Delhi High Court
Naresh Garg vs State (Govt. Of Nct Of Delhi) on 25 April, 2023
Neutral Citation Number: 2023:DHC:2771
$~1 & 2
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 17thFebruary, 2023
Decided on: 25th April, 2023
+ BAIL APPLN. 1696/2022
NARESH GARG .....PETITIONER
Through: Mr. Ramesh Gupta, Senior
Advocate with Mr. Vikas
Arora, Ms. Radhika Arora,
Mr. Mohit Dagar,
Mr. Siddharth Singh and
Mr. Abhay Sachar,
Advocates.
V
STATE (GOVT. OF NCT OF DELHI)
.....RESPONDENT
Through: Mr. Raghuvinder Varma,
APP for State with Insp.
Sandeep Kumar, P.S. Vasant
Vihar.
Ms. Rebecca John, Senior
Advocate with Mr. Kanay
Pisal, Ms. Anushka
Baruah and Mr. Rudraksh,
Advocates for complainants.
+ BAIL APPLN. 1697/2022
NIRMALA AGGARWAL .....PETITIONER
Through: Mr. Ramesh Gupta, Senior
Advocate with Mr. Vikas
Arora, Ms. Radhika Arora,
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Mr. Mohit Dagar,
Mr. Siddharth Singh and
Mr. Abhay Sachar,
Advocates.
V
STATE (GOVT. OF NCT OF DELHI)
.....RESPONDENT
Through: Mr. Raghuvinder Varma,
APP for State with Insp.
Sandeep Kumar, P.S. Vasant
Vihar.
Ms. Rebecca John, Senior
Advocate with Mr. Kanay
Pisal, Ms. Anushka Baruah
and Mr. Rudraksh,
Advocates for complainants.
CORAM
HON'BLE MR. JUSTICE SUDHIR KUMAR JAIN
JUDGMENT
1. The present common order shall decide two bail applications
bearing no.1696/2022 and 1697/2022 filed by the applicants Naresh
Garg and Nirmala Aggarwal respectively under section 438 of the
Code of Criminal Procedure, 1973 (hereinafter referred to as "the
Code") for grant of anticipatory bail in FIR bearing no. 445/2020
dated 16.06.2020 registered under sections 420/468/471/34 of the
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Indian Penal Code, 1806 (hereinafter referred to as "IPC") at P.S
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
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no.10), Roohi Reshi (the accused no.11), Skyline Financial Services
(the accused no.12), Swaroop Narain Agarwal (the accused no.13)
and other unknown persons were implicated.
2.1 The complainant alleged that he is owner of 62,500 equity shares
of the accused no.1which were transferred on 10.05.2016 in favour of
the applicant no.2 who never purchased these shares from the
complainant. The complainant further alleged that 50 equity shares
alleged to be owned by Sanjay Prasad Jain (the accused no.9) were
transferred on 14.10.2017 in his favour which he never purchased
from Sanjay Prasad Jain; 100 equity shares stated to be owned by
Kavita Bhulani (the accused no.10) were transferred on 30.12.2017 in
favour of his wife namely Preet Kaur and his wife never purchased
these shares; and 300 shares owned by the complainant were
transferred on 30.12.2017 in favour of Roohi Reshi (the accused
no.11) who never purchased these shares from the complainant.
2.2 The accused no.1 is a Listed Limited Company registered under
the Companies Act 1956, (CIN L65910DL 1990PLC040705) and
presently listed on Metropolitan Stock Exchange of India. The
accused no.1 on 27.11.2008 had allotted its 62,500 equity shares in
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favour of the complainant and on 10.05.2016 these equity shares
were fraudulently transferred in favour of the applicant no.2 who is a
relative of the applicant no.1.
2.2.1 The applicant no.1 (appointed on 10.07.1994), Gopal Bisht (the
accused no.3 and appointed on 30.06.2004), Sangeeta Garg (the
accused no.4 and appointed on 27.11.1997) and Kapil Berera
(appointed on 02.03 1995) were the Directors of the accused no.1 at
the time of allotment of 62,500 shares i.e. on 27.11.2008 besides
others. The applicant no.1 (appointed on 10.07.1994), Gopal Bisht
(the accused no. 3 and appointed on 30.06.2004), Sangeeta Garg (the
accused no.4 and appointed on 27.11.1997), Kapil Berera (the
accused no.5 and appointed on 02.03.1995), Umang Sarkar (the
accused no.6 and appointed on 14.08.2014) and Aashish Ghai (the
accused no.7 and appointed on 21.08.2015) were the directors of
Genesis Finance Ltd. at the time of fraudulent transfer of 62,500
equity shares in favour of the applicant no.2 on 10.05.2016. The
above persons were also directors on 14.10.2017 when Sanjay Prasad
Jain i.e. the accused no.9 had transferred 50 equity shares in favour of
the complainant; on 30.12 2017 when 300 equity shares were
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allegedly transferred 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 under taking 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 inthe 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
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share would increase multi-fold and thereafter the complainant
invested in the equity shares of the accused no.1.
2.3.1The accused no.1 on 27.11.2008 had allotted 62,500 equity
shares having face value of Rs.10 with premium of Rs.190 to the
complainant.The complainant after allotment asked for giving of
share certificate of allotment of 62,500 equity shares but the applicant
no.1 (the accused no.2) informed the complainant that the share
certificates are lying in safe custody.The complainant as per Form
MGT-7 Annual Return of the accused no.1 filed with the Registrar of
Companies for the Financial Year 2015-2016 as on 31.03.2016 was
holding 62,500 equity shares of the accused no.1.The complainant
however as per Form MGT-7-Annual Return of the accused no.1
filed with the Registrar of Companies for the Financial Year 2016-
2017 was not holding 62,500 equity shares of the accused no.1 and
stated to be transferred to the applicant no.2. The complainant did not
know the applicant no.2 and never sold these shares to her. The
complainant never executed any share transfer deed and did not enter
into any agreement for transfer of these shares. The complainant also
did not receive any consideration from the applicant no.2. The
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documents pertaining to transfer of 62,500 equity shares are forged
and fabricated.
