IMPORTANT POINT
The court established that the transfer of investigation to the CBI is not routine and should only occur in exceptional circumstances to maintain public confidence in the investigation process.

JUDGMENT :

M. S. Karnik, J.

1. Heard learned counsel for the parties.

2. By this petition under Article 226 of the Constitution of India, the petitioner is seeking transfer of investigation of First Information Report (FIR) No.01/2024 dated 14.06.2024 registered with the Economic Offences Cell, Goa (EOC) to the Central Bureau of Investigation (CBI). The petitioner seeks a further direction to the CBI to conduct fair and impartial investigation and submit report in a time-bound manner.

3. The basic facts leading to the registration of FIR are thus:

4. The Chowgule and Company Pvt Ltd is a flagship company of the Chowgule Group established in 1965 for conducting mining and ship building operations in India. The said group was established by the members of Chowgule Family. On 04.10.2008, Mr. Vishwasrao Chowgule passed away leaving behind the heirs of the Chowgule family extending three generations.

5. In 2021, due to the numerous disputes, the family entered into Memorandum of Family Settlement dated 11.01.2021. The settlement contemplated splitting the family into two groups being Group A headed by Ms. Padma Chowgule and Group B headed by Mr. Vijay Chowgule. The Companies and the assets of the Chowgule group were also divided into Schedule C and Schedule D. The members of Group A were entitled for the companies in Schedule C, whereas members of Group B were entitled for the Companies in Schedule D.

6. The accused no.1 Vijay Chowgule was Director of the petitioner company from 16.08.1974 to 12.01.2021 and Managing Director of the petitioner Company from 01.01.1988 to 28.05.2019. The accused no.2 Pradip Mahatme was the principal financial advisor from 1980 to 2020 and a director of the petitioner company from 14.02.1989 to 12.01.2021. The accused no.3 Pratap Shirke is the brother of accused no.1 and associated with the petitioner company through the accused no.1.

7. In the year 2009, Mr. Vijay Chowgule and Mr. Pradip Mahatme proposed establishing as wholly owned subsidiary overseas being Rudra Shipping and Trading Ltd representing it as a profitable business venture. They proposed creating a subsidiary in the country of Guernsey and investing the petitioner’s monies in Rudra for establishing the shipping business. The said Rudra came to be incorporated in Guernsey on 31.07.2009 and a total sum of USD 128, 691, 536 was infused by the petitioner company into Rudra Shipping and Trading Ltd. from 31.07.2009 to 22.04.2014 under instructions of Vijay Chowgule and Pradip Mahatme. These funds were unlawfully utilized to make investments and provide loans to various entities, including those under the control of Mr. Pratap Shirke.

8. The said Pratap Shirke owned and controlled various entities including Pan Oceanic Bulk Carriers, Guernsey, ASP Ship Management Singapore Pvt. Limited, Wadi Foundation, Natlata Holding Corporation(“Natlata”), Quail Investments Limited (“Quail”), Bulmark Limited, Bay Holdings (both companies incorporated in Guernsey), and Quail. Through these entities, the applicants and their associates executed numerous transactions to launder the monies received from the petitioner disguising the money trail and its ultimate beneficiaries.

9. Approximately USD 47 millions were advanced to Pratap Shirke Company Pan Oceanic Bulk Carriers. However, none of the monies were ever repaid. The security provided was not invoked and a significant portion of the loan was written off or waived through board resolutions. On 31.03.2017, an agreement to write off USD 10 million was executed without addressing or enforcing the loans secured by Pan Gulf Group Ltd under the consolidated loan agreement dated 25.10.2015. The remaining amount of approximately USD 38 million was waived through a mere board resolution.

10. Vijay Chowgule, Pradip Mahatme and Pratap Shirke made series of misrepresentations to the board of petitioner company regarding the utilization of the funds invested or lent through the petitioner company. They falsely assured the board th