Bombay High Court
Vijay V. Chowgule vs Chowgule And Company Pvt. Ltd.Thr. ... on 14 August, 2024
Author: M. S. Karnik
Bench: M. S. Karnik
2024:BHC-GOA:1340-DB 901-WPCR-630-24 (F) WITH CRMA-56-24 & 678-24 (F).DOC
2024:BHC-GOA:1340-DB
Suchitra
IN THE HIGH COURT OF BOMBAY AT GOA
CRIMINAL WRIT PETITION NO.630/2024 (F)
WITH
CRIMINAL MISC. APPLICATION NO.56/2024
WITH
CRIMINAL MISC. APPLICATION NO.678/2024 (F)
CHOWGULE AND COMPANY PVT. LTD.
hrough authorized representative Mr Harsh
Shah, aged 25 years, having address at
Chowgule House, Mormugao Harbour, Goa -
403803. ... PETITIONER
Versus
1. STATE OF GOA through
the Public Prosecutor, State of Goa.
Porvorim, Goa.
2. POLICE INSPECTOR,
Economic Ofences Cell, Goa.
3. UNION OF INDIA, through
Secretary Home, Ministry of
Home Afairs, New Delhi. ... RESPONDENTS
Mr. Rizwan Merchant, Advocate along with Mr. Gaurish Agni, Ms.
Ramiz Shaikh, Mr. Nihal Kamat, Mr. Gautam Panvelkar, Mr. Harshil
Gandhi and Mr Kishan Kavlekar, Advocates for the Petitioner and in
connected matters (CRMA 56/2024 and CRMA 678/24(F) for
Respondent No. 3.
Mr. Nikhil Vaze, Additional Public Prosecutor for the Respondent
Nos.1 and 2.
Mr. Pravin Faldessai, Deputy Solicitor General of India, for
Respondent No. 3.
Mr. Amit Desai, Senior Advocate along with Mr. Parag Rao, Mr. Gopal
Shenoi, Ms. Bulbul Sinch Rajpurohit, Mr. Prashant Asher and Mr.
Subhash Jadhav, Mr. Ajay Menon and Ms. Somya Drago, Advocates for
the Applicant- Intervernor in CRMA 56/2024.
Page 1 of 22
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Mr. Aabad Ponda, Senior Advocate with Mr. Shivan Desai, with Ms.
Tahira Menezes, Mr. V. Bhandankar and Mr. Subhash Jadhav,
Advocates for the Applicant-Intervenor in MCA(F) 1836/2024.
CORAM: M. S. KARNIK &
VALMIKI MENEZES, JJ.
DATE: 14th AUGUST 2024
JUDGMENT:
(Per M. S. Karnik)
1. Heard learned counsel for the parties.
2. By this petition under Article 226 of the Constitution of India, the
petitioner is seeking transfer of investigation of First Information Report
(FIR) No.01/2024 dated 14.06.2024 registered with the Economic
Ofences Cell, Goa (EOC) to the Central Bureau of Investigation (CBI).
he petitioner seeks a further direction to the CBI to conduct fair and
impartial investigation and submit report in a time-bound manner.
3. he basic facts leading to the registration of FIR are thus:
4. he Chowgule and Company Pvt Ltd is a lagship company of the
Chowgule Group established in 1965 for conducting mining and ship
building operations in India. he said group was established by the
members of Chowgule Family. On 04.10.2008, Mr. Vishwasrao Chowgule
passed away leaving behind the heirs of the Chowgule family extending
three generations.
5. In 2021, due to the numerous disputes, the family entered into
Memorandum of Family Settlement dated 11.01.2021. he settlement
contemplated splitting the family into two groups being Group A headed
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by Ms. Padma Chowgule and Group B headed by Mr. Vijay Chowgule.
he Companies and the assets of the Chowgule group were also divided
into Schedule C and Schedule D. he members of Group A were entitled
for the companies in Schedule C, whereas members of Group B were
entitled for the Companies in Schedule D.
6. he accused no.1 Vijay Chowgule was Director of the petitioner
company from 16.08.1974 to 12.01.2021 and Managing Director of the
petitioner Company from 01.01.1988 to 28.05.2019. he accused no.2
Pradip Mahatme was the principal inancial advisor from 1980 to 2020
and a director of the petitioner company from 14.02.1989 to 12.01.2021.
he accused no.3 Pratap Shirke is the brother of accused no.1 and
associated with the petitioner company through the accused no.1.
