2021 (1) TMI 117 - HC - Companies Law

Seeking grant of anticipatory bail under Section 438 Cr.P.C - increase in the price of shares on the basis of valuation certificate - Allegation that the investors were allured and induced on the basis of forged valuation certificate/report allegedly prepared by Kamini Sehgal, CA, while Kamini Sehgal has denied her signature on Annexure P-2 i.e. valuation certificate - Learned Public Prosecutor further submitted that the forged original valuation certificate has not been recovered from the petitioner so far, therefore, question of comparison of signature appearing on the said valuation certificate vis-a-vis. the admitted signatures of Kamini Sehgal, CA does not arise. HELD THAT - Both the parties have argued the case with reference to numerous documents. While dealing with the anticipatory bail, I refrain myself from commenting upon legality and veracity of these documents, lest it may prejudice the case of the parties during trial - At this stage, I would not like to comment upon genuineness of the assertion and denial by the parties based on these documents, but in any case, keeping in view the nature of allegations surfaced in respect of forged valuation certificate, I deem it appropriate not to grant any indulgence in favour of the petitioner. Custodial interrogation of the petitioner is required. Therefore, this petition is found to devoid of merits and is accordingly dismissed.

Issues Involved:
1. Grant of anticipatory bail under Section 438 Cr.P.C.
2. Allegations of embezzlement and forgery.
3. Nature of the case: civil vs. criminal.
4. Role and involvement of the petitioner.
5. Validity of the valuation certificate issued by Kamini Sehgal, CA.
6. Requirement of custodial interrogation.

Issue-wise Detailed Analysis:

1. Grant of anticipatory bail under Section 438 Cr.P.C.:
The petitioner sought anticipatory bail in connection with FIR No.99 dated 27.10.2020, registered under Sections 420/468/471/120-B IPC at Police Station North, Chandigarh. The court ultimately dismissed the petition, stating that custodial interrogation was required.

2. Allegations of embezzlement and forgery:
The FIR was lodged based on a complaint alleging that the accused allured the complainant and her husband into investing ?50 lakhs in YEPL by promising high returns and a directorial position. It was alleged that the accused embezzled ?344.57 lakhs using a forged valuation certificate to inflate the share price from ?10 to ?55, thereby cheating the investors.

3. Nature of the case: civil vs. criminal:
The petitioner argued that the case was civil in nature and had been given a criminal color. The petitioner claimed to have resigned from the company and had no inducement role. The petitioner also highlighted ongoing litigation before the National Company Law Tribunal (NCLT) as evidence of the civil nature of the dispute.

4. Role and involvement of the petitioner:
The petitioner claimed disassociation from the company since 14.11.2019 and argued that the complainant's husband was inducted as a Director with financial powers. The petitioner also pointed out that the valuation and other financial documents were verified by professionals and accepted by the complainant before her investment.

5. Validity of the valuation certificate issued by Kamini Sehgal, CA:
The petitioner asserted that the valuation certificate was genuine and issued by Kamini Sehgal, CA, whose services were duly paid for. However, the Public Prosecutor countered that Kamini Sehgal denied issuing the certificate and stated that the document was forged, with discrepancies in FRN numbers and signature patterns.

6. Requirement of custodial interrogation:
The Public Prosecutor argued that custodial interrogation was essential to ascertain the transfer of embezzled funds and the role of the petitioner in the alleged forgery. The court agreed, emphasizing the need for custodial interrogation to investigate the allegations thoroughly.

Conclusion:
The court refrained from commenting on the legality and veracity of the documents presented by both parties to avoid prejudicing the trial. However, given the serious allegations of forgery and embezzlement, the court deemed it appropriate to deny the anticipatory bail, emphasizing the necessity of custodial interrogation for a thorough investigation. The petition was dismissed, and the court clarified that its observations should not influence the merits of the case during the trial.

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