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* IN THE HIGH COURT OF DELHI AT NEW DELHI Reserved on: 17.01.2023 Pronounced on: 17.02.2023 %

+ BAIL APPLN. 2347/2022 TARANJEET SINGH BAGGA@SONU SINGH...Petitioner Through: Mr. Abhik Kumar and Mr. Rinku Mathur, Advocates.

versus SERIOUS FRAUD INVESTIGATION OFFICE ...Respondent Through: Mr. A. Ansari, Prosecutor with Mr. Tarun Srivastava, Advocate.

CORAM:

HON'BLE MS. JUSTICE SWARANA KANTA SHARMA

JUDGMENT

SWARANA KANTA SHARMA, J.

1. The present bail application has been filed under Section 439 of the Code of Criminal Procedure, 1973 (hereinafter “Cr.P.C.”) by the applicant seeking regular bail in C.C. No. 245 of 2021 titled “Special Fraud Investigation Office v. Parul Polymers Pvt. Ltd. & Ors.” pending before the learned Special Judge (Companies Act), Dwarka Court, South-West, New Delhi (hereinafter “Trial Court”) for the offence punishable under Section 447 of the Companies Act, 2013 (hereinafter “Companies Act”).

Signature Not Verified BAIL APPLN.2347/2022 Page 1 of 14 Digitally Signed

2. The present applicant was summoned in the instant case by virtue of summoning order dated 07.03.2022 vide which cognizance of offences inter-alia under section 447 of the Companies Act, 2013 was taken by the Court concerned in C.C. No. 245 of 2021, wherein present applicant was arraigned as accused no. 10, among 12 accused persons. The applicant was summoned to appear on 25.05.2022, and upon entering his appearance, he was sent to judicial custody by the learned Trial Court. Subsequently, his application for grant of regular bail was dismissed by the learned Trial Court vide order dated 14.07.2022.

3. The background of the present complaint against Parul Polymers Private Limited (hereinafter “PPPL”) is that the said company had availed various credit facilities from Central Bank of India, due to non- payment of same as per terms and conditions, appropriate proceedings were initiated by the concerned Bank. During the course of litigation between the parties, this Court on 07.12.2015 had issued directions to Serious Fraud Investigation Office (hereinafter “SFIO”) to investigate certain issues, and pursuant to same, SFIO conducted an investigation in limited scope and the report was submitted to this Court on 20.05.2016 as well as to the Ministry of Corporate Affairs. Thereafter, the Ministry of Corporate Affairs ordered investigation into the affairs of PPPL on 14.03.2017. The said investigation led to the filing of present complaint case.

4. The case of prosecution is that the main accused Suman Chadha (accused no. 2 in complaint) i.e. Director of PPPL used to procure plastic granules from large scale public sector undertakings as well as from local suppliers, and this was sold in cash to local vendors without Signature Not Verified BAIL APPLN.2347/2022 Page 2 of 14 Digitally Signed any tax invoices, whereas tax invoices for these cash sales were issued to various entities including many related parties to adjust the purchases. Similarly, tax invoices without any underlying goods were also issued to non-related parties who required it for availing credit of duty (VAT). In order to carry out this deception, several sham entities were formed by accused no. 2 in the name of his relatives and employees. The bank accounts and name of the entities were misused by Suman Chadha for routing of funds in the guise of sale/purchase of plastic granules and also for adjustment of sales of material sold in local market in cash without tax invoice. The cash so generated were deposited in the bank accounts of such entities, and PPPL received RTGS/cheques against the tax invoices raised in the name of such entities showing normal sales against tax invoices. However, no goods under these invoices were dispatched. Huge amount of money was also transferred through the banking channel from one company/entity to another entity for ballooning/inflating the turnover and to adjust the cash received against cash sales. This was done by PPPL by issuing fake/fictitious/bogus invoi