2022 (5) TMI 1212 - HC - Companies Law

Seeking grant of anticipatory bail - Conspiracy - tracing of money trail - recovery of cheated amount - HELD THAT - Undoubtedly, the State has verified the factum of the applicant having undergone targeted Chemotherapy on 20.01.2021 with he having been diagnosed with Prostate Cancer, Stage-4 in March 2019, as per the synopsis filed on 26.02.2021 by the State and the applicant he has been taking medicines for the said Chemotherapy and undergoing Chemotherapy sessions since 2019. The documents of the Action Cancer Hospital that the applicant has placed on record indicates that as on 20.01.2021, the applicant had been admitted for Chemotherapy and was scheduled for Chemotherapy on 21.01.2021. The said document annexed to the written submissions of the applicant dated 08.02.2021 also indicates that the applicant was being discharged in a stable condition - In the instant case, the allegations levelled against the applicant relate to his alleged involvement with other accused Directors of M/s Prabhu Shanti Real Estate Pvt. Ltd., i.e. the company as being a signatory to resolutions of the said company resulting into the multivictim cheating and duping of innocent flat buyers. Furthermore, as has been observed hereinabove, the applicant was discharged from the Action Cancer Hospital in a stable condition. The applicant seeking the grant of anticipatory bail in relation to FIR No.59/2019 dated 04.04.2019 Police Station, Economic Offences Wing, Mandir Marg, New Delhi under Sections 406,420 120B of Indian Penal Code, 1860, is thus declined and the interim protection granted to the applicant vide order dated 24.11.2020 and extended till date vide order dated 01.03.2021 is thus, withdrawn - Application is disposed off.

Issues Involved:
1. Grant of anticipatory bail.
2. Allegations of cheating, criminal breach of trust, and conspiracy.
3. Applicant’s health condition and its impact on the bail decision.
4. Applicant’s involvement in the company’s financial affairs.
5. Investigation findings and forensic audit report.
6. State and complainants’ opposition to the bail.

Detailed Analysis:

1. Grant of Anticipatory Bail:
The applicant sought anticipatory bail in relation to FIR No. 59/2019 registered under Sections 406, 420, and 120B of the Indian Penal Code, 1860. The applicant argued that he is a senior citizen with a clean record, suffering from stage 4 prostate cancer, and has cooperated with the investigation.

2. Allegations of Cheating, Criminal Breach of Trust, and Conspiracy:
The FIR was lodged by the complainant who alleged that the company failed to deliver flats within the stipulated period, cheated her, and threatened her. The company announced a residential project in 2008 and collected significant amounts from home buyers but did not complete the project. The funds collected were allegedly siphoned off by the company and its directors, including the applicant, for other projects.

3. Applicant’s Health Condition and Its Impact on the Bail Decision:
The applicant submitted medical documents indicating he has been undergoing chemotherapy for prostate cancer since 2019. The court acknowledged the applicant’s health condition but noted that he was discharged in a stable condition. The court also referred to a previous case where anticipatory bail was granted due to health reasons but found the facts of the current case not comparable.

4. Applicant’s Involvement in the Company’s Financial Affairs:
The applicant claimed he was a non-executive director and not involved in the day-to-day affairs of the company. However, the investigation revealed that the applicant was a signatory to resolutions for taking significant loans and was involved in financial transactions of the company. The forensic audit report indicated various financial discrepancies and misappropriations involving the applicant.

5. Investigation Findings and Forensic Audit Report:
The status report and forensic audit revealed that the company had taken multiple loans and misappropriated funds. The audit found bogus invoices, dubious cash payments, and unpaid government duties and taxes. The applicant was found to be a signatory to resolutions for drawing loans and involved in financial mismanagement.

6. State and Complainants’ Opposition to the Bail:
The State and complainants opposed the bail, arguing that the applicant was non-cooperative during the investigation and was likely to influence witnesses. The complainants highlighted the financial distress caused by the company’s actions and the need for custodial interrogation to unearth the conspiracy and recover the cheated amount.

Conclusion:
The court declined the applicant’s prayer for anticipatory bail, emphasizing the need for custodial interrogation to investigate the conspiracy and financial mismanagement. The interim protection granted earlier was withdrawn. The court directed that the applicant should receive adequate chemotherapy sessions if in custody.

Separate Judgments:
There were no separate judgments delivered by different judges in this case.

Final Disposition:
The application for anticipatory bail was disposed of, with the court ensuring the applicant’s medical needs would be met if in custody. The court’s observations were not to be taken as an expression on the merits of the trial.

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