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TMI Blog2023 (11) TMI 1261X X X X Extracts X X X X X X X X Extracts X X X X ..... al media platform to make statements or express opinions during his interim bail period affects his fundamental right to freedom of speech. As this Court granted interim bail on medical grounds, this Court thought fit that the petitioner was not supposed to conduct public meetings and rallies. This Court directed the petitioner, while disposing of interim bail application on medical grounds, to place the details about his treatment in a closed cover to the Superintendent, Central Prison, Rajamahendravaram, at the time of his surrender. In view of granting of regular bail, this Court views that a direction can be given to the petitioner to file such medical record before the Special Court, Vijayawada, on or before 28.11.2023. Accordingly, the interim bail granted to the petitioner/A.37 vide common order dated 31.10.2023 is made absolute, and the petitioner/A.37 is ordered to be released on regular bail on the bail bond already furnished by him in respect of this case. However, the condition imposed in respect of his organizing or participating in public rallies and meetings shall stand relaxed from 29.11.2023 onwards. The petitioner/A.37 is directed to produce the medical reports, r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial scam by SIEMENS and Design Tech involving funds allocated to APSSDC. iii. The Memorandum of Agreement (MoA) specifies that Design Tech is obligated to provide training software development, including various sub-modules for advanced manufacturing CAD/CAM. The MoA explicitly prohibits sub-contracting. Despite this, SIEMENS and Design Tech subcontracted a substantial portion of their work to M/s. Skillar Enterprises Private Limited, New Delhi, employs a self-centric approach reminiscent of Solomon's wisdom. iv. Design Tech claimed that M/s. Skillar Enterprises Private Limited provided training software development for advanced manufacturing of CAD/CAM, and payments for royalty and subscription were made as they developed the software. M/s. Skillar allegedly supplied the software directly to Skill Development Centers in Andhra Pradesh. When tax authorities questioned M/s Skillar, it denied subcontracting technical work, stating the software provided was technical material, and invoices wrongly mentioned royalty and subscription. v. A.D.G.G.I., Pune, found contradictory stands between the service provider and service receiver. Further scrutiny revealed that M/s. Skillar purcha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... monitoring his heart/cardiac and skin conditions. Given his health concerns, maintaining proper hydration is crucial to prevent complications. Notably, due to a perceived threat, the Central Government provided Z+ security by the National Security Guard (NSG) following an attempted assassination in 2002. iv. The prosecution, even after more than 30 days of continuous incarceration, has failed to present any material linking the petitioner to witnesses. Without tangible evidence, the petitioner argues against being held in custody based on the whims and caprices of the investigating agency. The respondent's attempt to attribute the actions of other co-accused to the petitioner, alleging obstruction to the investigation, is contested. The petitioner asserts the legal principle that bail is the rule, and jail is the exception, emphasizing that an accused person is better positioned to handle their case and defend themselves when not in custody. v. The petitioner asserts that there is no prima facie material or evidence in the investigation records proving his guilt. It is claimed that he was implicated in this crime with malicious intent for political vendetta and at the behest o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ependent examination, the Income Tax authorities concluded that the petitioner engaged in large-scale fraudulent cash transactions. The petitioner allegedly influenced the government's release of substantial cash amounts to specific private entities, facilitated through intermediaries like Mr. Manoj Vasudev Pardasany. Subsequently, these entities transferred the received cash back to the petitioner through individuals such as Mr Pendyala Srinivas (the petitioner's former Personal Secretary), Mr Kilaru Rajesh (a close associate), or Mr Nara Lokes (the petitioner's son). A notice dated 04.08.2023 from the Income Tax authorities details that the petitioner received over Rs. 100 Crores in cash. iv. In the context of the current case, an internal inquiry conducted by the SIEMENS Compliance Regulatory Department revealed that SIEMENS does not employ a Grant-in-Aid financial mechanism, which is pertinent to the present scam. Notably, SIEMENS discovered Hawala transactions and significant swindling by the involved parties. The transfer of swindled amounts followed the typical Hawala method, utilizing specific currency note numbers to identify the intended recipients. v. Followi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rly established. The Remand Report thoroughly discussed all material facts and submitted relevant documents. Note files related to the project were removed from the Secretariat once central tax agencies began uncovering the misappropriation of funds. Witness statements and note files regarding relevant government orders revealed that the petitioner, acting as a public servant during 2015-19, abused his position, securing financial advantages for M/s. DesignTech (A.4) then funnelled the funds into various shell companies