MUKUL BHARDWAJ vs STATE OF HP - 2026 Supreme(Online)(HP) 2535

Headnote:(A) Narcotic Drugs and Psychotropic Substances (NDPS) Act, 1985 - Sections 21, 27A and 29 - Bharatiya Nyaya Sanhita (BNS), 2023 - Sections 221 and 132 - Grant of Bail - Parameters for granting bail include the nature of the charge, the nature of evidence, the severity of punishment, the likelihood of the applicant interfering with witnesses, and the criminal antecedents of the applicant (Paras 8-10).

(B) Evidence - Sufficiency of Financial Transactions and Call Detail Records (CDRs) - Mere financial transactions between the accused and main co-accused are not sufficient to connect the accused with the commission of a crime for the purpose of denying bail (Para 11) - Similarly, phone calls exchanged between the parties as evidenced by CDRs are insufficient to establish a prima facie case against the accused (Paras 12-14).

(C) NDPS Act - Section 27A - Meaning of "Financing" - "Financing" denotes providing monetary support or funds to make illegal traffic operational or sustaining it, rather than simply paying for the purchase of contraband - The act of purchasing drugs does not equate to financing illicit traffic under Section 27A (Paras 15-16).

Facts of the case:
The petitioner was arrested in connection with an FIR registered for offences under the NDPS Act and BNS after a search of a co-accused's house resulted in the recovery of heroin and other drug-related paraphernalia. While no contraband was recovered from the petitioner, the prosecution alleged involvement based on financial transfers made by the petitioner to the accounts of the main accused and evidence of phone calls between them. The State opposed bail on the grounds of these transactions, the nature of the offence, and the petitioner's previous involvement in a similar case.

Findings of Court:
The Court found that financial transactions and call records alone are insufficient to prima facie connect the petitioner to the commission of the crime. It further observed that the payments made did not amount to "financing" within the meaning of Section 27A of the NDPS Act. Regarding the petitioner's criminal record, the Court held that antecedents cannot be the sole basis for detention if there is insufficient material to connect the accused to the current crime.

Issues: Whether monetary transactions and call records are sufficient to deny bail under the NDPS Act; whether paying for the purchase of contraband constitutes "financing" under Section 27A; and whether criminal antecedents can justify detention in the absence of prima facie evidence in the present case.

Ratio Decidendi: The court ruled that dietary financial transfers and phone call records do not establish a prima facie link to the commission of an offence sufficient to deny bail. "Financing" under Section 27A requires providing capital to sustain illicit traffic, which is distinct from the act of purchasing drugs. Criminal antecedents are irrelevant if the prosecution fails to provide sufficient material to connect the accused to the current charge.

Result: Petition allowed; petitioner ordered to be released on bail.

Legal Category Hierarchy

1. Bail petition for NDPS Act and BNS offences based on financial transactions with co-accused; no contraband recovered from petitioner. (Para 1 , 2 , 3 )

2. Petitioner argues financial transactions insufficient; State argues transactions prove purchase of heroin and criminal antecedents warrant denial. (Para 5 , 6 )

3. Bail granted subject to conditions; petitioner released on bail. (Para 19 , 20 , 21 )

4. Are financial transactions alone sufficient to connect an accused to a drug offence under the NDPS Act?

No, financial transactions without other evidence are insufficient to prima facie connect the accused to the commission of a crime under the NDPS Act. (Para 11 , 12 , 14 )

5. Are call detail records and disclosure statements of co-accused sufficient to deny bail?

No, phone calls and disclosure statements of co-accused, without more, are not sufficient to deny bail as they do not establish a prima facie case. (Para 12 , 13 )

6. What constitutes 'financing' under Section 27A of the NDPS Act?

Financing under Section 27A means providing funds to make illicit drug activity operational or sustain it; merely purchasing drugs is not financing. (Para 15 , 16 )

7. Can criminal antecedents alone justify denial of bail when there is insufficient material connecting the accused?

No, criminal antecedents alone are not sufficient to deny bail when there is insufficient material to show involvement in the alleged offence. (Para 18 )

Rakesh Kainthla, Judge

The petitioner has filed the present petition for seeking regular bail in FIR No. 282 of 2025, dated 22.11.2025, registered at Police Station Sadar, Chamba, District Chamba, H.P., for the commission of offences punishable under Sections 21 , 27A and 29 of the Narcotic Drugs and Psychotropic Substances (NDPS) Act and Sections 221 and 132 of Bharatiya Nyaya Sanhita (BNS), 2023.

