TaxTMI 
TaxTMI 
2023 (4) TMI 1083
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.... Vasant Vihar. 2. FIR bearing no. 445/2020 was got registered on basis of complaint made by Tript Singh (hereinafter referred to as "the complainant") regarding fraudulent transfer of 62,500 equity shares of Genesis Finance Ltd. owned by the complainant on 10.05.2016 in favor of Nirmala Devi by committing forgery and in FIR Genesis Finance Ltd. (hereinafter referred to as "the accused no. 1"), Naresh Garg, Managing Director of Genesis Finance Ltd. (the accused no. 2/applicant in bail application no. 1696/2022 and hereinafter referred as "the applicant no. 1"), Gopal Bisht, CFO & Whole Time Director of Genesis Finance Ltd. (the accused no. 3), Sangeeta Garg, Whole Time Director of Genesis Finance Ltd.(the accused no. 4), Kapil Berera, Ex-Director of Genesis Finance Ltd.(the accused no. 5), Umang Sarkar. Director of Genesis Finance Ltd.(the accused no. 6), Aashish Ghai, Director of Genesis Finance Ltd.(the accused no. 7), Nirmala Devi (the accused no.8/ applicant in bail application no. 1697/2022 and hereinafter referred as "the applicant no. 2"), Sanjay Prasad Jain (the accused no. 9), Kavita Bhulani (the accused no. 10), Roohi Reshi (the accused no. 11), Skyline Financial Servic....
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....red by the complainant to Roohi Reshi (the accused no. 11) and when Kavita Bhulam (the accused no. 10) transferred 100 equity shares in favour of wife of the complainant namely Preet Kaur. 2.2.2 Skyline Financial Services (the accused no. 12) is registrar and Share Transfer Agent (STA) for undertaking physical transfers and acts as Depository Agency on behalf of the accused no. 1 and Swaroop Narain Aggarwal (the accused no. 13) is the Director of Skyline Financial Services (the accused no. 12). 2.3 The accused no. 1 to 5 including the applicant no. 1 induced the complainant to become a share-holder of the accused no. 1 on the pretext that the accused no. 1 is in the business of finance and the value of the shares of the accused no. 1 would increase multi-fold. The applicant no. 1 (the accused no. 2) repeated approached the complainant to invest in the shares of the accused no. 1. The complainant was also having other financial transactions with the accused no. 1. The applicant no. 1 assured the complainant that investment in equity shares at Rs. 200 is good option and price of the share would increase multi-fold and thereafter the complainant invested in the equity shares of ....
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....the help of accused no. 2 to 13 has cheated the complainant by showing wrong transfer of 62,500 equity shares which after allotment of 437500 bonus equity shares at the rate of 7 equity shares for every equity share having become 500000 shares. The accused no. 1 along with other accused has reduced shareholding of the complainant from 500000 equity shares to only 100 equity shares as on 31.03.2018. 2.5 The accused no. 1 and its directors have never given any share certificate for the allotment of 62,500 equity shares to the complainant. The complainant has never received notice of any of the AGM or EGM conducted by the accused no. 1. 2.6 On basis of the complaint, after enquiry prima facie FIR bearing no. 445/22 for offences punishable under sections 420/468/471/34 IPC was got registered and investigation was handed over to SI Pankaj Kumar. 3. The applicants no. 1 & 2 have filed bail applications bearing no. 734/2022 and 765/2022 which were dismissed by the court of Additional Sessions Judge-02, Patiala House Courts, New Delhi vide order dated 28.05.2022 and observed as under:- At the very outset, 1 have no hesitation in observing that the facts of the instant cas....