2.3.2 Form MGT-7-Annual Return of the accused no.1 for the
Financial Year 2017-2018 showed that on 14.10.2017 Sanjay Prasad
Jain (the accused no.9) has transferred 50 Equity share of the accused
no. 1 in favour of the complainant. The complainant has never
purchased any shares from Sanjay Prasad Jain (the accused no 9). It
was also shown that on 30.12.2017 Kavita Bhutani (the accused
no.10) has transferred 100 equity share of the accused no.1 to the
wife of the complainant namely Preet Kaur who never purchased
these shares from Kavita Bhutani (the accused no.10). It was also
shown that the complainant on 30.12.2017 had transferred 300 equity
share to Roohi Reshi (the accused no.11). The complainant did not
know Roohi Reshi (the accused no.11) and never sold any shares to
her. The transfer documents are forged and fabricated.
2.4 The complainant also came to know that the accused no.1 in its
AGM held on 30.09.2017 allotted bonus of 7 equity shares for each
equity share to the complainant and as such 350 equity shares were
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allotted to the complainant making total number of equity shares to
2.4.1 The accused no.1 with 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
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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 case are
mired in mendacity, exaggeration and
embellishments and unfortunately none of the
parties including the complainant is coming
upwith the entire truth before the court.
Eloquent silence of the complainant in not
reporting the non- receipt of the shares purchased
by him in the year 2008 till 2020 raises a serious
question mark about his claim of non receipt of
shares. The doubt further deepens as to why the
complainant opted to not seek a set off against the
unreceived shares in the settlement agreement
dated05.06 2020. However the matter is still under
probe, therefore, I am resting the issue here
itself.Having said that, itwould be pertinent to
observe here that the conduct of the
applicants/accused persons is also shrouded in
suspicion and if I may say so, it appears to bemuch
more tainted and stained as compared to the
complainant. The claim of the accused persons
regarding there-purchase of the said shares stands
thoroughly discredited inthe teeth of the FSL
result, wherein it has been reported that the
signatures of the complainant on the share
Transfer deed was found to be forged. During the
course of investigation, not only it was revealed
that the shares were transferred in the favour of
applicant /accused Nirmala Aggarwal upon
thestrengthof forged and fabricated documents,
applicants/accused persons have also been found to
be constantly changing their stand regarding the
consideration for re-purchase of the said shares. It
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is reported by the IO that accused Nirmala
Aggarwal in her written reply, prior to receipt of
FSL result, mentioned that vide letter dated
30.04.2016, she requested the Genesis Company to
pay Rs.6,25,000 /- to the complainant on her behalf
towards the payment for the above said 62,500
shares purchased by her. She further mentioned
that upon receipt of money, the complainant
handed over his duly signed share transfer form.
However contrary to the claim of Ms. Nirmala
Aggarwal,it was subsequently claimed by co-
accused Naresh Garg that the company adjusted
the said amount in the loan account of the
complainant. The accused persons have failed to
provide any request from or intimation for the
complainant regarding the adjustment of the said
amount in the loan account.
Further, the claim regarding the rebate provided
to the complainant and his brother by the accused
persons in consideration of the re-purchase 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 themother-in-law of Managing
Director Naresh Garg.
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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.
During the course of arguments, it was informed
to the court by the prosecution that while applying
for loan from Yes Bank and Union of India Bank
complainant has claimed his net worth to be about
Rs.16 crores and since there was no requirement
of separately mentioning the shares of Genesis
company held by him, therefore, this fact was not
separately mentioned . Therefore, I do not find any
merit in the said contention of the accused persons.
Since the share transfer deed, which is a valuable
security as per section 30 of the Indian Penal Code
has been forged in the matter, therefore, I cannot
but disagree with the Ld. Defence counsel that
section 467 IPC cannot be validly invoked or that
this case is squarely covered by the judgment of
Hon'ble Apex Court in the matter of Arnesh
Kumar v. State of Bihar (supra).
Further, the material available on record suggests
that both the accused persons were instrumental in
the alleged forgery, therefore, their pleaof false
implication fails to inspire confidence.
Considering the totality of circumstances, I concur
with the Ld.Addl PP that in order to unearth the
conspiracy, the modus operandi of the alleged
offence and to ascertain the author of the alleged
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forgery, a sustained custodial interrogation of
applicants/accused persons is required.
I am conscious of the fact that applicant/accused
Nirmala Aggarwal is an aged lady but the fact that
if at such an advanced age, she chooses to associate
herself with fraudulent transactions, now she
cannot shy away from the consequences.
Even the judgments relied upon by the accused
persons would not come to their rescue as none of
the judgments mandates that the anticipatory bail
should be granted as a matter of right lo the
accused persons in such circumstances wherein
grant of anticipatory bail shall cause an
irreparable damage to the pending investigations.
Consequently, I do not find any merits in the
applications at hand and the same arc accordingly
dismissed.
Before: parting, it would be pertinent to observe
that it appears that the company is involved in
certain shady transaction with respect to the
transfer of shares. Consequently, it is desirable
that the IO may bring the matter to the notice of
SEBI authorities so as to rule out the possibility of
the violation of any of the provisions of SEBI 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
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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 Officerwho 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
28.5.2022 dismissed the bail application.
4.1 The applicant no.1 is the Managing Director of the accused no.1
and the complainant was a regular customer of the accused no. 1. The
complainant, his wife and other family members and companies in
which the complainant and his family members are
Directors/Shareholders/Guarantors happened to be clients/borrowers
of the accused no.1 for last 15-20 years.
