ANURAG DWIVEDI v. STATE OF CHHATTISGARH

punishable under Sections 420,467,468,471,120-B of IPC and Sections 7 & 12 of the Prevention of Corruption Act.

2. Facts of the case in brief is that vide letter dated 11.07.2023, the Directorate of Enforcement has made a disclosure under Section 66 of the PMLA 2002 of ECIR/11/2022 with regard to registration of FIR. On the basis of the said information received under Section 66 of the PMLA 2002, the investigation agency registered FIR for the offence punishable under Sections 420,467,468,471,120-B of IPC and Sections 7 & 12 of the Prevention of Corruption Act was registered against the applicant on 17.01.2024. After registration of the said FIR some arrests were made. In the present FIR, the allegation against the present applicant is that by using duplicate holograms there was sale of unaccounted liquor in which he was involved and this caused revenue loss to the State of Chhattisgarh. Now the case against him is that there are two bottles one is original hologram and the second is duplicate hologram The holograms are the same and manufactured by the same company as per the charge sheet "The Prizm Hologram Ltd." It is the case of prosecution that there are two types of bottles used in the alleged offence - one containing duplicate holograms and the other is original holograms.

3. On 29.06.2024, first charge sheet was filed before the Court and final report under Section 173 of the Cr.P.C was filed by the respondent/Agency under Sections 420,467,468,471 and120-B IPC and

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Sections 7 & 12 of the Prevention of Corruption Act, 2018. On 03.07.2024, the prosecuting agency received information from the informant and on that basis, an officer was deputed under Section 165(3) of the Cr.P.C to conduct the search on the premises which is situate at Dhaneli where the unused duplicate holograms were buried on the backside of the godown. It is alleged that the said premises belong to the co-accused Anwar Dhebar and was used by the present applicant for keeping the empty bottles. Further allegation against the applicant is that the duplicate holograms were supplied to the distilleries and from the distilleries it was distributed to different shops ie. Welcome Distilleries, Bhatia Wines and others. The prime allegation and the mode of offence was that one bottle was containing original holograms and the other was containing duplicate holograms. The duplicate holograms should have been seized from the shop but as such there is no seizure. And if these holograms were seized but they have not been used in committing the offence and were destroyed.

4. Further allegation against the applicant is that he used to buy the used empty bottles from the market from the junk dealers and after cleaning them used to supply to big dealers in the market. Till 2019-20, the applicant used to sell his goods to one Navneet Gupta, who used to supply these empty bottles to the distilleries. It is further alleged that the applicant used to supply the empty bottles to Sarveshwri Bottling Plant ltd. Siltara and later on took the plant on contract after getting acquainted with accused Arvind Singh and his nephew Amit Singh.

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Meanwhile, the applicant in association with these persons supplied empty bottles to the distilleries through a firm named Adeep Empire. The ACB/EOW conducted raid one after another at various places and meanwhile, statement of the applicant was recorded under Section 27 of the Evidence Act on 03.07.2024. Thereafter seizure panchnama was prepared whereby duplicate holograms were seized from the premises of M/s. Anurag Traders Office. The applicant was not aware as to on what ground he was being arrested by the Investigating Agency. Thereafter on 18.07.2024, the applicant was served with the ground of arrest fortified by the order of the learned Special Judge under PC Act, Raipur.

5. Shri Rajeev Shrivastava, learned Sr. Counsel for the applicant submits that the applicant was arrested on 03.07.2024 and the investigating agency has already filed the final report against the applicant on 26.09.2024 and as many as 455 witnesses have been cited and 70 accused persons are named. It is contended that the applicant is in custody during the trial and there is no likelihood that the trial would be concluded in the near future. He contended that the imprisonment before conviction is punitive amounting to violation of Article 21 of the Constitution of India. The applicant had satisfied that triple test for grant of bail. He has relied upon the judgment of the Supreme Court in the matter of Satendra Kumar Antil Vs. CBI (2022)

10 SCC 51 wherein it has been observed as under:

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"14. Innocence of a person accused of an offense is presumed through a legal fiction, placing the onus on the prosecution to prove the guilt before the Court. Thus, it is for that agency to satisfy the Court that the arrest made was warranted and enlargement on bail is to be denied.

15. Presumption of innocence has been acknowledged throughout the world. Article 14

(2) of the International Covenant on Civil and Political Rights, 1966 and Article 11 of the Universal Declaration of Human Rights acknowledge the presumption of innocence, as a cardinal principle of law, until the individual is proven guilty.

