9911796707
TMI Blog2023 (6) TMI 73X X X X Extracts X X X X X X X X Extracts X X X X ..... d Additional Sessions Judge-03/Special Judge (Companies Act), Dwarka Courts, New Delhi. Background 2. The Ministry of Corporate Affairs, Government of India ('MCA'), in exercise of its powers conferred under Section 212(1)(c) of the Companies Act, assigned the investigation into the affairs of Bhushan Power and Steel Ltd. ('BPSL'), its ten group companies and Bhushan Steel Limited ('BSL') with its two group companies to Serious Fraud Investigation Office ('SFIO'), vide order F. No. 5/5/2016/CL-II dated 03.05.2016. 3. The Director, SFIO, appointed officers of the SFIO as inspectors to investigate the aforementioned companies. Thereafter, MCA vide order No. 5/5/2016/CL-II dated 08.01.2018 granted approval under Section 219(b) & 219(c) of the Companies Act to investigate twenty group companies associated with BPSL. 4. The applicant herein, a Chartered Accountant, was associated with BPSL since the year 2000 till May 2019, handling financial matters of the company. 5. As per the allegations leveled by the SFIO, during investigation, it was revealed that in furtherance of a fraudulent modus operandi, finished goods lying in the plant of BPSL were removed from the plant allegedly wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The SFIO, in its report, alleges fraudulent availing of credit facilities from banks also through the instrument of Inland Letter of Credits ('LCs') issued on the basis of false documents from banks and then fraudulently discounting the said LCs, converting them into wrongful gains. 9. After placing sufficient material on record against the accused, for prosecution under Sections 447/36(c) read with Sections 447/129/448 of the Companies Act, Sections 211 and 628 of the Companies Act, 1956 and Sections 120B/417/420 of the IPC. The SFIO arrested the applicant on 21.03.2022 and produced him before the learned Special Court, Dwarka that granted 2 days judicial remand. Thereafter, the SFIO filed an application seeking 14 days Judicial Custody that was granted by the learned Special Court vide Order dated 24.03.2022. The applicant is in judicial custody since then. 10. The SFIO, in the complaint case, on the basis of the findings of the investigation report, has leveled the following charges of fraud, citing instances that associate the applicant herein to the alleged fraud with respect to public money to the tune of Rs. 5,435 Crores. The respondent has alleged a total number of twelv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e not reflecting a true and fair picture of BPSL and wherein provision of Rs.471.78 crores was made and E & Y in its Forensic Report of BPSL has red flagged advances to certain parties wherein there was no supporting documents except the payment vouchers and the names of 20 parties out of top 26 advances to suppliers were in the said list prepared by E&Y report. On investigation, it was revealed that advances to suppliers were not genuine. He, along with Amarjeet Sharma was coordinating on behalf of BPSL in conduct of Forensic Audit and supplying response/documents on behalf of BPSL to Forensic Auditor. 155. He submitted response of BPSL vide its letter dated 2l.06.2017 the SBI in response to clarifications sought on the issues related to Forensic Auditor, wherein he had stated that the advances made to parties mentioned at Sr. No.5,8,13,14,15,17,20,22,23,24,30 & 36 of the letter were given in the normal course of business for supply of goods and services, however on investigation it is found that these parties are not genuine and the funds transferred to these parties were siphoned off from the accounts of BPSL for providing accommodation entries to BPSL group entities. He is al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he cash generated through the sale of theft material from BPSL Plant to various paper entities managed and controlled by aforesaid entry-operators and after placing and layering through web of entities, the funds were infused in the Companies including four front companies namely Diyajyoti, Jasmine, Marsh and Vision and ultimately infused in BPSL as share capital. Investigation revealed that through four front companies a total capital of Rs. 3689.89 crores (equity - Rs. 2681.31 crores and preference shares - Rs. 1008.58 crores)had been infused in BPSL. Through this modusoperandi BPSL used to maintain a healthy debt-equity ratio and thereby dishonestly induced the banks to sanction as well as disburse the loans to it. 270. Thus, Sanjay Singal, Amarjeet Sharma, Alkesh Sharma, R.K. Gupta, R.P. Goyal, H. C. Verma, Arun Kumar Agrawal' R.K. Mehra (Deceased), Abhaychand Bardia, Abhishek Chokhani, Anand Kumar Sharma, Anil Kumar Khemk &, B. D. Agarwal, Praveen Kumar Jain alias Pintoo, Sagarmal Nahata, Sirish Chanderkant shah, Subhash Kumar Agarwal Dilip Nahata, Himanshu Verma, Krishan Kumar Khadaria, Narender Kumar Jain, Pankaj Agrawal, Pankaj Kasera,praveen Kumar Tavatiya, R. K. Kedia, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een infused in BPSL during FY 2014-15 to 2016-17 as preference shares. 