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SUPREME COURT OF INDIA
Ashok Bhushan, M.R. Shah, V. Ramasubramanian, JJ.
Jinofer Kawasji Bhujwala – Appellant
Versus
State of Gujarat – Respondent
Criminal Appeal No. 460 of 2020 (@ Special Leave Petition (Crl.) No. 1616 of 2020)
Decided on : 19-06-2020
Criminal Procedure Code, 1973 – Section 439 – Indian Penal Code, 1860 – Sections 406, 409, 420, 465, 468, 471 and 120B – Prevention of Corruption Act, 1988 – Section 13(1)(d) – Bail application – Dismissal – Alleged financial scam – Period of six months within which High Court hoped trial to commence, has expired as on date – Appellant, who is admittedly 62 years of age has already spent nearly a year in judicial custody – Period of nine months has passed from date of filing of charge-sheet – Though Solicitor General contended that sanction to prosecute has already been issued as against Government Officials, fact remains that charges have not been framed and trial has not commenced as yet – Arguments revolving around potential threat to national security, cannot be sustained – Company of which appellant is Head, continues to operate VTPMS Project – Arbitral Tribunal has not merely protected economic interests of State, but also permitted State Police to be there at project site – Tribunal has also allowed Maritime Board to depute a competent person, familiar with project in question, to supervise and monitor functioning of project – Prosecution rests mainly on documents – In any case, prosecution is not remediless if a person enlarged on bail, indulges in certain activities – Appellant is entitled to bail – Appellant directed to be released on bail. (Paras 20, 21, 22 and 23)
Facts of the case:
Aggrieved by the dismissal of his bail application by High Court of Gujarat at Ahmedabad, a person who is cited as A-1 in First Information Report for alleged offences under Sections 406, 409, 420, 465, 468, 471 and 120B of Indian Penal Code and Section 13(1)(d) of the Prevention of Corruption Act, 1988, has come up with the above appeal.
Findings of the Court:
Company of which appellant is the head, continues to operate VTPMS Project. In any case, Arbitral Tribunal has not merely protected the economic interests of the State, but also permitted the State Police to be there at the project site. Tribunal has also allowed the Maritime Board to depute a competent person, familiar with the project in question, to supervise and monitor the functioning of the project.
Result : Appeal allowed.
ORDER
V. Ramasubramanian, J.
Leave granted.
2. Aggrieved by the dismissal of his bail application by the High Court of Gujarat at Ahmedabad, a person who is cited as A-1 in the First Information Report in Crime No.I-I/5/201 dated 26.06.2019 for alleged offences under Sections 406, 409, 420, 465, 468, 471 and 120B of the Indian Penal Code and Section 13(1)(d) of the Prevention of Corruption Act, 1988, has come up with the above appeal.
3. We have heard Mr. Harish Salve and Mr. Siddhartha Dave, learned Senior Counsel appearing for the appellant; Mr. Tushar Mehta, learned Solicitor General appearing for the State of Gujarat and Mr. Mukul Rohatgi, learned Senior Counsel appearing for Gujarat Maritime Board.
4. Pursuant to an invitation to offer floated in November 2006 and the assessment of the proposals received from interested parties, a company by name Aatash Norcontrol Limited (for short "ANL"), was issued with a Letter of Intent on 26.02.2007 for the construction and development of Vessels Traffic and Port Management System (hereinafter referred to as "VTPMS") in the Gulf of Khambhat, on Build Own Operate and Transfer (BOOT) basis. It was followed by a Concession Agreement dated 30.09.2007 entered into between the Gujarat Maritime Board, ANL and the Government of Gujarat.
5. As per the Concession Agreement, Aatash Norcontrol Limited is obliged to install Key Radar Stations at 7 places in the Gulf of Cambay and repeater Radar Stations at 2 places, with the master control being set up at Dumas. The object of setting up the Radar Stations is to monitor the vessels entering the Gulf of Khambhat and to ensure Coastal and National Security
6. VTPMS for the Gulf of Khambhat became operational in August, 2010 after a completion certificate was issued by the Gujarat Maritime Board. But in 2018 disputes arose regarding the capital cost incurred by ANL. An expert committee was appointed under Clause 18 of the agreement and they submitted a report indicating a particular amount as the capital cost.
7. But Gujarat Maritime Board claimed, on the basis of a preliminary inspection report of the Principal Accountant General that ANL made an extra income of Rs. 134.38 crores during the financial years 2015-16 and 2017-18 and that the said amount should be paid by ANL.
8. ANL moved the commercial court at Ahmedabad under section 9 of the Arbitration and Conciliation Act, 1996, as there was a threat of termination of the Concession Agreement. The disputes were also referred to arbitration. Before the Arbitral Tribunal constituted on 01.03.2019, both parties (ANL and Gujarat Maritime Board) moved applications under section 17 of the Arbitration and Conciliation Act.
9. However, on 01.05.2019, the Gujarat Maritime Board lodged a complaint with the CID Crime, Gandhi Nagar Zone, alleging that ANL was guilty of (1) inflation of cost (2) non execution of certain works (3) creation of shell companies and carrying out work through them (4) siphoning and round tripping of funds through those companies (5) not carrying out construction on the lands allotted for Master Control Room (6) raising of false bills and forged invoices (7) managing the issue of completion certificate through the then Superintending Engineer and Chief Nautical Officer of the board and (8) entering into a conspiracy with each other to exceed the expenditure of the project upto Rs. 100 crores and committing criminal breach of trust.
10. On the basis of the above complaint, a FIR bearing no. II/5/2019 was registered on 26.6.2019 against eight named accused, for alleged offences under sections 406, 409, 420, 465, 468, 471 and 120B of IPC and section 13(1)(d) of the Prevention of Corruption Act. The appellant herein and his son and daughter were cited as A-1, A-2 and A-3 respectively, as they happen to be the Directors of the Companies.
11. On 27.6.2019, the appellant and his son were arrested. After being in police custody under orders of court, the appellant was sent to judicial custody on 2.
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