AI Drafter 
TaxTMI 
TaxTMI 
2025 (4) TMI 640
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....25 (@ SLP (CRL.) NO. 13978 OF 2023) BELA M. TRIVEDI And PRASANNA B. VARALE, JJ. JUDGMENT BELA M. TRIVEDI, J. 1. Leave granted. 2. This batch of sixteen Appeals being interconnected with each other and arising out of the proceedings being CIS No. COMA/5/2019 pending before the Special Judge, Gurugram, are being decided by this common judgment. 3. In these cases, there is a brazen attempt made on the part of the respondents-accused to stall the criminal proceedings initiated against them, in respect of the serious economic offences allegedly committed by them, by not respecting the summons/warrants issued by the Special Court from time to time and thereby causing obstruction in the administration of justice. A few basic common facts necessary for deciding the present appeals may be stated as under: - (i) The Appellant i.e. Serious Fraud Investigation Office (SFIO) is a statutory body constituted and established under Section 211 of the Companies Act of 2013. The Ministry of Corporate Affairs (MCA) vide the order dated 20.06.2018 in exercise of its powers conferred under Section 212(1)(c) of the Companies Act, 2013 and Section 43(2) and (3)(c)(i) of Limited ....
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.... could not be a member of a multistate credit cooperative society and therefore loans could not have been given to such companies by the ACCSL. It is further alleged that total amount of Rs.4120 crores were the outstanding balance as on 31.03.2018 against such illegal loans given by the ACCSL. (v) It is also further alleged by the SFIO that the illegal loans obtained from ACCSL by the Companies belonging to Adarsh Group and Ridhi Sidhi Group were on the basis of forged financial/loan documents submitted/signed by the directors of the Companies belonging to the Adarsh Group. The said directors had siphoned off the said funds/loans obtained from the ACCSL in connivance of the other accused. The directors had signed off balance sheets of the companies showing the said funds obtained ACCSL as "loans taken from a financial institution". (vi) The Special Court vide the detailed Order dated 03.06.2019 took the cognizance of all the offences alleged against the accused including the respondents, under the Companies Act and under the IPC, and summoned all the accused including the respondents herein by issuing bailable warrants in the sum of Rs.10,000/- with one surety in ....
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.... Page 619 of the concerned SLP] Denied by Special Court (23.09.2019) [Annexure P5, Page 483 the of the concerned SLP] Granted by High Court (29.03.2023) CRM-M- 43219/2019 (IMPUGNED) Ss. 447, 448 [Annexure P5, Page 483 of the concerned SLP] 3 SFIO vs. Nazima Khan, SLP (Crl.) No. 15318/20 23) 5 BW 03.06.2019 30.07.2019 04.09.2019 03.10.2019 19.10.2019 [Annexure P13, Page 629 of the concerned SLP] 8 NBW 02.11.2019 22.11,2019 17.12.2019 31.01.2019 24.09.2020 15.01.2021 19.02.2021 04.08.2021 08.09.2021 [Annexure P13, Page 629 of the concerned SLP] Pro. Order (25.03.2022) [Annexure P13, Page 629 of the concerned SLP] Denied by Special Court (11.05.2022) [Annexure P15, Page 651 of concerned SLP] Granted by High Court (29.03.2023) CRM-M- 25052/2022 (IMPUGNED) S. 447 [Annexure P15, Page 651 of the concerned SLP] 4 SFIO Vs. Shinder Pal Singh & Gurbir Singh, SLP(Crl.) 15322/20 23 2 BW 03.06.2019 30.07.2019 [Annexure P14, ....
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....020 24.09.2020 15.01.2021 19.02.2021 04.08.2021 08.09.2021 [Annexure P15, Page 593 of the concerned SLP Pro.Order (25.03.2019) [Annexure P15, Page 593 of the concerned SLP] Denied by Special Court (15.11.2019) [Annexure P6, Page 493 of the concerned SLP] Granted by High Court (29.03.2023) CRM-M- 51929/2019 (IMPUGNED) S. 447 [Annexure P6, Page 494 of the concerned SLP 8 SFIO Vs. Shyam Bihari Gupta, SLP (Crl.) No. 14128/20 23 2 BW 03.06.2019 30.07.2019 [Annexure P14, Page 629 of the concerned SLP] 5 NBW 24.09.2020 15.01.2021 19.02.2021 04.08.2021 08.09.2021 [Annexure P14, Page 629 of the concerned SLP] Pro.Order (25.03.2022) [Annexure P14, Page 629 of the concerned SLP] Denied by Special Court (20.08.2020) [Annexure P7, Page 494 of the concerned SLP] Granted by High Court (29.03.2023) CRM-M- 17096/2022 (IMPUGNED) S. 447 [Annexure P7, Page 502 of the concerned SLP] 9 SFIO vs. Naveen Choudha ry, SLP (Crl.) No. 13965/20 2....
