Delhi High Court
National Agricultural ... vs Central Bureau Of Investigaton & ... on 22 February, 2023
Neutral Citation Number:2023/DHC/001272
$~49
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Reserved on: 22nd November, 2022
Decided on: 22nd February, 2023
+ CRL.M.C. 6163/2019, CRL.M.A. 41630/2019 (stay), 43663/2019 &
12184/2021(for directions)
NATIONAL AGRICULTURAL CO-OPERATIVE
MARKETING FEDERATION OF INDIA
LIMITED (NAFED)
..... Petitioner
Through: Ms. Nitya Ramakrishnan, Senior
Advocate with Mr. Shivam Batra, Mr.
Akhil Ranganathan and Mr. Ankit
Bhushan, Advocates.
v
CENTRAL BUREAU OF
INVESTIGATON & ORS
..... Respondents
Through: Mr. Anupam S. Sharrma, Special
Counsel with Mr.Prakarsh Airan, Ms.
Harpreet Kalsi, Mr. Anurag
Aggarwal, Mr.Ripudaman Sharma
and Mr.Abhishek Batra, Advocates
for CBI/R-1.
Mr. M. Dutta, Mr. Jalaj Aggarwal and
Mr. Aditya Guha, Advocates for R-2.
Mr.Kushal Mangal, Advocate for R-3.
CORAM:
HON'BLE MR. JUSTICE SUDHIR KUMAR JAIN
JUDGMENT
1. CBI registered FIR bearing no. RC/BD1/2006/E/009 at P.S. CBI/BS/FC
Delhi under sections 409/420/467/468/471/120B of the Indian Penal Code,
1860 (hereinafter referred to as "IPC") on the basis of the complaint made
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by the petitioner/National Agricultural Co-operative Marketing Federation
of India Limited (hereinafter referred to as "NAFED") through Alok
Ranjan, Managing Director vide D.O. letter No.
HO/BIG/81/3RDCLC/2006-07 dated 07.08.2006 against the respondent
no.3, O.P. Aggarwal and others for causing wrongful loss to NAFED to the
extent of more than Rs. 250 crores.
2. The charge-sheet, as per section 173 of the Code of Criminal Procedure,
1973 (hereinafter referred to as "the Code"), was filed on 24.12.2019 and
the trial is pending before the concerned Court. The charges were ordered to
be framed vide order dated 08.08.2018 for offences as detailed in order
dated 08.08.2018. The respondent no.2 was not implicated as one of the
accused in the FIR and there was no direct or indirect allegation made
against the respondent no.2 in the charge sheet. The respondent no.3 and
O.P. Aggarwal were charged for commission of offences punishable under
section 420 IPC read with section 120B IPC, offences punishable under
sections 468/471 IPC read with 120B IPC and for the substantive offence of
section 120B IPC.
3. The CBI (hereinafter referred to as "respondent no.1"), during the
investigation, conducted a search on 18.01.2007 at the office of M/s
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Earthtech Enterprises Limited (hereinafter referred to as "the respondent
no.3") bearing no. 39, Sadhna Enclave, New Delhi and seized certain
documents including documents pertaining to M/s Bayswater Enterprises
Limited (hereinafter referred to as "the respondent no.2") which included
the D-MAT accounts bearing no. 10025232 with M/s Star Finvest Limited
& 10612215 with M/s Religare Securities Limited. It was also revealed that
the respondent no.2 and the respondent no.3 were having their offices at the
same premises bearing no. 39, Sadhna Enclave, New Delhi. The respondent
no.1/CBI also recorded the statement of Mahaveer Prasad Mishra under
section 161 of the Code who stated that he was looking after the accounts of
the respondent no.3 and its sister concern i.e., the respondent no.2 and was
shown as one of the directors of the respondent no.3. It was also stated that
O.P. Aggarwal, who is one of the accused in the above mentioned FIR, was
looking after the work of the respondent no.3 and his son was the authorized
signatory of the respondent no.2. It was also found that the respondent no.2
and the respondent no.3 were having their accounts at HDFC Bank,
Panchsheel Park. It appeared that there was a direct nexus between the
respondent no.2 and the respondent no.3.
