2022 (2) TMI 257 - HC - Companies Law

Seeking grant of Regular Bail - siphoning-off the funds - commitment of fraud by swindling away the hard-earned money of the members/depositors of ACCSL, mainly belonging to the low and middle income groups - HELD THAT - The co-accused of the petitioner, i.e Vijay Shukla, has also been granted the interim protection only and that too, in the circumstances when this Court had specifically noted in the impugned judgment that he was not accused of having committed the offence under Section 447 of the Act of 2013 and was only a signatory to the financials of the Company whereas the petitioner was one of the Directors in ACCSL as well as in some of the Companies comprised in AGC L and she has categorically been alleged to have committed the offence under Section 447 of the Act of 2013. Again, mere custody of the petitioner since the said date, in itself, does not suffice at all to extend the relief of bail to her in the eventuality when Section 212(6) of the Act of 2013 is applicable to the present case. The observations made by Hon ble Supreme Court in Union of India 2021 (2) TMI 1212 - SUPREME COURT , Shri Gurbaksh Singh Sibbia and Others 1980 (4) TMI 295 - SUPREME COURT and Sanjay Chandra 2011 (11) TMI 537 - SUPREME COURT also do not come to the rescue of the petitioner to seek her release on bail because the facts and circumstances of the case in hand are distinguishable from those of the cited above. In Union of India 2021 (2) TMI 1212 - SUPREME COURT , the Apex Court was dealing with the issue of cancellation of bail in a matter involving Section 43-D(5) of the UAP Act and had, rather, observed that there was a vivid distinction between the parameters to be applied while considering the bail application vis- -vis those, applicable while deciding a petition for its cancellation and moreover, the respondent-accused had been in custody in the said case for more than five years whereas the petitioner has moved this petition with a prayer for grant of bail and she is in custody for the last about 2 years. The petitioner does not deserve the relief of regular bail and the petition in hand, being sans any merit, deserves dismissal - Petition dismissed.

Summary

Issues involved:
Petition seeking regular bail in a Criminal Complaint Case involving various sections of IPC and Companies Act. Interpretation of provisions under Section 212(6) of the Companies Act, 2013 for granting bail. Consideration of the petitioner's alleged involvement in fraudulent transactions and siphoning-off funds. Evaluation of the proviso appended to Section 212(6) regarding bail for female offenders. Comparison with previous judgments and grant of interim bail in other cases.

Analysis by Issue:

1. Regular Bail Petition: The petitioner sought regular bail in a Criminal Complaint Case involving multiple sections of the IPC and Companies Act. The investigation stemmed from orders by the Ministry of Corporate Affairs regarding the affairs of Adarsh Group of Companies and LLPs. The petitioner, a Director of a Credit Co-operative Society, was accused of siphoning-off funds through fraudulent loans. The Special Court took cognizance based on the report submitted by the respondent.

2. Interpretation of Section 212(6): The petitioner's counsel argued for bail based on the absence of her arrest during the investigation. However, the respondent contended that bail under Section 447 of the Companies Act, 2013 is subject to fulfilling specific conditions under Section 212(6). The magnitude of the fraudulent transactions indicated active participation, raising doubts about the petitioner's eligibility for bail.

3. Proviso Appended to Section 212(6): The petitioner claimed entitlement to bail as a female offender under the proviso to Section 212(6). However, the respondent argued that the proviso does not automatically grant bail and highlighted the severity of the alleged offenses involving duping depositors of their earnings.

4. Comparison with Previous Judgments: The petitioner cited previous cases where interim bail was granted, emphasizing her custody since 2019. However, the court differentiated those cases, noting that interim bail in another matter does not warrant regular bail in the present case. The involvement of co-accused and the specific allegations under Section 447 of the Act were crucial factors in denying bail.

5. Final Decision: The court dismissed the bail petition, emphasizing the petitioner's alleged role in the fraudulent transactions and the stringent provisions of Section 212(6) of the Companies Act, 2013. The court found no grounds to exercise discretion in favor of the petitioner, considering the seriousness of the offenses and the specific circumstances of the case. The judgment highlighted the distinction from previous cases and the lack of merit in the current petition.