7. In the year 2009, Mr. Vijay Chowgule and Mr. Pradip Mahatme
proposed establishing as wholly owned subsidiary overseas being Rudra
Shipping and Trading Ltd representing it as a proitable business venture.
hey proposed creating a subsidiary in the country of Guernsey and
investing the petitioner's monies in Rudra for establishing the shipping
business. he said Rudra came to be incorporated in Guernsey on
31.07.2009 and a total sum of USD 128, 691, 536 was infused by the
petitioner company into Rudra Shipping and Trading Ltd. from
31.07.2009 to 22.04.2014 under instructions of Vijay Chowgule and
Pradip Mahatme. hese funds were unlawfully utilized to make
investments and provide loans to various entities, including those under
the control of Mr. Pratap Shirke.
8. he said Pratap Shirke owned and controlled various entities
including Pan Oceanic Bulk Carriers, Guernsey, ASP Ship Management
Singapore Pvt. Limited, Wadi Foundation, Natlata Holding Corporation
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("Natlata"), Quail Investments Limited ("Quail"), Bulmark Limited, Bay
Holdings (both companies incorporated in Guernsey), and Quail. hrough
these entities, the applicants and their associates executed numerous
transactions to launder the monies received from the petitioner disguising
the money trail and its ultimate beneiciaries.
9. Approximately USD 47 millions were advanced to Pratap Shirke
Company Pan Oceanic Bulk Carriers. However, none of the monies were
ever repaid. he security provided was not invoked and a signiicant
portion of the loan was written of or waived through board resolutions.
On 31.03.2017, an agreement to write of USD 10 million was executed
without addressing or enforcing the loans secured by Pan Gulf Group Ltd
under the consolidated loan agreement dated 25.10.2015. he remaining
amount of approximately USD 38 million was waived through a mere
board resolution.
10. Vijay Chowgule, Pradip Mahatme and Pratap Shirke made series of
misrepresentations to the board of petitioner company regarding the
utilization of the funds invested or lent through the petitioner company.
hey falsely assured the board that the monies were being used for
legitimate and proitable business activities. However, the investments
never generated the promised returns and were instead siphoned of under
the pretext that further investment was necessary to recover the initial
funds.
11. he audit conducted by Group A members revealed that about 40%
of the investments in Rudra were transferred as loans to Pan Oceanic Bulk
Carriers, ultimately beneiting Mr. Pratap Shirke. he audit uncovered that
the funds were further siphoned to ailiated entities obscuring the money
trail and ultimately enriching Mr. Pratap Shirke.
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12. All the accused as part of criminal conspiracy to siphon of monies of
the petitioner company established another company named Nilgiri. Rudra
contributed USD 8.675 million to Ross Chemical IV on behalf of Nilgiri's
subsidiary without disclosing this to the petitioner company's board.
Nilgiri was engaged in various inancial activities including acquiring shares
and providing loans without informing the petitioner resulting in wrongful
losses, impairments and undervalued sales of the company and its
subsidiaries.
13. he loans to Pan Oceanic Bulk Carriers totalling USD 47 million,
lacked proper documentation and commercial justiication indicating
malfeasance. he funds were transferred without adequate security or due
diligence, showing a deliberate intent to defraud the petitioner company.
14. he accused no.1, 2 and 3 manipulated the accounts of Niligiri to
facilitate its sale to Natlata Company owned by Pratap Shirke for a
nominal amount of USD 1 despite its considerable assets. Nilgiri‟s
involvement led to substantial wrongful gains for Pan Oceanic Bulk
Carriers at the expense of complainant and Rudra.
15. he accused no.1, 2 and 3 in collusion and criminal conspiracy with
accused no.4 to 6 engaged in a series of deceptive inancial transactions.
hey concealed their identities provided unsecured loans, misrepresented
vessel acquisitions and siphoned money for personal gain. he accused no.1
and 2 knowingly advanced large interest free loans though Rudra to
companies under the control of Pratap Shirke which were subsequently
written of without proper justiication.
