2024 (11) TMI 110 - HC - Indian Laws

Grant of Anticipatory Bail - financial fraud and conspiracy - offences punishable under Sections 406, 408, 420, 465, 467, 468, 471, 477A read with Section 34 of the Indian Penal Code - whether the applicants could be forced to supply the documents which are not in existence? - HELD THAT - The overall facts of the case reveal that it is purely an accounting matter. A detailed investigation has been done. Necessary ledgers of the applicants as well as the complainant have been recovered and assistance of the Chartered Accountant has also been taken. It may be an attempt of the complainant to recover money from this criminal case only. However, criminal law does not provide for recovering money through criminal proceedings. Besides, the complainant has filed cases against the Kawadiya Brothers under Section 138 of the N.I. Act before lodging the report and legally enforceable debt would be a matter of facts and the evidence of the case. Considering the cooperation extended by the applicants during the interim protection, the Court is of the view that sending the applicants to custodial interrogation would serve no purpose. As far as the allegations against applicant Bharat Machhindra Khedkar are concerned, he resigned long back. Whether he committed fraud of such huge money would be determined by appreciating the evidence. The relevant bank account has been recovered. Nothing has remained to be recovered from him. He also cooperated with the Investigating Officer. Whether he was the plant head is also question of fact. This Court is of the view that custodial interrogation of the applicants is not essential. Hence, they deserve anticipatory bail - bail application allowed.

Summary

Issues:
Claim for pre-arrest bail in criminal case involving multiple sections of the Indian Penal Code; Allegations of financial fraud and conspiracy; Dispute over settlement of accounts between firms; Cooperation with Investigating Officer; Custodial interrogation necessity; Anticipatory bail application.

Analysis:
The judgment dealt with the applications for pre-arrest bail in a criminal case involving various sections of the Indian Penal Code. The applicants were accused of financial fraud and conspiracy related to their firms' transactions with the complainant's businesses. The prosecution alleged that false entries were made in accounts, leading to misappropriation of funds. The complainant claimed that the applicants misused blank cheques and filed multiple complaints against them under the Negotiable Instruments Act. The applicants, on the other hand, argued that all transactions were legitimate, and accounts were settled as per ledger statements provided by the complainant himself.

The court considered the arguments presented by both sides regarding cooperation with the Investigating Officer. The defense contended that all demanded documents were supplied, while the prosecution claimed non-cooperation. The complainant insisted on custodial interrogation to uncover the truth, alleging collusion between the applicants and the complainant's employees. However, the defense maintained that no prima facie evidence existed to prove fraud and that custodial interrogation was unnecessary.

Regarding one of the applicants, it was argued that he was falsely implicated, having no involvement in the alleged crime. He had resigned from his job and started a grocery shop, denying any knowledge of irregularities in the complainant's firms. The defense highlighted his poor financial status and cooperation with the investigation, seeking pre-arrest bail.

After considering all arguments and evidence, the court concluded that custodial interrogation was not essential for the applicants. The court noted the cooperation extended during interim protection and granted anticipatory bail to the applicants. The order confirmed interim protection for two applicants and granted bail to the third applicant on specific conditions, including not tampering with witnesses and cooperating with the Investigating Officer.

In essence, the judgment addressed the complexities of the case involving financial fraud allegations, cooperation with authorities, and the necessity of custodial interrogation, ultimately deciding in favor of granting anticipatory bail to the applicants based on the circumstances presented during the proceedings.