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2019 DIGILAW 356 (JK)

Shalinder Gulhati Sandeep Gulhati v. State of J&K

2019-07-26

TASHI RABSTAN

body2019
JUDGMENT : 1. Since both the petitions for grant of bail have arisen out of a common FIR and the facts in both the petitions are similar in nature, hence both are being decided by this common judgment. 2. The petitioners are alleged to have committed the offences punishable under sections 420 and 120-B of the Ranbir Penal Code. The offence under section 420 is non-bailable. The petitioners were arrested on 17.11.2018 and are in judicial custody. 3. Before dealing with the outcome of applications on hand, a brief advertence of the circumstances leading to filing of instant applications is necessary. The petitioners wanted to sell the landed property measuring 29 Kanals situated at Gangyal, Jammu, and disclosed their intention to one Divya Ashish Jamwal, a common friend, who arranged the meeting of petitioners with complainant, namely, Navneet Mahajan, and his Late Father, namely, Mr. D. K. Mahajan. After negotiations and facilitation of Divya Ashish Jamwal, who mediated the deal, the value of said landed property came to be fixed at Rs. 26 crores. A Memorandum of Understanding was also prepared, in which it was agreed upon that after receiving Rs. 12.90 Crores, that is, almost half of the payment, the petitioners promised to handover the physical possession of said land. Accordingly, the complainant made a payment of Rs.12.90 Crores through Banks and also through Mediator, namely,Divya Ashish Jamwal, against proper receipts. However, on receipt of half of the payment, the petitioners failed to handover the possession of landed property and also failed to obtain No Objection Certificate from the Bank, to which the said property had been mortgaged. Instead they are alleged to have diverted the whole money, received from the complainant, to liquidate other liabilities and debts incurred by the petitioners. On the allegations of complainant that the petitioners have cheated him and also committed fraud upon Bank, as the landed property, proposed to be sold to the complainant, was mortgaged with the Bank and that the bank had no intimation regarding proposed sale, Police Station Crime Branch, Jammu, registered a case under sections 420 and 120-B of the Ranbir Penal Code against the petitioners and their father C.K Ghulati and mediator Divya Ashish Singh Jamwal. On completion of the investigation, the police filed the criminal Challan in the Court of learned Judicial Magistrate, 1st Class, Sub Judge, Jammu. 4. On completion of the investigation, the police filed the criminal Challan in the Court of learned Judicial Magistrate, 1st Class, Sub Judge, Jammu. 4. This is second round of bail applications filed by the petitioners. The petitioners were arrested on 17.11.2018. They filed applications for grant of bail before the Court of learned CJM, Jammu, which came to be dismissed on 24.11.2018, mainly on the ground that prima facie there were reasonable grounds for believing that the accused have committed non-bailable offence, as the case pertains to recovery of huge amount of Rs. 12.90 Crores, and that the investigation was still at its infancy for which custodial interrogation of the accused was necessary. Thereafter, again bail applications came to be filed before the learned 2ndAdditional Sessions Judge, Jammu, which were also dismissed on 30.11.2018 for the reason that investigation was yet to be concluded and there was possibility of accused winning over the material witnesses and jumping over the bail could not be ruled out. The petitioners thereafter made another bidfor grant of bail before this Court,but failed as their applications were dismissed on 31.12.2018 on the ground that criminal intention of petitioners to cheat the complainant was existing right from the beginning of execution of MOU and there was existence of a prima facie case of cheating and duping of about Rs.12.90 Crores by the accused from the complainant. 5. After presentation of criminal Challan on completion of investigation on 12.01.2019 in the Court of learned Judicial Magistrate, 1st Class, Sub Judge, Jammu, the petitioners again moved applications for grant of bail, which were rejected on 21.02.2019 mainly on the ground that there had been no change in circumstances for taking a view other than what had been recorded by earlier courts in previous applications. Aggrieved thereof, the petitioners approached learned 1st Additional Sessions Judge for grant of bail, which too were dismissed on 11.05.2019 for the reason that two accused were still absconding and had not been apprehended and in case grant of bail in favour accused, there would have been every possibility of their jumping over the bail and winning over the prosecution witnesses. It was also observed that in view of judgment of the Supreme Court in the case of Virupakshappa Gouda and anr vs. State of Karnatka and anr, (2017) 5 SSC 406, filing of Challan could not be treated as change in circumstances. 6. It was also observed that in view of judgment of the Supreme Court in the case of Virupakshappa Gouda and anr vs. State of Karnatka and anr, (2017) 5 SSC 406, filing of Challan could not be treated as change in circumstances. 6. Now petitioners have come up with applications on hand beseeching grant of bail on the grounds and submissions tailored therein. 