16. he accused no.1, 2 and 3 orchestrated dubious transactions
involving Rudra, Pan Oceanic Bulk Carriers and ailiated entities to
beneit themselves through a complex structure. Funds were transferred
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from Rudra to Pan Oceanic Bulk Carriers some of which were diverted to
Folar, a Company owned by Bay Holdings with USD 500,000 remaining
unexplained with Pan Oceanic Bulk Carriers.
17. he accused no.1 deliberately and wilfully used family funds from
Liechtenstein to purchase a property in New York in his daughter's name
demonstrating a pattern of moving large sums of money to ofshore entities
without remitting them back to the original source.
18. All the accused and their known and unknown associates,
orchestrated a series of deliberate and fraudulent actions, including
disseminating false representations to the petitioner's board to secure
endorsement and inancial backing for Rudra. he accused falsiied
accounts concerning fund utilization, vessel quantiications and valuations
misleading the petitioner's board. he FIR came to be registered.
19. Mr Rizwan Merchant, learned counsel for the petitioner submitted
that having regard to the manner in which the application for anticipatory
bail iled by the accused persons is handled by the investigating oicer
(IO), free and impartial investigation by the IO can never be expected and
hence this is a it case for transfer of investigation to CBI. Mr Merchant
submitted that the FIR was registered after a delay of two months from the
date when the petitioner had irst made a complaint to the IO. Even after
registration of FIR on 14.06.2024, it is the submission of the learned
counsel for the petitioner, that there has been no progress in the
investigation. he submission is that the accused have siphoned the money
in a very systematic manner to the detriment of the petitioner. he
documents which constitute materials required for investigation for
proving the ofence are mainly in the custody of the main accused who is
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residing abroad and the entire money trail has to be traced in a foreign
country.
20. Mr Merchant further submitted that the EOC, Goa is not
adequately stafed to investigate a crime of such magnitude. Learned
counsel urged that the investigation into the crime is of a complex nature.
he EOC, Goa does not have the necessary infrastructure to investigate
into such a complex crime. It is submitted that the investigation has to
proceed in a scientiic manner upon understanding the intricacies of the
modus adopted by the accused persons and it is here that the Investigating
Oicer (IO), according to the learned counsel, may lack the necessary
expertise in investigating the crime of such a nature. It is moreover
submitted that the nature of transactions have an international ramiication
and therefore it is only the CBI which is competent and equipped with the
necessary wherewithal to investigate and submit report. It is further
submitted, assuming without admitting that the IO is competent to
investigate, even then the investigation has to pass through various stages
which involve making necessary applications before the competent Court,
issuance of Letter Rogatories and considering the mutual arrangements
between the India and the country where the ofence is committed, it is
ultimately for the CBI to look into the matter; as this will be a long-drawn
process causing serious prejudice to the petitioner; instead, at this stage
itself the investigation be transferred to the CBI.
21. It is further submitted that the petitioner had iled civil proceedings
before the Foreign Court which came to be discontinued pursuant to a
Consent Order dated 25.03.2024 passed by the Foreign Court, whereafter
the complaint came to be lodged with the EOC, Goa. It is submitted that
as the petitioner is not in possession of any documents which obviously are
in the custody of the accused, the petitioner could not efectively pursue
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the matter before the Foreign Court. he submission is that the IO is
expected to collect all documents which are required for the process of
efective investigation, for it is only then that the petitioner can efectively
resort to civil remedies as well, as its claim is based on such documents. It is
submitted that it is not possible for the IO with the limited resources
available to retrieve such documents and hence, the said task can only be
efectively performed by the CBI, for which the investigation has to be
transferred to the CBI.
22. hough not part of the petition, Mr Merchant produced on record
copy of the letter dated 10.08.2024 addressed by the petitioner to the
Director General of Police, Panaji, Goa complaining about the
unprecedented and belated methods of investigation being adopted by the
IO in complete departure to the statutory procedure provided under the
Code of Criminal Procedure and/or he Bharatiya Nagarik Suraksha
Sanhita, 2023 (BNSS) for the purpose of investigation of the above FIR. It
is submitted that such complaint was made during the pendency of this
petition. Learned counsel for the petitioner submitted that a reading of
this complaint dated 10.08.2024 would indicate that the conduct of the
IO who is supposed to be in-charge of free, fair and impartial investigation
into the ofences is totally unbecoming of a police oicer. It is mentioned
that the IO questioned the need for approaching the EOC, Goa, if the
petitioner was interested in investigation to be done by the CBI. In the
complaint it is further mentioned that the IO having totally neglected and
ignored investigating in such a case involving international ramiications,
had no authority to question the registration of FIR by the EOC, Goa.