like PVSP/Skillar, ACI, Inweb, and Patrick Info. x. The petitioner, identified as the Principal Conspirator, served as the sole decision-maker in transactions, orchestrating a scheme to disproportionately transfer public funds to private entities, bypassing official protocols. The offences, punishable by over 10 years of imprisonment, constitute a financial misdemeanour by public officials. The deep-rooted conspiracy necessitates thorough interrogation to unravel all elements, securing information through witness confrontations. Releasing the petitioner on bail would impede the investigation, preventing the conclusion of this complex financial fraud. xi. During the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry of TDP with a request to produce the books of accounts pertaining to the huge cash deposits, specifically for the period January 2015 to June 2019. However, associates of the petitioner/A.37 allegedly avoided cooperation with the investigation under the petitioner's influence. The other contentions raised will be considered in the following part of the order. 8. Heard Sri Siddharth Luthra and Sri Dammalapati Srinivas, learned Senior Counsel, representing the petitioner/A.37, and Sri Ponnavolu Sudhakar Reddy, learned Additional Advocate General, representing the Respondent-State. Both sides reiterated their submissions on par with the contentions presented in the petition, counter, and additional counter. Consequently, the contentions raised by learned counsel need not be reproduced. 9. The learned Additional Advocate General for the Respondent-State submits that the Economic offences having deep-rooted conspiracies need to be viewed seriously. In support of his contention, he relied on a decision reported in Gautam Kundu v. Directorate of Enforcement (2015) 16 SCC 1, wherein the Hon'ble Supreme Court observed that: 37. xx We are sure that it is not expected at this stage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ggarwal v. State (NCT of Delhi) (2020) 13 SCC 337, the Constitution Bench reiterated that while deciding applications for anticipatory bail, courts should be guided by factors like the nature and gravity of the offences, the role attributed to the applicant, and the facts of the case. xxx 31. The nature and gravity of the alleged offence should have been kept in mind by the High Court. Corruption poses a serious threat to our society and must be dealt with iron hands. It not only leads to abysmal loss to the public exchequer but also tramples good governance. The common man stands deprived of the benefits percolating under social welfare schemes and is the worst hit. It is aptly said, Corruption is a tree whose branches are of an unmeasurable length; they spread everywhere; and the dew that drops from thence, Hath infected some chairs and stools of authority. Hence, the need to be extra conscious. 13. Whereas the learned Senior counsel for the petitioner relied on a decision reported in P. Chidambaram v. CBI (2020) 13 SCC 337, wherein the Hon'ble Apex Court held that: 22. There is no hard-and-fast rule regarding grant or refusal to grant bail. Each case has to be considered on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Investigation (2022) 10 SCC 51., the Hon'ble Apex Court held that: 90. What is left for us now to discuss are the economic offences. The question for consideration is whether it should be treated as a class of its own or otherwise. This issue has already been dealt with by this Court in P. Chidambaram v. Directorate of Enforcement [P. Chidambaram v. Directorate of Enforcement, (2020) 13 SCC 791 : (2020) 4 SCC (Cri) 646] , after taking note of the earlier decisions governing the field. The gravity of the offence, the object of the Special Act, and the attending circumstances are a few of the factors to be taken note of, along with the period of sentence. After all, an economic offence cannot be classified as such, as it may involve various activities and may differ from one case to another. Therefore, it is not advisable on the part of the court to categorise all the offences into one group and deny bail on that basis. Suffice it to state that law, as laid down in the following judgments, will govern the field . 15. In the light of the above settled legal principles, this Court is of the view that though a detailed examination of the evidence is to be avoided while considerin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -end technology to the trainers in collaboration with various State Governments. APSSDC deputed a team to visit SIEMENS Centres of Excellence, already established in Gujarat, and submit a report. ii. During negotiations, the State Government agreed to establish the SIEMENS Centre of Excellence, Technical Skill Development Institutions, and Skill Development Centres in different clusters. Six clusters were formed for Rs. 546,84,18,908/-at the inception. SIEMENS and Design Tech contributed 90% as a grant-in-aid, amounting to Rs. 491,84,18,908/-, while the government's share was 10%, equivalent to Rs. 55,00,00,000/-(Rs. 55 Crores). A Memorandum of Agreement (MoA) was entered into between the APSSDC and SIEMENS, under G.O.Ms. No. 4, dated 30.06.2017 of the Skill Development Entrepreneurship and Innovation (Skills) Department. As per the Memorandum of Agreement, Design Tech has to provide training software development, including various sub-modules designed for high-end software for advanced manufacturing CAD/CAM. 19. It is the case of the Prosecution that the scam at the centre of the Subject crime, running into an amount of more than Rs. 370 Crores, was first discovered by the Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eline of the alleged misappropriation of APSSDC funds and their diversion to various accused individuals. Notices were sent to the T.D.P.'s General Secretary-cum-Treasurer and the State President on October 31, 2023, and November 4, 2023, requesting the books of accounts for the cash deposits. However, it cannot be definitively concluded that the misappropriated amounts were diverted to the Telugu Desam Party's bank accounts based solely on these observations. 