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4.2 The accused no.1 is a public limited company listed as non-
deposit taking Non-Banking Finance Company and is reputed for its
fair and clean business practices. M/s Skyline Financial Services (the
accused no.12) was appointed as Share Transfer Agent (STA) for
maintaining and recording share transfer records.
4.3 The complainant in the year 2008 sought allotment of 62,500
shares of the accused no.1 at a total value of Rs.1.25 crores which
were duly allotted to him with distinctive nos. 3802501 to 3865000.
The complainant duly received share certificate through speed post
vide receipt dated 12.12.2008. The Delhi Stock Exchange was close
down in 2014 and as a result shares of all companies listed on Delhi
Stock Exchange including the shares of the accused no.1 were
delisted. The delisting and the resultant lack of liquidity in the
accused no.1 led to a drastic fall in the value of the shares of the
accused no.1. The accused no.1 was relisted with Metropolitan Stock
exchange of India.
4.4 The complainant in the year 2015-16 sold 62,500 shares to the
applicant no.2 who was already having a running loan account with
the accused no.1and the applicant no.2 requested to the accused no.1
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to pay Rs.6,25,000/- to the complainant on her behalf and
accordingly Rs.6,25,000/- was credited on 03.05.2016 in the loan
account no.LNHOF00l 11-120000179 of the complainant. The
complainant handed over duly signed and filled share transfer form to
the applicant no.2 along with original share certificate. The
complainant signed SH4 form in the presence of Vinod Kumar as a
witness. Thereafter share transfer form along with original share
certificate was submitted to the Share Transfer Agent i.e. M/s Skyline
Financial Services (the accused no.12) on 06.05.2016 for transfer of
62,500 shares.
4.5 The complainant and his brother, namely, Gaganmeet Singh,
were having two outstanding loan accounts with the accused no.1
which were in default. The accused no.1 gave rebate 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
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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 original share certificate with STA for transfer of 50 shares of
the accused no.1, which were purchased from Sanjay Prasad Jain.
The accused no.1, vide Board Resolution dated 09.10.2017, has
approved the said transfer, and accordingly informed STA. The
accused no.1 on 30.10.2017 issued 7 bonus shares for 1 share held in
the accused no.1 and accordingly the complainant was allotted 350
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shares as per his shareholding of 50 shares bearing distinctive
numbers 20194447-20194796.
4.7.1 Roohi Reshi submitted share transfer form along with original
share certificate to STA for transfer of shares which were purchased
from the complainant for Rs.3,000/- in her name and the accused
no.1 vide board resolution dated 12.12.2017 approved the said
transfer, and accordingly informed STA. Preet Kaur also submitted
share transfer form along with original share certificate for transfer of
100 shares of the accused no.1 purchased from Kavita Bhutani for
Rs. 1,000/- in her name to STA and the accused no.1vide board
resolution dated 12.12.2017 approved the said transfer, and
accordingly informed STA.
4.8 The applicant no.2 is sole beneficiary of the share sale purchase
transactions in whose account 62,500 shares were credited. The
accused no.1 or its directors/officers do not have any role to payand
did not receive any benefit from such transactions.
4.9 The court of Additional Sessions Judge-02, Patiala House Courts,
New Delhi did not pass order dated 28.05.2022 in accordance with
law and has not appreciated facts and law properly. The applicant
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no.1 also raised other grounds for grant of anticipatory bail and
prayed that he be released on anticipatory bail in FIR no.445/2020
registered at P.S Vasant Vihar under sections 420/468/471/34 IPC.
4.10 The applicant no.2 in bail application also mentioned similar
facts as stated by the applicant no.1 in his bail application.
5. The respondent/State filed Status Report dated 11.07.2022 under
signature of SHO PS Vasant Vihar and another Status Report dated
23.11.2022 under signature of Surender Singh, ACP/District
Investigation Unit,South-West District, Delhi in Bail Application
bearing no.1696/2022 filed by the applicant no.1.
5.1 The respondent/State in Status Report besides mentioning factual
position also gave details of investigation. It is stated that the accused
no.1 is engaged in the business of 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
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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 applicant no.2 and on her request Rs.6,25,000/-
were credited into his loan account and thereafter handed over duly
signed share transfer form to the applicant no.2. The applicant no.1
could not provide proof of such request. In Status Report, details of
financial transactions between the complainant and Genesis Finance
Ltd (the accused no.1) were also mentioned besides other facts.
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6.1 The respondent/State in Status Report dated 23.11.2022 stated
that during the investigation, notices under section 91 of the Code
dated 12.09.2022 and 04.11.2022 were sent to the applicant no.1 to
provide original share certificate no. 30141 in respect of 62,500
shares purchased by the applicant no.2 from the complainant and
share certificate no.31269 in respect of 300 shares purchased by
Roohi Reshi from the complainant on 12.12.2016 and stated to be
submitted to the accused no.1 by the applicant no.2 and Roohi Reshi
respectively but the applicant no.1 did not provide the requisite
original Share certificates and gave an evasive reply. The applicant
no.1 informed that original Share Certificates are not available being
destroyed after issuance of Jumbo share certificates which were stated
to be issued on 29.01.2018 in lieu of 62,500 shares of the complainant
and other purchased shares by the applicant no.2 and stated to be bear
the signature of Gushan Jhuranias Director of the accused no.1 who in
his statement dated 30.07.2022 stated that he was director of the
accused no.1 till December, 2012 and did not sign the share
certificate/Jumbo share certificate after 2012.