23. It is submitted that the IO took least interest in objecting to the
Anticipatory Bail Application iled by the accused persons as even the
observations of the learned Sessions Judge would reveal. Reliance is placed
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on the following decisions in support of the submissions that this is a it
case for exercising the extra-ordinary power of this Court when exceptional
circumstances exist warranting transfer to the CBI.
1. Rhea Chakraborty v State of Bihar & Ors [(2020) 20 SCC
184]
2. Arnab Ranjan Goswami v. Union of India, (2020) 14 SCC 12
3. K.V. Rajendran v. CBCID (2013) 12 SCC 480
4. Bharati Tamang vs Union of India (2013) 15 SCC 578
5. Narmadabai v State of Gujarat & Ors [(2011) 5 SCC 79]
6. Rubabbuddin Sheikh v. State of Gujarat [(2010) 2 SCC 200]
7. State of W.B. v. Committee for Protection of Democratic
Rights (2010) 3 SCC 571
8. Sri Bhagwan Vallabha Samardha Venkata Maharaj v. State of
A.P. (1999) 5 SCC 740 Sreepada Vishwanandha
9. E. Sivakumar v. Union of India (2018) 7 SCC 365
10. Dhananjay Kumar v State of Chhattisgarh & Ors. [Criminal
24. Mr Nikhil Vaze, learned Additional Public Prosecutor (APP)
appearing on behalf of the State opposed the petition. He invited our
attention to the aidavit in reply iled by the IO. It is submitted that the
complaint was received by EOC on 10.05.2024. he complainant was
asked to remain present for further inquiry into his complaint on
16.05.2024 at 16.00 hrs. for discussion and better understanding since the
complaint was massive in nature and voluminous in documents. he
complainant however did not turn up. On behalf of the complainant it was
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informed that he is not in Goa. Learned APP submitted that the FIR was
registered on 14.06.2024. It is submitted that the IO needs cooperation
from the complainant and is always willing to record the statement of
complainant and those who would throw light on the allegations made in
the complaint. Learned APP submitted that the EOC is a specialized unit
and conducting investigation of non-banking inancial cases and cases
which are directed by the higher authorities. It is submitted that there are
36 criminal cases which are pending with EOC Police Station and 15
diferent high proile and technical cases are investigated by the EOC
Police Station.
25. Learned APP submitted that there is a valid explanation in paragraph
8 of the aidavit in reply as to why the IO could not ile the Say before the
Sessions Court. Learned APP submitted that the matter is of a highly
complex nature involving inancial crimes having cross-border
ramiications which are partly committed in tax-haven countries of
Guernsey, Lichtenstein, Panama, etc. and proceeds of crime have
ultimately found its way to several countries and bulky in nature. It is
submitted that considering the complex nature of the investigation and
despite the complainant not cooperating, every possible efort is being
made to investigate into the FIR and that the investigation will be
conducted in a free, fair and impartial manner.
26. he rival contentions now fall for our determination.
27. Before considering the rival claims, we ind it necessary to
understand the principles laid down by the Hon'ble Supreme Court for
transfer of investigation to the CBI. he Hon'ble Supreme Court in para
42 of the decision in Arnab Ranjan Goswami (supra) held that the transfer
of investigation to CBI is not a matter of routine. he Supreme Court
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emphasised that this is an "extraordinary power" to be used "sparingly" and
"in exceptional circumstances". Para 42, 43, 44, 45, 47 and 52 are relevant
and are quoted below for convenience of reference:
"42. he transfer of an investigation to CBI is not a matter of
routine. he precedents of this Court emphasise that this is an
"extraordinary power" to be used "sparingly" and "in exceptional
circumstances". Speaking for a Constitution Bench in State of W.B.
v. Committee for Protection of Democratic Rights ("CPDR, West
Bengal"), D.K. Jain, J. observed: (SCC p. 602, para 70)
"70. ... despite wide powers conferred by Articles 32 and 226
of the Constitution, while passing any order, the courts must
bear in mind certain self-imposed limitations on the exercise of
these constitutional powers. he very plenitude of the power
under the said articles requires great caution in its exercise.