23. The petitioner, A.37, was arrested on September 9, 2023, and remained in judicial custody until being granted interim bail on health grounds on October 31, 2023, following the court's orders. Despite allegations of transferring misappropriated amounts to the T.D.P. party's account, no prima facie evidence is presented to support this claim. This court views that such serious allegations should be backed by substantial material before seeking the remand of the petitioner. The court, at this point, views the lack of supportive material as a gap in the investigation's conclusion that the alleged misappropriated amount had been transferred to the T.D.P. party's account. 24. The prosecution alleges that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment in the alleged offences, leading to bail being granted to both. 28. The prosecution also implicates Mukul Chandra Aggarwal (A.10) for fraud, forgery, and fabrication of books and accounts in collaboration with A.6 and A.8. However, the court, in an order dated 17.01.2022 in Crl.P. No. 7265 of 2021, observed that he never worked as C.O.O., the DGGI report didn't mention siphoning of funds, and the petitioner was not directly concerned with the allegations in the F.I.R. He was granted bail as he was an employee demitted from the office on medical grounds in 2017. 29. The prosecution contends that Shirish Chandrakant Shah (A.13) employed a standard procedure involving the cycling of bogus bills to facilitate the layer re-routing of inward money back to the entity that provided or transferred the funds to the bank account of M/s. A.C.I. Shah, a key figure, devised a plan for the layering of funds originating from PVSP and Design Tech. He allegedly issued several bogus invoices to M/s. Skiller, amounting to approximately Rs. 58.24 Crores for Training Software development, including various modules. A.13 was granted bail as per the order dated 19.01.2022 in Crl.P. No. 151 of 202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C, SIEMENS project by M/s. Sarath Associates. The report notes that APSSDC provided photocopies of the Board Minutes concerning the SIEMENS project and the Minutes of the State Level Monitoring Committee and Local Board of Governance Committee, which are not available with APSSDC. The report mentions conflicting statements from DESIGNTECH and SIEMENS regarding the place of MOA execution. 34. When there is no dispute about the MOA's execution, it is the Prosecution's responsibility to explain how conflicting statements about the place of execution, without mentioning the date in the agreement, support the case against the accused, especially the petitioner/A.37, who is not a party to the agreement. The report highlights that the final draft of the agreement did not contain a bank guarantee clause, allegedly removed by SISW on the petitioner's instructions. It is not brought to this Court notice as to which witness stated like so during the course of the investigation. 35. The report further notes that according to the MOA and License Agreement, the actual signatory for SIEMENS was Mr. Soumyadri Sekhar Bose, but Mr. Suman Bose signed the MOA. The report points out differe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provided discounts on the products supplied by it, which is often referred to as Go P.L.M. grant or In-Kind Grant by the commercial team that is a discount on software cost provided by SISW only, but there was no requirement of the Grant-in-Aid on the project cost . 38. In the said letter, it is mentioned in Para 19, which reads as follows: 19. We note that the projection to APSSDC of discounts offered by SISW on its product/software price projected as 90% Grant-in-Aid on the total APSSDC project cost by Mr. Suman Bose and the relevant project team members was wrong, and grant-in-aid was not approved by the board of SISW. The current management of SISW or its global management is not aware of the reasons and intention of Mr Bose in such a false projection and does not mention the Grant in Aid in Tripartite Agreement. As stated above, an In-kind grant is a discount provided on the academic price of the SISW products/software and any projection on a percentage basis can only be made in relation to the cost of the SISW products/software and not the project cost. However, we understand from our discussions with you and records available with SISW that Mr Bose and the relevant Project t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Rs. 371 Crores, at least Rs. 241 Crores were misappropriated by SISW and Design Tech, diverted to various shell companies. The petitioner questions the feasibility of providing training to over 2 lakh graduates under such circumstances, as the Prosecution has not indicated a lack of infrastructure in the Technical Skill Development Institutions and Skill Development Centres in different clusters. 