Orissa High Court Grants Bail to 23 Accused in ₹6.28 Crore Cyber Fraud Case

CUTTACK, ODISHA – The Orissa High Court has granted regular bail to 23 individuals arrested in connection with a sophisticated cyber fraud case amounting to ₹6.28 crore. Justice Aditya Kumar Mohapara, while acknowledging the gravity of the financial scam, observed that the petitioners prima facie appeared to have been used as conduits, with their bank accounts functioning as "mule accounts" to siphon the defrauded funds.

Case Background: The "KOTAK Investment Club" Scam

The case originates from an FIR lodged on August 24, 2024, by Kuntal Majumdar, who alleged he was cheated of his entire retirement corpus of ₹6.28 crore. According to the complaint, Majumdar was added to a WhatsApp group named "KOTAK Investment Club." Lured by promises of high returns and discounted stock offerings, he invested heavily in a purported IPO for "V.L. Infraprojects Limited."

After investing ₹4.82 crore, his account showed a balance exceeding ₹25 crore. However, when he attempted to withdraw the funds, he was asked to pay hefty "service fees" and "withdrawal charges." After paying an additional ₹23 lakhs, he was removed from the group, and the application was deactivated, leading him to realize he had been scammed.

The investigation, led by the Cyber Crime Police Station of Odisha CID, led to the arrest of numerous individuals from across the country, including the 23 petitioners who sought bail.

Arguments in Court

Counsel for the Petitioners argued that their clients were innocent victims themselves—mostly poor laborers, drivers, and students—who were falsely implicated. They contended that the real culprits had misused the petitioners' bank accounts, often with the petitioners' unknowing consent given to friends or acquaintances under the pretext of an emergency. Highlighting that the petitioners had been incarcerated for over six months and a preliminary charge sheet had been filed, they submitted that further custodial interrogation was unnecessary.

The State, represented by Additional Government Advocate Debasish Nayak , vehemently opposed the bail pleas. The prosecution described the case as a massive, nationwide cyber-scam with potential international links, including a bank account in Vietnam and the use of hawala routes. It was argued that a Special Task Force was still investigating the matter and releasing the accused would hamper the probe into this large-scale financial crime.

Court's Observations and Decision

After examining the case diary and preliminary charge sheet, Justice Mohapatra made a crucial observation. "It prima facie appears that the present Petitioners were used to loot the defrauded amount by alluring them a small portion of the money transferred to their amount as commission. Thus, it appears that the banks account belonging to the Petitioners have been used as mule accounts to syphon of the money belonging to the Informant," the court noted.

The court also pointed out that the bank statements of the petitioners did not show other high-value transactions, which supports the theory that they were not the primary beneficiaries or masterminds.

Considering the period of incarceration already served (over six months), the filing of a preliminary charge sheet, and the assessment that custodial interrogation was no longer required, the High Court decided to grant bail to all 23 petitioners.

However, the court imposed stringent and individually tailored conditions, stating that "the conditions shall vary according to their criminal antecedent and the amount of money involved in each of the cases." The conditions include furnishing bail bonds ranging from ₹30,000 to ₹1,00,000, along with substantial cash securities or bank guarantees—in one case as high as ₹15 lakh.

All petitioners are also bound by common conditions, including cooperating with the investigation, not leaving the country, surrendering their passports, and regularly informing the Investigating Officer of their whereabouts.