Insofar as the question of issuing a direction to CBI to conduct
investigation in a case is concerned, although no inlexible
guidelines can be laid down to decide whether or not such
power should be exercised but time and again it has been
reiterated that such an order is not to be passed as a matter of
routine or merely because a party has levelled some allegations
against the local police. his extraordinary power must be
exercised sparingly, cautiously and in exceptional situations
where it becomes necessary to provide credibility and instil
conidence in investigations or where the incident may have
national and international ramiications or where such an
order may be necessary for doing complete justice and
enforcing the fundamental rights. Otherwise CBI would be
looded with a large number of cases and with limited
resources, may ind it diicult to properly investigate even
serious cases and in the process lose its credibility and purpose
with unsatisfactory investigations."
(emphasis supplied)
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43. his principle has been reiterated in K.V. Rajendran v. CBCID
Dr B.S. Chauhan, J. speaking for a three-Judge Bench of this Court
held: (SCC p. 485, para 13)
"13. his Court has time and again dealt with the issue under
what circumstances the investigation can be transferred from
the State investigating agency to any other independent
investigating agency like CBI. It has been held that the power
of transferring such investigation must be in rare and
exceptional cases where the court inds it necessary in order to
do justice between the parties and to instil conidence in the
public mind, or where investigation by the State police lacks
credibility and it is necessary for having "a fair, honest and
complete investigation", and particularly, when it is imperative
to retain public conidence in the impartial working of the
State agencies.
44. Elaborating on this principle, this Court observed: (K.V.
Rajendran case 16, SCC p. 487, para 17)
"17. the Court could exercise its constitutional powers for
transferring an investigation from the State investigating
agency to any other independent investigating agency like CBI
only in rare and exceptional cases. Such as where high oicials
of State authorities are involved, or the accusation itself is
against the top oicials of the investigating agency thereby
allowing them to inluence the investigation, and further that
it is so necessary to do justice and to instil conidence in the
investigation or where the investigation is prima facie found to
be tainted/ biased."
he Court reiterated that an investigation may be transferred to CBI
only in "rare and exceptional cases". One factor that courts may
consider is that such transfer is "imperative" to retain "public
conidence in the impartial working of the State agencies". his
observation must be read with the observations by the Constitution
Bench in CPDR15, that mere allegations against the police do not
constitute a suicient basis to transfer the investigation.
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45. In Romila hapar v. Union of India, A.M. Khanwilkar, J.
speaking for a three-Judge Bench of this Court (one of us, Dr D.Y.
Chandrachud, J. dissenting) noted the dictum in a line of precedents
laying down the principle that the accused "does not have a say in
the matter of appointment of investigating agency". In reiterating
this principle, this Court relied upon its earlier decisions in Narmada
Bai v. State of Gujarat, Sanjiv Rajendra Bhatt v. Union of India, E.
Sivakumar v. Union of India and Divine Retreat Centre v. State of
Kerala, this Court observed: (Romila hapar case 17, SCC p. 776,
para 30)
"30. ... the consistent view of this Court is that the accused
cannot ask for changing the investigating agency or to do
investigation in a particular manner including for court-
monitored investigation."
47. As we have observed earlier, the petitioner requested for and
consented to the transfer of the investigation of the FIR from Police
Station Sadar, District Nagpur City to N.M. Joshi Marg Police
Station in Mumbai. He did so because an earlier FIR lodged by him
at that police station was under investigation. he petitioner now
seeks to pre-empt an investigation by Mumbai Police. he basis on
which the petitioner seeks to achieve this is untenable. An accused
person does not have a choice in regard to the mode or manner in
which the investigation should be carried out or in regard to the
investigating agency. he line of interrogation either of the petitioner
or of the CFO cannot be controlled or dictated by the persons under
investigation/interrogation. In P. Chidambaram v. Directorate of
Enforcement, R. Banumathi, J. speaking for a two-Judge Bench of
this Court held that: (SCC p. 56, para 66)
"66. there is a well-deined and demarcated function in the
ield of investigation and its subsequent adjudication. It is not
the function of the court to monitor the investigation process
so long as the investigation does not violate any provision of
law. It must be left to the discretion of the investigating agency
to decide the course of investigation. If the court is to interfere
in each and every stage of the investigation and the
interrogation of the accused, it would afect the normal course
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of investigation. It must be left to the investigating agency to
proceed in its own manner in interrogation of the accused,
nature of questions put to him and the manner of
interrogation of the accused."
