CBI Cannot Direct Creation of Demand Draft Under Guise of Producing a 'Document' Under S.91 CrPC: Delhi High Court - 2025-07-15

CBI Cannot Use Section 91 CrPC for Money Recovery, Order to Create Demand Draft Quashed: Delhi High Court

New Delhi: The Delhi High Court has delivered a significant ruling, clarifying the scope of an investigating agency's power under Section 91 of the Code of Criminal Procedure (Cr.P.C.). In a judgment delivered by Justice Neena Bansal Krishna, the court held that the provision, which allows for summoning the production of a "document or other thing," cannot be used as a tool for money recovery by directing a party to create a new financial instrument like a Demand Draft.

The court quashed an order issued by the Central Bureau of Investigation (CBI) that required luxury car dealer M/s Exclusive Motors Pvt. Ltd. to furnish a Demand Draft of Rs. 50 lakh, terming the directive as being "in the nature of a recovery, rather than for production of documents."

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Background of the Case

The case originated from a failed business transaction between Exclusive Motors, an authorized Bentley dealer, and M/s Samruddha Jeevan Foods India Ltd. In 2013, Samruddha Jeevan booked a Bentley Mulsanne for Rs. 6.06 crore and paid a non-refundable advance of Rs. 50 lakh. However, the company failed to pay the outstanding balance.

Consequently, Exclusive Motors forfeited the advance amount as per the terms of their agreement and, after two years, sold the imported car at a significant loss.

Subsequently, the CBI initiated an investigation into Samruddha Jeevan for illegal fund collection from the public. During this probe, the agency traced the Rs. 50 lakh payment to Exclusive Motors and classified it as "proceeds of crime." On July 22, 2021, the CBI issued an order under Section 91 Cr.P.C., directing Exclusive Motors to provide a Demand Draft for the forfeited amount. Exclusive Motors challenged this order in the High Court.

Arguments from Both Sides

• Petitioner's Stance (Exclusive Motors Pvt. Ltd.): Represented by Advocate Karan Bharihok, the petitioner argued that the CBI's order was a gross misuse of Section 91 Cr.P.C. They contended that the provision is meant for producing existing documents or things necessary for an investigation, not for compelling a party to create a new document like a Demand Draft. The petitioner asserted that this was an arbitrary attempt to adjudicate a purely civil and contractual dispute under the guise of a criminal investigation.

• Respondent's Stance (CBI): The CBI maintained that the Rs. 50 lakh was public money obtained fraudulently by Samruddha Jeevan and constituted proceeds of crime. The agency argued that the Demand Draft fell within the ambit of "other documents" under Section 91 Cr.P.C. and that its production was essential for the investigation into the money trail.

Court's Analysis and Precedents

Justice Neena Bansal Krishna undertook a detailed examination of Section 91 Cr.P.C., emphasizing its twin requirements: the item to be produced must be a "document or other thing," and it must be in the "possession or power" of the person being summoned.

The court observed that while a Demand Draft is indeed a document, the CBI's order required the creation of one that did not yet exist. The judgment highlighted a critical distinction:

"The impugned Order does not in any way, relate to a document or other thing, which is in existence on the date when the Order is passed; rather it specifically ordered that the Petitioner the get the draft made in favour of 'HOB, CBI, EO-VII, Bhubaneswar', thus, positing that it does not exist when it is ordered to be produced..."

The High Court drew support from previous rulings, including the Patna High Court's decision in Jagdish Prasad Sharma vs. State of Bihar and the Gauhati High Court's judgment in Rahul Hi-rise Ltd. & Anr. vs. State of Assam & Ors. These precedents established that Section 91 does not empower authorities to direct a person to change the form of an asset (e.g., cash into a draft) or to seize bank accounts.

Final Verdict and Implications

Concluding that the CBI had exceeded its jurisdiction, the court stated that the order was a thinly veiled attempt at recovery, which falls outside the scope of Section 91.

"In view of the above discussion, the impugned Order is in the nature of a recovery, rather than for production of documents which are necessary for the investigation/trial," the court ruled.

Setting aside the CBI's order, the High Court allowed the writ petition filed by Exclusive Motors. This judgment serves as a crucial check on the powers of investigating agencies, reinforcing that specific legal provisions for attachment and seizure of proceeds of crime must be followed, and Section 91 cannot be invoked as a shortcut for financial recovery.