TMI Blog2023 (2) TMI 1028X X X X Extracts X X X X X X X X Extracts X X X X ..... of such offence and that he is not likely to commit any offence while on bail. From the perusal of the complaint, it is apparent that even in relation to the charges which are alleged against the present applicant, there are various other accused persons who have been named as co-accused. The role assigned to them at this stage is no different than the Applicant. However, surprisingly the SFIO did not feel any need or ground to arrest those co-accused persons and proceeded to file the complaint praying the learned Special Court to take cognizance of the offences - the investigation, even though is stated to have started in the year 2018, the applicant was called on few occasions in the year 2020, then in February 2021 and thereafter information was sought from the applicant in July and September, 2022 and she was ultimately arrested on 14.10.2022. From the very nature of investigation and the complaint filed by the SFIO, the evidence appears to be documentary in nature which is already in custody of SFIO - the SFIO also has not been able to point out the need for continuing the custody of the applicant. Even though they have stated in cursory manner in the Status Report that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ine which shall not be less than the amount involved in the fraud, but which may extend to three times the amount involved in the fraud: Provided that where the fraud in question involves public interest, the term of imprisonment shall not be less than three years. [Provided further that where the fraud involves an amount less than ten lakh rupees or one per cent of the turnover of the company, whichever is lower, and does not involve public interest, any person guilty of such fraud shall be punishable with imprisonment for a term which may extend to five years or with fine which may extend to [fifty lakh rupees] or with both.] Explanation.-For the purposes of this section- (i) fraud , in relation to affairs of a company or any body corporate, includes any act, omission, concealment of any fact or abuse of position committed by any person or any other person with the connivance in any manner, with intent to deceive, to gain undue advantage from, or to injure the interests of, the company or its shareholders or its creditors or any other person, whether or not there is any wrongful gain or wrongful loss; (ii) wrongful gain means the gain by unlawful means of proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions. Further, to hold indirectly control of the prime assets of CUIs after Corporate Debt Restructuring ( CDR ) proposal, to siphoned off the funds from CUIs, he was assisted by his employees and close associates, through a series of concerted actions, such as bogus capital advances, bogus LCs, property at inflated prices and to infuse the capital, and maintain the required level of debt-equity, using a complex web of companies and financial transactions, siphoned off funds from CUIs starting from the F.Y. 2008-09 onwards. 4. Investigation established that Shantanu, Managing Director ESL and Director in EISML and others, in connivance with the KMPs/employees of the company and his close associates siphoned off huge amount of funds to the tune of Rs. 240.76 crores through various paper companies/entities from CUIS through a myriad of companies infused it back into his personal account SP and then infused these funds in the CUIs in the form of equity or promoter warrants directly or through a SPV namely A.P. Eduvision Pvt Ltd. or on his name to satisfy the conditions of agreement dated 19.06.2012 executed with Mt Kellet Group and (lender) and CDr. 5. Examination of bank accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of MEF during the period 01.10.2014 to 01.11.2017. 11. It is alleged that the applicant, despite being aware of the fact that the financials are not reflecting a true and fair view of the affairs of the company, had signed the financial statements of MEMPL for the financial year 2014-15 to 2018-19 and the financial statements of MEF for the financial year 2014-15 to 2015-16. 12. It is further alleged that she was the authorised signatory in the Bank Account operated by MEMPL in which funds were received from the various companies being operated by Shantanu Prakash. 13. She received funds to the tune of ₹ 17.78 crores in her personal account and the companies, MEMPL and MEF also received funds to the tune of ₹ 9.25 crores and ₹ 2 crores respectively from the companies controlled by Shantanu Prakash. 14. The said funds are claimed to have been transferred for the purpose of siphoning off inasmuch as from the said funds, a major shareholding of another company LMEPL were acquired and the funds were used to construct a school at Sector 119, Noida. 15. It is further claimed that Ms. Priya Prakash, daughter of Shantanu Prakash, also transferred ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ' were arranged by Shantanu Prakash. iii) In all, 15 persons have been stated to be involved in commission of the above mentioned Charge No. 1. b. The other charge in which the role of the applicant has been alleged was Charge No. 2A and Charge No. 2B, which reads as under: Charge No. 2A: Commission of fraud by divesting the asset of ESL (share in Educomp Child Care Private Ltd. now known as Little Millennium Education Private Limited) in favour of Millennium Education and Management Pvt. Ltd. punishable under Section 447 of the Companies Act, 2013 Charge No. 2B: Commission of fraud by using the funds of ESL, EISML and ESSPL to acquire the Millenium School through Millenium Education Foundation; punishable under Section 447 of the Companies Act, 2013 i) In relation to Charge No. 2A, 12 individuals including the applicant have been alleged to have committed the offence. ii) In relation to Charge No. 2B, 11 individuals along with the applicant are alleged to have committed the offence. iii) It is alleged that a primary property, admeasuring 27.10 acres, which was bought by EISML in July, 2008 in Mussoorie, was identified as one of the asset which was made p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and author. 