(emphasis supplied)
his Court held that so long as the investigation does not violate any
provision of law, the investigating agency is vested with the
discretion in directing the course of investigation, which includes
determining the nature of the questions and the manner of
interrogation. In adopting this view, this Court relied upon its earlier
decisions in State of Bihar v. P.P. Sharma and Dukhishyam
Benupani v. Arun Kumar Bajoria in which it was held that the
investigating agency is entitled to decide "the venue, the timings and
the questions and the manner of putting such questions" during the
course of the investigation."
28. he principles which need to be followed by this Court in the
exercise of its extraordinary jurisdiction under Article 226 of the
Constitution of India are by now well settled. his Court in the exercise of
its power of judicial review can in exceptional circumstances exercise its
extraordinary power to transfer the investigation. he power has to be
exercised with great caution. he same cannot be exercised routinely or
merely because a party has levelled some allegations against the local police.
his extraordinary power must be used sparingly, cautiously and in
exceptional situations where it becomes necessary to provide credibility and
instil conidence in investigations or where the incident may have national
and international ramiications or where such an order may be necessary
for enforcing the fundamental rights. he Supreme Court has cautioned
that if the power to transfer is exercised in routine manner, the CBI would
be looded with large number of cases and with limited resources, may ind
it diicult to properly investigate even serious cases and in the process lose
its credibility and purpose with unsatisfactory investigations.
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29. In the present case, we have perused the order dated 09.11.2023
passed by the Foreign Court as well as the Consent Order dated
25.03.2024 discontinuing the proceedings which the claimant (petitioner)
had initiated against the accused in the Foreign Court. hough the learned
counsel for the petitioner extensively argued on the merits of the rival
claims, we refrain from making any observations as the investigation is in
progress. Suice it to observe at this juncture that there is ongoing feud
between two rival camps of the Chowgule family in India. he camp to
which the petitioners belong allege that the accused were guilty of
masterminding a massive US$128 million fraud on the petitioner's
companies before the Foreign Court. he accused, before the foreign
Court, denied any fraudulent dealing and maintained that the claim was
made before the Foreign Court which was only an attempt to exert
pressure in the context of the family dispute. hus, the FIR is lodged as a
result of the outcome of the family dispute.
30. Upon perusing the aidavit in reply iled by the IO, it is not possible
for us to form an opinion that the EOC, Goa does not have necessary
infrastructure or wherewithal to investigate into the ofences. he EOC is a
specialized unit and conducting investigation of non-banking inancial
cases and cases which are directed by the higher authorities. here are 36
criminal cases which are pending with EOC Police Station and 15 diferent
high proile and technical cases are investigated by the EOC Police Station.
We ind that the claim made by the petitioners before the Foreign Court
was discontinued by the claimants (petitioners herein) in view of the terms
mentioned in the Consent Terms. After the proceedings before the
Foreign Court was disposed of on 25.03.2024 in the light of the Consent
Terms, that the complaint dated 08.04.2024 was iled before the EOC,
Goa. Even according to the petitioner the investigation is of a complex
nature. It is petitioner's case that one of the accused is a foreign national
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and the major part of the crime is committed abroad. It is the petitioner's
own case that the documents which would show the complicity of the
accused persons have to be retrieved/recovered from foreign country/s as
the monies which have been siphoned of are parked in tax-haven countries
of Guernsey, Lichtenstein, Panama, etc.
31. Looking at the very complexity of the crime, after inquiring into the
complaint, the FIR was registered on 14.06.2024. his petition was iled
for transfer of the investigation to the CBI on 19.07.2024. he stand of
the learned APP on instructions of the IO who was present in the Court is
that they are serious in proceeding with the investigation. He submitted
that the IO is in the process of calling all the concerned persons whose
presence is necessary in connection with the investigation. Learned APP
submitted that the complainant must cooperate, as during the course of the
inquiry prior to the lodging of FIR, there was no cooperation extended by
the complainant. he aidavit in reply dated 08.08.2024 iled by the IO
relects that the present case is of a highly complex nature. his is as well
the case of the petitioner. In fact, learned counsel for the petitioner
submitted that the complexity of the investigation involves retrieving large
number of documents from foreign countries which will show the money
trail in respect of the proceeds of the crime.
