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2026 Supreme(Online)(Del) 5843
Ayush Varshney – Appellant
Versus
CBI – Respondent
Bail Matter No. 13/2026 | RC-221 2024 E0010
Important Points
Subject
Criminal Law - Bail jurisprudence
Act Referred
Constitution of India: Art.21, Art.20(3), Art.22(2)
Indian Penal Code (IPC): S.120B, S.406, S.420
Information Technology Act, 2000: S.66
Income Tax Act: S.115BBH, S.194S
Code of Criminal Procedure (CrPC): S.41A, S.57, S.50A, S.41, S.50, S.161
Headnote
Facts of the case:
An application for regular bail was moved by an accused involved in a digital asset investment scheme, facing allegations of cheating, criminal conspiracy, and fraud. The accused argued the arrest was illegal due to the failure to issue a notice under Section 41A CrPC and a violation of the 24-hour production rule. The prosecution contended that the accused was a flight risk, non-cooperative, and possessed the technical skills to tamper with fragile electronic evidence.
Findings of Court:
The court held that the procedural safeguard of issuing a notice under Section 41A exists only when there is no need for arrest. When the investigating officer records sufficient reasons for the necessity of arrest, the power to apprehend is valid. The court noted that the communication of arrest details via digital messaging to family satisfied the spirit of the law and that the accused had already been afforded legal representation at all stages.
Issues: Whether the failure to serve a notice under Section 41A CrPC rendered the arrest illegal; and whether bail should be denied based on the potential for electronic evidence tampering and the status of absconding co-accused.
Ratio Decidendi: Where the investigating officer concludes that arrest is necessary based on specific reasons recorded in writing, the twin-test under the law is satisfied and the requirement to serve a preliminary notice is dispensed with. Liberty cannot be restricted indefinitely due to the procedural status of others involved in the conspiracy.
Result: Bail granted.
| Table of Content |
|---|
| 1. nature of case and factual background of the gain bitcoin scheme. (Para 1 , 40) |
| 2. parties' contentions regarding bail eligibility, arrest legality, and custodial necessity. (Para 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36 , 37 , 38 , 41 , 42) |
| 3. court's analysis on compliance with arrest procedures and grounds for bail. (Para 39 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50 , 51 , 52 , 53 , 54 , 55 , 56 , 57) |
| 4. operational order and conditions for grant of regular bail. (Para 58 , 59 , 60) |
ORDER
1. This order shall dispose of an application filed on behalf of accused/applicant Ayush Varshney under Section 480 BNSS, 2023 for grant of regular bail.
2. In the application, it is stated that the entire case set up by the respondent/CBI against the accused/applicant is baseless and misleading without any evidence in support; that the respondent/CBI has failed to follow the mandatory requirements in law while making the arrest of the applicant; that the continued custody of the applicant is unjustified, unwarranted and not required for the purposes of investigation, especially when the applicant has cooperated at all stages; the entire case of the prosecution is based on documentary and electronic evidence which is already in the possession of the investigating agency; that there is no possibility whatsoever of the applicant tampering with such evidence; that the alleged transactions pertain to the period 2017-2018 and despite the passage of several years, there is not even a single instance attributed to the applicant of tampering with evidence or influencing any witness; that the applicant has consistently cooperated with the investigation and has joined proceedings before various investigating agencies as and when called upon to do so; that the alleged arrest of the Applicant, effected without prior notice under Section 35 (3) BNSS and without proper written communication of the Grounds of Arrest to the Applicant and his relatives, amounts to an arbitrary deprivation of personal liberty in violation of Article 21 of the Constitution of India; that the offences alleged against the applicant carry a maximum punishment of seven years or less and therefore, in terms of the statutory mandate, arrest is not to be made as a matter of course but only upon satisfaction of necessity as contemplated under Section 35 BNSS; that the purported "grounds of arrest" and "reasons of arrest supplied by the respondent are wholly mechanical, vague and bereft of any specific material qua the Applicant; that such vague allegations, without any specific overt act demonstrating dishonest intention or participation in the alleged fraud, cannot justify the arrest and detention of the Applicant; that the applicant is not involved in the development of the alleged MCAP token and therefore the allegations are completely false; that the essential ingredients of cheating and criminal breach of trust are completely absent qua the Applicant; that the Applicant had no role whatsoever in the inception or operation of the alleged fraudulent scheme; that the Respondent/CBI has failed to establish any nexus or link between the applicant's limited role in software development and the alleged fraudulent investment activities in the absence of any such connection, the implication of the Applicant is unjustified and unsustainable in law; that there is no allegation or material to show that any part of the alleged funds or Bitcoins collected from investors was ever received, controlled or benefited the applicant, thereby completely demolishing the prosecution's case qua wrongful gain or misappropriation; that the co-accused, namely Nikunj Jain and Sahil Baghla, who are stated to have had a more active role in the affairs of the company Darwin, were granted regular bail by the Hon'ble High Court of Bombay; that the alleged transactions pertai