6.2 The applicant no.1in the reply dated 11.10.2022 stated that Bonus
Share Certificates no.31115 issued on 08.12.2017 were dispatched to
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the complainant. The applicant no.1 has given contradictory reply
regarding dispatch of 350 bonus shares which were issued on
08.12.2017 vide certificate no.31115 to the complainant through post
but details/proof of the post were not provided. The Bonus Certificate
stated to be split into two certificates bearing nos.31268 and 31269
for 50 shares and 300 shares respectively on 13.12.2017. The original
share transfer deed between the complainant and Roohi Reshi for
transfer of share certificate no.31269 for 300 shares was executed on
12.12.2017 whereas new certificate no.31269 was issued on
13.12.2017.
6.3 As per the copy of Board Resolution dated 12.12.2017 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.1was Managing Director of the accused no.1 at the time
of allotment of 62,500 shares to the complainant and at the time of
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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 dated12.12.2008 could not be
verified. The payment of Rs.6,25,000/- qua alleged transfer of 62,500
equity shares was internally adjusted by the accused no.1 by making
book entries in their records which reflects that no direct money was
transferred by the accused no.1 to the bank account of the
complainant. The complainant purchased equity shares in 2008 for
Rs.1,25,00,000/- which were allegedly sold to the applicant no.2 for a
nominal amount of Rs.6,25,000/- only with the help of forged
signatures. The accused no.1 during investigation was not able to
give satisfactory reply regarding huge rebate of Rs.38,81,5371- and
Rs.52,64,408/- to the complainant and Gaganmeet Singh
respectively. Skyline Financial Services (the accused no.12) provided
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original letter issued by the accused no.1 to it regarding verification
of signatures on transfer deed dated 06.05.2016 in respect of transfer
of 62,500 shares from the complainant to the applicant no.2 and
original letter dated 04.10.2017 issued by the accused no.1 to Skyline
Financial Services (the accused no.12) in respect of transfer of 50
shares from Sanjay Prasad Jain to the complainant. The signatures of
the complainant and his wife namely Preet Kaur on the alleged SH-4
Forms have been found forged and FSL result has confirmed the
forgery.
6.4.1 The applicant no.2 in reply dated 16.01.2021 stated that vide
letter dated 30.04.2016 she requested the accused no.1 to pay
Rs.6,25,000/- to the complainant towards paymentfor the 62,500
shares and the complainant after receipt of said amount handed over
his duly signed share transfer form but the accused no.1 adjusted said
amount in the loan account of the complainant. Neither the accused
no.1 nor the applicant no.2 provided any request/intimation to the
complainant in respect of the alleged adjustment. The applicants have
not cooperated in the investigation and concealed material facts. The
respondent/Stated prayed for custodial interrogation of the applicants
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on grounds that they have not provided requisite documents and gave
evasive replies during investigation.
7. The facts which are emerging from the record are that the accused
no.1 was a listed Limited Company registered under the Companies
Act, 1956, (CIN L65910DL 1990PLC040705) and presently the
accused no.1 is listed on Metropolitan Stock Exchange of India. The
applicant no.1 the accused no.1 is engaged in the business of finance
and money lending. M/s Skyline Financial Services (the accused
no.12) was appointed 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
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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 transferred on 30.12.2017 in favour of his wife namely Preet
Kaur but his wife never purchased these shares; and 300 shares
owned by the complainant were transferred on 30.12 2017 in favour
of Roohi Reshi (the accused no.11) which Roohi Reshi never
purchased these shares from him. The complainant and his wife
namely Preet Kaur never entered into any transaction in respect these
shares and alleged transfer documents are forged and fabricated. The
accused no.1 with the help of the accused no.2 to 13 has cheated the
complainant by fraudulent 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 have become 500000 shares. The
accused no.1 along with other accused has reduced share holding of
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the complainant from 500000 equity shares to only 100 equity shares
as on 31.03.2018. Thereafter on basis of complaint made by the
complainant present FIR bearing no.445/2020 was got registered for
offences punishable under sections 420/468/471/34 IPC.
7.2 The bail applications filed by the applicants no.1 & 2 were
dismissed by the court of Additional Sessions Judge-02, Patiala
House Courts, New Delhi vide order dated 28.05.2022. It was
observed that none including the complainant has appeared before the
court with truth.The complainant has not reported the non- receipt of
the shares purchased by him in the year 2008 till 2020 which raised
serious doubt about his claim of non-receipt of shares. The court also
observed that 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 did not accept claim of the applicants
regarding re-purchase of these shares due to FSL result by observing
that the signatures of the complainant on the share Transfer deed
were found to be forged. The court also observed that the applicant
no.2 in her written reply submitted to Investigating Officer prior to
receipt of FSL result mentioned that vide letter dated 30.04.2016, she
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requested the accused no.1 to pay Rs.6,25,000 /- to the complainant
on her behalf towards the payment for the above said 62,500 shares
and the complainant after receipt of money handed over duly signed
share transfer form which was contrary to the subsequent claim made
by the applicant no.1 that the accused no.1 adjusted the said amount
in the loan 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
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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 for
transfer of 62,500 shares. The applicant no.2 submitted share transfer
form along with original share certificate to the accused no.1 and
thereafter the accused no.1 approved the share transfer vide its board
meeting held on 10.05.2016. The accused no.1 had also settled
pending disputes with the complainant and his family vide agreement
dated 05.06.2020.
8.1 The complainant also submitted share transfer form along with
original share certificate with STA for transfer of 50 shares of the
accused no.1 stated to be purchased from Sanjay Prasad Jain. The
accused no.1 vide board resolution dated 09.10.2017 has approved
said transfer. The accused no.1 on 30.10.2017 also issued 7 bonus
shares for 1 share held in the accused no.1 and accordingly, the
complainant was allotted 350 shares as per his shareholding of 50
shares bearing distinctive nos.20194447-20194796.
