TaxTMI 
TaxTMI 
2021 (6) TMI 477
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....petition. 2. As per the final report dated 06.01.2020, the facts of the present case are that complainant-company- Religare Finvest Limited (RFL) is registered with the Reserve Bank of India (RBI) and is licensed to undertake the business of financial services as a non-deposit taking/lending Non-Banking Financial Company (NBFC). It operates as a small and medium enterprise (SME) financing focused NBFC and is in the business of extending SME working capital loans, secure SME business expansion, loans, short term trade finance and other loans to various entities. The complainant-company is classified as a 'systematically important NBFC' by the RBI and is a subsidiary of Religare Enterprises Limited (REL), which is a public company, listed on stock exchanges. 3. Pertinently, respondent No.2- Shivender Mohan Singh, the accused in FIR in question, was the Promoter along with the entities controlled by him and with persons acting in concert with him, owned the majority shareholding of REL till June 2017 and was as such classified as the Promoter of REL. Effectively, he continued to control REL till February, 2018, i.e. till the time he remained on the Board of Directors of REL and ....
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....hat the illegal transactions were caused by respondent No.2 in connivance with his brother- Malvinder Mohan Singh so as to siphon away the funds of the company before they ceased to be in control over the complainant-company. In this background, a complaint was made by petitioner/company to the EOW, which resulted in the FIR in question against the accused persons, including respondent No.2 herein for allegedly misappropriating, siphoning off and diverting through a labyrinth of financial transactions, the funds of petitioner- Religare Finvest Limited (RFL). 8. During the course of investigation, it revealed that high amount of shareholder's funds of REL have been invested in RFL. In this manner, the diversion of funds from RFL caused a direct loss to the shareholders of REL for the reason REL owned 85.64% equity share capital in RFL, the management of RFL is under the control of REL and REL is accountable for the actions taken by the management of RFL. 9. From further investigation, it was found that the Corporate Loan Book (CLB) was created since beginning of RFL business for the purpose of utilizing funds at the disposal of Promoters. This was done through loan product....
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....ll entities through which money has been disbursed and used as vehicle for rotation of money and was ultimately misappropriated/siphoned off through RHC Holding Pvt. Limited or Ranchem Private Limited. 13. The charge sheet in this case was filed on 06.01.2020. Subsequently on 15.01.2020, supplementary charge sheet was filed. 14. At the hearing, learned senior counsel for petitioner-RFL submitted that the FIR in question pertains to serious economic offence of high magnitude where huge public money to the tune of approximately Rs. 2397 crores as principal amount has been siphoned away at the behest of respondent No.2 in collusion with his brother- Malvinder Mohan Singh and other co-accused, for their personal benefit. Learned senior counsel emphasized that offence under Section 409 IPC has been invoked against both of them, which is punishable with imprisonment up to life. 15. Learned senior counsel for petitioner submitted that the learned trial court while granting bail to respondent No.2 vide impugned order dated 03.03.2021 has not taken the directions issued by this Court vide order dated 09.02.2021 in its right perspective. 16. He next submitted that on the very sam....
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....n various decisions. 21. In support of his submissions, learned senior counsel for petitioner relied upon decisions in State of Bihar Vs. Amit Kumar AIR 2017 SC 2487; Central Bureau of Investigation Vs. Vijay Sai Reddy AIR 2013 SC 2216; Mahipal Vs. Rajesh Kumar @ Polia and Anr. (2020) 2 SCC 118; Prasanta Kumar Sarkar Vs. Ashis Chatterjee and Anr. AIR 2011 SC 274; Neeru Yadav Vs. State of Uttar Pradesh & Anr. (2014) 16 SCC 508; Ram Govind Upadhyay Vs. Sudarshan Singh and Ors. AIR 2002 SC 1475; Ranjit Singh Vs. State of M.P. and Ors. (2013) 16 SCC 797; Kalyan Chandra Sarkar Vs. Rajesh Ranjan and Ors. (2004) 7 SCC 528; Nittin Johari Vs. Serious Fraud Investigation Office 2020 SCC Online Del 394 and Rajesh Ranjan Yadav Vs. CBI (2007) 1 SCC 70. 22. Lastly, learned senior counsel submitted that petitioner has prayed for setting aside of impugned order dated 03.03.2021 and resultantly, cancellation of bail granted to respondent No.2 is sought, as the impugned order is perverse and has been passed by non-application of mind. 23. On the other hand, learned senior counsel appearing for respondent No.2 supported the impugned order and submitted that the trial court was well cognizant....
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....uture, the present petition deserves to be dismissed. 30. The submissions advanced by learned senior counsel appearing from both the sides were heard at length and I have gone through the impugned order, decisions relied upon and other material placed on record. 31. During the course of arguments, learned senior counsel for petitioner asserted that respondents have mistakenly considered the present petition as only for cancellation of bail granted to respondent No.2, whereas in the present petition, setting aside of order dated 03.03.2021 passed by the learned trial court is sought. 32. Pertinently, the prayer made in this petition is two folds; (a) setting aside of the impugned order (b) consequently cancellation of bail granted to respondent No.2. Hence, this Court is not just required to test the correctness of the impugned order, but also to dwell upon the reasons as to why the relief of bail, already granted to respondent No.2, is required to be interfered with by this Court. 33. On this aspect, the pertinent observations of the Hon'ble Supreme Court in Mahipal Vs. Rajesh Kumar (2020) 2 SCC 118 are as under:- "16. The considerations that guide the power of an ap....
