TMI Blog2022 (1) TMI 973X X X X Extracts X X X X X X X X Extracts X X X X ..... ities, Bank officials to correlate and verify the nature and quantum of fraud and modus operandi adopted for incorporating shell companies, raising of fake invoices, routing back the amount through various associated shell companies. Hence petitioner, does not deserve for bail. The object of bail is to secure appearance of the accused person at his trial by a reasonable amount of bail. Unless it can be required to ensure that an accused person will stand his trial where called upon. As observed by the Hon ble Apex Court in catena of judgments, the basic principle of our criminal justice system is bail, not jail. Considering the specific contentions of the learned Additional Advocate General that the investigating agency requires couple of weeks to conclude the investigation and after that there is no necessity of judicial custody of the petitioners and also in view of the rejection of the petition filed by the CID in the Court below for police custody of the petitioners herein and the same was unchallenged by the respondents - there is no necessity to grant of police custody of the petitioners - this Court is inclined to enlarge the petitioners on bail, but with some conditi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nto between APSSDC on one hand and SIEMENS on the other. SIEMENS is a combination of M/s. SIEMENS Industry Software (India) private limited and M/s. Design Tech Systems Private Limited. 5. A tax investigation by the Additional Director General, GST, Intelligence, Pune in respect of the claims of CENVAT credited by M/s. Design Tech Systems Private Limited and M/s Skillar enterprises India private limited led to huge financial scam involving crores of rupees by M/s. SIEMENS Industry Software India Private Limited and M/s. Design Tech Systems Private Limited. As per the MOA, the Design Tech has to provide training software development including various sub modules designed for high end software for advance manufacturing CAD/CAM. As per the investigation conducted by the Additional DGGI, Pune concluded that both the service provider and service receiver had taken contradictory stands regarding the nature of service regarding the nature of services. An in-depth scrutiny into the records by the ADGGI revealed that training software development including various sub-modules shown as supplied by Skillar to design tech were purchased by Skillar from i) M/s Allied Computers Internati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hing a huge financial scam involving crores of rupees by M/s. SIEMENS Industry Software India Private Limited and M/s. Design Tech Systems Private Limited. The funds release to Andhra Pradesh State Skill Development Corporation, Vijayawada (shortly referred to as APSSDC). As per the MOA, the Design Tech has to provide training software development including various sub modules designed for high end software for advance manufacturing CAD/CAM. The MOA does not contemplate to the contract. However, Siemens and designtek had sub-contracted a large part of the work to M/s. SIEMENS Enterprises private limited, New Delhi, with self-centric Solomon s wisdom. As a matter of fact, Skillar was established after DesignTech had entered into a contract with APSSDC. It is the claim of Designtek that Skillar has provided training software development including various sub-modules designed for high and software for advance manufacturing CAD/CAM. Skillar has directly supplied the same to the Skill Development Centers in Andhra Pradesh. Designtek further claims that royalty and subscription were paid to Skillar since they have developed the software. When tax authorities confronted Skillar, Skil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stead of doing so both of them swindles crores of rupees in a dubious manner. Their acts affected the marrows of economic health of the State. As per the Memo No.143741/skill/2021 dated 11.7.2021 and 04.9.2021, the Managing Director, APSSDC is instructed to lodge a report with Crime Investigation Department to make a detailed probe into the case. I therefore, lodge this report for taking necessary legal action against the above M/s. SIEMENS and M/s Designtech and their bogus shell allies according to law. 7. In the above said F.I.R, the petitioner was shown as A10 and his designation was indicated as Chief Operating Officer, Skillar Enterprises India Pvt. Ltd. (formerly known as PVSP IT Skills Projects Pvt. Ltd.) In fact the petitioner was appointed as financial advisor of M/s. Skillar enterprises India Pvt. Ltd thorough offer letter dated 01.4.2016 and around June 2017, the designation of the petitioner was changed as Chief Operating Officer for operational convenience. It is stated that the petitioner had stopped attending to the work at Skillar enterprises since October, 2017 on his health reasons and demitted the office from December 2017. 