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of <h1>Alleged bank-fund diversion through shell companies: prolonged pretrial delay and mostly documentary case lead to regular bail</h1> The dominant issue was whether regular bail should be granted in a large-scale economic offence alleging diversion of bank funds through shell entities. ... Seeking grant of Regular bail - siphoning off the funds by the appellant by making shell companies - right to speedy trial - case based on documentary evidences - HELD THAT:- There is no gainsaying that under Indian law “bail is the rule and jail is an exception” is etched in the ethos of criminal jurisprudence. This rule stems from the fact that criminal law presumes a person to be innocent unless proven otherwise. Meaning that generally an under-trial prisoner ought not be placed behind bars indefinitely unless there is clear threat to society, influencing witnesses/inquiry or he is a flight risk etc. This rule also ensures that process is also not made punishment, wherein a person is jailed for very many years pending trial. Bail under the Code is a qualified right of an accused before conviction, wherein the accused is not guaranteed bail, rather it puts onus on the prosecution to establish as to why the under-trial prisoner should not be enlarged on bail. Any deviation in the above proposition is constitutionally circumspect. There has been many cases before this Court, which indicate that a separate treatment is meted out in large scale economic offenses regarding grant of bail. Wherein this Court has on many occasions held that strictest standards have to be applied while granting bail involving large scale economic fraud. In V. Senthil Balaji Versus Deputy Director, Directorate of Enforcement [2024 (9) TMI 1497 - SUPREME COURT], this Court noted that even under special penal statutes prescribing a higher threshold for grant of bail, these stringent conditions are premised on the legislative expectation of expeditious completion of trial. Consequently, inordinate delay in trial and prolonged pre-trial incarceration cannot coexist with such rigors. While highlighting the “bail is the rule and jail is the exception”, this Court stated that provisions like Section 45 of the PMLA, Section 43D(5) of the UAPA or Section 37 of the NDPS Act cannot be used as tools to incarcerate an undertrial for an unreasonably long period without conclusion of trial. It is clear that the appellant was made accused on account of non-payment of loan and credit facility availed from a consortium of 17 Banks and divesting of the money in 81 shell companies. Admittedly, this is a case based on documentary evidence and all the accused persons connected with these companies, except the appellants herein have been granted bail. In the present case, total 11 cases have been registered against the appellant as indicated in para 3 above. In all other cases, the appellants have been released on bail. The chargesheet filed by the CBI is voluminous in nature containing more than 4 lakh pages and having 736 witnesses. In addition, 17 trunks of documents are those which are not relied upon and may be brought on record subsequently if deemed necessary by the prosecution. The proceedings against the assets have already been taken up by the NCLT and the CIRP is in progress. In the present case, pending trial, the charges have not yet been framed by the Court. Thus, it appears that if the case is taken up on day-to-day basis, even in two to three years, the conclusion is not possible. Considering all the facts and circumstances of the case, subject to putting the restrictions on movement of appellants out of India, and without expressing any opinion on the merits of the case, while disposing of these appeals, it is deemed appropriate to release the appellants on bail subject to fulfilment of conditions imposed. Bail application allowed. Issues: Whether appellants, accused in large-scale economic offences and detained for prolonged pre-trial period with trial unlikely to conclude in the near future, are entitled to be released on bail despite the gravity of allegations and the invocation of stringent statutory provisions.Analysis: The Court reviewed settled principles of bail jurisprudence including the presumption of innocence and the constitutional guarantee under Article 21 of the Constitution entitling an accused to a speedy trial. It examined authorities holding that prolonged pre-trial incarceration may convert detention into punishment and that even in economic or special statute cases the higher threshold for bail cannot be applied so as to permit unreasonable detention where timely trial is not feasible. The Court considered the factual matrix: voluminous chargesheet, very large number of witnesses and documents, pendency of related proceedings, non-framing of charges and the realistic impossibility of concluding trial in a reasonable time; it also considered that co-accused in related matters had been granted bail. The Court rejected an interpretation of Section 479 of BNSS that would operate as an absolute bar to bail for offences punishable with life imprisonment, holding that the provision must be read compatibly with personal liberty and existing bail standards under the Code. Balancing the statutory framework, constitutional rights and facts, the Court found that continued detention would disproportionately infringe Article 21.Conclusion: In favour of Appellant.
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