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....d to believe that the accused had committed the crime, also taking into account the seriousness of the crime and the severity of the punishment........." 34. In the light of afore-noted decision of Hon'ble Supreme Court, this Court has to find out whether the cardinal principles of law to grant bail, were borne in mind of the trial court while passing the impugned order. 35. What should weigh in the mind of court at the time of granting or refusing bail, has been succinctly described by the Hon'ble Supreme Court in Ramesh Bhavan Rathod Vs. Vishanbhai Hirabhai Makwana (Koli)& Anr. 2021 SCC OnLine SC 335, whereby deciding bunch of five appeals arising from orders of the High Court of Gujarat granting bail under Section 439 of the Code of Criminal Procedure 1973 to six persons, who were implicated in five homicidal deaths, the Hon'ble Supreme Court observed as under:- "43. Grant of bail under Section 439 of the CrPC is a matter involving the exercise of judicial discretion. Judicial discretion in granting or refusing bail - as in the case of any other discretion which is vested in a court as a judicial institution - is not unstructured. The duty to record reasons is a s....
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....y/status report filed by the IO would show that except for last paragraph the entire reply is more or less a reiteration of the chargesheet and the supplementary chargesheet. IO states in the last paragraph of the reply that it is a fraud of large magnitude where public money has been swindled in conspiracy with the officials of the company and promoters. It is further stated that it is quite likely, if accused/applicant be released on bail, he could influence the witnesses and tamper with the evidence. 17. The possibility of tampering with the evidence exists in every case till the length of the trial. If the stand of the IO canvassed in the reply is accepted then any accused cannot be released till the conclusion of the trial as there is always a possibility of tampering with the evidence. I find substance in the contention of Ld. counsel for applicant/accused that merits of the case has receded in the background and after filing of the supplementary chargesheet the merits of the case was discussed in detail by this court vide order dated 25.09.2020 and thereafter order dated 09.02.2021 of Hon'ble High Court was passed. The applicant/accused is not at flight risk as ....
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....11. Although there is no quarrel with respect to the legal propositions canvassed by the learned counsel, it should be noted that there is no straitjacket formula for consideration of grant of bail to an accused. It all depends upon the facts and circumstances of each case. The Government's interest in preventing crime by arrestees is both legitimate and compelling. So also is the cherished right of personal liberty envisaged under Article 21 of the Constitution. Section 439 of the Code of Criminal Procedure, 1973, which is the bail provision, places responsibility upon the courts to uphold procedural fairness before a person's liberty is abridged. Although "bail is the rule and jail is an exception" is well established in our jurisprudence, we have to measure competing forces present in facts and circumstances of each case before enlarging a person on bail." 42. No doubt at the time of grant of bail, the court is not required to go into the merits of the prosecution case and meticulous observations on the material placed on record are not required to be made, but the court is expected to judiciously apply its mind as to whether a prima facie case against the accused is ....
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....orded reasons for granting bail to respondent No. 2, but has failed to consider that the present FIR case pertains to a serious economic offence of high magnitude, where large amount of approximately Rs. 2400 crores including interest has been siphoned off at the behest of respondent No.2 and his brother Malvinder Mohan Singh by diverting it through various financial transactions, by granting loan to the shell companies, of whom they were the Directors or Promoters or beneficiary in interest. There are allegations that respondent No.2 in connivance with other co-accused created the Corporate Loan Book (CLB) for the purpose of utilizing the funds of the company to their personal benefits and the Corporate Loan Policy was not at all followed by the sanctioning authority. Moreover, the learned trial court has ignored the fact that respondent No.2 along with other accused persons has been charge- sheeted for the offences under Sections 409/420/120B IPC. The punishment prescribed for the offence under Section 409 IPC is imprisonment for life or imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine. 46. In this way, the learned t....
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....e tune of Rs. 1250 crores, was ultimately done by the company RHC Holding Pvt. Ltd., which belonged to its Promoters - Shivinder Mohan Singh and Malvinder Mohan Singh. A cursory perusal of letter dated 27.01.2017 issued by Reserve Bank of India to the Managing Director of Religare Finvest Ltd. as well as copies of SEBI's orders dated 14.03.2019 and 1.09.2019 strengthens the case of prosecution against respondent No.2 and his brother Malvinder Mohan Singh, who allegedly, in connivance with co-accused Rajendera Prasad Aggarwal, Narender Kumar Ghoushal and Maninder Singh hatched a conspiracy to divert the funds of complainant-company. Hence, the plea put-forth on behalf of respondent No.2 that he cannot be held vicariously liable for the acts of the company, shall be tested during trial. 50. The plea put-forth by respondent No.2 that he had taken retirement from active life and was in Radha Swami Satsang, Beas is controverted by the prosecution alleging that Board Minutes and various emails reveal his active participation in the affairs of the company even after his appointment as Non-Executive Director & Vice Chairman and this assertion of prosecution, casts a doubt in the mind of....
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.... or the Sessions Court can cancel the bail even in cases where the order granting bail suffers from serious infirmities resulting in miscarriage of justice. If the court granting bail ignores relevant materials indicating prima facie involvement of the accused or takes into account irrelevant material, which has no relevance to the question of grant of bail to the accused, the High Court or the Sessions Court would be justified in cancelling the bail. Such orders are against the well-recognised principles underlying the power to grant bail. Such orders are legally infirm and vulnerable leading to miscarriage of justice and absence of supervening circumstances such as the propensity of the accused to tamper with the evidence, to flee from justice, etc. would not deter the court from cancelling the bail. The High Court or the Sessions Court is bound to cancel such bail orders particularly when they are passed releasing the accused involved in heinous crimes because they ultimately result in weakening the prosecution case and have adverse impact on the society. Needless to say that though the powers of this Court are much wider, this Court is equally guided by the above principles in ....