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8.2 The respondent/State in Status Report dated 11.07.2022 and
Status Report dated 23.11.2022 primarily stated that copy of Speed
Post receipt dated 12.12.2008 by which original share certificate was
sent to the complainant could not be verified from postal department
being weeded out. The 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 as per FSL result received on 24.10.2021. The applicant
no.1 could not provide proof of any request allegedly made by the
applicant no.2 for credit of Rs.6,25,000/- in the loan account of the
complainant. The applicant no.1 could not provide original share
certificate in respect of 62,500 shares purchased by the applicant no.2
from the complainant and 300 shares purchased by Roohi Reshi from
the complainant on 12.12.2016 and gave evasive reply. The applicant
no.1 also gave contradictory reply regarding dispatch of 350 bonus
shares issued on 08.12.2017 to the complainant through post. The
respondent/Stated sought custodial interrogation of the applicants on
grounds that they have not provided requisite documents and gave
evasive replies during investigation.
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9. It would be relevant to discuss relevant statutory law and decisions
rendered by the Superior Courts before adjudicating applications. The
anticipatory bail is not defined in the Code. The anticipatory bail is
pre-arrest bail and grant of anticipatory bail is discretionary. 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-
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(i) a condition that the person shall make
himself available for interrogation by a police
officer as and when required;
(ii) a condition that the person shall not, directly
or indirectly, make any inducement, threat or
promise to any person acquainted with the facts
of the case so as to dissuade him from disclosing
such facts to the Court or to any police officer;
(iii) a condition that the person shall not leave
India without the previous permission of the
Court;
(iv) such other condition as may be imposed
under sub- section (3) of section 437, as if the
bail were granted under that section.
(3) If such person is thereafter arrested without
warrant by an officer in charge of a police station
on such accusation, and is prepared either at the
time of arrest or at any time while in the custody
of such officer to give bail, be shall be released on
bail; and if a Magistrate taking cognizance of such
offence decides that a warrant should issue in the
first instance against that person, he shall issue a
bailable warrant in conformity with the direction
of the Court under sub- section (1).
9.1 The Supreme Court in Ms. X V The State of Maharashtra and
another, Criminal Appeals No. 822-823 of 2023 observed that court
ought to refrain from undertaking detailed analysis of evidence at
time of consideration of bail application. It was observed as under:-
11.1. We propose to take a quick look at the
considerations that ought to govern grant of
anticipatory bail. There are a line of decisions of
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this court that have underscored the fact that
while deciding an application for bail, the court
ought to refrain from undertaking a detailed
analysis of the evidence, the focus being on the
prima facie issues including consideration of some
reasonable grounds that would go to show if the
accused has committed the offence or those facts
that would reflect on the seriousness of the offence.
The self imposed restraint on delving deep into the
analysis of the evidence at that stage is for valid
reasons, namely, to prevent any prejudice to the
case set up by the prosecution or the defence likely
to be taken by the accused and to keep all aspects
of the matter open till the trial is concluded.
9.2 The Supreme Court in Masroor V State of Uttar Pradesh and
another, (2009) 14 SCC 286 observed that courts ought to refrain
from mechanically granting bail and absence of relevant
considerations will make such an order susceptible to interference. It
was 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
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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:
(i) whether there is any prima facie or reasonable
ground to believe that the accused had committed
the offence;
(ii) nature and gravity of the accusation;
(iii) severity of the punishment in the event of
conviction;
(iv)danger of the accused absconding or fleeing, if
released on bail;
(v) character, behaviour, means, position and
standing of the accused;
(vi) likelihood of the offence being repeated;
(vii) reasonable apprehension of the witnesses
being influenced; and
(viii) danger, of course, of justice being thwarted
by grant of bail.
9.3 The bail applications under section 438 of the Code 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.
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The Supreme Court in this eventuality in Kalyan Chandra Sarkar
V Rajesh Ranjan alias Pappu Yadav and another, (2004) 7 SCC
528 observed as under:-
12. In regard to cases where earlier bail
applications have been rejected there is a further
onus on the court to consider the subsequent
application for grant of bail by noticing the
grounds on which earlier bail applications have
been rejected and after such consideration if the
court is of the opinion that bail has to be granted
then the said court will have to give specific
reasons why in spite of such earlier rejection the
subsequent application for bail should be granted.
9.4 The Supreme Court in Sushila Aggarwal and Others V State
(NCT of Delhi) and another, (2020) 5 SCC 1 clarified the factors
that would be required to be kept in mind while dealing with
applications moved under Section 438 of the Code and observed as
under:-
92.3. Nothing in Section 438 CrPC, compels or
obliges courts to impose conditions limiting relief
in terms of time, or upon filing of FIR, or
recording of statement of any witness, by the
police, during investigation or inquiry, etc. While
considering an application (for grant of
anticipatory bail) the court has to consider the
nature of the offence, the role of the person, the
likelihood of his influencing the course of
investigation, or tampering with evidence
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(including intimidating witnesses), likelihood of
fleeing justice (such as leaving the country), etc...
92.4. Courts ought to be generally guided by
considerations such as the nature and gravity of
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.
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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 of the
provisions of Section 438 CrPC has to take into
consideration the fact that the grant or rejection of
an application under Section 438 CrPC has a
direct bearing on the fundamental right to life and
liberty of an individual. The genesis of this
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jurisdiction lies in Article 21 of the Constitution, as
an effective medium to protect the life and liberty
of an individual. The provision therefore needs to
be read liberally, and considering its beneficial
nature, the courts must not read in limitations or
restrictions that the legislature has not explicitly
provided for. Any ambiguity in the language must
be resolved in favour of the applicant seeking
relief.
