Anticipatory bail in serious financial corruption cases should be denied when custodial interrogation is essential to unearth the conspiracy, recover public funds, and evaluate the accused's specific role in the misappropriation, especially where no exceptional circumstances exist to warrant such relief.

ORDER

Dated this the 8^th day of June, 2026 This is a petition filed under Section 482 of the Bharatiya Nagarik Suraksha Sanhita, 2023, seeking pre- arrest bail and the petitioner is the 2^nd accused in Crime No.2/2026 of VACB, Thiruvananthapuram, where the prosecution alleges commission of offences punishable under Sections 201, 409, 420, 468, 471 and 120B read with 34 of the Indian Penal Code and under Sections 13(2) read with 13(1)(a) of the Prevention of Corruption Amendment Act, 2018 [hereinafter referred as ‘P.C. Act’ for short], by the accused persons.

2. Heard the learned counsel for the petitioner as well as the learned Public Prosecutor, in detail. Perused the Enquiry Report and relevant documents pertaining to this crime.

3. As per the report submitted by the Investigating Officer, the prosecution case is that, the first accused, while working as Industries Extension Officer (IEO) under the Corporation of Thiruvananthapuram, responsible for implementing development schemes and entrusted with the authority to grant loan subsidies to women belonging to the general category, as the implementing officer of the project no 46/21. He was also in charge of receiving applications and granting benefits to members of the general women groups. The first accused, in criminal conspiracy with others, misappropriated funds by creating false records, manipulating the list of eligible beneficiaries under the scheme and disbursing subsidies to fake beneficiaries, who were not entitled to receive any benefits during the financial year 2020- 2021. Despite having knowledge that the documents were fabricated, the 1^st to 3^rd accused misused their official position and conspired with the 4^th accused (Private Person) with the intention of securing unlawful gain for them. It is alleged that they misappropriated a total sum of Rs.357 lakhs (Three Crores and fifty seven lakh), thereby causing corresponding loss to the Government and unlawful gain to themselves. On this premise, the prosecution alleges commission of the above said offences by the accused.

4. According to the learned counsel for the petitioner, the petitioner is innocent and he has no involvement in this crime.

The learned counsel for the petitioner further submitted that, the 3^rd accused transferred the money to fake beneficiaries and the petitioner herein has no involvement in this crime. Therefore, the petitioner deserves anticipatory bail and he is ready to co-operate with the investigation and is ready to subject himself for interrogation.

5. The learned Public Prosecutor vehemently opposed grant of anticipatory bail to the petitioner for the reasons stated in paragraph Nos. 16 to 18. The same are as under:

“16. It is submitted that the investigation is ongoing and it is highly essential to collect all the evidences relating to the crime. Custodial interrogation of the accused person is necessary to unearth the involvement of other accused in the case, to recover the records and to find out the proceeds of crime and to recover the lost government money. In this financial fraud case 3.57 Cores is Involved. There are materials which would, prima facie, show or would suggest economic abuse by way of misappropriation by the accused 1 and 2 and others. The investigation conducted thus far has revealed that Accused No. 2 (A2) played a specific role in the misappropriation of funds, which resulted in the non-implementation of the project and the defalcation of a substantial amount of Government money. There are specific allegations against the 2^nd accused/petitioner in the matter where cores of rupees alleged to have been misappropriated and hence the investigation in t