272. Thus, Sanjay Singal, Aarti Singal, H'C' Verma, R'P' Goyal' R.K. Gupta, Alkesh Sharma, Amarjeet Sharma, Arun Kumar Agrawal Himanshu Verma, Devesh Upadhyaya, Krishan Kumar Khadaria, Vikash Chowdhary, Diyajyoti Steel Ltd., Jasmine Steel Trading Ltd., Marsh Steel Trading Ltd and Vision Steel Limited used false documents in order to induce banks for availing loans from the banks during the period covering F.Y. 2014-15 to 2016-17 and thereby, they are liable for fraudulent inducement of banks as laid down in Section 36(c) of companies Act 2013 and punished u/s 36 (c) r/w 447 of the Companies Act, 2013." 10.5. Charge 7: Liability for making false representations in the financials for the Financial Year 2017-18, under Sections 129 and 448 read with 447 of the Companies Act. The relevant allegations read as under: "Arun Kumar Agarwal 286. Investigation revealed that Sanjay Singal (erstwhile CMD), R. P. Goyal (the then WTD of BPSL), Amarjeet Sharma (Director-Finance of BPSL), Arun Kumar Agarwal (the then CFO) and R.K. Gupta Company Secretary were at all material times, aware about the fact that SAP-ERP data di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. books of accounts and financials which did not reflect true and fair view about the affairs of BPSL and are hence, liable to be prosecuted u/s. 129(7), 448 r/w 447 of the Companies Act, 2013 and u/s. 211 and 629 of the Companies Act, 1956 for the corresponding relevant financial years as follows: i) Sanjay Singal (Managing Director)' R'P' Goyal (Director) Amarjeet Sharma (Director), Arun Kumar Agrawal (CFO) only for F.Y. 2012-13, R.K. Gupta' Company Secretary and R'K' Mehra (Deceased) Statutory Auditor, Parbrer Mehra Goel & Co. u/s. 211 r/w 628 of Companies Act, 1956 for F.Y. 2009-10 to 2012-13; ii). Sanjay Singal (Managing Director)' R'P' Goyal (Director)' Amarjeet Sharma (Director), Arun Kumar Agrawal (CFO)' R.K. Gupta (Company Secretary), R'K' Mehra (Deceased) Statutory Auditor, Parfirer Mehra Goel & Co' S'K' Mittal & Co' through S.K. Mittal, Partner, Statutory Auditor (F'Y' 2015-16 to 2016-17)." 10.7. Charge 10: Other fraudulent transactions punishable under Section 447 of the Companies Act. The relevant allegations read as under: "Arun Kumar Agarwal 294. During the F.Y.2013-14, Sanjay Singal (erstwhile CMD of BPSL) connived with KMPs/employees namely Amarjeet Shar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctions of Sanjay Singal and R.P. Goyal. 299. During investigation, Dinesh Kumar Behal, chairman of the Audit committee, vide his statement recorded u/s 217 (4) of the companies4ct,2073, has stated that he was the chairman for namesake and no extensive discussions regarding financials had taken place in the meetings of Audit committee. Since the Audit committee was functioning under the control of Sanjay Singal, therefore, it had never highlighted the irregularities which were going on in BPSL. 300. Thus, Sanjay signal in connivance with R.P. Goyal Member of the Audit committee and Ex Whole-Time Director, BPSL with an intent to deceive the shareholders/creditors and to conceal the true affairs of BPSL had misused the structure of Audit Committee and on their instructions, the Audit committee didn't properly examine the financials of BPSL and placed the false financials before the Board of Directors for its approval. The above said acts had caused misrepresentation of financials before the creditors and shareholders and injured their interest and therefore, Sanjay Singal and R.P. Goyal are liable to be punished u/s 447 of the Companies Act 2013. Submissions on behalf of the Appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is argued that it is the case of the respondent that four group companies of BPSL, being accused nos. 14, 17, 19, 30, referred to as "four front companies" in the investigation report, received accommodation entries from several entry operators, and invested Rs. 3350.05 crores in BPSL. It is pointed out that Sanjay Singal (A-36) and Aarti Singal (A-37), along with their children Aniket Singal (A-38), and Priyanka Miglani (A39) were directors/shareholders in the said four front companies. Aniket Singal was not arrested during investigation and was granted anticipatory bail by the learned Special Judge vide order dated 16.03.2023, and Priyanka Miglani has not been arrested. It is pointed out that Aniket Singal and Priyanka Miglani have not even been made accused under the present charge. 