8. The contention of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ording to the remand report, it shows that the fraudulent acts and violations committed by the petitioner are as follows: 1. As per the investigation already done by DGGI, Pune, it is revealed that Mukul Agarwal worked previously with Mr. Soumyadri Shekhar Bose @ Suman Bose of SISW in Dassault Systems and SDRC (Structural Development and Research Corporation). 2. He came to know that DesignTech and Siemens were going to execute APSSDC project. 3. He expressed his desire with Bose and Vikas Khanvelkar to start a company independently and contacted Pravin Bhatia to set up a company and to handle this project for DesignTech and he worked as Chief Financial Officer of the PVSP IT Skills. Its name was later changed to Skillar Enterprises Pvt. Ltd. 4. The PVSP/Skillar was created exclusively for execution of APSSDC project for DesignTEch. 5. Mukul Agarwal, Mr. Soumyadri Shekhar Bose @ Suman Bose and Mr. Vikas Vinayak Khanvelkar designed a plan for diversion of the APSSDC funds through various shell companies. 6. Mr. Soumyadri Shekhar Bose @ Suman Bose and Mr. Vikas Vinayak Khanvelkar made various negotiations for rates and deliveries by various vendors to PVS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by documents and the petitioner/CID can seize the documents from company of the respondent/A10 and for that purpose, there is no need for custodial interrogation of the respondent/A10. The Hon ble Supreme Court time and again cautioned the subordinate Courts that police custody of accused cannot be granted in a routine manner without there being any valid grounds and purpose. Here, in the case on hand, prior to the arrest and during the course of searches, the petitioner/CID officials interrogated the respondent/A10 and since the material was also seized from the possession of respondent/A10, I am of the opinion that there is no need to grant police custody of the respondent/A10. From the aforesaid discussion, I see no grounds to order the police custody of the respondent/A10 as prayed for. Accordingly, these points are answered. 11. In the said circumstances the petitioner is no way concerned with the allegations made in the F.I.R. and remand report and the petitioner is not the director or share holder and he is only an employee and fact remains is that he demitted the office on medical grounds in the year December, 2017 itself. In view of the dismissal of the police custody ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e allegations as they stand, in the FIR; and (vi) The significant interests of the public or the State and other similar considerations. More than four decades ago, in a celebrated judgment in State of Rajasthan, Jaipur vs Balchand, Justice Krishna Iyer pithily reminded us that the basic rule of our criminal justice system is bail, not jail . The High Courts and Courts in the district judiciary of India must enforce this principle in practice, and not forego that duty, leaving this Court to intervene at all times. We must in particular also emphasise the role of the district judiciary, which provides the first point of interface to the citizen. Our district judiciary is wrongly referred to as the subordinate judiciary . It may be subordinate in hierarchy but it is not subordinate in terms of its importance in the lives of citizens or in terms of the duty to render justice to them. High Courts get burdened when courts of first instance decline to grant anticipatory bail or bail in deserving cases. This continues in the Supreme Court as well, when High Courts do not grant bail or anticipatory bail in cases falling within the parameters of the law. The consequence for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n behalf of the learned counsel for the petitioner/A6 submitted that basing on the contents of the F.I.R except stating that a huge financial scam involving crores of rupees by SIEMENS and Designtech systems private limited relating to the funds of APSSDC, Vijayawada, no allegations are made against the petitioner. In fact as per the report submitted by the DGCI, the designtech has to provide training software development through various sub-modules designed for high end software for advance manufacturing CAD/CAM. In fact according to the allegations, the designtech has supplied various sub-modules to the companies which are shell/defunct companies by issuing fake invoices without providing any service. Except that there are no allegations against the Siemens industries software India limited. The complaint made by the Chairman, APSSDC on 07.9.2021, the entire allegations are against the DigiTech and the other skillar forms. In fact, the allegations in the said complaint is Siemens has to oversee the functions of the cluster and their maintenance instead of doing so, both of them swindled crores of rupees. Basing on the complaint, the respondents have registered the F.I.R. on 09.12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... received from DGGST Intelligence Unit, Pune, who investigated and concluded that the APSSDC funds were diverted by DesignTech by giving a sub-contract to PVSP IT Skillars from where the amount was diverted to various shell companies by raising fake invoices without providing any services or supplying any goods. 