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....ditya Sarda] 5 NBW 24.09.2020 15.01.2021 19.02.2021 04.08.2021 08.09.2021 [Annexure P17, Page 713 of Main SLP i.e., Aditya Sarda] Pro.Order (25.03.2022) [Annexure P17, Page 714 of Main SLP i.e., Aditya Sarda] Denied by Special Court (20.08.2020) [Annexure P7 of the concerned SLP] Granted by High Court (29.03.2023) CRM-M- 242999/2022 (IMPUGNED) Ss 447/448/76A (@ Page 498 Annexure P7 of the concerned SLP) 13 SFIO vs. Jinendra Vyas, SLP (Crl.) No. 13971/20 23 2 BW 03.06.2019 30.07.2019 [Annexure P17, Page 686 of Main SLP i.e., Aditya Sarda] 12 NBW 24.09.2019 03.10.2019 19.10.2019 02.11.2019 22.11.2019 17.12.2019 31.01.2020 24.09.2020 15.01.2021 19.02.2021 04.08.2021 08.09.2021 [Annexure P17, Page 686 of Main SLP i.e., Aditya Sarda] Pro.Order (25.03.2022) [Annexure P17, Page 687 of Main SLP i.e., Aditya Sarda] Denied by Special Court (24.09.2020) [Annexure P5 of the concerned SLP] Granted by High Court (29.03.2023) CRM-M- 31742/2....
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....) [Annexure P13, Page 561 of the concerned SLP] Denied by Special Court (25.05.2022) [Annexure P14, Page 94 of the concerned SLP] Granted by High Court (29.03.2023) CRM-M- 25516/2022 (IMPUGNED) Naveen Ss 447/6A [Annexure P18, Page 826 of the concerned SLP] 16 SFIO vs. Paras Bolia, SLP (Crl.) No. 13978/20 23 2 BW 03.06.2019 30.07.2019 [ Annexure P16, Page 651 of the concerned SLP] 9 NBW 04.09.2019 03.10.2019 19.10.2019 02.11.2019 24.09.2020 15.01.2021 19.02.2021 04.08.2021 08.09.2021 [Annexure P16, Page 651 of the concerned SLP] Pro.Order (25.03.2022) [Annexure P16, Page 651 of the concerned SLP] Denied by Special Court (08.07.2020) [Annexure P8, Page 555 of the concerned SLP] Granted by High Court (29.03.2023) CRM-M- 25412/2020 (IMPUGNED) S. 447 [Annexure P14, Page 594 of concerned SLP] 5. If the individual cases of the respondents are taken into consideration, the following facts have emerged as transpiring from the chart tabulated hereinabov....
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....ation proceedings were initiated against him by the Special Court. His anticipatory bail was rejected by the Special Court vide the order dated 02.07.2020 and he was granted anticipatory bail by the High Court vide the order dated 29.03.2023, which is impugned herein. (vii) In case of the respondent Nitin Rathore (Accused No.116), the non-bailable warrants issued against him were received back unexecuted with the report that he had left the house at the given address. His anticipatory bail was rejected by the Special Court vide the order dated 15.11.2019 and he was granted anticipatory bail by the High Court vide the order dated 29.03.2023, which is impugned herein. (viii) In case of Shyam Bihari Gupta (Accused No.165), the non-bailable warrants issued against him were received back unexecuted with the report that as per the gardener in his house, he was not available at home. His anticipatory bail was rejected by the Special Court vide the order dated 20.08.2020 and he was granted anticipatory bail by the High Court vide the order dated 29.03.2023, which is impugned herein. (ix) In case of the respondent Naveen Choudhary (Accused No. 162), the non-bailab....