12.1.4. It is argued by learned Senior Counsel on behalf of the applicant that the allegation of the respondent that he had supplied documents to forensic auditors which did not reflect the true and correct picture, does not, in isolation, make out an offence. The applicant in fact, assisted in the forensic audits of BPSL by duly providing documents required by the auditors. It was submitted that n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to suppliers were used to purchase a property situated at Worli, Mumbai through one Assurity Real Estate LLP (A-35), a firm incorporated in the name of Priyanka Miglani (A-39). The modus operandi alleged is to be similar to the previous instances. It has been submitted that none of the entry operators name the applicant. Attention of this Court has been drawn to the Statements of Dilip Nahata, Praveen Kumar Tavatiya, R.K. Kedia and Deepak Aggarwal recorded in the investigation report, wherein it has been stated that Alkesh Sharma (A-42) and Sanjay Singal were the persons, on whose request they had provided loans to Assurity Real Estate Pvt. Ltd. and Aarti Singal in form of accommodation entries. It was pointed out that Priyanka Miglani (A-39), one of the designated partners in Assurity Real Estate LLP, and a direct beneficiary, was not arrested. 13. Charge 2: The present charge pertains to issuance and negotiation of LCs by BPSL. It is alleged that bogus LCs were opened by BPSL on the basis of forged and fabricated proforma invoices and bills of exchange, without any further underlying documents. Learned Senior Counsel submitted that the main accused under the present charge is on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resolution was passed in his name by the Board of Directors. He had never been at the forefront of any alleged activities rendering his arraignment by SFIO in the capacity of CFO as incorrect. 15. Charges 7 & 8: Learned Senior Counsel has submitted that allegations under Charges no. 7 and 8 pertain to making false representation in the financials for the financial year 2017-18 and falsification of books of accounts. It has been submitted that the balance sheets and financial reports of BPSL were prepared at the Chandigarh office of BPSL, under the supervision of Amarjeet Sharma (A-43), as per the case of respondent itself, the applicant was working out of the Delhi office of BPSL. 15.1. It has been submitted that the applicant did not verify the figures in the balance sheets and he relied on Amarjeet Sharma (A-43), who prepared them. It is submitted that Amarjeet Sharma (A-43) was the Vice President, Finance, BPSL and his department in Chandigarh looked after the day-to-day banking operations including LCs/BGs/fund management and payments related to properties of BPSL as well as the minutest material decisions like finalization of accounts, preparation of balance sheet and any ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d case, even after joining the investigation more than twenty times, conforming to the summons received from time to time. On 19.05.2022, SFIO filed the prosecution complaint under Section 447 of the Companies Act. The Learned Special Court, in order dated 19.05.2022, has recorded as under: "Documents contained in nine trunks have been also filed along with the complaint" Therefore, it is submitted that as per the provisions of Section 439 of the CrPC, the applicant deserves bail to prevent interference with personal liberty of the applicant as there will be a delay in trial, owing to the voluminous documents. To support the said contention, learned Senior Counsel for the applicant placed reliance on 'Jainam Rathod v. State of Haryana & Anr., Criminal Appeal No. 640 of 2022' and 'Sujay Desai v. SFIO, Criminal Appeal No. 1023 of 2022.' 19. Furthermore, it is submitted that the applicant satisfies the 'triple test' for grant of bail as there is no possibility of him tampering with evidence, influencing the witnesses or fleeing from justice as the allegations are based solely on the prosecution's documents, in custody of the learned Special Court. Additionally, the statements reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in all probability he may not be ultimately convicted, an order granting bail may be passed. The satisfaction of the court as regards his likelihood of not committing an offence while on bail must be construed to mean an offence under the Act and not any offence whatsoever be it a minor or major offence. If such an expansive meaning is given, even likelihood of commission of an offence under Section 279 of the Penal Code, 1860 may debar the court from releasing the accused on bail. A statute, it is trite, should not be interpreted in such a manner as would lead to absurdity. What would further be necessary on the part of the court is to see the culpability of the accused and his involvement in the commission of an organized crime either directly or indirectly. The court at the time of considering the application for grant of bail shall consider the question from the angle as to whether he was possessed of the requisite mens rea. Every little omission or commission, negligence or dereliction may not lead to a possibility of his having culpability in the matter which is not the sine qua non for attracting the provisions of MCOCA. A person in a given situation may not do that which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or refusing bail undoubtedly would be tentative in nature, which may not have any bearing on the merit of the case and the trial court would, thus, be free to decide the case on the basis of evidence adduced at the trial, without in any manner being prejudiced thereby. 