42. The Prosecution asserts that the Finance Secretary raised objections, emphasizing that funds should only be released with necessary security in the form of bank guarantees. Despite objections, the Chief Secretary, with the Chief Minister's endorsement, ordered the release of funds. The Prosecution does not argue that the Chief Minister lacked authority to issue such directions when objections were raised for the release of B.R.O.s. The petitioner's inclination to clear funds does not imply his involvement in the offence without evidence of funds being diverted to his or his party's account. The court agrees with the petitioner's Senior Counsel that the petitioner cannot be held responsible for every subcontractor's evasion. There is no prima facie indication that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngh, if the use of power is of the fulfillment of a legitimate object, the actuation or catalyzation by malice is not logical. 45. During the ongoing investigation, this Court is unconvinced by the petitioner's claim that the case was politically motivated as a regime revenge by the present Government. The Respondent-State highlights that the issue was raised by a whistle-blower during the previous Government's regime. While the Respondent argues that the Income Tax authorities independently examined the petitioner's role and found fraudulent transactions, no supporting material has been presented. 46. The Prosecution's claim that the petitioner indirectly influenced witnesses, co-accused, and party members lacks substantiating material. The filing of a petition by Kilaru Rajesh before the S.H.O., Jubilee Hills Police Station, and the non-appearance of Pendyala Srinivas, Ex. P.A. to the petitioner do not bear relevance to the bail application. The agency should follow legal procedures to address any concerns regarding Pendyala Srinivas. The allegation that the petitioner influenced key witnesses and hindered the investigation lacks supporting evidence. The copy of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l report submitted by the petitioner, opines that the filing of health reports before this Court should not be considered a contravention of the bail conditions. Any infringement will occur if the petitioner fails to produce his health report during his surrender before the Superintendent of Central Prison, Rajamahendravaram. 49. It is evident from the record that the petitioner has been shown as an accused one year and ten months after the registration of the crime. The case against him was filed just before his arrest. There is no indication on the record that, during this period of one year and ten months, the petitioner interfered with the investigation. The Prosecution has not made any such claim either. 50. In bail applications, generally, it has been laid down from the earliest times that the object of bail is to secure the appearance of the accused person at his trial by a reasonable amount of bail. The object of bail is neither punitive nor preventative. Deprivation of liberty must be considered a punishment unless it is required to ensure that an accused person will stand his trial when called upon. The grant or refusal of bail is entirely within the discretion of the cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used is not misused to impede the investigation, overawe the witnesses or obstruct the course of justice. Several decisions of this Court have dwelt on the nature of the conditions which can legitimately be imposed both in the context of bail and anticipatory bail. X 18. This Court also discussed the scope of the discretion of the court to impose any condition on the grant of bail and observed : (Sumit Mehta case [Sumit Mehta v. State (NCT of Delhi), (2013) 15 SCC 570 : (2014) 6 SCC (Cri) 560], SCC p. 576, para 15) 15. The words any condition used in the provision should not be regarded as conferring absolute power on a court of law to impose any condition that it chooses to impose. Any condition has to be interpreted as a reasonable condition acceptable in the facts permissible in the circumstance and effective in the pragmatic sense and should not defeat the order of grant of bail. 22. xxx The human right to dignity and the protection of constitutional safeguards should not become illusory by the imposition of conditions which are disproportionate to the need to secure the presence of the accused, the proper course of the investigation and eventually, to ensure a fair trial. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9;, which in those clauses includes the security of the State. 54. He further relied on a decision in S. Rangarajan v. P. Jagjivan Ram (1989) 2 SCJ 128, while dealing on the issue relating to the pre-censorship of movies and motion pictures, the Hon'ble Supreme Court held as follows: Freedom of expression which is legitimate and constitutionally protected, cannot be held to ransom by an intolerant group of people. The fundamental freedom under Article 19(1)(a) can be reasonably restricted only for the purposes mentioned in Article 19(2) and the restriction must be justified on the anvil of necessity and not the quicks and of convenience or expediency. Open criticism of Government policies and operations is not a ground for restricting. We must practice tolerance to the views of others. Intolerance is as much dangerous to democracy as to the person himself..... 55. As seen from the order passed in I.A. No. 04 of 2023 in Crl.P. No. 7951 of 2023 while considering the request of the Respondent-State seeking to include the additional conditions in the interim bail order, this Court directed the petitioner to abstain from making any public comments relating to the case and from organ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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