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....is second anticipatory bail application was granted by the Special Court vide the order dated 20.07.2022. It appears that a Petition seeking cancellation of his bail was rejected by the High Court vide the order dated 20.03.2023 which is impugned herein. Similarly, in case of the respondent Naveen Kumar (Accused No. 139), the nonbailable warrants issued against him were received back unexecuted with the report that no such person resided at the given address. However, it appears that his anticipatory bail application was granted by the Special Court vide the order dated 19.07.2022 and the High Court rejected the Petition filed by the SFIO seeking cancellation of his bail, vide the order dated 20.03.2023, which is impugned herein. (xv) In case of the respondent Prakash Chandra Purohit (Accused No.133), the non-bailable warrants issued against him were received back unexecuted with the report that the house was locked since long. His anticipatory bail application was rejected by the Special Court vide the order dated 25.05.2022 and he was granted anticipatory bail by the High Court vide the order dated 29.03.2023, which is impugned herein. (xvi) In case of the respondent Par....
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.... said respondents that the respondents were not aware of the complaint proceedings filed by the SFIO in the Special Court. There is no justification coming forth from the said respondents as to why after the rejection of their anticipatory bail applications by the Special Court, they did not appear before the Special Court and made themselves unavailable at the given addresses furnished by them during the course of the investigation by the SFIO. It may be noted that the anticipatory bail applications, of the said respondents were allowed by the High Court only in March-April 2023. Since, the said respondents had concealed themselves and avoided to remain present before the Special Court despite they having the knowledge about the pendency of the complaint proceedings, the Special Court was perfectly justified in initiating the proclamation proceedings against the said respondents. LEGAL PROVISIONS: 10. At this juncture, it would be beneficial to reproduce some of the provisions of the Companies Act as also the Code of Criminal Procedure. 11. Section 212 of the Companies Act, 2013 pertains to the "Investigation into the affairs of Company by Serious Fraud Investigation Offi....
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.... Punishment for fraud. - Without prejudice to any liability including repayment of any debt under this Actor any other law for the time being in force, any person who is found to be guilty of fraud, 1 [involving an amount of at least ten lakh rupees or one per cent. of the turnover of the company, whichever is lower] shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to ten years and shall also be liable to fine which shall not be less than the amount involved in the fraud, but which may extend to three times the amount involved in the fraud: Provided that where the fraud in question involves public interest, the term of imprisonment shall not be less than three years. Provided further that where the fraud involves an amount less than ten lakh rupees or one per cent. of the turnover of the company, whichever is lower, and does not involve public interest, any person guilty of such fraud shall be punishable with imprisonment for a term which may extend to five years or with fine which may extend to fifty lakh rupees or with both. Explanation. -For the purposes of this section- (i)....
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....ommitted 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; and that Court may, after taking into consideration, inter alia, the following factors, namely:- (i) the nature and gravity of the accusation.; (ii) the antecedents of the applicant including the fact as to whether he has previously undergone imprisonment on conviction by a Court in respect of any cognizable offence; (iii) the possibility of the applicant to flee from justice; and (iv) where the accusation has been made with the object of injuring or humiliating the applicant by having him so arrested, either reject the application forthwith or issue an interim order for the grant of anticipatory bail: Provided that, where the High Court or, as the case may be, the Court of Session, has not passed any interim order under this subsection or has rejected the application for grant of anticipatory bail, it shall be open to an officer in-charge of a police station to arrest, without warrant the applicant on the basis of th....
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....rests entirely in the discretion of the Court. Although, the discretion is exercised judicially, it is not possible to computerise and reduce into immutable formulae the diverse considerations on the basis of which this discretion is exercised. Broadly speaking, the court would take into account the various factors such as, the nature and seriousness of the offence, the character of the evidence, circumstances peculiar to the accused, possibility of his absconding, larger interest of the public and State. [See State v. Capt. Jagjit Singh, AIR 1962 SC 253 at p. 255, para 3.] 50 & 51.......... 52. Just as liberty is precious for an individual so is the interest of the society in maintaining law and order. Both are extremely important for the survival of a civilised society. Sometimes in the larger interest of the public and the State it becomes absolutely imperative to curtail freedom of an individual for a certain period, only then the non-bailable warrants should be issued. When non-bailable warrants should be issued 53. Non-bailable warrant should be issued to bring a person to court when summons or bailable warrants would be unlikely t....
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....of a provision for grant of anticipatory bail. It observed: 'We agree that this would be a useful advantage. Though we must add that it is in very exceptional cases that such power should be exercised.' In the light of this recommendation, Section 438 was incorporated, for the first time, in the Criminal Procedure Code of 1973. Looking to the cautious recommendation of the Law Commission, the power to grant anticipatory bail is conferred only on a Court of Session or the High Court. Also, anticipatory bail cannot be granted as a matter of right. It is essentially a statutory right conferred long after the coming into force of the Constitution. It cannot be considered as an essential ingredient of Article 21 of the Constitution. And its non-application to a certain special category of offences cannot be considered as violative of Article 21. ( emphasis supplied ) 72. We are conscious of the fact that the legislative intent behind the introduction of Section 438 CrPC 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 c....