10. The learned Senior Counsel for the applicants argued that the
applicants have joined investigation as and when directed by the
Investigating Officer since 2020 and also submitted replies and
documents as available with them. The Investigating Officer has
taken the handwriting of the applicants for sending to FSL. The
dispute subject matter of present FIR is civil in nature and is wrongly
converted into a criminal case and the complainant and the applicant
no.1 had lot of financial transactions during the years 2008 to 2018.
The sale of 62,500 shares by the complainant was a genuine
transaction. The complainant was paid sale consideration of the
62,500 shares which was adjusted in the loan account of the
complainant but relevant loan files are not available.
10.1 The learned Senior Counsel further argued that the Investigating
Officer has recorded statement of various independent witnesses
including Gulshan Jurani, and Kapil Kumar who stated that in the
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year 2016, the complainant had offered to sell the shares to them and
on their refusal sold shares to the applicant no.2. The investigation is
relying on alleged contradictions being made by the applicants in
their various replies instead of establishing the case on the basis of
the complainant. The Status Report filed by the Investigating Officer
reflects vindictive nature of the Investigating agency. The
Investigating Officer has already collected various documents and
statements of independent witnesses. The applicant no.1 has already
explained entire facts pertaining to present case to the Investigating
Officer.
10.2 The complaint was lodged on 14.06.2020 i.e. 9 days after the
settlement agreement dated 05.06.2020 was executed between 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
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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 share certificate no.30141 in respect of 62,500 shares
was converted into Jumbo shares along with various other shares
belonging to the applicant no.2 and as such the original share
certificate has been destroyed. The Jumbo certificates were submitted
to share depository. There is no possibility of availability of the
original share certificates pertaining to 62,500 shares.
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10.5 The complainant also did not participate and cooperated in
investigation properly. The accused no.1 used old share certificate
containing printed signatures of its Director Gulshan Jurani even after
his demitting office. The accused no.1 sent the Bonus Share to the
complainant through ordinary post which does not reflect mala fide
on the part of the accused no.1. The complainant did not explain that
why he preferred to remain silent till 2020 when he has not received
share certificate stated to be issued in year 2008 and despite having
made the payment of Rs.1.25 crores.
10.6 The allegation that the signatures on the share transfer deed are
forged is absolutely incorrect. As per FSL Report the signatures upon
the share transfer deed are not matching with the signatures of the
complainant and his wife. It does not mean that the signatures are
forged as the complainant was in habit of changing his signatures.
The actual value of 5 Lac shares can be assessed at Rs.1.75 crores
only and the applicants have already deposited Rs.5 crores, without
prejudice to show their bona fide. The value of the shares in 2016
was only Rs.10 for each share.
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10.7 The applicants have cooperated in the investigation and never
misused interim protection granted by this Court. The applicants
never gave evasive and contradictory replies. The entire case is based
upon the documentary evidence which has already been collected by
the Investigating Officer. The investigation is already completed. The
applicants have already joined investigation and relevant documents.
The investigation is pending since the year 2020. The dispute is
purely a civil dispute which pertains to allotment of shares issued by
the accused no.1 which were sold by the complainant to the applicant
no.2. There is no flight risk, likelihood of tampering evidence, and
likelihood of influencing witnesses. The leaned Senior Counsel for
the applicants argued that the applicants be allowed and also relied on
certain decisions rendered 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
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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 shares, consequent 350 bonus shares, 300 shares
and 100 equity shares.
12.2 The learned Senior Counsel for the complainant during
arguments brought out list of forged and fabricated documents
pertaining to different transactions. It was argued that share
certificate regarding 62,500 shares is containing endorsement 'paid-
up' whereas the actual amount was paid much later. FSL Report
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confirmed forgery in Share Transfer deed dated 03.05.2016 (SH4
Form) as signature on share transfer deed does not found to be of the
complainant. The ledgers of loan accounts maintained by the accused
no.1 are also found to be forged. The applicants and other accused
have forged the share transfer register (MGT7). It is argued regarding
transfer of 50 shares that as per FSL report, signatures of the
complainant on share transfer deed dated 02.10.2017 were found to
be forged. The fabricated PAN number of Sanjay Prasad Jain was
also created. The Board resolution dated 09.10.2017 was held prior to
the accused no.1 receiving request for share transfer from STA
skyline (the accused no.12). The complainant in written arguments
also pointed discrepancies and contradictions in 350 bonus shares,
100 shares, jumbo share certificates.
12.3 It is also argued and mentioned in written arguments that the
applicants have also created fabricated documents such as share
certificate certificates, loan ledgers, Jumbo Certificate during the
course of investigation. The learned Senior Counsel for the
complainant argued that the complainant in the year 2008 had
purchased and was allotted 62,500 equity shares at the rate of Rs.200
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per share (Rs.10 as the face value and Rs.190 the premium) for a
consideration of Rs.1.25 crore and the applicants have fabricated
share certificate dated 27.11.2008. The applicants in the year 2016
illegally grabbed 62,500 equity shares of the Complainant by
fraudulent transfer in favour of the applicant no.2 by forged and
fabricated documents and no money was ever paid into the bank
account of the complainant in lieu of alleged transfer of shares. The
jumbo shares certificate despite being issued on 29.01.2018 carries
signature of Gulshan Jhurani who resigned from the accused no.1 in
December 2012. Sanjay Prasad Jain who allegedly transferred 50
shares to the complainant is a non-existent person. The applicant no.1
alleged that 7 bonus shares for each share were 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
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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 SC100 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 SCCOnLine SC
12.5 The learned Senior Counsel regarding requirement of custodial
Interrogation in cases of serious offences, such as forgery, etc. cited
Maruti Nivrutti Navale V State of Maharashtra, (2012) 9 SCC
235 wherein it was observed that custodial interrogation is essential
in order to bring out material information and documents and to
ascertain the genuineness of the document alleged to be forged.The
learned Senior Counsel to support arguments that anticipatory Bail
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should not to be granted on the basis of generalized grounds but
should be granted only on the facts of the case cited Sanjay Kumar
Gupta V State of U.P., 2021 SCC OnLine SC 596. The learned
Senior Counsel in support of prime argument that custodial
Interrogation is required to recover the money/property/documents
cited Jangya Narayan Mishra V State (Delhi), 2015 (4) JCC 2334.
