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March 22, 2022

HC denies to cancel bail of CA Couple in case of alleged fraud with client

by CA Shivam Jaiswal in Legal Court Judgement

HC denies to cancel bail of CA Couple in case of alleged fraud with client

Fact and Issue of the case

This petition has been filed under Section 397 (1) CrPC read with Section 482 CrPC challenging Order dated 11.03.2019, wherein Respondent No.2 was granted bail by the learned ACMM (South), Saket Courts as well as Order dated 06.01.2021 passed by the learned Additional Sessions Judge, Saket Courts, rejecting an application filed by the Petitioner herein seeking cancellation of bail granted to Respondent No2.

It is stated that the Petitioner is a senior citizen on whose name property bearing No.S-61, Panchsheel Park, New Delhi-110017 had devolved after the death of her husband. It is stated that in the month of December 2010, the Petitioner met one Manoj Sachdeva (Respondent No.2 herein) and his wife. The Petitioner was informed that Respondent No.2 herein was a Chartered Accountant and his wife was his associate. It is stated that in the first week of February 2011, the Petitioner provided some income tax related work to Respondent No.2 and his wife. In mid-February 2011, both Respondent No.2 and his wife informed the Petitioner that through their internal sources in the Income Tax Department, they had been told that the Petitioner’s property at Panchsheel Park was under scrutiny and was going to be sealed by the Department. Respondent No.2 and his wife informed the Petitioner that they wanted to help her out on account of her being a senior citizen.

Respondent No.2 and his wife further informed the Petitioner that she had only two options: either to pay a sum of Rs.17 crores or to go behind bars and have her property sealed by the IT Department. They stated that they could get this issue resolved if the Petitioner paid Rs.1 crore in Order to save the property. They assured the Petitioner that this would lead to the Income Tax Department issuing assessment Orders and closing the file. Thereafter, in Order to settle the matter, the Petitioner gave Rs.70 lakhs to Respondent No.2 in separate instalments in the year 2011. Respondent No.2 accordingly prepared the papers of the Petitioner’s property at Panchsheel Park and transferred the ground floor in the name of Rita Bhutani & Co. to arrange the loan of Rs.2,50,00,000/- from Dhanlaxmi Bank.

It is stated that the Petitioner, despite paying cash and issuing cheques multiple times, was not provided any receipt for the same. The Petitioner was also forced to sign many blank papers and cheques whose purpose she was not aware of by Respondent No.2 and his wife. It is stated that after sanction of loan from Dhanlaxmi Bank, the Petitioner was made to provide blank cheques to the Respondent No.2 and his wife. It is stated that the loan amount of Rs.2,50,00,000/- was misappropriated by the accused and the accused had also fraudulently opened many bank accounts in the Petitioner’s name. Further, when the Petitioner enquired about the details of the bank statements, she found that no payments had been made to the Income Tax Department. She further found that some payments had been made to a company namely, Shivalik Holidays Pvt. Ltd. and M/s Yans Swastik Pvt. Ltd.

It is stated that Respondent No.2 and his wife have altogether fleeced the Petitioner out of Rs.5,50,00,000/-, and that they have also taken the original made by the Petitioner’s husband in her name. When the Petitioner enquired about these transactions from Respondent No.2 and his wife, she was threatened that they would kill her if she attempted to complain against them. On the basis of this complaint, FIR No. 1364/2015 dated 14.07.2015 was registered at Police Station Malviya Nagar for offence punishable under Section 420 IPC, with chargesheet and supplementary chargesheet being filed with offences under Section 420, 463, 467, 46, 471 IPC read with Section 120 B IPC.

Vide Order dated 11.02.2016, an application for anticipatory bail filed by Respondent No.2 herein was dismissed by the learned District & Sessions Judge, Saket Courts. On 23.02.2019, Respondent No.2 was arrested by officials of Economic Offences Wing. On 11.03.2019, Respondent No.2 was granted bail by the learned ACMM, Saket Courts and the same was challenged by the Petitioner herein which was rejected vide Order dated 27.02.2020.

Thereafter, citing change in circumstances, the Petitioner filed another application seeking cancellation of bail which was consequently rejected vide Order dated 06.01.2021. Aggrieved by the grant of bail to Respondent No.2 as well as rejection of Petitioner’s application seeking cancellation of bail, the Petitioner has approached this Court by way of the instant petition.

Mr. Vaibhav Gaggar, learned counsel for the Petitioner, states that the case relates to a senior citizen who has been duped by Respondent No.2 who is a Chartered Accountant. He informs this Court that Respondent No.2’s licence was taken away by the Institution of Chartered Accountants of India (ICAI). He states that matter pertaining to the licence of Respondent No.2 being taken away was adjudged all the way upto the Supreme Court and the licence was not restored.

