Judicial Analysis Court Copy Headnote Facts Arguments Court observation

IN THE HIGH COURT OF ALLAHABAD
DINESH KUMAR SINGH, J.
Rajneesh Kumar - Applicant
Versus
Union of India and Another - Opposite Parties
Criminal Misc. Anticipatory Bail Application U/s 438 CR.P.C. No.4367 of 2022, Criminal Misc. Anticipatory Bail Application U/s 438 CR.P.C. No.4369 of 2022, Criminal Misc. Anticipatory Bail Application U/s 438 CR.P.C. No.13381 of 2022, Criminal Misc. Anticipatory Bail Application U/s 438 CR.P.C. No.6275 of 2022
Decided On : 09-01-2023

Advocates Appeared:
For the Applicant : Kapil Kumar, Rajrshi Gupta, Sandhya Singh, Shiv Sagar Singh, Sr. Adv., Vineet Vikram, Imran Ullah.
For the Opposite Parties : A.S.G.I., Sri Sanjay Kumar Yadav.

The main legal point established in the judgment is the need for a different approach in the matter of bail for economic offences, considering the severity of punishment, nature of accusations, and the magnitude and gravity of the offence.

Headnote:
anticipatory bail - economic offences - Prevention of Corruption Act, 1988, Sections 120-B, 420, 468, 471, 13(2), 13(1)(d) - The court discussed the legal provisions related to economic offences, the severity of punishment, and the need for a different approach in the matter of bail for economic offences. The court cited several Supreme Court cases to emphasize the seriousness of economic offences and the need for stringent view towards grant of bail in such cases.
Fact of the Case:
The accused-applicants sought anticipatory bail in a case involving economic offences under the Prevention of Corruption Act, 1988. The case pertained to a loan fraud of over Rs. 20 Crores, siphoning off loan amounts, and submission of forged documents to obtain the loan.
Finding of the Court:
The court found that economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. It considered the nature of accusations, magnitude and gravity of the offence, and the nature of evidence in support of accusations while rejecting the anticipatory bail applications.
Issues: The issues involved the seriousness of economic offences, the need for a different approach in bail for economic offences, and the severity of punishment for economic offences.
Ratio Decidendi: The court emphasized the need for a stringent view towards grant of bail in cases involving economic offences, citing various Supreme Court cases to support its decision.
Final Decision: The anticipatory bail applications were rejected, and the accused-applicants were directed to surrender before the trial court concerned within five days and apply for regular bail, which would be considered expeditiously in accordance with the law.

ORDER :

1. The present applications under Section 438 Cr.P.C. have been filed by the accused-applicants seeking anticipatory bail apprehending their arrest in FIR registered by the Central Bureau of Investigation (for short ‘CBI’) EO-1, New Delhi in RC No.219 2019 E 0004, Police Station CBI/EO-1, New Delhi, under Sections 120-B read with 420, 468 and 471 IPC and Section 13(2) read with 13(1)(d) of Prevention of Corruption Act, 1988 and substantive offences thereof.

2. The facts, in brief, are that M/s H.K. Enterprises is a partnership firm and it has two partners, Harmesh Kumar and Ravindra Ahlawat. A case was registered on 10.6.2019 on the basis of a complaint dated 15.1.2019 of Sri Pawan Kumar Gaur, AGM/Regional Head, Union Bank of India (UBI), Regional Office, Meerut, U.P. alleging that borrowers and guarantors i.e. M/s H.K. Enterprises and its partners during the period of September, 2017 entered into a criminal conspiracy and in pursuance thereof, they submitted false/forged documents along with the loan application. On the basis of these documents, a Cash Credit Limit of Rs.20 Crores was sanctioned to M/s H.K. Enterprises on 24.10.2017 by Union Bank of India, Regional Office, Meerut on the recommendations of the Union Bank of India, Mid Corporate Branch, Kaushambi, Ghaziabad.

3. The propose for which the loan/Cash Credit Limit was sanctioned, was for wholesale trading/supplying of building materials such Bricks, Cement, Steel, Rodi, Marble, Tiles and Wood, including plywoods, woodboard and hardboard etc. Subsequently, two temporary overdrafts for Rs.64 Lakhs were also sanctioned.

4. It is alleged that the loan amounts in pursuance of criminal conspiracy were diverted by the borrowers for purposes other than for which the loan was sanctioned and the same were fraudulently siphoned off within one month from the first disbursement on 30.10.2017, through the accounts of their associated concerns/related parties/their own current accounts. The loan account became irregular from December, 2017 to March, 2018 and turned into “NPA” within six months, resulting in wrongful loss to the bank to the tune of Rs.20.60 Crores. Further, the said account was also declared as fraud on 9.8.2018. The wrongful loss along with interest caused to the bank was Rs.21.87 Crores.

5. While sanctioning the loan to M/s H.K. Enterprises, the sanctioning authority had considered another firm M/s S.M. Enterprises, Proprietorship of Bharat Kalra, S/o Harmesh Kumar as a group concerned of M/s H.K. Enterprises. Both the firms had shown their business of the same nature i.e. trading of building materials/construction materials and their office addresses were also the same. M/s S.M. Enterprises was already sanctioned a Cash Credit Limit of Rs.16 Cores by the same bank in March, 2017 and it was also sanctioned an ad-hoc limit of Rs.4 Crores on 7.10.2017 despite the fact that there was very poor turnover in its account and had already siphoned off its entire loan. The said fact could get established on the basis of its stock statement and statement of the loan account.

6. Accused-applicant Bharat Kalra, Proprietor of M/s S.M. Enterprises was actively managing the affairs of borrower firm M/s H.K. Enterprises. Despite such adverse facts of the loan of the group concerned, another loan of Rs.20 Crores was also fraudulently sanctioned to M/s H.K. Enterprises within few days i.e. on 24.10.2017, which resulted in siphoning off another Rs.20 Crores of the bank within one month during 30.10.2017 to 28.11.2017. Later on, the loan account of M/s S.M. Enterprises also turned into NPA.

7. During the course of investigation, it could be found out that M/s H.K. Enterprises had no licence/permission for storage and transportation of sand, crushed stone, pebble etc. from the Mines Department of the District concern and, therefore, M/s H.K. Enterprises was not authorised to carry on business of sand, crushed stones, pebbles (stone) etc.

8. The loan was sanctioned against hypo