The learned Senior Counsel in support of other arguments cited
Prakash Gupta V State of Delhi, 2017 SCC OnLine Del 9265;
State Rep. by CBI V Anil Sharma (1997), 7 SCC 187; Urmila
Gupta V The State (Govt. of NCT of Delhi), 2016 SCC OnLine
Del 553, State of T.N. V R. Vasanthi Stanley, (2016) 1 SCC 376,
etc.
13. The Code extensively deals with powers of the investigating
agency to carry out investigation in a cognizable offence. The
interrogation of the accused is exclusively lie within domain of the
investigating agency whose powers are unfettered so long as the
investigating officer exercises investigating powers within the legal
boundaries as per provisions of the law. The court can interfere and
issue appropriate direction to the investigating agency only in the
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eventuality when investigating officer exercised powers mala fide or
where there is abuse of power and non-compliance of the
provisions of Code . However court can interfere with the
investigation only in rare cases where there is abuse of process or
non-compliance of the provisions of the Code. It was held in King-
Emperor V Khwaja Nazir Ahmad, AIR 1945 PC 18 that it is of
the utmost importance that the judiciary should not interfere with the
police in matters which are within their province and into which the
law imposes upon them the duty of enquiry.The decision in Khwaja
Nazir Ahmad has been quoted with approval by the Supreme Court
in Abhinandan Jha and others V Dinesh Mishra, AIR 1968 SC
117, State of Bihar and another V J.A.C. Saldanha and
others, (1980) 1 SCC 554 and subsequent decisions. The Supreme
Court in Dukhishyam Benupani, Assistant Director, Enforcement
Directorate (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
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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 the
suspected person knows that he is well protected and insulated by a
pre-arrest bail order during the time he is interrogated. Very often
interrogation in such a condition would reduce to a mere ritual. The
Supreme Court in Muraleedharan V State of Kerala, AIR 2001 SC
1699 held that custodial interrogation of accused is indispensably
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necessary for the investigating agency to unearth all the links
involved in the criminal conspiracies committed by the persons
which ultimately led to the capital tragedy.
13.2 The Supreme Court in relation to power to grant anticipatory
bail and power of investigating agency to investigate in P.
Chidambaram V Directorate of Enforcement, Criminal Appeal
No. 1340 2019 decided on 05.09.2019, observed as under:-
Ordinarily, arrest is a part of procedure of the
investigation to secure not only the presence of the
accused but several other purposes.
Power under Section 438 Cr.P.C. is an
extraordinary power and the same has to be
exercised sparingly. The privilege of the pre-arrest
bail should be granted only in exceptional cases.
The judicial discretion conferred upon the court
has to be properly exercised after application of
mind as to the nature and gravity of the
accusation; possibility of applicant fleeing justice
and other factors to decide whether it is a fit case
for grant of anticipatory bail. Grant of
anticipatory bail to some extent interferes in the
sphere of investigation of an offence and hence, the
court must be circumspect while exercising such
power for grant of anticipatory bail. Anticipatory
bail is not to be granted as a matter of rule and it
has to be granted only when the court is convinced
that exceptional circumstances exist to resort to
that extraordinary remedy.
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13.3 The Supreme Court in this case also discussed grant of
anticipatory bail with Article 21 of the Constitution and
referred State of M.P. and another V Ram Kishna Balothia and
another, (1995) 3 SCC 221 wherein the Supreme Court held that the
right of anticipatory bail is not a part of Article 21 of the Constitution
of India and observed that 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. The Supreme
Court in P. Chidambaram further observed 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.
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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 of the investigating agency to interrogate the
accused as to the material so far collected and to
collect more information which may lead to
recovery of relevant information.
13.4 The Supreme Court in P. Chidambaram also referred
Siddharam Satlingappa Mhetre V State of Maharashtra and
Others, (2011) 1 SCC 694 wherein the Supreme Court laid down the
factors and parameters to be considered while dealing with
anticipatory bail and held that the nature and the gravity of the
accusation and the exact role of the accused must be properly
comprehended before arrest is made and that the court must evaluate
the available material against the accused very carefully. It was also
held that the court should also consider whether the accusations have
been made only with the object of injuring or humiliating the
applicant by arresting him or her.The Supreme Court in P.
Chidambaram also referred also referred Jai Prakash Singh V
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State of Bihar and another, (2012) 4 SCC 379 wherein the
Supreme Court held as under:-
19. Parameters for grant of anticipatory bail in a
serious offence are required to be satisfied and
further while granting such relief, the court must
record the reasons therefor. Anticipatory bail can
be granted only in exceptional circumstances
where the court is prima facie of the view that the
applicant has falsely been enrobed in the crime
and would not misuse his liberty.