47. In Kalyan Chandra Sarkar v. Rajesh Ranjan [(2004) 7 SCC 528 : 2004 SCC (Cri) 1977] this Court observed : (SCC pp. 537-38, para 18) "18. We agree that a conclusive finding in regard to the points urged by both the sides is not expected of the court considering a bail application. Still one should not forget, as observed by this Court in the case Puran v. Rambilas [(2001) 6 SCC 338 : 2001 SCC (Cri) 1124] : (SCC p. 344, para 8) 'Giving reasons is different from discussing merits or demerits. At the stage of granting bail a detailed examination of evidence and elaborate documentation of the merits of the case has not to be undertaken. ... That did not mean that whilst granting bail some reasons for prima facie concluding why bail was being granted did not have to be indicated.' We respectfully agree with the above dictum of this Court. We also feel that such expression of prima facie reasons for granting bai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e accused which is, of course, the work of Trial Court. The Court is only required to place its view based on probability on the basis of reasonable material collected during investigation and the said view will not be taken into consideration by the Trial Court in recording its finding of the guilt or acquittal during trial which is based on the evidence adduced during the trial. As explained by this Court in Nimmagadda Prasad, the words used in Section 45 of the 2002 Act are "reasonable grounds for believing" which means the Court has to see only if there is a genuine case against the accused and the prosecution is not required to prove the charge beyond reasonable doubt. 402. Sub-Section (6) of Section 212 of the Companies Act imposes similar twin conditions, as envisaged under Section 45 of the 2002 Act on the grant of bail, when a person is accused of offence under Section 447 of the Companies Act which punishes fraud, with punishment of imprisonment not less than six months and extending up to 10 years, with fine not less than the amount involved in the fraud, and extending up to 3 times the fraud. The Court in Nittin Johari, while justifying the stringent view towards gran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e grant of bail, even though regarded as an important right of the accused, is not a mechanical order to be passed by the Courts. The prayer for grant of bail even in respect of general offences, have to be considered on the basis of objective discernible judicial parameters as delineated by this Court from time to time, on case-to-case basis." 21.3. Similarly in Anil Vasantrao Deshmukh v. State of Maharashtra., 2022 SCC Online Bom 3150 while examining the ration in Ranjitsing Brahmajeetsing Sharma (supra) and Vijay Madanlal (supra) held as under: "37. The aforesaid pronouncements, thus, indicate that the statutory restrictions in the matter of grant of bail are required to be considered reasonably. A finding that the accused is not guilty of the offence and that he is not likely to commit an offence if released on bail, are required to be recorded only for the purpose of arriving at an objective finding on the strength of the material on record to assess the entitlement for bail only. If the Court having regard to the material brought on record is satisfied that, in all probability, the accused may not be ultimately convicted, an order granting bail may be passed. Conversely, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent 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. We accordingly direct that the appellant shall be released on bail, subject to such terms and conditions, as may be imposed by the Sessions Judge, Kanpur in connection with Sessions Trial No 577 of 2020. 21.6. The Hon'ble Supreme Court, in Gurbaksh Singh v. CBI & Anr (1980) 2 SCC 565, held as under: "27. It is not necessary to refer to decisions which deal with the right to ordinary bail because that right does not furnish an exact parallel to the right to anticipatory bail. It is, however, interesting that as long back as in 1924 it was held by the High Court of Calcutta in Nagendra v. King-Emperor [AIR 1924 Cal 476, 479, 480 : 25 Cri LJ 732] that the object of bail is to secure the attendance of the accused at the trial, that the proper test to be applied in the solution of the question whether bail should be granted or refused is whether it is probable that the party will appear to take his trial and that it is indisputable that bail is not to be withheld as a pun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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... 47. 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. 