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....chase of the shares also fails to inspire confidence. The accused persons have failed to provide any request of the complainant regarding his willingness for transfer of his shares or adjustment of the amount in his loan account nor have they provided any intimation to the complainant regarding the adjustment of the consideration amount in the loan account. lt is inexplicable as to why Genesis Company would give a rebate to the complainant and his brother for shares purchased by applicant/accused Nirmala Aggarwal in her individual capacity. In fact such a rebate, if at all given by the company, is in fact a fraud played upon the other share holders, as the loan owed to the company cannot be utilized for creating private assets for the mother-in-law of Managing Director Naresh Garg. Furthermore, in contradiction to the earlier claim, in reply to the notice u/s 91 CrPC dated 07.05.2022, it is informed by the IO that vide Para No. 13, it is claimed that the transaction of sale and purchase of shares by applicant/accused Nirmala Aggarwal and complainant is an independent transaction and has no connection with the waiver given on loan account of the complainant and his brother.....
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....BI Act. With these observations, both the anticipatory bail applications are disposed off accordingly. 4. The applicant no. 1 in bail application stated that he is an innocent person and has been falsely implicated. The applicant no. 1 is a respectable member of the society with clean antecedents and has joined the investigation on several occasions. The applicant no. 1 cooperated in the investigation and supplied all the documents and information as sought by the investigating agency. It was informed in 2021 that FSL result has concluded that the signatures of the complainant and his wife on the share transfer forms were not made by them. Thereafter during investigation handwriting/signatures of the applicant no. 1 were taken by the Investigating Officer who also asked the applicant no. 1 to settle the matter with the complainant otherwise he would be arrested. The applicant no. 1 filed an application for grant of anticipatory bail and was granted interim protection vide order dated 28.04.2022 with the direction to join the investigation. The applicant no. 1 joined the investigation. The court of Additional Sessions Judge, Patiala House Courts, vide order dated 28.5.20....
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....ebate of Rs. 38,81,547/- to the complainant on 03.05.2016 and Gaganmeet Singh was given rebate of Rs. 52,64,408/- and Rs. 6,25,000/- were also credited in the loan account of the complainant. The applicant no. 2 submitted share transfer form along with original share certificate for transfer of 62,500 shares and the accused no. 1 upon receiving intimation from M/s Skyline Financial Services (the accused no. 12) regarding receipt of application approved the share transfer vide its board meeting held on 10th May, 2016. 4.6 The accused no. 1 and the complainant along with his family, had settled pending disputes pertaining to business and personal loans vide agreement dated 05.06.2020 and the complainant had agreed to pay Rs. 15.30 crores with future interest @18% pa to the accused no. 1. The complainant after the settlement dated 05.06.2020 filed complaint on 14.06.2020 which after inquiry was converted into FIR on 25.11.2020. Vinod Kumar and Vinod Tayal also stated that the complainant signed and handed over the original share certificate and signed share transfer form to the applicant no. 2 on 03.05.2016. 4.7 The complainant also submitted that share transfer form along with ....
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....f finance and money lending and complainant is the client of the accused no. 1 for last 15-20 years. The accused no. 1 in reply to notice under section 91 of the Code denied all allegations. The accused no. 1 provided a copy of speed post dated 12.12.2008 by which original share certificate was sent to the complainant which could not be verified from postal department as relevant record was stated to be weeded out. The applicant no. 1 also claimed that the complainant also received Rs. 6,25,000/- in lieu of the shares sold to the applicant no. 2 by crediting said amount in the loan account of the complainant. 5.1.1 The specimen and admitted signatures of the complainant and his wife Preet Kaur were collected during investigation and sent to FSL along with question signatures on all four alleged Original Share Certificates (SH-4) for expert opinion on 04.06.2021. As per FSL result received on 24.10.2021, signatures of the complainant and his wife Preet Kaur on Original Share Certificates do not match with specimen and admitted signatures of the complainant and his wife Preet Kaur. 5.2 The applicants during investigation revealed that the complainant sold shares to the applican....
