Companies Act itself, it was stressed that since the provision, as it exists, requires the Court to practically record a finding of acquittal in order to grant bail, it is well nigh impossible for an applicant to obtain bail under the provision. Overall, it was contended that the High Court had used its discretion in granting bail in Respondent No.1 after applying its mind to the contents of the complaint and relevant legal propositions, and did not suffer from any perversity so as to warrant the intervention of this Court. 9. Having heard the learned Counsel on either side, we have perused the record. 10. It is pertinent to begin our discussion by referring to the mandatory conditions imposed under Section 212(6)(ii) for the grant of bail in connection with off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations. This Court has adopted this position in several decisions, including Gautam Kundu v. Directorate of Enforcement (Prevention of Money Laundering Act), Government of India, (2015) 16 SCC 1, and State of Bihar v. Amit Kumar, (2017) 13 SCC 751. Thus, it is evident that the above factors must be taken into account while determining whether bail should be granted in cases involving grave economic offences. 12. As already discussed supra, it is apparent that the Special Court, while considering the bail applications filed by Respondent No. 1 both prior and subsequent to the filing of the Investigation Report and complaint, has attempted to account not only for the conditions laid down in Section 212(6) of the Companies Act, but also of the general principles governing the grant of bail. 13. In our considered opinion, the High Court in the impugned order has failed to apply even these general principles. The High Court, after referring to certain porti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the nonarrest of Brij Bhushan Singal and the grant of bail to Neeraj Singal. 15. In light of the foregoing discussion, we are of the view that the High Court has failed to apply its mind to all the circumstances that were required to be considered while granting bail, particularly in relation to economic offences. Accordingly, the impugned order is hereby set aside. 16. In the interest of justice, we deem it fit to remand the matter to the High Court to reconsider Bail Application No. 1971/2019 filed by Respondent No.1 in light of the principles governing the grant of bail under Section 439 of the Cr.P.C, while also keeping in mind the scope and effect of the twin mandatory conditions for grant of bail laid down in Section 212(6)(ii) of the Companies Act. Needless to say, Respondent No. 1 shall continue to remain in custody subject to the order of the High Court in the said bail application. 17. The impugned order of the High Court is set aside. This appeal is disposed of accordingly, with a request to the High Court to decide the bail application afresh at an early date, in accordance with law, and in the light of the aforesaid obser ..... X X X X Extracts X X X X X X X X Extracts X X X X
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