Bharat Modi vs Serious Fraud Investigation ...
2023 Latest Caselaw 3800 P&H

                                                   Neutral Citation No:=2023:PHHC:054326




  HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
                          ****
                CRM-M-36374-2022 (O&M)
                 Decided on 12.04.2023
                          ****
Bharat Modi                            ... Petitioner

                                        VS.

Serious Fraud Investigation Office                           ... Respondent
                             ****
CORAM: HON'BLE MR.JUSTICE SANDEEP MOUDGIL
                             ****
Present: Mr. Keshavam Chaudhri, Advocate for the petitioner

          Ms. Puneeta Sethi, Advocate for the petitioner
                                ****
Sandeep Moudgil, J.

The petitioner seeks grant of regular bail in respect of complaint

bearing CIS No.COMA/5/2019 dated 18.05.2019, filed by the respondent

under Sections 58A, 58AAA, 211(7), 227, 628, 233 of Companies Act, 1956,

Sections 74(3), 76A, 448, 147, 447, 448, 143, 144, 141(3)(e) of the

Companies Act, 2013 and Section 120-B read with Sections 406, 417, 418,

420, 467, 468, 471, 477A, 474 of IPC, pending before the Special Judge,

Gurugram.

It is the prosecution case that the petitioner was amongst the

directors/partners in a total of 16 CUIs/LLPs and the role attributed to the

petitioner is that funds were secured fraudulently and illegally during his

terms of directorship, from Adarsh Credit Cooperative Society Ltd.

(hereinafter referred to ACCSL) and he had signed balance sheets of certain

companies. It was revealed that 70 out of 126 companies under investigation

(CUIs) received loan fraudulently and illegally and a total of Rs.4120 crores

were outstanding as loan as on 31.03.2018.

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Learned counsel for the petitioner contended that he has been

falsely implicated in the present case. The co-accused persons, who have

been attributed with graver allegations, have already been granted the

concession of anticipatory/regular bails whereas the petitioner is in custody

since 13.08.2019. It is further contended that the petitioner was not arrested

during investigation as his arrest was not deemed appropriate by the agency.

There is no progress in the trial and the petitioner is the victim of protracted

trial. The allegations levelled by the respondent nowhere suggests that the

petitioner had been the beneficiary of the entire transaction since the entire

matter is based upon documentary evidence.

On the other hand, Ms. Puneeta Sethi, learned Sr. Panel Counsel,

Union of India appearing for respondent-SFIO submitted that the petitioner is

being prosecuted being a Director of the company and being as such, the

petitioner misused his position and illegally obtained and siphoned off loans

from the Cooperative Society by the companies belonging to Adarsh Group

& Riddhi Siddhi Group, on the basis of forged financials/loan documents

submitted/signed by the Directors etc. of the companies in connivance with

the accused persons.

Heard learned counsel for the parties and gone through the

record.

Learned counsel for the respondent, on instructions, informed

that the petitioner was taken into custody on 13.08.2019 and the investigation

of the case is already complete and that nothing further is to be recovered

from the petitioner.

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It is the case of the petitioner that the co-accused Jainam Rathod

approached the Supreme Court in Criminal Appeal No.640 of 2022 and the

Supreme Court vide order dated 18.04.2022 granted bail to the said accused

observing that "while the provisions of Section 212(6) of the Companies Act,

2013 must be borne in mind, equally, it is necessary to protect the

constitutional right to an expeditious trial in a situation where a large

number of accused implicated in a criminal trial would necessarily result in

delay in its conclusion. The role of the appellant must be distinguishable

from the role of the main accused".

Another co-accused, namely, Peeyush Aggarwal also challenged

the order dated 18.12.2022 vide which this Court rejected the anticipatory

bail petition, before the Supreme Court in SLP(Crl.) No.12744 of 2022 which

was allowed vide order dated 13.01.2023 restraining the respondent-SFIO

from initiating coercive steps. In the same manner, Vivek Harivyasi and

Priyanka Modi have also been extended the benefit of regular bail by the

Supreme Court

'Bail is rule, jail is an exception' is a legal principle that was laid

down by the Supreme Court in a landmark judgment of State of Rajasthan v.

Balchand alias Baliya 1977 AIR 2447. His Lordship Hon'ble Mr. Justice

Krishna Iyer, speaking on behalf of the Bench, held that bail and not jail

would be the basic Rule in ordinary circumstances, when he observed, "The

basic Rule may perhaps be tersely put as bail, not jail, except where there are

circumstances suggestive of fleeing from justice or thwarting the course of

justice or creating other troubles in the shape of repeating offences or

intimidating witnesses and the like......''. The judgment was based upon

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several rights that have been guaranteed by the Constitution of

India with Article 21 being the most important one. Detention of an

individual infringes his right to life and liberty as guaranteed under Article 21

of the Constitution of India. The main purpose of detention is to ensure easy

proceedings by availing the accused for the trials without any inconvenience.

Thus, if it can be ensured that the accused will be available as and when

required for the trial, then, detaining the person is not necessary. Therefore, it

was held that the provisions of the Criminal Procedure Code, 1973 (CrPC)

regarding the arrest of an individual must be interpreted in a sense that unless

indispensable, detention of a person must be avoided.

In this view of the matter and also taking into consideration the

fact that investigation of the case is complete; nothing more is to be recovered

from the petitioner; also keeping in view the education, antecedents and

character of the present petitioner, he is not likely to flee from the course of

justice and also the fact that the trial is likely to take some time, therefore, no

fruitful purpose will be served by keeping the petitioner behind bars, the

petitioner is directed to be released on regular bail on furnishing bail and

surety bonds to the satisfaction of the Chief Judicial Magistrate/Duty

Magistrate concerned.

The present petition is, therefore, allowed.

12.04.2023                                             (Sandeep Moudgil)
V.Vishal
                                                             Judge
1. Whether speaking/reasoned?                        Yes/No
2. Whether reportable?                               Yes/No




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