Pre-arrest bail in loan diversion allegations granted where documentary evidence limited tampering risk and custodial interrogation was unnecessary.

Pre-arrest bail was granted in a project-related loan dispute involving allegations of economic offence, diversion of funds and breach of contractual obligations. The Court noted that the material was largely documentary, the relevant records were with the bank and project authority, and there was limited scope for tampering. It also considered the one-time settlement, substantial payment already made, the petitioners' business background, the absence of any shown risk of absconding, and the lack of necessity for custodial interrogation. Bail was allowed subject to conditions, including cooperation with the investigation and payment of the balance amount.

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Issues: Whether the petitioners were entitled to pre-arrest bail in a case involving allegations of economic offence, diversion of loan funds, and breach of contractual obligations.

Analysis: The allegations arose out of a project-related loan transaction and the material on record was largely documentary in nature. The relevant documents were stated to be in the possession of the bank and the project authority, leaving limited scope for tampering. The bank had already entered into a one-time settlement, substantial payment had been made, and the balance was to be paid within the stipulated time. The petitioners were engaged in business, there was no shown likelihood of absconding, and custodial interrogation was not seen as necessary for further investigation.

Conclusion: The petitioners were held entitled to pre-arrest bail, subject to conditions including cooperation with investigation and payment of the balance amount.

Final Conclusion: The application for pre-arrest bail was allowed with conditions, and the petitioners were directed to be released on bail in the event of arrest.

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