4. The respondent no.1/CBI vide communication dated 19.01.2007
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addressed to M/s Star Finvest Limited had directed the said agency not to
allow any operation/withdrawal from the D-MAT account pertaining to the
respondent no.2. The respondent no.2 on 19.01.2007 received information
from M/s Religare Securities Limited regarding receipt of notice under
section 102 of the Code from the respondent no.1/CBI and in pursuance of
said notice, the D-MAT account no. 10612215 of the respondent no.2 was
frozen. The respondent no.1/CBI vide communication dated 22.01.2007 also
asked M/s Religare Securities Limited to keep 2,09,91,600 security shares of
the respondent no.2 with M/s Religare Securities Limited as case property of
the present FIR under section 102 of the Code.
4.1 M/s Religare Finvest Limited filed an application before the court of
Shri Rakesh Pandit, ACMM-I/EAST/KKD wherein it was stated that the
respondent no.1/CBI has frozen the D-MAT accounts bearing nos.10025232
& 10612215 of the respondent no.2 and these accounts were having certain
financed outstanding money of M/s Religare Finvest Limited and due to the
freezing of the said account, M/s Religare Finvest Limited could not recover
its due amount due from the respondent no.2. The Court of Shri Rakesh
Pandit, ACMM-I/EAST/KKD vide order dated 04.02.2009 observed that a
major part of the investment in the D-MAT account of the respondent no.2
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is made by M/s Religare Finvest Limited. It was also noticed that Rs.
1,06,20,384,09/- was outstanding as on 26.01.2009 towards the full and final
settlement of the account of the respondent no.2 with M/s Religare Finvest
Limited. The Court of Shri Rakesh Pandit, ACMM-I/EAST/KKD vide order
dated 04.02.2009 had allowed the D-MAT account bearing no. 10025232 to
be defrozen and M/s Religare Finvest Limited was allowed to transact shares
lying in the said D-MAT account up to the limit of Rs.1.06 crores on certain
conditions as mentioned in the order dated 04.02.2009. It was further
ordered that after realization of Rs.1.06 crores, the D-MAT account bearing
no. 10025232 shall be frozen. The applications of the respondent no.2 and
others for defreezing of their D-MAT accounts were also rejected vide order
dated 04.02.2009 due to the pending investigation and by observing that the
alleged money appears to be ill-gotten money.
5. The respondent no.2 filed an application under section 451 of the Code
for release of shares seized during the investigation of the present FIR. The
respondent no.2 pleaded that the respondent no.1/CBI had registered FIR
bearing no. RC/BD1/2006/E/009 against the respondent no.3 and others in
pursuance of the complaint made on behalf of NAFED. The respondent no.2
is neither an accused nor is there any direct or indirect allegation made
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against the respondent no.2.
5.1 The said application was contested by NAFED as well as by the
respondent no.1/CBI. The respondent no.1/CBI alleged that the respondent
no.2 is the sister concern of the respondent no.3 which has committed a
fraud of Rs. 250 crores with NAFED. The respondent no.1/CBI during the
search conducted at the office of the respondent no.3 bearing no. 39, Sadhna
Enclave seized documents and it was also found that the respondent no.2
and the respondent no.3 are having the common office. O.P. Aggarwal has
diverted the proceeds of the NAFED to the respondent no.2 and other
companies such as M/s Firstcorp International Limited, M/s Shilpa Holdings
Limited and M/s KamakhyaImpex Limited.
5.2 NAFED also opposed the application and it was argued on behalf of
NAFED that NAFED has been cheated to the tune of Rs. 250 crores by O.P.
Aggarwal, Chairman of the respondent no.3 along with other co-accused and
had diverted the said amount to various companies wherein he was having
direct or indirect stake; the respondent no.2 and the respondent no.3 were
having the common office at Sadhana Enclave and directors of these
companies were related to each other.