48. The investigation, even though is stated to have started in the year 2018, the applicant was called on few occasions in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he wasn't involved in the day-to-day activities of the company as regards the siphoning off funds of BPSL in the form of bogus capital advances, he connived with Amarjeet Sharma (A-43) by using the mode of capital advances, diverting funds to various paper companies, which were placed and layered through a web of entities and ultimately used for infusing in BPSL as share capital, hence, routing the same as equity or unsecured loans to related entities of BPSL. During the investigation, it was revealed that huge amount of funds was siphoned off from BPSL from financial year 2009-10 to 2017-18. During the examination of the balance sheet of BPSL for the financial year 2016-17, it was found that the company provisioned Rs.3079.39 crores of capital advances and raw material. 23.2. Charge 1, Instance III: It is averred that the applicant played a paramount role in the company's affairs and day to day working. He along with Amarjeet Sharma (A-43) assisted the forensic team of Ernst & Young on behalf of BPSL. He signed the balance sheet for the financial year 2013-14 to 2017-18 knowing that the finances do not reflect the true and fair picture of the affairs of the BPSL. Moreover, appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... then the CFO of BPSL to get LCs issued on the basis of false documents from banks and then, fraudulently discounted the LCs for causing wrongful gain to themselves. In pursuance of aforesaid object, Ravinder Kumar Rastogi and the applicant were authorized by committee on borrowings of BPSL, in its meeting on 26.06.2013, to open the LCs and execute all related documents. 25. Charges 3 & 4: The present charges pertain to cheating banks by fraudulent inducement. Learned CGSC submitted that during financial year 2009-10 to financial year 2013-14, Sanjay Singal (erstwhile CMD of BPSL) (A-36) entered into criminal conspiracy with KMPs/employees including the applicant (the then CFO of BPSL) to dishonestly induce the banks to sanction loans on the basis of false financial statements and bogus infusion of equity, including funds generated through LCs without actual supply of any materials. Investigation revealed that through four front companies a total capital of Rs. 3689.89 Crores (equity-Rs. 2681.31 Crore and preference shares - Rs. 1008.58 Crore) had been infused into BPSL. Through this modus operandi BPSL used to maintain a healthy debt-equity ratio and thereby dishonestly induced th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cant. It has been submitted that the applicant connived with other co-accused persons for misusing the corporate structure of these 30 companies for commission and continuation of the fraud. Investigation also established that the financials of these companies were knowingly manipulated for the purpose of equity infusion into BPSL. The financials of 30 companies' for financial year 2009-10 to 2016-2017 did not reflect a true and fair picture of its affairs. It is the argument of the learned CGSC that in the aforesaid statement of Dinesh Kumar Behal it is stated that the applicant had been a key person of BPSL and attended the audit committee meetings in the said capacity. 28.1 It was further submitted, on the basis of the Dinesh Kumar Behal's testimony and the signatures of the applicant on the proceeding book of passing resolution, that it is clear that the applicant was present in meetings of the audit committee and was the key controller of the committee, thereby giving rise to liability under Section 447 of the Companies Act, for misuse and fraudulent abuse of the structure of audit committee. 29. Learned CGSC submitted that the judgments cited by the applicant are not applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roposition that provisions of Section 447 read with Section 212(6) of the Companies Act, have been upheld. 33.2 In Narcotics Control Bureau v. Mohit Aggarwal, 2022 SCC OnLine SC 891, it was held as under: "18. In our opinion the narrow parameters of bail available under Section 37 of the Act, have not been satisfied in the facts of the instant case. At this stage, it is not safe to conclude that the respondent has successfully demonstrated that there are reasonable grounds to believe that he is not guilty of the offence alleged against him, for him to have been admitted to bail. The length of the period of his custody or the fact that the charge-sheet has been filed and the trial has commenced is by themselves not considerations that can be treated as persuasive grounds for granting relief to the respondent under Section 37 of the NDPS Act." 33.3 Reliance was placed on Serious Fraud Investigation Office v. Nittin Johari & Anr., (2019) 9 SCC 165, to demonstrate that non-arrest of other co-accused persons cannot replace the satisfaction of the mandatory requirements under Section 212(6) of the Companies Act. 33.4 Reliance was placed on Satender Kumar Antil v. CBI & Anr., (2021) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the board of directors or anyone or more of the Directors is or are accustomed to act." 37. The allegations with respect to the present application for commission of offence under Section 447 read with Section 212(6) of the Companies Act, are with respect to following charges: 37.1. Charge 1 Instance II relates to siphoning of funds from BPSL through capital advances and routing the same as equity of unsecured loans to related entities of BPSL. It is the case of respondent that the present applicant connived with Sanjay Singal, Aarti Singal, R.P. Goel, H.C. Verma, Amarjeet Sharma, Alkesh Sharma and R.K. Gupta in siphoning of the funds of BPSL by payments made to parties which were not genuine. It was further argued that the present applicant signed the balance sheets for financial year 2016-2017 knowing the finances were not reflecting a true and fair picture of BPSL. It is further urged that the present applicant used to attend the meetings of bankers to discuss the forensic report of Ernest & Young along with Sanjay Singal and some of his co-accused. It is further alleged that the present applicant comes under the category of 'Key Managerial Personnel' as defined under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tand of the present applicant in his statements to the respondent that he did not verify the financial figure and balance sheet and relied upon the aforesaid Amarjeet Sharma (A-43) for their veracity. Moreover, as per the role ascribed to Sanjay Singal and Aarti Singal, it is case of the respondent that they were the authorized signatories of BPSL and had given directions to extend advances to paper companies. 38.1. So far as the four front companies,(A-14, 17, 19 & 30) are concerned, it is pointed out that accused Aniket Singal (A-38) was not arrested during investigation and was granted anticipatory bail by learned Special Judge and Priyanka Minglani (A-39) has not been arrested and has not been made an accused in the present charge. It is pertinent to note that the aforesaid co accused were direct beneficiaries being the directors of the said companies. It is alleged that said companies received accommodation entries from several entry operators who do not name the present applicant. 38. 2. The allegation with respect to the applicant supplying documents to forensic auditors, which did not reflect true and correct picture, has to be seen in the background of the applicant's st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... name of Ravindra Kumar Rastogi, Vice President (A-46). It has been pointed out that both the aforesaid accused persons namely Ravindra Kumar Rastogi (A-46), who as per the case of respondent in his confessional statement admitted direct involvement in the commission of the offence and aforesaid Ankur Nagar (A-80) have not been arrested by the respondent. 39.1. It has been further pointed out that with reference to the gist of Banker's statements in the SFIO report, during examination of bankers, it has come on record that aforesaid Ravinder Kumar Rastogi (A-46) used to come to the branches but do not name the present applicant. 40. Charge 4 relates to cheating banks by fraudulently inducing them to sanction loans to BPSL on the basis of financial statements and balance sheets of BPSL, which did not reflect true and correct picture of the said company. It is alleged that the present applicant alongwith other accused persons including entry operators committed frauds upon the banks to sanction loans on the basis of financial statements which otherwise were created on the basis of modus operandi as alleged in charge 1 instance (II, III and IV). It is alleged that the present applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns who were part of the audit committee namely Dinesh Kumar Behal, R.P. Goel (A-41) and Anil S. Supanekar. It is alleged, in the said report that although the board had entrusted said committee with specific duties in terms of Section 171 of the Companies Act, with regard to correctness and completeness of financial results but the structure of audit committee was used to perpetrate fraud. It is the case of the respondent itself that the said committee was not functioning independently and the committee members were following the instructions of Sanjay Singal and R.P. Goel. 43.1. Reliance was placed on statement date 30.03.2022 made by Dinesh Kumar Behal, who was chairman of the audit committee wherein he stated that the present applicant used to attend the meetings of the audit committee as well as board meetings and also played an active role in the said meetings. Perusal of the record reflects that the name of the present applicant does not find mention in the attendance register of the board meetings and that of the audit committee, placed on record by the respondent. Reliance by respondent was placed on the Proceeding books of the company's minutes of meetings showing applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are related to theft of material from Sambhalpur plant, sale of Chennai land and destruction of SRP-ERP data. Finally, it has been vehemently argued upon that no material has come on record to show that the present applicant was beneficiary of the any of the alleged siphoned funds. 