32. It is the stand of the IO in the aidavit in reply iled, that the
following investigation is to be conducted and hence the complainant's
interaction and availability is valued in this case:
"a) To collect order of the accused Mr. Pradip Mahatme as Principal
Financial Advisor to CCPL.
b) To collect service report from 1980 to 2020 engaged by accused
Mr. Pradip Mahatme to CCPL as inancial and tax consultant.
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c) To collect order of the accused Mr. Pradip Mahatme as Board
Director to CCPL from 14/02/1989 to 12/01/2021.
d) To investigate role of entity called Pan Oceanic Bank Carriers
(UK) Limited.
e) To investigate loan advanced to other entities by "Rudra
company.
f) To investigate documents of write of of loan advanced by CCPL
to Rudra.
g) To investigate loan 47 million advanced to POBC by Rudra.
h) To investigate USD 4.40 million siphoned of to Accused Mr.
Pratap Shirke.
i) To investigate numerous transactions to launder the monies
received from Petitioner Company, disguising the money trail and its
ultimate beneiciaries.
j) To investigate transaction of approximately USD 47 Million
advanced to Mr Pratap Shirke Company Pan Oceanic Bulk Carriers.
k) To investigate portion of loan which was written of or waived
through board resolution.
l) To investigate regarding agreement date 31.03,2017 to write of
USD 10 million by Pan Gulf Group Ltd without any security under
the consolidated loan agreement dated 25.10.2015.
m) To investigate remaining USD 38 million waived of through
Board resolution.
n) To investigate audit report conducted by the CCPL.
o) To investigate funds which siphoned to ailiated entities,
obscuring the money trail to accused person.
p) To investigate role of Nilgiri Company established by the accused
persons.
q) To investigate investment of USD 8.675 Million which was
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contributed by Rudra Company to Ross Chemical IV on behalf of
Nilgiri without disclosing and transferred from Rudra to Pan
Oceanic Bulk Carries.
r) To investigate funds from Liechtenstein which was used to
purchase a property in New York in the name of Accused daughter
Deepa Chowgule.
s) To investigate suit for recovery of the siphoned funds which was
iled by the complainant against accused person before the Court of
England.
t) To investigate the role of the known and unknown associates of
the main accused persons in the commission of ofence.
u) To investigate use of overseas entities, bank accounts and shell
companies owned and operated by accused persons for the purpose
of siphoning funds taken overseas under the garb of seed capital."
33. It is the stand of the IO that the EOC is conducting a free, fair and
impartial investigation for justice to the complainant and to the Company
and there is no lackadaisical and perfunctory approach towards the
investigation. It is submitted that every efort and hard work is being put
in to take the investigation towards the logical conclusion. Learned APP
on instructions from the IO who is present in the Court has assured that
the IO is making every possible efort in carrying out the investigation
which will be taken to its logical end in accordance with law in a free, fair
and impartial manner.
34. Undoubtedly, the petitioner is entitled to a free and fair investigation
into the FIR that is lodged on the basis of the complaint made. he FIR is
an outcome of a family dispute regarding siphoning of funds by some of
the family members (accused) who were managing the afairs of the
Company. he civil proceedings before the Foreign Court were
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discontinued apparently at the behest of the petitioner Company as can be
seen from the Consent Order dated 25.03.2024. It is after the Consent
Order of the Foreign Court that the complaint came to be made on the
basis of which the FIR is registered.
35. his petition is iled for transferring the investigation to the CBI
within a month and ive days of lodging of the FIR. In our opinion,
considering the complex nature of the accusations and the voluminous
documents which the IO has to deal with, it is diicult to form any
opinion that the delay or the inaction in conducting the investigation is
deliberate and/or intentional. Likewise, it is not possible for us to form an
opinion that the delay of two months by the EOC, Goa in registering the
FIR is deliberate. he grievance of the petitioner is that before the Foreign
Court they could not present their case efectively for lack of documents
which are in possession of the accused. he petitioner wants the CBI to
investigate so that the documents pertaining to the proceeds of the crime
indicating the money trail can be retrieved expeditiously without
unnecessary delay which will enable the petitioner to efectively explore
civil remedies against the accused persons for recovery of money and
damages.
