2011 (4) TMI 1547 - SC - Indian Laws

Summary

Issues Involved:
1. Grant of bail to A4 and A10 by the High Court.
2. Role and allegations against A4 (S. Gopalakrishnan).
3. Role and allegations against A10 (V.S. Prabhakara Gupta).
4. Comparison with the bail granted to A5 (Talluri Srinivas).
5. Impact on the trial and influence on witnesses.
6. High Court's reliance on previous Supreme Court orders.
7. Timeliness and diligence of CBI in challenging the bail order.

Summary:

Grant of Bail to A4 and A10:
The Supreme Court addressed appeals by the CBI against the High Court's order granting bail to A4 (S. Gopalakrishnan) and A10 (V.S. Prabhakara Gupta). The High Court had granted bail to these respondents by imposing certain conditions.

Role and Allegations Against A4:
A4, a partner at M/s Price Waterhouse, was accused of signing misleading financial statements for M/s SCSL, failing to verify bank balances and other financial details, and receiving an exorbitant audit fee as quid pro quo. His actions were alleged to be offenses punishable u/s 120B r/w Sections 420, 419, 467, 471, and 477A of IPC.

Role and Allegations Against A10:
A10, the Head of Internal Audit at M/s SCSL, was accused of intentionally excluding Oracle Financials from the audit plan, submitting misleading audit plans, and failing to take corrective measures on anomalies. His actions were alleged to be offenses punishable u/s 120B r/w Section 420 IPC.

Comparison with Bail Granted to A5:
The High Court had relied on the Supreme Court's previous order granting bail to A5 (Talluri Srinivas). However, the Supreme Court noted that A4 and A5 had different roles, with A4 being involved for seven years compared to A5's one year. The Court found no parity between A4 and A5's roles.

Impact on the Trial and Influence on Witnesses:
The Supreme Court acknowledged that releasing A4 and A10 could jeopardize the trial, as they might influence witnesses, especially those still employed at M/s SCSL under new management.

High Court's Reliance on Previous Supreme Court Orders:
The Supreme Court found that the High Court's reliance on the bail order for A5 was misplaced. The Court emphasized that the trial was proceeding on a day-to-day basis and was likely to conclude by 31.07.2011, making the reasons for A5's bail inapplicable to A4 and A10.

Timeliness and Diligence of CBI:
The Supreme Court noted that although the CBI was not diligent in promptly challenging the High Court's bail order, this delay did not justify rejecting their challenge on merits.

Conclusion:
The Supreme Court set aside the High Court's order granting bail to A4 and A10, directing them to surrender by 30.04.2011. The Court emphasized that the trial court should decide the case without being influenced by observations made by the High Court or the Supreme Court in this order. The appeals were allowed.