7. Respondent-State has filed the objections, insisting therein that successive bail applications, without their being any change of circumstance, are not maintainable and deserve to be dismissed. It is contended that during the course of investigation, the allegations against the accused have prima facie been proved. The statements of witnesses recorded during investigation are stated to have revealed that the accused have received an amount of Rs.12.90 crores against the property-in-question from the complainant but, after taking the amount, they utilized the same for other purposes instead of liquidating the bank loan pending against the said property and planned to sell the property without seeking permission from the bank authorities. Further, it is averred that the fact of Rs.29.00 crores loan liability against the bank was intentionally concealed so as to cheat the complainant and to take the money from the complainant. After taking Rs.12.90 crores, the accused failed to give half of the possession of land to the complainant and also to obtain NOC from the Bank, thus they not only cheated the complainant, buthave also played fraud with the Bank authorities after hatching conspiracy with criminal intention, thereby causing huge loss to the complainant.In the objections it is also submitted that there are huge liabilities amounting to Rs.70.00 crores to Rs.80.00 crores approximately, outstanding against the firm and the individuals, which are in the shape of Bank Loan, PPF of the employees, salary of the employees, Sales Tax, Income Tax, GST etc. It is asserted that as per the investigation, the concerned firm has not paid/maintained the PPF of its employees and in this regard another complaint No.J-95/2018 dated 05.03.2018 is also under probe, which is lodged by the employees. The investigation conducted so far has revealed that the concerned firm/individuals have not filed any Income Tax Returns since 2016 as per Audit Report No.JSVP/CA/2018-19 dated 22.11.2018. The investigation conducted so far has revealed that the concerned firm/individuals have not filed any Income Tax Returns since 2016 as per Audit Report No.JSVP/CA/2018-19 dated 22.11.2018. It is also stated that from the investigation it was found that fourth accused Divya Ashish Jamwal has not committed any offence as he only acted as a mediator, so the benefit under section 169 of Cr.P.C has been given to him, thus final investigation report stands filed against three accused and all are in judicial custody. 8. I have heard and considered the rival contentions of learned counsel appearing for the parties and perused the files. 9. Learned counsel for petitioners, to cement the case set up by petitioners, has submitted that the petitioners have numerous business concerns running in the State of Jammu and Kashmir, such as, M/s National Garage, dealership of Tata Motors etc., and owns various movable and immovable properties. He contends that petitioners entered into a Memorandum of Understanding (MOU) with one Navneet Mahajan, and his late father Mr. D. K. Mahajan for development of land measuring 29 kanals situated at Gangyal, Jammu, owned and possessed by them. The MOU was based upon reciprocal promises/obligations and the complainant expressed his inability to arrange the entire amount on which the MOU’s were agreed upon and entered between the parties, which ultimately led to the frustration/delay in the contract. His further submission is that the transaction between the parties is purely of civil nature, so the criminal proceedings should not have been lodged, but the complainant lodged the FIR. The courts below are said to have not properly appreciated the transaction between the parties which was purely of civil nature and there was no intention on the part of petitioners to cheat complainant. Previous bail applications, it is contended, were rejected on the reason that the investigation was not complete, but now the investigation stands concluded and no purpose would be achieved by keeping the petitioners in custody. Petitioners are in advance stage of life and suffering from multiple ailments and their continued detention is visiting them with penal consequences. 10. In the background of the case set up it would be relevant to say that personal liberty is a very precious fundamental right enshrined in Article 21 of the Constitution of India and deprivation of liberty is a matter of grave concern. 10. In the background of the case set up it would be relevant to say that personal liberty is a very precious fundamental right enshrined in Article 21 of the Constitution of India and deprivation of liberty is a matter of grave concern. It should be curtailed only when it becomes imperative to the peculiar facts and circumstances of the case. When a person is arrested on the allegations of commission of non-bailable offence, two conflicting interests are pitted against each other, that is, liberty of individual involved and interest of society so as to prevent crime and punish criminal. It becomes responsibility of the courts to weigh the contrary factors. The object of detaining a person in judicial custody is to direct him to join the investigation, secure his presence at trial, he may not interfere with investigation, intimidate witnesses, tamper with evidence, flee from justice, chances of repeating the offence etc., and if this purpose can be fulfilled by putting certain conditions and securing bail bonds, it would be an ideal blending of two apparently conflicting claims. 11. A fundamental postulate of Criminal Jurisprudence is the presumption of innocence, which means a person is believed to be innocent until found guilty. Another facet of our Criminal Jurisprudence is that grant of bail is the general rule and putting a person in jail is an exception (Bail but not the jail). Grant or denial of bail is entirely the discretion of a Judge considering a case, but such discretion should be exercised judiciously and not arbitrarily. 