Mr. Gaggar submits that the instant matter is predominantly forgery and cheating, and the instant application seeking cancellation of bail has been filed as certain circumstances have arisen that indicate that Respondent No.2 is resorting to illegal methods to shield himself. He submits that Respondent No.2, from the inception of investigation, had been contending that the alleged loan transactions had been conducted by one Anil Alexender Biswas, who is the Director of the company M/s Shivalik Holidays. He states that recently Mr. Biswas passed away under mysterious circumstances and this gives impetus to the suspicion that it is no longer conducive for Respondent No.2 to be out on bail. He further submits that Respondent No.2 is a habitual offender and he has allegedly deprived not only the Petitioner herein of monies, but other people as well.

The learned counsel for the Petitioner relies upon the judgment in Dr. Narendra K Amin v. State of Gujarat, (2008) 13 SCC 584 to submit that if it is found that serious attempts have been made to tamper with evidence and sidetrack the investigation, bail granted should be cancelled. Mr. Gaggar states that in the instant case, the Respondent No.2 has deliberately misled the investigation as per the Status Report. He submitted that the impugned Order granting bail to Respondent No.2 is legally infirm and, due to the presence of supervening circumstances i.e. the mysterious death of the co- accused, who was a Director at M/s Shivalik Holidays, the Petitioner is no longer entitled to enjoy his grant of bail. He, therefore, submits that the impugned Orders dated 11.03.2019 and 06.01.2021 are liable to be set aside.

Observation of the Court

Having heard and after perusing the material on record. The aspect of grant of bail and cancellation of bail stand on different footing as the factors which go into consideration of an application seeking grant of bail are completely different from the factors that must be considered while hearing an application seeking cancellation of bail on account of the latter involving interference in the personal liberty of the accused that has been duly granted by the lower court. Therefore, Appellate Courts must be circumspect while interfering in an Order granting bail.

In Dolat Ram & Ors. v. State of Haryana, (1995) 1 SCC 349, the Supreme Court had succinctly discussed cancellation of bail under Section 439 (2) CrPC as well as the factors that must be borne in mind while hearing an application seeking cancellation of bail.

 Therefore, cogent and overwhelming circumstances must exist for an Order directing the cancellation of bail. Further, bail once granted should not be cancelled in a mechanical manner without considering as to whether any supervening circumstances exist that entail a fair trial not being allowed to be conducted.

In the instant case, the Petitioner seeks not only cancellation of bail but has also appealed against the grant of bail to Respondent No.2. On one hand, in an application for cancellation of bail, conduct subsequent to release on bail and the supervening circumstances alone are relevant, on the other hand, in a petition challenging grant of bail, all aspects that are relevant while dealing with an application seeking bail continues to be relevant [Refer State of U.P. through CBI v. Amarmani Tripathi, (2005) 8 SCC 21].

A perusal of the material on record reveals that the Petitioner has approached the lower court twice with an application under Section 439 (2) CrPC. On 27.02.2020, the learned ACMM, Saket Courts had astutely considered the circumstances on merits before refusing to cancel bail that had been granted to Respondent No.2. Thereafter, citing mysterious death of co-accused, the Petitioner approached the learned Trial Court for the second time seeking cancellation of bail. The said application was dismissedvide impugned Order dated 06.01.2021 on the ground that no details had been furnished regarding the death of the co-accused and the role of Respondent No.2 in the said death.

This Court finds that the impugned Order dated 06.01.2021 of the learned Trial Court has aptly considered the fact that no supervening circumstances have come to light that would warrant cancellation of bail granted to Respondent No.2. This Court does not find any weight in the learned counsel for the Petitioner’s reliance on Dr. Narendra K Amin v. State of Gujarat (supra), as the said judgment pertains to a fake encounter and the instant case relates to the misappropriation of property, which cannot be said to be a graver offence than one committed against the human body.

Further, a perusal of the impugned Order dated 11.03.2019 indicates that the learned Trial Court had carefully considered all the material present before it and rendered a well reasoned Order granting bail to Respondent No.2. It is well settled that where bail has been granted by lower court, an Appellate Court must be slow to interfere and ought to be guided by the principles set out for the exercise of the power to set aside bail. (Refer Mahipal v. Rajesh Kumar, (2020) 2 SCC 118).

In view of the above, this Court does not deem it fit to exercise its jurisdiction under Section 482 CrPC to set aside impugned Orders dated 11.03.2019 and 06.01.2021. However, this Court is cognizant of the fact that the Petitioner is a female senior citizen who has been embroiled in this matter since 2015, and that charges are yet to be framed despite a lapse of three years.

This Court, directs the learned Trial Court to hear arguments on charge and if charges are framed, expeditiously conduct the trial and conclude the same within a period of 18 months year from the date of this Order. The petition is dismissed with the above observations.


The court dispose of the petition and ruled against the petitioner

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