5.3 The Court of Shri Amit Arora, ACMM(E), KKD vide order dated
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31.10.2018 has dismissed the application of the respondent no.2. It was held
as under:-
Accused M/s Earthtech Enterprises ltd. O.P. Aggarwal alongwith
various other accused are facing trial in the present case. Charges
have already been framed against the accused M/s Earthtech
Enterprises ltd and O.P. Aggarwal for commission of offences u/S
420/409/471/468 read with 120 B IPC.
During the course of arguments the applicant was asked to
show the source of funds through which it has purchased the
share in question. It is not out of place to note here that the shares
which are sought to be released by the applicant are more than 2
crores of rupees which is huge amount. In these circumstances the
applicant company ought to have atleast placed on record the
source of fund through which such huge amount of share were
purchased. There is no merit in the contention of the ld. Counsel
for the applicant that CBI has no jurisdiction in such cases and it
is only the Income Tax authority which can seize unaccounted
money. Rather there is sufficient evidence to prima facie show
that the money defrauded by M/s Earthtech Enterprises ltd. was
diverted in various companies. Here this court cannot ignore the
fact that the applicant company as well as M/s Earthtech
Enterprises ltd. are having their offices at 39, Sadhna Enclave.
Besides that there are various other companies which were found
operating from the same address. It cannot be simply termed as a
co-incidence. As already noted above NAFED was allegedly duped
by M/s Earthech Enterprises ltd. and O.P. Aggarwal regarding
which the present RC was registered. After filing of charge-sheet,
charges have been framed against M/s Earthtech Enterprises ltd
and O.P. Aggarwal and various other accuse as it was prima facie
found that they have diverted the cheated amount.
I have gone through the statement of one Mahavir Prasad
Mishra recorded u/s 161 Cr.P.C. Sh. Mahavir Prasad Mishra was
working with M/s Earthtech Enterprises ltd and was looking at
the accounts of M/s Earthtech Enterprises ltd and its sister
concern namely M/s Bayswater enterprises. He had stated u/s 161
Cr.P.C. that he is one of the Directors of M/s Earthtech
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Enterprises ltd. and was looking the accounts of the company and
was shown as the Director, whereas the work of the company was
being looked after by O.P. Aggarwal and he was only an employee
in the company. He had further stated that his son is the
authorized signatory of Bayswater Enterprises. Now it cannot be
termed as a co-incidence that the applicant company as well as
M/s Earthtech Enterprises ltd are having their account at HDFC
Bank, Panchsheel Park. He has also stated that he was earlier the
sole authorized signatory of M/s Earthtech Enterprises ltd. and
his son (Vijay Mishra) has been made an authorized signatory of
Bayswater Enterprises and earlier he was the authorized
signatory. Thus, it somehow prima facie shows a nexus between
the applicant company and the accused i.e. M/s Earthtech
Enterprises ltd. His statement shows that O.P. Aggarwal
appointed him as a cashier, made him Director and he was the
authorized signatory of the both the companies and now his son
has been substituted in his place as authorized signatory.
Moreover both the companies i.e. applicant company and accused
company are having their registered office at the same address.
Thus at this stage I find no merit in the application as
applicant company has failed to prove its source of purchasing the
shares and moreover, there is a strong reason to believe that both
the above companies are being managed by O.P. Aggarwal, who is
main accused in this case and against him there are allegations of
cheating NAFED. Application is accordingly dismissed.
6. The respondent no.2, being aggrieved by the order dated 31.10.2018, filed
the Criminal Revision bearing no. 01/2019 titled as M/s Bayswater
Enterprises Limited V State/through CBI & others which was
adjudicated upon by the court of Shri Inderjeet Singh, Additional Sessions
Judge/Special Judge (PC Act), CBI-17, Delhi (hereinafter referred to as "the
revisional court") and disposed of the said revision petition vide order
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BHATIA
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dated 24.09.2019 (hereinafter referred to as "the impugned order"). The
relevant portion of the impugned order is reproduced as under:-
4.5. As introduced the beginning that Section 451 Cr.P.C has
limited application while dealing with the custody and disposal of
the property pending trial and the same are to be dealt
expeditiously and judiciously, as held in Amba Lal Desai Vs. State
of Gujarat & C Muddaliar AIR 2003 SC .638. The ratio of law
laid down in DN Upadhyay Vs. CBI (supra) is also applicable to
the situation in hand. However, the impugned securities and D-
MAT accounts (no. 10025232 of M/s Bayswater Enterprises
Limited with M/s Star Finvest Limited and account no. 10612215
of Bayswater Enterprises Limited with M/s Religare Securities
Limited) were freezed on the instructions of CBI, vis a vis in view
of the factual position and status of petitioner, as well as the
seizure memo has been cited as search list at serial no. 509 in the
list of documents, which is as a prima facie view depriving the
petitioner to utilize the funds to channelize in the business, the
purpose may be served by dealing with the securities in a manner
it was dealt while realising the same to M/s Religare Securities
Limited.