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....2017 the accused no. 1 approved share transfer request of 300 shares bearing certificate no. 31269 from the complainant to Roohi Reshi on 12.12.2017 whereas in reply dated 09.11.2022, the accused no. 1 stated that the said certificate no. 31269 was issued on 13.12.2017. 6.4 The respondent/State opposed bail applications filed by the applicants and prayed for custodial interrogation on grounds that the applicant no. 1 was Managing Director of the accused no. 1 at the time of allotment of 62,500 shares to the complainant and at the time of fraudulent transfer of shares. The applicant no. 1 admitted that he was aware that the complainant sold his shares to the applicant no. 2 and on request of the complainant, Rs. 6,25,000 was credited into his loan account but the applicant no. 1 could not provide any such request. The applicant no. 2 in whose favour 62,500 shares were fraudulently transferred is mother-in-law of the applicant no. 1. The accused no. 1 could not establish receiving of the share certificates by the complainant as the speed post receipt dated 12.12.2008 could not be verified. The payment of Rs. 6,25,000/- qua alleged transfer of 62,500 equity shares was internally ad....
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....d as Share Transfer Agent (STA) for maintaining and recording share transfer records. The complainant is having financial transactions with the accused no. 1 for last 15-20 years. The applicant no. 1 is Managing Director of the accused no. 1. The accused no. 1 had allotted 62,500 equity shares having face value of Rs. 10 with premium of Rs. 190 in favour of the complainant on 27.11.2008. 7.1 The complainant primarily alleged that he never received share certificates in respect of 62,500 shares allotted to him and were fraudulently transferred in favour of the applicant no. 2 on 10.05.2016 who is mother in law of the applicant no. 1. The complainant never sold these shares to the applicant no. 2 and never executed any share transfer deed in favour of the applicant no. 2. The documents pertaining to alleged transfer of 62,500 equity shares in favour of the applicant no. 2 are forged and fabricated. 7.1.1 The complainant also alleged that 50 equity shares stated to be owned Sanjay Prasad Jain (the accused no. 9) were transferred in his favour on 14.10.2017 but he never purchased these shares; 100 equity shares stated to be owned by Kavila Bhulani (the accused no. 10) were transf....
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....oan account of the complainant. The court also made certain other observations. 8. The applicants in bail applications under consideration primarily pleaded that the complainant, his wife and other family members and companies in which the complainant and his family members are Directors/Shareholders/Guarantors are clients/borrowers of the accused no. 1 for the last 15-20 years. The complainant in the year 2008 was allotted 62,500 shares of the accused no. 1 at a total value of Rs. 1.25 crores with distinctive nos. 3802501 to 3865000. The complainant had received share certificate through speed post dated 12.12.2008. The complainant in the year 2015-16 sold these shares to the applicant no. 2 and the applicant no. 2 requested to the accused no. 1 to pay Rs. 6,25,000/- to the complainant on her behalf and said amount was credited in the loan account of the complainant on 03.05.2016. The complainant also handed over duly signed share transfer form to the applicant no. 2 along with original share certificate. The share transfer form along with original share certificate was submitted to the Share Transfer Agent (STA) M/s Skyline Financial Services (the accused no. 12) on 06.05.2016....
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....iscretionary. The Law Commission of India in its 41st Report pointed out the necessity of introducing a provision in the Code enabling the High Court and the Court of Sessions to grant anticipatory bail which may allow a person to seek bail in anticipation of an arrest on accusation of having committed a non-bailable offence. Section 438 of the Code deals with grant of bail to a person who is apprehending arrest. It reads as under:- 438. Direction for grant of bail to person apprehending arrest. (1) When any person has reason to believe that he may be arrested on an accusation of having committed a non-bailable offence, he may apply to the High Court or the Court of Session for a direction under this section; and that Court may, if it thinks fit, direct that in the event of such arrest, he shall be released on bail. (2) When the High Court or the Court of Session makes a direction under sub- section (1), it may include such conditions in such directions in the light of the facts of the particular case, as it may think fit, including- (i) a condition that the person shall make himself available for interrogation by a police officer as and when req....
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.... observed as under:- 13. ...Though at the stage of granting bail an elaborate examination of evidence and detailed reasons touching the merit of the case, which may prejudice the accused, should be avoided, but there is a need to indicate in such order reasons for prima facie concluding why bail was being granted particularly where the accused is charged of having committed a serious offence. The Supreme court in Prasanta Kumar Sarkar V Ashis Chatterjee and another, (2010) 14 SCC 496 considered the factors which should be examined at time of deciding anticipatory bail application and observed as under:- 9. We are of the opinion that the impugned order is clearly unsustainable. It is trite that this Court does not, normally, interfere with an order passed by the High Court granting or rejecting bail to the accused. However, it is equally incumbent upon the High Court to exercise its discretion judiciously, cautiously and strictly in compliance with the basic principles laid down in a plethora of decisions of this Court on the point. It is well settled that, among other circumstances, the factors to be borne in mind while considering an application for bail are: ....