12. The courts below on second round of bail applications have observed that in view of the judgment of the Supreme Court in case of Virupakshappa Gouda and anr. vs. State of Karnatka and anr. (supra), filing of Challan cannot be treated as substantial change in circumstances, therefore, declined to enter upon the merits of submissions made by the learned counsel for petitioners. Same issue was considered by the High Court of Karnataka in Mohammed Nalpad Haris vs. State of Karnatka, (Criminal Petition No. 1764 of 2018) decided on 14.06.2018, in which it was observed that reliance placed on Virupakshappa Gouda’s case is misplaced as the Supreme Court has nowhere laid down that filing of chargesheet does not amount to change of circumstances. Same issue was considered by the High Court of Karnataka in Mohammed Nalpad Haris vs. State of Karnatka, (Criminal Petition No. 1764 of 2018) decided on 14.06.2018, in which it was observed that reliance placed on Virupakshappa Gouda’s case is misplaced as the Supreme Court has nowhere laid down that filing of chargesheet does not amount to change of circumstances. It was observed that the submission of charge sheet accompanied by documents relied upon by the prosecution, therefore, affords more material to the accused to invite the court to examine them. These materials were not available either with the accused or with the prosecution at the time of consideration of his/their earlier bail applications. Therefore, on account of this changed circumstance, the Court is required to consider these materials and satisfy itself that subsequent developments and other considerations are sufficient grounds for releasing the applicant on bail. 12(a) I am also in total agreement with observations made by the Karnataka High Court in the above case. In that view of matter, the courts below, in the present case, have misunderstood the observations made in Virupakshappa Gouda’s case (supra). Admittedly, the investigation has now been completed and evidence stands collected which are mostly in documentary form, including Memorandum of Understanding, bank statements and other receipts of money, revenue papers etc., are by itself a substantial change of circumstance for this Court to decide the bail application on merit, more particularly when the previous bail applications were rejected mainly on the ground that the investigation was at its infancy and there was every likely hood of tampering with the evidence. 13. Although filing of successive bail application is permissible in law and the petitioners herein have a right to make successive applications for grant of bail, yet this Court while entertaining such subsequent bail applications has a duty to consider the reasons and grounds on which the earlier bail applications were rejected. 14. While examining the scope of grant of bail, the Supreme Court in a landmark decision rendered in the case of Sanjay Chandra vs Central Bureau of Investigation, AIR 2012 SC 830 , has held that the object of bail is neither punitive nor preventive. Deprivation of liberty must be considered a punishment unless it is required to ensure that the accused will stand his trial when called upon. Deprivation of liberty must be considered a punishment unless it is required to ensure that the accused will stand his trial when called upon. It was also observed that detention in custody pending completion of trial could be a great cause of hardship. While refusing the bail, one must not lose sight of the fact that any imprisonment before conviction has a substantial punitive content and it would be improper for any court to refuse bail of an un-convicted person for the purpose of giving him a taste of imprisonment as a lesson. 15. In the present case, the petitioners are in custody. The petitioners have filed the present applications for grant of bail on the ground that investigation in the case has now been completed and Challan has also been produced. A perusal of instant bail applications would reveal that the petitioners herein have nowhere denied that they along with their father have not received an amount of Rs.12.90 crores from the complainant on account of sale of property. In paragraph9 of the bail application the petitioners though have averred that the prosecution has levelled allegations against them of duping an amount of Rs.12.90 crores of complainant, but they have not denied that they did not receive such a huge amount. Further, in paragraph10 of the bail application it has been admitted by the petitioners that they had received certain amount from the complainant. Even in the Memorandum of Understanding, annexed by the petitioners with the bail applications, it has been specifically mentioned that they have already received a sum of rupees six crores from the complainant and that the complainant would pay rupees four crores within 15 days and rupees three crores within two months of signing of the MOU. The MOU was executed on 10.08.2015;meaning thereby the petitioners have already received an amount of Rs.12.90 crores from the complaint, which they too have neither denied in the bail application nor in their pleadings before this Court. The MOU was executed on 10.08.2015;meaning thereby the petitioners have already received an amount of Rs.12.90 crores from the complaint, which they too have neither denied in the bail application nor in their pleadings before this Court. Not only this, as per the prosecution story they have also violated the terms and conditions of MOU by not depositing the said amount with the concerned bank for release of the mortgaged/hypothecated land-in-question, which was the specific condition of MOU that the owner, i.e., petitioners herein, would take full responsibility in obtaining the NOC from banks, shareholders, partners or co-owners; meaning thereby the petitioners herein have utilized the huge amount received from the complaint for the purposes other than what has been specified in the MOU. 16. The first round of bail applications were rejected on the ground that prima facie there were reasonable grounds for believing that the accused have committed non-bailable offences, as the case pertains to recovery of huge amount of Rs. 12.90 Crores; the investigation was still at infancy for which custodial interrogation of the accused was necessary; the investigation was yet to conclude and there was possibility of accused winning over the material witnesses and jumping over the bail could not be ruled out. The criminal intention of petitioners to cheat the complainant was existing right from the beginning of execution of MOU and there was existence of a prima facie case of cheating and duping of about Rs.12.90 crores by the accused from the complainant. 