4.6 Therefore, by taking into consideration facts and features
appearing, the provisions of law and the ratio of law laid down in
precedent and case law presented, the impugned order dated
31.10.2018 is liable to the set aside to the extent to release the
29,04,000 shares as well as to de-freeze the D-MAT accounts so
that the petitioner may operate the D-MAT accounts, however, it
is subject to furnishing the superdaginama/bond in the sum of Rs.
1 crore or equivalent value to the satisfaction of Ld. Chief
Metropolitan Magistrate, Rouse Avenue Court Complex/trial
court being application u/s 451 Cr.P.C pending conclusion of trial.
The trial court will be at liberty to keep on record the
documentary record of securities/D-MAT accounts or their up-to-
date position so that during trial it will not be treated as a hurdle
in proceeding in the case.
4.7 Accordingly, this revision petition is disposed off, however any
expression given while discussing the merits of application and
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disposing the contentions of parties, it will not be treated any
reflection on the merits of the case.
7. The petitioner, being aggrieved, filed the present revision petition and
challenged the impugned order on the grounds that there are substantial
glaring errors and omissions on the face of the impugned order passed by the
revisional court. The impugned order is illegal both on facts and law and is,
therefore, liable to be set aside. The respondent no.2 has not brought out any
illegality, infirmity and has not challenged the propriety of any finding of
the order dated 31.10.2018. The revisional court has not appreciated the
order dated 31.10.2018 in the right perspective which was passed after
giving cogent reason. The revisional court has not appreciated the facts and
material on record particularly the relationship between the respondent no.2
and O.P. Aggarwal and has overlooked the interconnection between the
respondent no.2 and the respondent no.3. The charges have already been
framed against the respondent no.3 and O.P. Aggarwal as such the
defreezing of the shares should not have been allowed. O.P. Aggarwal,
Chairman of respondent no.3 along with other accused has diverted and
siphoned off the huge amount of NAFED. The revisional court has not
appreciated the statement of PW 63 Mahaveer Prasad Mishra who stated that
the respondent no.2 and the respondent no.3 are having the common
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registered office and are also having their bank account in the same branch
of HDFC Bank. NAFED also raised various other grounds to challenge the
impugned order.
8. The learned Senior Counsel for NAFED advanced oral arguments and
written submissions were also submitted on behalf of NAFED. The learned
Senior Council argued that the respondent no.3 and O.P. Aggarwal, who is
accused no.2 before the concerned trial court, have caused wrongful loss to
NAFED and wrongful gains to themselves to the tune of Rs. 250 crores. The
funds of NAFED were siphoned off by the O.P. Aggarwal to the companies
wherein the accused O.P. Aggarwal and other accused are having direct or
indirect interest including the respondent no.2. There is a direct nexus and
relationship between the respondent no.2, respondent no.3 and O.P.
Aggarwal as the respondent no.2 is the sister concern of the respondent no.3.
The respondent no.2 and the respondent no.3 are having the same registered
office and the directors and the signatories of the respondent no.2 are the
relatives and servants of O.P. Aggarwal, who is in charge of the affairs of
the respondent no.3. During the search conducted at the premises of the
respondent no.3 situated at 39, Sadhna Enclave, New Delhi, documents
pertaining to the respondent no.2 and other companies owned and controlled
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by O.P Aggarwal were recovered which clearly indicated that the respondent
no.2 is the sister concern of the respondent no.3. The statement of PW 63
Mahaveer Prasad, under section 161 of the Code, was not appreciated in the
right perspective. The Trial Court vide order dated 04.09.2009 also
dismissed the application of the respondent no.2 for defreezing of the D-
MAT account. The respondent no.2 and the respondent no.3 could not
explain the source of funds for acquiring the shares in question. The
respondent no.2 is another face of the respondent no.3 and O.P. Aggarwal. It
was argued that the impugned order be set aside and the order dated
31.10.2018 passed by the court of ACMM be restored.