6. He along with his team members made email correspondence with the officials of APSSDC and finalized the draft of the manipulated and defective tripartite agreement to serve their vested interests. 7. With a preconceived mind, he affixed signature as Suman Bose on APSSDC Siemens Tripartite Agreement, which is quite different from the signature affixed as Soumayadri Shekhar Bose on agreement with Gujarat State. 8. He resigned from SISW on 27.3.2018 shortly after the commencement of investigation by Siemens. 9. Soon after commencement of investigation by Siemens, Soumayadri Shekhar Bose @ Suman Bose and his team members (GVS Bhaskar Prasad, Bhavana Gupta, Sateesh Kurup, Rahul Sehgal, Ashish Sharma, Naga Rama Pratap Bontha), deliberately deleted data from mobile handsets and laptops. 10. However, the investigation team of Siemens retrieved and imaged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficials. 18. Mr. Soumyadri Shekhar Bose @ Suman Bose brought the partners viz., DesignTech, PVSP, TalentEdge and KnowledgePodium together for APSSDC project. 19. Mr. Soumyadri Shekhar Bose @ Suman Bose had previous nexus with MD, DesignTech Mr. Vikas Vinayak Khanvelkar and Mukul Agarwal of Skillars since long back as they worked previously in HCL and Dassault. 20. Mukul Agarwal joined the Skillars in February, 2016 when the money started flowing in to DesignTech from AP Government. Thus, the closely knit team of Mr.Soumyadri Shekhar Bose @ Suman Bose executed the entire plan with Vikas Khanvelkar who worked with Suman Bose since 1990 in HCL and Mukul Agarwal who worked together with Suman Bose in Dassault and SDRC. 21. Further, the investigation done by DGGSTI, Pune, indicated that some of the money was routed from Skillars to some Singapore Entity (Ink Fish Hospitality) and from there to Aptus Healthcare (India) Ltd. Through Hawala transactions. 22. Mr. GVS Bhaskar Prasad was CEO of Aptus Healthcare, he also played active role and assisted Mr. Soumyadri Shekhar Bose @ Suman Bose in APSSDC-Siemens Project. 23. Further, the shareholding of KnowledgePodi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed against the PVSP/Skillar only. 16. Further learned senior counsel has submitted that the documents which were related by the Managing Director, APSSDC is mainly on incident report of the DGGST, Pune and forensic aid report of Sarath and associates, chartered accountants and the internal report of the Siemens. Even according to the internal report of the Siemens dated 12.4.2019 findings are that based on the material facts establish during the investigation as well as the testimonial evidence it can be concluded that there are strong indications which point to the fact that Mr. Bose, ex SISW CEO played an active role in a scheme together with mentioned external vendors and their owners with the purpose of misusing public funds. Except that there are no clear indications/allegations against the petitioner. Further more in the forensic audit report submitted by the Sarath and associates, chartered accounts in conclusion the allegations made against the petitioner is as follows: As per the MOA and license agreements between APSSDC, Designtech and Siemens, the actual signatory for Siemens was Mr. Soumyadri Sekhar Bose as a Managing Director but the MOA was signed by Mr. Suman ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods. With a preconceived mind, he affixed signature as Suman Bose on APSSDC Siemens Tripartite agreement, which is quite different from the signature affixed as Soumayadri Sekhar Bose on agreement with Gujarat State. Soon after commencement of investigation by Siemens, Soumayadri Shekhar bose @ Suman Bose and his team members (GVS Bhaskar Prasad, Bhavana Gupta, Satheesh Kurup, Rahul Sehgal, Ashish Sharma, Naga Rama Pratap Bontha) deliberately deleted date from mobile handsets and laptops. However, the preliminary investigation established that Mr. Bose, Khanvelkar and Mr. Agarwal played an active role in setting up Skillar as a project management entity for APSSDC project and the above three persons controlled the activities of skillars. Finally held that the bill of material attached with MoU/agreement very different from the Bill of material actually supplied/executed at various CoEs and TSDIs. 