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2019 Supreme(Del) 1920
IN THE HIGH COURT OF DELHI AT NEW DELHI
ANU MALHOTRA, J.
Raghu Menon — Appellant
Versus
State — Respondent
Bail Application No.2226 of 2019
Decided on : 13-09-2019
Advocate Appeared:
Akshay Singh, Adv., Tasha Singh, Adv., Madhar Sharma, Adv., Lakshay Verma, Adv., Farhat Arif, Adv., Rahul Mehra, Adv., Kewal Singh Ahuja, Adv.
The judgment underscores the seriousness of economic offences and the need for custodial interrogation in such cases, highlighting the impact on the economy and the potential consequences of granting anticipatory bail.
Headnote:
Bail Application - Anticipatory Bail - Indian Penal Code, 1860 - Sections 420/406/467/471 r/w Section 120B r/w Section 34 - Cr.PC, 1973 - Section 438 r/w Section 482 - Fraud, cheating, and misappropriation of money - SBLC arrangement - Forgery - Economic Offences
Fact of the Case:
The petitioner sought anticipatory bail in a case involving allegations of fraud, cheating, and misappropriation of money. The complainant company, M/s Europa Digital Ltd., alleged that the petitioner and co-accused conspired to arrange a Standby Letter of Credit (SBLC) in a forged manner, leading to a loss of funds.
Finding of the Court:
The court found that the petitioner was aware of the deal between the co-accused and the complainant company, and there was evidence of the petitioner's involvement in the conspiracy to cheat M/s Europa Digital Ltd. The court dismissed the bail application and withdrew the interim protection granted to the petitioner.
Issues: The key issues involved allegations of fraud, conspiracy, and economic offences, specifically related to the arrangement of SBLC and forgery of documents.
Ratio Decidendi: The court considered the seriousness of economic offences and the need for custodial interrogation to unearth the conspiracy and trace the money trail. It emphasized the gravity of economic offences and the potential impact on the economy.
Final Decision: The bail application was dismissed, and the interim protection granted to the petitioner was withdrawn.
JUDGMENT :
Anu Malhotra, J.
Vide the present bail application under Section 438 r/w Section 482 of the Cr.PC, 1973, the applicant/petitioner seeks the grant of anticipatory bail in FIR No.354/2019, PS Dwarka which is indicated to have been registered on 29.07.2019 on the complaint of Mr. Vikas Arora, s/o Mr. Amarjeet Arora, President of M/s Europa Digital Ltd. situated at A-57, Sector-8, Dwarka, New Delhi for alleged commission of the offences punishable under Sections 420/406/467/471 r/w Section 120B r/w Section 34 of the Indian Penal Code, 1860.
2. The averments made in the FIR read to the effect:-
"12. F.I.R Contents (attach separate sheet, if reburied) Dated: 18.04.2019 To the DCP Dwarka Distt. New Delhi Subject: Fraud, cheating and misappropriation of money to the tune of Rs.50 Lakhs by Rajiv Gupta (9810023535), Raghu Menon (7011343749) & Adhiraj (+994509639566) all consultants and having their office at 38, Housing Society NDSE-1. New Delhi and prayer for registering FIR U/s 420, 467, 471, 120B, 506 IPG. Sir, I, Vikas Arora, Working as President of M/S Europa Digital Limited having its registered office at A-57 Sector 8 Dwarka New Delhi 110077, wish to inform as herein under: l. Sir, our company M/s Europa Digital Limited is basically engaged in Diversified activities pertaining to manufacture, marketing and finance of Customer Electronic products, including high end Smart LED Tvs and is an internationally acclaimed brand.
2 Our company had been in the process of expanding its business and for that reasons were in requirement of business loans/funds in the form of capital infusion for running, operation and management of its business. It was this background that our company came in touch with one Mr. Rajiv Gupta, who claimed to a consultant and an expert in sourcing funds internationally.
3 The said Rajiv Gupta, called me at his office at 38, Housing Society NDSE-1, New Delhi, Wherein he was joined by MR. Raghu Menon and both of them represented that they had a third partner by the name of Mr, Adhiraj, stationed at Singapore and all of them primarily dealt sourcing of funds, ECB (external commercial borrowing) and were financial consultants to various reputed business houses. These people, after understanding our company's business need agreed for sourcing a fund for 5 million USD form Czar international Pte Limited, having its office at Singapore and at Baku, Azerbaijan, Which both Raghu and Rajeev represented that belonged to their third partner Adhiraj.
4. After, some discussion, Raghu Menon represented that there would be some issue in obtaining a fund of 5 million USD for our company and suggested that they would be able to arrange SBLC from a Bank routed through their company-Czar international Pte Limited.
5. it may be mentioned herein that SBCL (standby letter of credit) is a guarantee that is made by bank on behalf of a client which ensures payment will be made even if their client cannot fulfill the payment. It is a payment of last resort from the bank, and ideally, is never meant to be used. An SBCL is frequently used as a safety, mechanism for the beneficiary, in an attempt to hedge out risks associated with the trade. Simplistically, it is a guarantee of payment which will be issued by a bank in the behalf of a client. It as also perceived as a "payment of last resort" due to the circumstances under which it is called upon. The SBLC prevents contracts going unfulfilled if a business declares bankruptcy or cannot otherwise meet financial obligations. Furthermore, the presence of an SBLC is usually seen as a sign of good faith as it provides proof of the buyer's credit quality and the ability to make payment. In order to set this up, a short underwriting duty is performed to ensure the credit quality of the party that is looking for a letter of credit.
6. Thus, the aforesaid Czar international Pte Limited were engaged as consultant for our company vide a letter to engagement dated 20.12.2018 and ultimately after discus