9. The counsel for the respondent no. 2 advanced oral arguments and also
submitted written submissions. He argued that the charge-sheet was filed on
24.12.2009 after the completion of the investigation in pursuance of FIR
bearing no. RC/BD1/2006/E/009. The respondent no.2 was not charged for
any offence. The respondent no.2 is not an accused in the complaint dated
07.08.2006, FIR dated 20.11.2006 and the charge-sheet dated 24.12.2009.
The respondent no.2 has already complied with the directions given by the
impugned order. The present petition is beyond the scope of the section 482
of the Code. It was argued that the petition be dismissed.
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BHATIA
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10. The respondent no.1/CBI also filed a Status Report under the Signature
of Vishal, Inspector of Police, CBI, BSFB, New Delhi wherein it was stated
that the CBI registered a case vide FIR bearing no. RC/BD1/2006/E/0009 in
pursuance of the complaint made by NAFED against the respondent no.3
and others on 20.11.2006. The respondent no.1/CBI conducted a search at
the office of the respondent no.3 bearing no.39 Sadhna Enclave, New Delhi
and seized the documents pertaining to the respondent no.2 including the D-
MAT accounts. It was also found during the search that the respondent no.2
and the respondent no.3 are having an office at the same premises. The
statement of Mahavir Prasad Mishra was also recorded under section 161 of
the Code which reflects that the respondent no.2 and the respondent no.3 are
controlled and managed by the accused/O.P. Aggarwal. The charge-sheet
has already been filed and the trial is pending before the concerned Court.
The application filed by the respondent no.2 for release of shares was
dismissed vide order dated 31.10.2018. The respondent no.1/CBI has
already issued letters on 19.11.2019 directing M/s Religare Securities Ltd. &
M/s Star Finvest Ltd. to defreeze/release of the D-MAT accounts/shares.
The Special Counsel for the respondent no.1/CBI advanced arguments on
the basis of factual position as stated in the Status Report.
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11. Section 102 of the Code deals with power of police to seize property.
Section 102(1) reads as under:-
102. Power of police officer to seize certain property.
(1) Any police officer, may seize any property which may be
alleged or suspected to have been stolen, or which may be found
under circumstances which create suspicion of the commission of
any offence.
12. It is reflecting from the perusal of the record that the respondent
no 1/CBI registered a FIR bearing no. RC/BD1/2006/E/0009 dated
07.08.2006 under sections 409/420/467/468/471/120B IPC on the basis of
the complaint made by NAFED wherein the respondent no. 3, O.P.
Aggarwal and others were implicated for causing wrongful loss to NAFED
to the extent of more than Rs. 250 crores. The respondent no.1/CBI, during
the investigation, conducted a search on 18.01.2007 at the office of the
respondent no.3 and seized documents pertaining to the respondent no.2
including the D-MAT accounts bearing no. 10025232 with M/s Star Finvest
Limited and 10612215 with M/s Religare Securities Limited. The
respondent no.1/CBI also recorded the statement of PW63 Mahavir Prasad
Mishra under section 161 of the Code which reflects that the respondent
no.2 is the sister concern of the respondent no.3 and both are being
controlled by the accused/O.P. Aggarwal. It appears that there was a direct
nexus between the respondent no.2 and the respondent no.3 as the
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respondent no.2 and the respondent no.3 were found to be having their
offices at same premises bearing no.39, Sadhna Enclave, New Delhi and
their accounts in HDFC Bank, Panchsheel Park and the son of O.P.
Aggarwal was found to be the authorized signatory of the respondent no.2.
