Anticipatory Bail (S.482 BNSS) Granted Despite Multiple Economic Offence Allegations Citing 'Bail is Rule' Principle: Kerala HC - 2025-04-04

Kerala High Court Grants Anticipatory Bail to Director in Multiple Deposit Fraud Cases

Ernakulam: The Kerala High Court, presided over by Justice P.V.Kunhikrishnan , granted anticipatory bail to Mr. Anantha Krishnan , a 28-year-old director implicated in numerous criminal cases related to alleged financial irregularities and deposit fraud across several police stations in Kerala. The court invoked the principle of 'bail is the rule, jail is the exception' while imposing stringent conditions, despite the seriousness of the allegations involving cheating and violations under the Banning of Unregulated Deposit Schemes (BUDS) Act, 2019, and the Kerala Protection of Interests of Depositors in Financial Establishments (KPID) Act, 2013.

Background of the Cases

Mr. Anantha Krishnan faced a barrage of bail applications (66 in total, including BA Nos. 4814, 4845, 4846, etc., of 2025) connected to crimes registered in Koipuram , Karukachal , Pulikeezhu , Elavumthitta, and Thiruvananthapuram Museum Police Stations. The core allegation across these cases, now being investigated by the Crime Branch, is that the petitioner, along with other accused (including his father, the Managing Director), collected substantial deposits from complainants promising returns but failed to repay the principal or interest, thereby committing offences under Sections 406 (Criminal Breach of Trust) and 420 (Cheating) of the Indian Penal Code, read with Section 34 (Common Intention), Section 3 of the BUDS Act, and Section 5 of the KPID Act.

Arguments Presented

Petitioner's Counsel (Adv. C.S. Manu): * Argued that the petitioner was not involved in the day-to-day operations of the company. * Stated the petitioner had been residing in Singapore since 2019 and was only nominally added as a director by his father. * Contended the scheme did not fall under the definition of an 'unregulated deposit scheme'. * Assured the court of the petitioner's intention to return to India on April 15, 2025 (producing travel documents) and cooperate fully with the investigation. * Emphasized readiness to abide by any bail conditions.

Public Prosecutor (Representing State of Kerala): * Strongly opposed the bail applications, highlighting the gravity and multiplicity of the offences involving significant financial loss to numerous depositors. * Pointed out that the petitioner was currently residing abroad.

Court's Reasoning and Legal Principles

Justice Kunhikrishnan acknowledged the seriousness of the allegations but considered several mitigating factors and legal principles:

Petitioner's Role: The court noted the petitioner was only one of the directors, and his father, the Managing Director, had already been arrested and released on bail.

Bail Jurisprudence: The court explicitly relied on established legal principles: > "Moreover, it is a well accepted principle that the bail is the rule and the jail is the exception."

Reference was made to landmark Supreme Court decisions: * Chidambaram. P v Directorate of Enforcement [2019 (16) SCALE 870]: Reinforcing that grant of bail is the rule. * Siddharth v State of Uttar Pradesh [2021(5)KHC 353]: Emphasizing that arrest should not be routine and requires justification beyond mere lawfulness, especially if the accused cooperates and is not a flight risk. > "Merely because an arrest can be made because it is lawful does not mandate that arrest must be made... If the Investigating Officer has no reason to believe that the accused will abscond or disobey summons and has, in fact, throughout cooperated with the investigation we fail to appreciate why there should be a compulsion on the officer to arrest the accused.” * Manish Sisodia v. Central Bureau of Investigation [2023 KHC 6961]: Observing that even grave economic offences do not automatically preclude bail. 3. Cooperation: The petitioner's stated intention to return and cooperate weighed in his favour.

The court concluded that, balancing the circumstances and legal precedents, anticipatory bail could be granted under stringent conditions.

Final Decision and Conditions

The High Court allowed all the connected bail applications filed under Section 482 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), directing the following:

Surrender & Interrogation: The petitioner must appear before the Investigating Officer within four weeks for interrogation.

Bail on Arrest: If arrested post-interrogation, he shall be released on bail upon executing a bond of Rs. 50,000/- with two solvent sureties for the like amount.

Cooperation: Must appear before the IO as required and cooperate fully, without tampering with evidence or influencing witnesses.

Travel Restriction: Cannot leave India without permission from the jurisdictional court.

No Repeat Offences: Must not commit similar offences while on bail.

Prima Facie Observations: Findings in the order are limited to the bail decision.

Investigation Powers: The IO retains the power to investigate and make recoveries based on information provided by the petitioner while on bail (citing Sushila Aggarwal v. State (NCT of Delhi) [2020 (1) KHC 663] ).

Cancellation Clause: Violation of any condition empowers the jurisdictional court to cancel the bail upon application by the prosecution or victim.

The court's decision grants Mr. Anantha Krishnan protection from arrest upon his return, subject to his cooperation with the ongoing multi-jurisdictional investigation into the alleged deposit scheme irregularities.