AI Drafter 
TaxTMI 
TaxTMI 
2022 (1) TMI 1139
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....1 r/w/s 628 of the Companies Act, 1956. 3. It transpires from the record that initially the applicant moved an interim bail application before the Apex Court by filing Writ Petition (Criminal) No.126 of 2020, which came to be disposed of directing the applicant to approach this Court by filing bail application and, thereafter, the applicant approached this Court by filing bail application under section 439 Cr.P.C. being Criminal Misc Bail Application No.12047 of 2020, which came to be disposed of by order dated 05.05.2020 whereby the prayer for interim bail of the applicant was rejected and liberty was granted to the applicant to move regular bail application. However, in the meantime, the order dated 05.05.2020 has also been challenged by the applicant before the Apex Court by filing SLP Criminal No.2393 of 2020, which came to be disposed of vide order dated 28.05.2020 as not maintainable and liberty was granted to the applicant to file a regular bail application. Hence, the present bail application has been filed seeking regular bail under Section 439 Cr.P.C. read with Section 212(6) of the Companies Act, before this Court. 4. The encapsulated facts of the case are that the....
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.... financing for their MT Business and under the guise of MT Business, accused is said to have violated the regulations/guidelines issued by Reserved bank of India. It is also found that the accused, who is the Director of the company caused huge loss amounting to Rs. 7820/crores to the Public Sector Banks in connivance with other foreign entities coaccused and others Directorsco accused. It is also found that the applicant abused their position as PromoterDirector of Frost International Limited (FIL) to cause wrongful loss of Rs. 4041/crores to public Sector Banks. Applicant along with other Directors utilized the corporate identity of the FIL to perpetrate fraud of rotating the funds obtained through Letter of Credit. It is further alleged that in furtherance of their dishonest intention, applicant along with others manipulated the books of FIL by showing fake and unrecoverable MT trade receivable to the tune of Rs. 3537.74 crores to deceive the public sector Banks and allured them to obtain credit facilities. It is further alleged that the applicant along with other Directors were also indulged in speculative currency trading with banks money and ultimately public money which resu....
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....r co accused persons under the garb of Merchantile Trade have fraudulently induced the Banks & Public Financial Institutions to obtain credit facilities. He had knowingly falsified the books of account and the financial statements of F.I.L. deliberately concealing material facts thereby inducing BFIs to fraudulently extending credit facilities to F.I.L. which ultimately remained outstanding as account of F.I.L. became N.P.A. He submitted that the offence committed by the applicant being the Director and the Managing Director of F.I.L., has come into light during the investigation, is of grave nature. In support of his arguments, learned counsel also relied upon the cases of P. Chidrambaram vs. Directorate of Enforcement (2019) 9 SCC 24 and Y.S. Jagan Moham Reddy vs. Central Bureau of Investigation, 2013 (7) SCC 439, in which the Court has observed that economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. 11. I have considered the rival submissions advanced by the learned counsel for the parties and have gone through the entire material available on record. 12. Perusal of the record discloses that the applicant has ....
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....t he abused his position as promoterdirectors of FIL to cause wrongful loss of Rs. 4041 Crores to public sector Banks. He utilized the corporate identity of FIL to perpetrate fraud of rotating the funds obtained through Letter of Credits discounting for mopping the interest arbitrage available between LC issuance and discounting charges and that between the interest on fixed deposits. This whole conspiracy was played under the garb of doing MT. 14. The applicant used the corporate identity of FIL to rotate LC funds for mopping the interest arbitrage and showed it in the books as Merchanting Trade business. Since it was not actually into MT business the corresponding sales and purchase shown in the financial statements and books of accounts is false. Since mopping of interest was done by keeping the rotated funds obtained through LC discounting in Fixed Deposits to camouflage the same the interest income from FD was shown as part of revenue from operation in the financial statements to give a false picture of profitability of MT business. A large amount of these fictitious trade receivables were standing against their undisclosed related parties. The sum and substance of the outc....
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....public/State and other similar considerations. 17. As discussed above, there are serious allegations against the applicant. The offence committed by the applicant is an economic offence of huge magnitude affecting the economy of the nation and interest of public/State and, therefore, requires a stringent approach for grant of bail. The offence has been committed with prior planning with an eye on personal profit totally disregarding the interest of the community and causing damage to the economy and ignoring national interest. The applicant was instrumental in submissions of false and fabricated documents and siphoning of funds of the company to the tune of several crores and indulging in fraudulent and deceptive methods, and thus, keeping in mind the nature of accusation as discussed in detail in earlier paras and the material brought on record against the applicant by SFIO, this court is not inclined to release the applicant on bail even under Section 439 Cr.P.C. 18. In the end, it is contended by learned counsel for the applicant that the applicant is suffering from diabetes and various other ailments and, therefore, on that ground, he should be released on bail and also l....