There is factual force in arguments advanced by learned Senior Counsel for
the NAFED that the respondent no.2 is directly connected with the
respondent no.3 and there is a direct nexus between the respondent no.2 and
the respondent no.3. The shares/securities subject matter of present judicial
consideration may be the outcome of proceeds of crime but the trial is still
pending and this issue would be decided at appropriate stage during trial or
after conclusion of trial.
12.1 The respondent no.1/CBI vide communication dated 19.01.2007
addressed to M/s Star Finvest Limited had directed not to allow any
withdrawal from the D-MAT account bearing no. 10025232 pertaining to
the respondent no.2. The account bearing no. 10612215 of the respondent
no.2 with M/s Religare Securities Limited was also ordered to be frozen.
However, M/s Religare Finvest Limited vide order dated 04.02.2009 passed
by the Court of Shri Rakesh Pandit, ACMM-I/EAST/KKD was allowed to
transact shares lying in the D-MAT account bearing no. 10612215 to the
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tune of Rs.1.06 crores. The application of the respondent no.2 for defreezing
of the D-MAT accounts was also rejected vide order dated 04.02.2009. The
respondent no.2 also filed an application under section 451 of the Code for
release of shares seized during the investigation which was dismissed vide
order dated 31.10.2018. The respondent no.2, being aggrieved, filed the
Criminal Revision bearing no. 01/2019 which was allowed by the revisional
court vide their impugned order dated 24.09.2019.
12.2 The respondent no.2 was not charged for any offence and was not
implicated as an accused either in the FIR dated 20.11.2006 or in the charge-
sheet dated 24.12.2009.
13. The perusal of the impugned order also reflects that 29,04,000 shares out
of 2,09,91,600 shares have been left in the D-MAT account of the
respondent no.2 with M/s Religare Securities Limited. The D-MAT accounts
of the respondent no.2, as detailed hereinabove, were frozen on the
instructions of the respondent no.1/CBI. The revisional court has taken the
view that freezing of the D-MAT account and the securities/shares has
deprived of the respondent no.2 to utilize the fund to channelize in the
business. The revisional court, after taking into consideration the factual
position as well as relevant law, has set aside the order dated 31.10.2018 to
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BHATIA
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the extent of release of 29,04,000 shares as well as to defreeze the D-MAT
accounts so that the said accounts can be operated by the respondent no.2.
The revisional court also protected the interest of NAFED by asking the
respondent no.2 to furnish supurdginama/bond in the sum of Rs. 1 crore or
an equivalent value to the satisfaction of the concerned Trial Court. The
revisional court has also passed other necessary directions such as to keep
on record the documentary record of the securities/D-MAT accounts or their
up-to-date position during the trial. The subject matter of the present
litigation is the shares/securities which are having the fluid/fluctuating
values in the market. The D-MAT accounts of the respondent no. 2 as well
as shares therein were ordered to be frozen in 2009 and to continue with the
said directions, would not serve any purpose particularly when the interest
of NAFED is reasonably protected by the revisional court in the impugned
order. No useful purpose would be served by freezing the D-MAT accounts
of the respondent no.2 with M/s Star Finvest Limited and M/s Religare
Securities Limited and freezing of the shares therein. The arguments
advanced on behalf of contesting parties are considered in right perspective.
There is no infirmity and illegality in the impugned order which does not
call for any interference. Hence, the present petition is dismissed.
CRL. M.C.6163/2019 Page 17
Signature Not Verified
Digitally Signed
By:HARVINDER KAUR
BHATIA
Signing Date:22.02.2023
17:38:04
Neutral Citation Number:2023/DHC/001272
14. The present petition along with pending application, if any, stands
disposed of. Nothing in this judgment shall be taken as opinion on merits of
the case and shall not in any manner influence the trial.
15. The copy of this order be sent to the concerned revisional court as well
as the Trial Court for information.
SUDHIR KUMAR JAIN
JUDGE
FEBRUARY 22, 2022/j/pj
CRL. M.C.6163/2019 Page 18
Signature Not Verified
Digitally Signed
By:HARVINDER KAUR
BHATIA
Signing Date:22.02.2023
17:38:04