16(a) Going by the record of the file and the objections filed by the State, I am in full agreement with the observations made by the previous courts that prima facie the petitioners have committed non-bailable offence, particularly on considering that the amount they received from the complainant was not deposited with the bank to which the said property was mortgaged and instead diverted the money to liquidate other debts and liabilities incurred by the petitioners and the same is also not denied by the petitioners that they have not deposited the received amount in the bank or have taken the permission from the bank about the proposed sale of mortgaged property. Be that as it may, this Court is not inclined to appreciate the evidence at this stage and the only point to be seen is that the Challan stands filed and there is nothing on record which shows that further investigation is required in the matter. All the accused stands arrested including those who had not been arrested during the rejection of previous bail applications and was one of the grounds for rejection of previous bail applications. 17. Going by the totality of the circumstances and the law laid down by the Supreme Court in State v. Jaspal Singh Gill, reported in AIR 1984 SC 1530, that the detention of un-convicted persons pending completion of trial, particularly when trial has not been commenced, should not be continued unless it is imperative to detain them. While considering the overall factors for detaining a person pending trial, i.e., nature and gravity of offence, severity of punishment in the event of conviction, danger of accused absconding or fleeing if released on bail, likelihood of offence being repeated, reasonable apprehension of witnesses being tampered with and the nature of offence being compoundable with the permission of the Court, I am of the considered view that the petitioners are entitled to be released on bail, of course, with certain terms and conditions. 18. While making my mind to release the petitioners on bail, I am conscious of the fact that petitioners are charged with serious economic offence involving Rs.12.90 crorers and law in this regard is settled that in case of economic offences, the object of criminal prosecution is to protect the investors and help them in recovery of the money. The detention of accused in the jail would not aid them in recovery of money. In economic offences, the purpose is more to recover the amount than to punish the accused persons. In “Bihar Fodder Scam” case, the Supreme Court observed that economic offences jeopardize the economy of the Country, however, the fact that investigating agency has already completed investigation and the charge sheet already filed before the court, the presence of accused in the custody may not be necessary. The economic offences in our Country are increasing at alarming rate which causes significant damage to the general economy of the Country and adversely affect the growth and development of the Country. The economic offences in our Country are increasing at alarming rate which causes significant damage to the general economy of the Country and adversely affect the growth and development of the Country. Therefore, a balance is required to be maintained between the right of the accused and interest of the society, particularly in economic offences having tendency to jeopardize the economy of the Country and hampering growth and development of the Nation. 19. Accordingly, the applications, for the reasons stated above, are allowed on the following conditions: i. Petitioners are ordered to be enlarged on interim bail of 20 days on their furnishing bail bonds in the sum of Rs. 2,00,000/- (rupees two lakh only) each with two sureties of the like sum to the satisfaction of the trial court. If the petitioners deposit an amount of rupees two crores each with the Presiding Officer of the Court of learned Judicial Magistrate, 1st Class, Sub Judge, Jammu (trial Court), the interim bail shall be deemed to have become absolute. On deposit of the amount within a period of twenty days of release of the petitioners, learned Presiding Officer of trial Court shall keep the same in the shape of FDR with the J&K Bank Limited with its High Court Branch at Jammu by designation, initially for a period of six months. ii. Petitioners shall surrender their passport, if any, and in case they are not holder of the same, they shall swear individual affidavits before the trial Court. iii. Petitioners shall appear before the Police Station, Crime Branch, Jammu, on every Saturday during day time. iv. Petitioners shall appear before the court as and when required. v. Petitioners shall not threaten, induce or allure the witnesses and shall not temper with the prosecution evidence. vi. Petitioners shall not leave the territorial jurisdiction of trial court without its permission. 20. It is made clear that the trial Court shall not be influenced by any of the observations made hereinabove while proceeding further with the trial of the case. 21. Let a copy of this order be sent to the learned trial Court, who shall take follow up action in the matter.