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....the offences, the role attributed to the applicant, and the facts of the case, while considering whether to grant anticipatory bail, or refuse it. Whether to grant or not is a matter of discretion; equally whether and if so, what kind of special conditions are to be imposed (or not imposed) are dependent on facts of the case, and subject to the discretion of the court. xxxxxxxxxxxx 92.6. An order of anticipatory bail should not be "blanket" in the sense that it should not enable the accused to commit further offences and claim relief of indefinite protection from arrest. It should be confined to the offence or incident, for which apprehension of arrest is sought, in relation to a specific incident. It cannot operate in respect of a future incident that involves commission of an offence. 9.5 The Supreme Court in Nathu Singh V State of UP, (2021) 6 SCC 64, has emphasized on liberal interpretation in relation to grant of anticipatory bail and observed as under:- 19. At first blush, while this submission appears to be attractive, we are of the opinion that such an analysis of the provision is incomplete. It is no longer res integra that any interpretation ....
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....the Complainant and the accused no. 1 whereby the complainant had agreed to pay over Rs. 15 crores to the accused no. 1. The complainant is under wrong belief that 62,500 shares are worth more than Rs. 10 crores. The complainant at time of settlement dated 05.06.2020 was conscious that he had already sold 62,500 shares to the applicant no. 2 in the year 2016 itself. The accused no. 1 was not under legal obligation to maintain the files of loan accounts which had been closed in the year 2016. The complainant in net worth statement which he had submitted in the year 2018 to a bank for securing loan facility, did not disclose that he owned 62,500 shares of the accused no. 1 which established that the complainant had sold shares in the year 2016. 10.3 The learned Senior Counsel further argued that Rs. 6,25,000/- was adjusted in the loan account of the complainant on 03.05.2016. The complainant and his brother Mr. Gaganmeet Singh were given discount of about Rs.92 lacs and thereafter their loan accounts were closed which indicated that Rs. 6,25,000/- was adjusted in loan account of the complainant. 10.4 The applicant no. 2 is not required for custodial interrogation. The original ....
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....red by the Superior Courts. 11. The Additional Public Prosecutor for the respondent/State argued on basis of averments made in Status Reports. He argued that the custodial interrogation of the applicants is required to recover relevant documents and information from the applicants. 12. The learned Senior Counsel who assisted the Additional Public Prosecutor advanced oral arguments and also submitted written arguments. The learned Senior Counsel argued that the applicants in conspiracy with each other have committed the grave economic offence in a cool, calculated and systematic manner and have already tampered with evidence and destroyed evidence. The applicants have taken repeated false and varying stances and custodial interrogation of the applicants is required to bring out the actual facts as well as recover forged documents. The accused who are implicated in FIR are closely related or directly associated with each other. The applicants are habitual offenders. 12.1 The learned Senior Counsel for the complainant partitioned offences alleged to have been committed by the applicants in five different transactions which are pertaining to the 62,500 equity shares, 50 equity....
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....re given on 30.10.2017 on the 50 shares allegedly held the complainant and the applicant no. 1 issued and sent the said bonus share certificate on 08.12.2017 by post but no proof of the same is given. The complainant never transferred 300 shares Roohi Reshi and said transfer is fraudulent. The signature of the complainant on SH4 is forged as stated in FSL Report. Preet Kaur, wife of the complainant never purchased 100 shares from Kavita Bhutani and alleged transfer of 100 shares is fraudulent. 12.4 The learned Senior Counsel for the applicant cited Centrum Financial Services Limited V State of NCT of Delhi, 2022 SCC OnLine SC 100 wherein grant of anticipatory Bail was cancelled considering the modus operandi followed by the accused as disclosed by the State in Status Report, by observing that said bail was granted by considering that it was a commercial transaction, but not considering the nature of accusation and material collected during course of investigation. The learned Senior Counsel also referred Sadhna Chaudhary V State of Rajasthan, 2022 SCC OnLine SC 869. 12.5 The learned Senior Counsel regarding requirement of custodial Interrogation in cases of serious offences, ....