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....4. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offences having deep-rooted conspiracies and involving huge loss of public funds need to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country. 35. While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations." 20. In Nimmagadda Prasad vs. Central Bureau of Investigation, (2013) 7 SCC 466 it was observed as under: - "23. Unfortunately, in the last few years, the country has been seeing an alarming rise in white-collar crimes, which has affected the fibre of the country's economic structure. Incontrovertibl....
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....mstances and that it may cause some hinderance to the normal flow of investigation method when called upon to exercise the power under Section 438, Cr.PC, courts must keep reminded of the position that law aides only the abiding and certainly not its resistant. By saying so, we mean that a person, having subjected to investigation on a serious offence and upon making out a case, is included in a charge sheet or even after filing of a refer report, later, in accordance with law, the Court issues a summons to a person, he is bound to submit himself to the authority of law. It only means that though he will still be at liberty, rather, in his right, to take recourse to the legal remedies available only in accordance with law, but not in its defiance. We will dilate this discussion with reference to the factual matrix of this case. However, we think that before dealing with the same, a small deviation to have a glance at the scope and application of the provisions under Section 82, Cr.PC will not be inappropriate. 11 to 24.............................. 25. We have already held that the power to grant anticipatory bail is an extraordinary power. Though in many cases it....
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....3CrPC by simply observing that "be that as it may". The aforesaid relevant aspect on grant of anticipatory bail ought not to have been ignored by the High Court and ought to have been considered by the High Court very seriously and not casually. 10.3..................................... 11. Thus, the High Court has committed an error in granting anticipatory bail to Respondent 2- accused ignoring the proceedings under Sections 82/83 CrPC." ANALYSIS : 23. In view of the above settled legal position, it is no more res integra that economic offences constitute a class apart, as they have deep rooted conspiracies involving huge loss of public funds, and therefore such offences need to be viewed seriously. They are considered as grave and serious offences affecting the economy of the country as a whole and thereby posing serious threats to the financial health of the country. The law aids only the abiding and certainly not its resistants. When after the investigation, a chargesheet is submitted in the court, or in a complaint case, summons or warrant is issued to the accused, he is bound to submit himself to the authority of law. If he is creating hindrances in t....
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....Kanhaiya Prasad, 2025 SCC Online SC 306 it has been observed by this Court that cryptic orders granting bail without adverting to the facts or the consideration of such restrictive conditions with regard to the bail are perverse and liable to be set aside. 26. Coming back to the facts of the present case, though the Special Court had taken cognizance of the alleged offences under the Companies Act including under Section 447 and other offences under the IPC, and even though the non-bailable warrants were issued from time to time against the Respondents, and even though the proclamation proceedings were initiated against them, the High Court has passed the impugned orders. The said Orders have been passed in utter disregard of the mandatory conditions contained in Section 212(6) of the Companies Act, and also ignoring the conduct of the respondents - accused. Such orders being in the teeth of the legal position settled by this Court, as also in the teeth of the Section 212(6) of Companies Act, would fall into the category of perverse orders and therefore untenable at law. 27. In none of the impugned orders, the High Court has bothered to look into the proceedings conducted, an....
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....person to the Court, when it is reasonable for the Court to believe that the person will not voluntarily appear in the Court or the police authorities are unable to find the person to serve him with a summons. There cannot be a strait jacket formula, as sought to be submitted by the learned advocates for the Respondents that the Court must first issue a summons even in case of a warrant case, irrespective of the gravity or seriousness of the offence. As well settled by now, whether the attendance of the accused can be best secured by issuing a bailable warrant or non-bailable warrant, would be a matter, which entirely rests at the discretion of the concerned Court. State of U.P. vs. Poosu (1976) 3 SCC 1 (Para-49) Although the discretion should be exercised judiciously, diverse considerations such as the nature and seriousness of the offence, the circumstances peculiar to the accused, possibility of his concealing or absconding, larger interest of public and state etc. also must be seriously considered by the court. 29. In the instant case, the Special Court considering the seriousness of the alleged offences had initially issued bailable warrants, however, the Respondents kept o....