20. The applicant has always cooperated with the investigation for the past four years. She joined as and when she was called. He submits that there was no occasion for the respondent authorities to arrest the applicant. 21. He further submits that the applicant has been targeted by the prosecution. The main accused, even as per the prosecution case has not been arrested till date. The respondents have not arrested other accused persons who are stated to be the co-accused in the transactions which are alleged against the applicant. 22. No offence under Section 447 of the Companies Act is made out against the applicant even if taken at the face value. He submits that the applicant, at best, has entered into certain business transactions with the main accused and his companies but the same cannot be termed as having been entered into for the purpose of siphoning off of the money from the companies under investigation. The money was raised by the applicant's company for the business expansion. The applicant cannot be alleged to be aware of the source of the funds or that she was aware that the funds were allegedly siphoned off. 23. He submits that the res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is Court in the case of Shivani Rajiv Saxena v. Directorate of Enforcement: MANU/DE/2776/2017 to contend that merely because the applicant is a woman does not entitle her for bail and the nature, gravity and seriousness of the offence have also to be considered. 32. He further relies upon the judgment passed by the Hon'ble Apex Court in the case State of Gujarat v. Mohanlal Jitamalji Porwal (1987) 2 SCC 364, Y.S. Jagan Mohan Reddy v. CBI (2013) 7 SCC 439 and Rohit Tandon v. Directorate of Enforcement (2018) 11 SCC 46 in order to buttress the argument that economic offences constitute a class apart and need to be visited with a different approach in a matter of bail. 33. I have considered the arguments advanced by the parties. 34. After the arrest of the applicant on 14.10.2022, the SFIO has already filed their compliant on 12.12.2022. It is pertinent to note that the provisions of Section 167(2) have been made applicable in relation to arrests made under the Companies Act. 35. In terms thereof, if the chargesheet (complaint) is not presented before the expiry of 60 days from the date of arrest, the accused is entitled for the grant of default bail. 36. It is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ences, it is not a rule that the bail has to be denied in every case. Every application has to be considered on its own merits and considering the factors which are relevant for the said case. The basic test, as reiterated by the Hon'ble Apex Court from time to time, remains the same being: (i) the chances of tampering with the documents and evidence, (ii) the chances of influencing the witness, and (iii) the flight risk. 43. It is not in dispute that the investigation in the present case is already complete, which has culminated into a criminal complaint filed before the concerned Special Court. 44. There may be certain aspects of investigation which are stated to be pending further investigation but it is not denied that the complaint has already been filed and is pending consideration for the purpose of taking cognizance before the learned Special Judge. 45. The fact is that the complaint has been filed by the SFIO without feeling the need of any custody of the 53 out of 55 accused persons. The main accused even as per the SFIO has not been arrested, being protected by the order passed by this Court in Writ Petition (Criminal) No. 1242 of 2022. The said wri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irector, into the investigation. It is stated that the such statements were withdrawn subsequently by filing appropriate application before the Special Judge. 52. It is submitted that the Applicant has during the course of investigation explained all transactions undertaken by her and the aforesaid companies. Applicant was never involved in the financial affairs of ESL and was never an authorised signatory of the company and has not signed any balance sheet of ESL during her tenure. All transactions were undertaken through proper banking channels and as per lawful commercial practices. 53. It was further submitted that the investigations started pursuant to corporate rivalry. Raffles Group filed fraudulent complaints with investigative agencies. The allegations levelled in the present case have already been investigated by Economic Offences Wing, Delhi Police ( EOW ) in FIR No. 222/2019, registered against the ESL Group on the behest of Raffles Group. In the aforesaid case, EOW has concluded that the documents submitted by Raffles Group were forged and fraudulent. 54. It was also stated that the Loans totalling INR 18.10 Crores taken by the Applicant from daughter of Shant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents. 63. As reiterated by the Hon'ble Apex Court from time to time, the object of bail is neither punitive nor preventive and deprivation of liberty must be considered as a punishment. 64. Considering the aforesaid facts and circumstances in mind, I am persuaded to admit the applicant on regular bail pending the trial in the Criminal Complaint titled SFIO Vs Educomp Solutions Limited others. The applicant is, therefore, directed to be released on bail on furnishing a personal bond for a sum of ₹ 5 lakh with one surety of the like amount to the satisfaction of the Special Judge/Duty Magistrate on the following conditions: (i) The applicant shall join and cooperate with any further investigation as and when directed by the IO. (ii) The applicant shall not take adjournment and attend the Trial Court proceedings on every date. (iii) The applicant shall not leave the country without the permission of the learned Special Court. (iv) The applicant shall surrender her passport to the learned Special Court. (v) The applicant shall not contact the witnesses in any manner. 65. The applicant during the period that she is on bail shall not commit any offenc ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