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....irectorate (FERA) V Arun Kumar Bajoria, (1998) 1 SCC 52, held that it is not the function of the court to monitor investigation processes so long as such investigation does not transgress any provision of law. It must be left to the investigating agency to decide the venue, the timings and the questions and the manner of putting such questions to persons involved in such offences. A blanket order fully insulating a person from arrest would make his interrogation a mere ritual. 13.1 Custody means formal arrest or the deprivation of freedom to an extent associated with formal arrest. Interrogation means explicit questioning or actions that are reasonably likely to elicit an incriminating response. The Supreme Court in State rep. by the CBI V Anil Sharma, (1997) 7 SCC 187 observed that custodial interrogation is qualitatively more elicitation-oriented than questioning a suspect who is well ensconced with favourable order under section 438 of Code. It was further observed that effective interrogation of a suspected person is of tremendous advantage in disinterring many useful information and also materials which would have been concealed. Success in such interrogation would elude if....
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....rved as under:- We are conscious of the fact that the legislative intent behind the introduction of Section 438 Cr.P.C. is to safeguard the individual's personal liberty and to protect him from the possibility of being humiliated and from being subjected to unnecessary police custody. However, the court must also keep in view that a criminal offence is not just an offence against an individual, rather the larger societal interest is at stake. Therefore, a delicate balance is required to be established between the two rights - safeguarding the personal liberty of an individual and the societal interest. It cannot be said that refusal to grant anticipatory bail would amount to denial of the rights conferred upon the appellant under Article 21 of the Constitution of India. Ordinarily, arrest is a part of the process of the investigation intended to secure several purposes. There may be circumstances in which the accused may provide information leading to discovery of material facts and relevant information. Grant of anticipatory bail may hamper the investigation. Pre-arrest bail is to strike a balance between the individual's right to personal freedom and the right o....
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....s were allotted to the complainant making total number of equity shares to 400. As per the investigating agency above mentioned transactions pertaining to transfer of shares are forged and alleged share certificates and share transfer forms are fabricated documents. The complainant also alleged that he never sold these shares to the applicant no. 2 and never executed any share transfer deed in favour of the applicant no. 2. The documents pertaining to alleged transfer of 62,500 equity shares in favour of the applicant no. 2 are forged and fabricated. As per FSL result received on 24.10.2021, signatures of the complainant and his wife Preet Kaur on original share certificates do not match with their specimen and admitted signatures and as such are forged and fabricated documents. 14.1 The applicant no. 1 as per Status Reports did not provide the requisite original Share certificates and also gave evasive replies during investigation. It is also appearing as surfaced during investigation that the applicant no. 1 who is managing director of the accused no. 1 could not produce any proof regarding request of the applicant no. 2 made to the accused no. 1 for payment of Rs. 6,25,000/- ....
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....tigating agency. 14.4 The bail applications filed by the applicants were dismissed by the court of Additional Sessions Judge-02, Patiala House Courts, New Delhi, vide order dated 28.05.2022 wherein it was observed that none including the complainant has appeared before the court with truth and conduct of the applicants is also shrouded in suspicion and appears to be much more tainted and stained as compared to the complainant. The court of Additional Sessions Judge-02, Patiala House Courts, New Delhi, in order dated 28.05.2022 also noticed under contradictions in stand taken by the applicants during investigation. The concerned court was not justified in dismissing bail applications of the applicants on basis of alleged more tainted and stained conduct of the applicants. It appears that the concerned court minutely examined material collected during investigation in manner as deciding case on merits after conclusion of trial which was not warranted at time of consideration of bail applications. 14.5 There is no much force in arguments advanced by the learned Senior Counsel who assisted the Additional Public Prosecutor the applicants that custodial interrogation of the applica....