46. The Supreme Court while considering the provisions of Section 37 of the NDPS Act, in Mohd. Muslim alias Hussain v. State (NCT of Delhi), 2023 SCC Online SC 352, held as under: "19. The conditions which courts have to be cognizant of are that there are reasonable grounds for believing that the accused is "not guilty of such offence" and that he is not likely to commit any offence while on bail. What is meant by "not guilty" when all the evidence is not before the court? It can only be a prima facie determination. That places the court's discretion within a very narrow margin. Given the mandate of the general law on bails (Sections 436, 437 and 439, CrPC) which classify offences based on their gravity, and instruct that certain serious crimes have to be dealt with differently while considering bail applications, the additional condition that the court should be satisfied that the accused (who is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during investigation (as held in Union of India v. Rattan Malik). Grant of bail on ground of undue delay in trial, cannot be said to be fettered by Section 37 of the Act, given the imperative of Section 436A which is applicable to offences under the NDPS Act too (ref. Satender Kumar Antil supra). Having regard to these factors the court is of the opinion that in the facts of this case, the appellant deserves to be enlarged on bail." (emphasis supplied) 47. A coordinate bench of this Court in Ashish Mittal v. SFIO vide judgment dated 03.05.2023 in BAIL APPLN. 251/2023 after exhaustively examining the law on the case with respect to satisfaction in terms of Section 212(6) of the Companies Act, has held as under: "28. The above enunciation of the law clearly mandates that where additional conditions are stipulated in a statute for grant of bail relating to specified offences; it cannot be that the prosecution need only recite from its complaint, or simply say that it has material against the accused in respect of such offences. The prosecution must show how the material collected during investigation supports the allegations in the complaint, and most importantly, how the allega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noticed that the 2013 Act specifically circumscribes even the power of an SFIO officer to arrest an accused. Section 212(8) expressly stipulates that an arrest may only be made by an officer of the rank of Assistant Director or above; and further stipulates pre-conditions to making an arrest, viz. that the officer must be in possession of material, based on which he has formed the reason to believe that the accused has committed an offence under the 2013 Act, with a further requirement that the reason for the belief are to be recorded in writing. This adds further weight to the interpretation that the opposition offered by the prosecutor must also be based on material in the possession of the SFIO, from which the reason to believe for arrest has arisen, which reason must also have been recorded in writing. 33. It is also important to articulate here, that though the general principle is that parity with co-accused alone is not a ground to claim bail as a matter of right; however, that principle is nuanced. The nature of an offence may be such, that the fact that other accused have been granted bail, may persuade the court to exercise its discretion in favour of another co-accused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 's name from the attendance registers of board meetings and audit committee will have a bearing for the purposes of deciding the present application. It is pertinent to note that while grave allegations have been made qua the applicant with regard to connivance/conspiring with the promoters and other co accused, but no allegation with regard to his receiving benefits have been made. 50. Admittedly, the evidence in the present case is predominantly documentary in nature and it has been pointed out by learned Senior Counsel, the complaint is accompanied with documents contained in 09 trunks. It is common knowledge that the trial is likely to take a long time. The reliance placed by the respondents on the orders with regard to co-accused Amarjeet Sharma and Alkesh Sharma, dismissing their bail applications by a coordinate bench of this court is misplaced. The aforesaid order of the coordinate Bench was with respect to the contention of the said co-accused with regard to Section 167(2) of the CrPC In any case the present application is being decided on the basis of its own facts. 51. Learned Senior Counsel has submitted that the present applicant joined the investigation on each and e ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
