2020 (2) TMI 1542 - HC - Money Laundering

Grant of bail - cheating and fraud - appreciation of evidence oral or documentary in detail - framing of charge or discharge of accused - HELD THAT - It is evident that the applicants along with other co-accused have swindled an amount of ₹ 147, 67, 92,256/- by floating a private company in the name and style of Hablas Pvt. Ltd. They collected the money from the people of that area and undertook to double the same within one month. It is humanly impossible to double the money within one month by any sort of business. In this way, applicants along with other accused have criminally instigated the people to deposit the money by false promise of doubling the same within one month. Law is clear that detail of appreciation of documents, which were never filed before the Trial Court (Bail court) cannot be considered by the High Court for the first time in the bail application. Further, this Court, while dealing with the bail application, cannot appreciate the evidence oral or documentary in detail, which the Court is required to appreciate while framing of charge or discharge of accused. In case titled Y.S. JAGAN MOHAN REDDY VERSUS CENTRAL BUREAU OF INVESTIGATION 2013 (5) TMI 896 - SUPREME COURT , wherein the Supreme Court has held that bail in economic offences requires different approach by the Court. From a combined reading of Section 167 (2) and 173 (i) (ii), it is apparent that if the police failed to submit a final report in terms of Section 173(2) of the Cr.P.C within the statutory period of 90 days or 60 days as the case may be, the accused becomes entitled to bail as a matter of right. The contention of the learned State counsel was that in the present case, the charge-sheet submitted against the petitioners was not a preliminary charge-sheet and that whether said charge-sheet is a final report in terms of Section 173 (2) of the Cr.P.C has to be considered on the basis of the overall materials collected and produced before the court along with the report and not on the basis of an isolated statement or averment made in the charge-sheet. In the present case, apparently on the basis of FIR lodged by the informant, police completed the investigation and initially submitted the charge sheet against the petitioners and others, and having considered the broad spectrum of the conspiracy involved in the case, police has continued with further investigation - While granting or refusing bail, the Court has to see the nature of accusation, gravity of the offence for which the accused have been found involved and impact of granting bail on general public. The argument that investigation is complete and nothing is required from applicants, is also not sustainable, because it may be a ground for consideration of bail but not an exclusive ground to grant bail. The applicants along with other accused have been found involved in swindling of huge amount of ₹ 147,67,92,256/- of innocent persons of locality on the promise of doubling the same within one month. These applications are found to be without any merit - Application dismissed.

Summary

Issues Involved:
1. Whether the applicants are entitled to bail under Section 420, 120-B of RPC.
2. Whether the preliminary charge sheet filed by the prosecution is valid under Section 167 of Cr.P.C.
3. Whether the applicants' involvement in the alleged economic offense warrants a different approach in granting bail.

Detailed Analysis:

Issue 1: Entitlement to Bail under Section 420, 120-B of RPC
The applicants, Zafar Iqbal and Zaheer Abass, sought bail in connection with FIR No. 04/2019 under Sections 420 and 120-B of RPC. They were accused of being part of a fraudulent scheme involving a company named Hablas Pvt. Ltd., which promised to double the money deposited by people within a month. The investigation revealed that the accused collected money from the public under false pretenses and used it for personal gains, including purchasing properties.

Arguments by Applicants:
- Zafar Iqbal: Claimed no mention in the FIR and argued that he was falsely implicated without cogent proof. He asserted his right to the presumption of innocence and emphasized his respectable status as an advocate.
- Zaheer Abass: Claimed he was merely an Accounts Assistant with no involvement in the fraudulent activities. He argued that his name was not mentioned in the FIR or in the complainants' statements under Section 161 Cr.PC.

State's Objections:
- Zafar Iqbal: Found actively involved in the case, propagating for the accused and delivering public lectures to lure people. Evidence included videos showing him distributing money and bank account statements revealing large sums of money credited.
- Zaheer Abass: Worked as an Accounts Assistant and was responsible for collecting money from the public. He received significant amounts of money, which were used for personal purposes, including constructing a house.

Court's Decision:
The court found that the applicants, along with other co-accused, swindled a substantial amount of money by making false promises. The nature of the accusations, the gravity of the offense, and the impact on the general public were considered. The court concluded that granting bail would undermine public trust and dismissed the bail applications.

Issue 2: Validity of Preliminary Charge Sheet under Section 167 of Cr.P.C.
The applicants argued that the preliminary charge sheet filed by the prosecution violated Section 167 of Cr.P.C. because it was incomplete, and they were entitled to default bail.

Court's Analysis:
The court referred to several judgments, including "Abdul Azeez P.V. and Ors. Vs National Investigating Agency (NIA)" and "K. Veeraswami Vs Union of India and Ors.," which clarified that a charge sheet is considered complete if it contains sufficient evidence for the court to take cognizance. The court held that the charge sheet filed was a final report under Section 173(2) Cr.P.C., and the plea for default bail was not sustainable.

Issue 3: Different Approach for Economic Offenses in Granting Bail
The court emphasized that economic offenses, especially those involving large sums of public money, require a different approach in granting bail. Citing "Y. S. Jagan Mohan Reddy Vs Central Bureau of Investigation," the court noted that such offenses have deep-rooted conspiracies and pose a serious threat to the financial health of the country.

Court's Conclusion:
The court concluded that the applicants' involvement in swindling a massive amount of public money warranted a stringent approach. The potential impact on public trust and the severity of the offense justified the denial of bail.

Final Judgment:
The bail applications were dismissed, and the court underscored the need to maintain public trust and ensure that those involved in significant economic offenses are not granted bail lightly. The decision was aligned with the principles of law and the gravity of the offenses committed.