36. We are afraid that it is not possible for us to form any opinion that
the EOC, Goa does not have the suicient wherewithal or infrastructure to
investigate into the ofences. Furthermore, there is a procedure established
by law after registration of the FIR and the same cannot be bypassed only
because it will help the petitioner speed up and expedite their claim for
recovery of money or damages in civil proceedings after the documents are
made available. he investigation is in progress. he IO has assured that
the investigation will be proceeded in a fair and impartial manner. here is
nothing on record to doubt the statement of the IO. he complex nature
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of the ofence is a factor because of which the investigation is taking some
time, but that by itself is not suicient, according to us, to infer that the IO
is not competent to carry out the investigation or for that matter the
investigation will not proceed in a free and impartial manner. Merely
because at some stage according to the learned counsel for the petitioner,
the CBI will come into picture considering the major part of the ofence is
committed abroad, will not be a ground in the facts of the present case to
circumvent the procedure established by law and hand over the
investigation to the CBI, and that too in a family dispute. It is always open
for the petitioner to invoke remedies under the Criminal Procedure Code
if there is any grievance about the investigation.
37. According to us, this is not an exceptional case where the
extraordinary power to transfer the investigation to the CBI should be
exercised by this Court. he transfer to the CBI cannot be in a routine
manner merely because the petitioner feels that the CBI is better suited to
investigate the ofences. he CBI is already looded with the large number
of cases. It is the stand of the IO that the complainant is not cooperating.
he observations of the learned Sessions Judge in the Application for
Anticipatory Bail is at an interlocutory stage in the course of hearing of an
anticipatory bail application. he explanation tendered by the IO is for the
learned Sessions Judge to consider and it is not possible for us to form an
opinion about the conduct of the IO based on such observations made at
an interlocutory stage.
38. he petitioner has already made a grievance vide its letter dated
10.08.2024 to the Director General of Police, Goa about the
unprecedented and belated methods of investigation being adopted by the
IO in complete departure to the statutory procedure provided by the
Criminal Procedure Code. he investigation is in progress and we ind
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that there are no materials to form an opinion that a free, fair and impartial
investigation will be a casualty in the present case. he IO has assured that
immediate steps are being taken to record statement of the complainant as
well as those concerned required for the purpose of investigation into the
FIR with reasonable dispatch.
39. As a complaint has already been made during the pendency of this
petition about the conduct of the IO to the Director General of Police,
Goa, it is for the Director General of Police to look into the complaint. At
this stage we do not ind any merit in this petition or that a case is made
out for exercise of extraordinary power to transfer the case to the CBI. As
is well settled this extraordinary power to transfer must be exercised
sparingly and cautiously and only in exceptional situations where it
becomes necessary to provide credibility and instil conidence in
investigations. hough much has been argued by the learned counsel for
the petitioner that the present case is having international ramiications, it
needs to be borne in mind that the FIR is an outcome of a family dispute
which was registered after the discontinuance of the civil proceedings
before the Foreign Court by the petitioner. he submissions of learned
counsel for the petitioner as to the international ramiications therefore will
have to be considered in this light of the matter and do not aford a reason
enough to transfer the investigation to CBI.
40. Taking an overall view of the matter and after considering all the
rival contentions, considering that the investigation is at a preliminary
stage, presently it is not possible for us to form an opinion that the
investigation will not be carried out in a free, fair and impartial manner or
that on the ground of international ramiications the case needs to be
transferred.
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41. he petition is dismissed.
42. It was not necessary to hear the learned Senior Advocates appearing
on behalf of the intervenors as we were satisied with the submissions of the
learned APP. One of the objections raised by the learned counsel for the
petitioner was that the intervention applications are not maintainable. It is
made clear that we have not gone into the maintainability of the
intervention applications. he intervention applications no.678/2024 (F)
and No.56/2024 are disposed of.
VALMIKI MENEZES, J. M. S. KARNIK, J.
14th August, 2024