19. In all the above allegations there are no specific allegations that the petitioner has swallowed the amounts of the APSSDC or how he has diverted the funds of APSSDC to his personal funds and there is no whisper that the amount said to have been paid by the APSSDC is transferred to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as per the MoU. In fact as per the MoU, the petitioner and the Skillar has supplied both hardware and software and they have established six clusters as per the MoU and they have also imparted training both to the faculty and students. It is not the case of the complainant that the petitioner has not supplied the software and hardware as per the MoU. 23. Learned senior counsel further submitted that the petitioner is still continuing and the project is ongoing even as on today. They have been providing software, hardware and conducting clusters and imparting training to both faculty and students. Hence the question of siphoning of funds of the department would not arise. It is not their case they have not supplied hardware or software as per the MoU. In the complaint also they have based on the AGGST the Skillar has established certain companies and supplied the material and raised fake invoices is only matter of GST and which is nothing to do with the implementation of the project or diversion of the funds of the State Government. In fact, learned senior counsel has specifically stated in their grounds that they have raised six clusters as individual tripartite agreement has se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th Siemens Industry Software India Pvt. Limited (in short SISW) an entity of Siemens and DesignTech, Pune for setting up of skill development centers named as clusters. Each cluster comprising one center of excellence and six technical skill development centers across the State of Andhra Pradesh in selected educational institutions. The name of the project is called as APSSDC-SIEMENS project. As per the cost of each cluster is ₹ 546,84,18,908/- and the Siemens and Designtech contribute 90% of the project cost as grant in aid and the remaining 10% has to be contributed by the Government of A.P. and 10% contribution comes to ₹ 370,78,80,000/- including taxes. Basing on the said G.O. the APSSDC entered into an agreement without any date and without mentioning nature of grant in aid percentage of contribution of grant in aid by SIEMENS and DesignTech. More particularly it can be seen that the sanction terms of disbursement of the financial assistance was kept intentionally blank to accommodate the disbursement of monies. As per the above said agreement, the SISW shall provide the PLM software and further act as technology partner to actively collaborate and assist DesignTec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... funds, which were released to DesignTech(A4) and it was transferred to others through Hawala transactions with the help of shell companies by raising fake invoices for layering the funds. 29. After commencement of GST investigation, the Siemens Global Team conducted an internal investigation separately and concluded that A6 Soumyadri Shekhar Bose in connivance with A8 Vikas Vinayak Khavelkar, MD of DesignTech(A4), Mukul Chandra Agarwal (A10), and his project team members had used the above shell companies as a mechanicm to obtain illegal benefits through the use of invoices issued by the shell companies for diversion of APSSDC funds. Even before filing the complaint with APCID, the APSSDC officials got conducted a forensic audit on the Siemens Project and the forensic auditor in his report concluded that M/s. DesignTech and M/s. SISW diverted the APSSDC funds to the tune of ₹ 241,78,61,508/- through various associate shell companies by raising fake/bogus invoices out of ₹ 371 crores released by APSSDC to DesignTech. The said report also revealed that M/s DesignTech and M/s Siemens have utilized and invested only a meager amount towards the project out of the Gove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd huge magnitude of the fraud running into several crores of rupees, the IO is still in the process of securing various incriminating documents/records from various Central and State Government Agencies including Income Tax Authorities, GST officials, ROC authorities, Bank officials to correlate and verify the nature and quantum of fraud and modus operandi adopted for incorporating shell companies, raising of fake invoices, routing back the amount through various associated shell companies. Hence petitioner, does not deserve for bail. With the identical allegations the counters were filed in all the three criminal petitions. 33. Learned Additional Advocate General after hearing the elaborate arguments advanced by all the three senior counsel, on instructions, has submitted that without going into the merits of the case, he requested couple of weeks time. In the meanwhile, the respondent investigating agency would complete the investigation and hence remand of the petitioners would not require further. 34. Learned Additional Advocate General has further submitted that on perusal of the tripartite agreement entered in is vague and the clauses of the said agreement are more ben ..... X X X X Extracts X X X X X X X X Extracts X X X X
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