14. The line of dispute which is subject matter of present FIR is
alleged transfer of 62,500 equity shares of the accused no.1 on
10.05.2016 having face value of Rs.10 with premium of Rs.190
which were stated to be allotted to the complainant on 27.11.2008 for
consideration of Rs.1.25 crores in favour of the applicant no.2 by the
complainant for sale consideration of Rs.6,25,000/-; alleged transfer
of 50 equity shares stated to be owned by Sanjay Prasad Jain (the
accused no.9) on 14.10.2017 in favour of the complainant; alleged
transfer of 100 equity shares stated to be owned by Kavita Bhulani
(the accused no.10) on 30.12.2017 in favour of Preet Kaur, wife of
the complainant; and alleged transfer of 300 shares stated to be
owned by the complainant on 30.12 2017 in favour of Roohi Reshi
(the accused no.11). The accused no.1 in its AGM held on
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30.09.2017 also stated to be allotted bonus of 7 equity shares for each
equity share to the complainant and as such 350 equity shares 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
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applicant no.2 made to the accused no.1 for payment of Rs.6,25,000/-
to the complainant on her behalf and said amount was actually
credited in the loan account of the complainant. The applicant no.1
also could not produce Jumbo share certificates which were stated to
be issued on 29.1.2018 in lieu of 62,500 shares of the complainant and
stated to be bearing the signature of Gulshan Jhurani as Director of the
accused no.1. Gulshan Jhurani in his statement dated 30.07.2022 also
stated that he did not sign the share certificate/Jumbo share certificate
after 2012. It also came into investigation that original share transfer
deed between the complainant and Roohi Reshi for transfer of share
certificate no.31269 for 300 shares was executed on 12.12.2017
whereas new certificate no.31269 was issued on 13.12.2017.
14.2 The respondent/State prayed for custodial interrogation of the
applicants on grounds that they have not provided requisite
documents and gave evasive replies during investigation. It is also
alleged that there are contradictions in replies given by the applicants
as mentioned in Status Reports and also argued by the Additional
Public Prosecutor and the learned Senior Counsel for the
complainant. The issue which needs judicial assessment and
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consideration is that whether the applicants can be subjected to
custodial interrogation merely the applicants as per investigating
agency did not produce documents as sought by the investigating
officer and gave evasive and contradictory replies during
investigation. It was also surfaced during investigation that the
complainant is having financial transactions with the accused no.1 for
the last 15-20 years.
14.3 The perusal of the Status Reports submitted by the
respondent/State reflects that investigating agency has already
conducted large part of investigation and the applicants have
participated in the investigation although contrary is alleged by the
Additional Public Prosecutor and the learned Senior Counsel for the
complainant. The applicants cannot be subjected to custodial
investigation merely due to reasons that the applicants failed to
produce requisite documentsand also gave evasive and contradictory
replies during investigation as detailed in Status Reports and written
arguments submitted on behalf of the complainant. FSL Report
pertaining to genuineness of the complainant and his wife Preet Kaur
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on share transfer forms has already been received by the investigating
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
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applicants that custodial interrogation of the applicants is required to
recover forged documents as alleged forged and fabricated
documents pertaining to different transactions as mentioned in
written documents are within knowledge of the Investigating Officer.
FSL Report which is stated to be confirming forgery in all share
transfer certificates is already received.The alleged discrepancies and
contradictions in 350 bonus shares, 100 shares, jumbo share
certificates etc. are also within knowledge of the complainant and
investigating officer. The arguments advanced by the learned Senior
Counsel for the complainant and case law relied on and referred by
the learned Senior Counsel do not provide much help to the
investigation. The learned Senior Counsel also relied on Maruti
Nivrutti Navale V State of Maharashtra, (2012) 9 SCC 235
wherein laid down that custodial interrogation is essential in order to
bring out material information and documents and to ascertain the
genuineness of the document alleged to be forged. In the present case
the relevant facts have already been surfaced during investigation and
as per Status Report, FSL Report is already received.
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14.6 The Supreme Court in relation to power to grant anticipatory
bail and power of investigating agency to investigate in P.
Chidambaram also observed that the judicial discretion to be
properly exercised after application of mind as to the nature and
gravity of the accusation; possibility of applicant fleeing justice and
other factors to decide whether it is a fit case for grant of anticipatory
bail. The custodial interrogation of the applicants is not warranted
under given facts and circumstances of the present case and after
evaluation of the available material against the applicants and
particularly only to recover certain documents pertaining to the share
transfer and contradictions in the replies given by the applicants
during investigation. There is no direct and apparent apprehension
that the applicants may flee or avoid further investigation. The
applicants cannot be remanded to custodial interrogation in the
absence of convincing material which warrants that certain
documents and evidence pertaining to present FIR cannot be
recovered without custodial interrogation of the applicants.
14.7 The applicants vide order 31.05.2022 were granted interim
protection from arrest subject to the deposition of Rs.5 crores in the
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form of FDR in the name of Registrar General. After considering all
facts, the bail applications bearing no.1696/2022 and 1697/2022 filed
by the applicants Naresh Garg and Nirmala Aggarwal respectively
are allowed. The applicants in case of arrest shall be release on bail
on furnishing personal bond in sum of Rs.50,000/- with one surety of
like amount to the satisfaction of concerned SHO/IO/Duty Officer
subject to following conditions:-
i) The applicants shall join the investigation as and
when directed by the concerned Investigating
Officer and shall extend full cooperation in
investigation.
ii) The applicants shall not leave country without
prior permission of the concerned trial court.
iii) The applicants shall not temper with the
evidence and shall not influence the witnesses in
any manner.
14.8 The applicants were granted interim protection from arrest vide
order 31.05.2022 subject to the deposition of Rs.5 crores in the form
of FDR in the name of Registrar General. It was held by the Supreme
Court in Guddan @ Roop Narain V State of Rajasthan, 2023 Live
Law (SC) 45, observed excessive conditions imposed on the
appellant (convict) in practical manifestation acted as a refusal to the
grant of bail. The present litigation is not for recovery of damages.
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The trial to be initiated out of present FIR may take time as
investigation is still pending. It would not be appropriate to keep
amount of Rs.5 crores on record and accordingly, FDR of Rs. 5
crores is ordered to be released to the applicant no.1 immediately
from the office of the Registrar General.
15. Nothing in this order shall be taken as an opinion on merits of
the case.
SUDHIR KUMAR JAIN
(JUDGE)
April 25, 2023
N/SD
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