Constitutional challenge to special economic offence arrest and bail provisions supported interim bail despite maintainability objections.

A writ petition challenging the constitutional validity of Companies Act arrest and bail provisions, and the legality of arrest and custody, was held maintainable despite objections that the petitioner should pursue statutory bail before the Special Court. The Court found a prima facie case for interim bail, noting arguable issues on the applicability of Criminal Procedure safeguards, service of arrest grounds, maintenance and production of case diaries, retrospectivity of the arrest provisions, and the compatibility of the bail restriction and compelled examination provisions with Articles 14, 20 and 21. Interim bail was granted while the constitutional challenges were left for final adjudication.

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Issues: (i) Whether the preliminary objections to the maintainability of the writ petition and the prayer for interim relief were sustainable; (ii) Whether the petitioner made out a prima facie case for interim bail on the challenge to the constitutional validity of Sections 212(6) and 212(8) of the Companies Act, 2013 and on the legality of the arrest and custody.

Issue (i): Whether the preliminary objections to the maintainability of the writ petition and the prayer for interim relief were sustainable.

Analysis: The petition was not confined to a bare habeas corpus claim. It also challenged the constitutional validity of the statutory provisions governing cognizability, arrest and bail under the Companies Act, 2013. Since the challenge was directed to the very provisions under which the petitioner was arrested and kept in custody, the petition could not be treated as an attempt to bypass the statutory remedy of bail in the Special Court. The objections based on maintainability therefore did not survive.

Conclusion: The preliminary objections were rejected.

Issue (ii): Whether the petitioner made out a prima facie case for interim bail on the challenge to the constitutional validity of Sections 212(6) and 212(8) of the Companies Act, 2013 and on the legality of the arrest and custody.

Analysis: The Court found a prima facie case that the arrest and continued custody raised serious legal questions. The statutory scheme conferred coercive powers on SFIO officers, but the procedural safeguards under the Code of Criminal Procedure, 1973 and the arrest rules could not prima facie be excluded in the manner suggested by the respondents. There were also arguable issues on service of grounds of arrest, maintenance and production of case diaries, retrospectivity of the arrest provisions, and the compatibility of the bail restriction and compelled examination provisions with Articles 14, 20 and 21 of the Constitution of India. The Court further noted the continuing custody, the absence of a satisfactory explanation for further detention, and the practical difficulty created by the stringent bail provision.

Conclusion: The petitioner was held entitled to interim bail.

Final Conclusion: The writ petition was allowed to the limited extent of granting interim bail and rejecting the preliminary objections, while leaving the merits of the constitutional challenges open for final adjudication.

Ratio Decidendi: Where statutory provisions confer arrest and bail restrictions in a special economic offences framework, the Court may grant interim liberty if the challenge raises a strong prima facie case that the arrest procedure, custody requirements and bail threshold are inconsistent with constitutional safeguards and the applicable criminal procedure.

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