2. It has been asserted that, as per the prosecution, the police party was present at Bhatti Nala near Sultanpur-Chamba-Pathankot, NH-154A on 22.11.2025 at about 7 AM. They were checking the vehicles when they received secret information that one Binta Mahajan and her son Aryan Mahajan were indulging in the sale/purchase of heroin. A huge quantity of heroin could be recovered by searching their house. The police reduced the information into writing and went towards the house of Binta Mahajan. They joined one independent witness on the way. Aryan Mahajan was present in his home. The police searched the house and recovered one electronic weighing machine, two burnt foil papers, one folded and burnt ₹20 currency note, and one syringe. Binta Mahajan came to the spot and raised a hue and cry. One lady was bolted inside the room. The room was opened, and a polythene bag was recovered containing numerous foil papers and small packets containing 20.65 grams of heroin. The police checked the accounts of Binta and Aryan Mahajan and found that the petitioner had made a financial transaction of ₹98,960/- in their account. The police arrested the petitioner based on these transactions. The allegations against the petitioners are false. The investigation has been completed, and custodial interrogation of the petitioner is not required. No recovery of contraband was effected from the petitioner. The petitioner is ready and willing to abide by the terms and conditions that the Court may impose. Hence, it was prayed that the present petition be allowed and the petitioner be released on bail.

3. The petition is opposed by filing a status report asserting that the police were checking the vehicles on 22.11.2015. They received secret information that Binta Mahajan and her son Aryan Mahajan were selling heroin, and a huge quantity of heroin could be recovered by searching their house. The information was sent to the Additional Superintendent of Police, Chamba, who issued an authorisation letter. The police joined Seema Kumari and Mahender Kumar and went to the house of Binta Mahajan. The police found Aryan Mahajan in the house. The police searched the house and recovered an electronic weighing machine, two burnt foil papers, one burnt and one folded currency note of ₹20/- and one syringe. Binta Mahajan also came to the spot. The police conducted a further search of the house and recovered 14 mobile phones, jewellery, 20.65 grams of heroin, and ₹2,33,377/- in cash. The police seized all these articles and arrested the occupants. The police checked their accounts and found that various persons, including the petitioner, had transferred the money to their accounts. The police arrested those persons, including the petitioner. The investigation revealed that Swati Mahajan, Binta and Aryan Mahajan had sold the heroin to Mukul Bhardwaj (petitioner), Saurav, Sachin, Ankush, Rajesh, Karan, Suraj, Kirpal, Vinod Kumar and other persons. There were financial transactions between them. They were in constant touch with each other. The charge sheet was filed before the Court on 20.1.2026. The prosecution has cited 41 witnesses. The petitioner had transferred ₹69,920/- between 21.08.2024 and 31.08.2025 in the joint account of Aryan and Binta Mahajan. FIR No. 35 of 2025, dated 16.04.2025, has been registered against the petitioner for the commission of an offence punishable under Sections 21 and 25 of the NDPS Act. The petitioner would indulge in the commission of a similar offence in case of his release on bail. The statement of any witness has not been recorded, a

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2026 Supreme(Online)(HP) 2535

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
HON'BLE MR. JUSTICE RAKESH KAINTHLA
MUKUL BHARDWAJ – Appellant
Versus
STATE OF HP – Respondent
CRMPM/497/2026

Financial transactions and call detail records alone are insufficient to establish a prima facie case to deny bail. Additionally, paying for the purchase of drugs does not constitute "financing" under Section 27A of the NDPS Act, as financing requires providing funds to sustain illicit traffic.

Legal Category Hierarchy

Table of Contents

4. Are financial transactions alone sufficient to connect an accused to a drug offence under the NDPS Act?

5. Are call detail records and disclosure statements of co-accused sufficient to deny bail?

6. What constitutes 'financing' under Section 27A of the NDPS Act?

7. Can criminal antecedents alone justify denial of bail when there is insufficient material connecting the accused?

2026 Supreme(Online)(HP) 2535

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLAHON'BLE MR. JUSTICE RAKESH KAINTHLAMUKUL BHARDWAJ – AppellantVersusSTATE OF HP – RespondentCRMPM/497/2026

Financial transactions and call detail records alone are insufficient to establish a prima facie case to deny bail. Additionally, paying for the purchase of drugs does not constitute "financing" under Section 27A of the NDPS Act, as financing requires providing funds to sustain illicit traffic.

Legal Category Hierarchy

Table of Contents

4. Are financial transactions alone sufficient to connect an accused to a drug offence under the NDPS Act?

5. Are call detail records and disclosure statements of co-accused sufficient to deny bail?

6. What constitutes 'financing' under Section 27A of the NDPS Act?

7. Can criminal antecedents alone justify denial of bail when there is insufficient material connecting the accused?

Cases Referred (9)

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
HON'BLE MR. JUSTICE RAKESH KAINTHLA
MUKUL BHARDWAJ – Appellant
Versus
STATE OF HP – Respondent
CRMPM/497/2026