16. Both in Australia and Canada, a prima facie right to a reasonable bail is recognized based on the gravity of offence. In the United States, it is a common practice for bail to be a cash deposit. In the United Kingdom, bail is more likely to consist of a set of restrictions. 17.The Supreme Court of Canada in Corey Lee James Myers v. Her Majesty the Queen, 2019 SCC 18, has held that bail has to be considered on acceptable legal parameters. It thus confers adequate discretion on the Court to consider the enlargement on bail of which unreasonable delay is one of the grounds. Her Majesty the Queen v. Kevin Antic and Ors.,

2017 SCC 27:

"The right not to be denied reasonable bail without just cause is an essential element of an enlightened criminal justice system. It entrenches the effect of the presumption of innocence at the pre-trial stage of the criminal trial process and safeguards the liberty of accused persons. This right has two aspects: a person charged with an offence has the right not to be denied bail without just cause and the right to reasonable bail. Under the first aspect,

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a provision may not deny bail without "just cause" there is just cause to deny bail only if the denial occurs in a narrow set of circumstances, and the denial is necessary to promote the proper functioning of the bail system and is not undertaken for any purpose extraneous to that system. The second aspect, the right to reasonable bail, relates to the terms of bail, including the quantum of any monetary component and other restrictions that are imposed on the accused for the release period. It protects accused persons from conditions and forms of release that are unreasonable. While a bail hearing is an expedited procedure, the bail provisions are federal law and must be applied consistently and fairly in all provinces and territories. A central part of the Canadian law of bail consists of the ladder principle and the authorized forms of release, which are found in S. 515(1) to (3) of the Criminal Code. Save for exceptions, an unconditional release on an undertaking is the default position when granting release. Alternative forms of release are to be imposed in accordance with the ladder principle, which must be adhered to strictly: release is favoured at the earliest reasonable opportunity and on the least onerous grounds. If the Crown proposes an alternate form of release, it must show why this form is necessary for a more restrictive form of release to be imposed. Each rung of the ladder must be considered individually and must be rejected before moving to a more restrictive form of release. Where the parties disagree on the form of release, it is an error of law for a judge to order a more restrictive form without justifying the decision to reject the less onerous forms. A recognizance with sureties is one of the most onerous forms of release, and should not be imposed unless all the less onerous forms have

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been considered and rejected as inappropriate. It is not necessary to impose cash bail on accused persons if they or their sureties have reasonably recoverable assets and are able to pledge those assets to the satisfaction of the court. A recognizance is functionally equivalent to cash bail and has the same coercive effect. Cash bail should be relied on only in exceptional circumstances in which release on a recognizance with sureties is unavailable. When cash bail is ordered, the amount must not be set so high that it effectively amounts to a detention order, which means that the amount should be no higher than necessary to satisfy the concern that would otherwise warrant detention and proportionate to the means of the accused and the circumstances of the case. The judge is under a positive obligation to inquire into the ability of the accused to pay. Terms of release under s. 515(4) should only be imposed to the extent that they are necessary to address concerns related to the statutory criteria for detention and to ensure that the accused is released. They must not be imposed to change an accused person's behaviour or to punish an accused person. Where a bail review is requested, courts must follow the bail review process set out in R. v. St-Cloud, 2015 SCC 27, [2015] 2 S.C.R. 328."

17. We may only state that notwithstanding the special provisions in many of the countries world-over governing the consideration for enlargement on bail, courts have always interpreted them on the accepted principle of presumption of innocence and held in favour of the accused.

18.The position in India is no different. It has been the consistent stand of the courts, including this Court, that presumption of

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innocence, being a facet of Article 21, shall inure to the benefit of the accused. Resultantly burden is placed on the prosecution to prove the charges to the court of law. The weightage of the evidence has to be assessed on the principle of beyond reasonable doubt.

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55. Section 389 of the Code concerns itself with circumstances pending appeal leading to the release of the appellant on bail. The power exercisable under Section 389 is different from that of the one either under Section 437 or under Section 439 of the Code, pending trial. This is for the reason that "presumption of innocence" and "bail is the rule and jail is the exception" may not be available to the appellant who has suffered a conviction. A mere pendency of an appeal per se would not be a factor.

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90. What is left for us now to discuss are the economic offences. The question for consideration is whether it should be treated as a class of its own or otherwise. This issue has already been dealt with by this Court in the case of P. Chidambaram v. Directorate Of Enforcement ., (2020) 13 SCC 791, after taking note of the earlier decisions governing the field. The gravity of the offence, the object of the Special Act, and the attending circumstances are a few of the factors to be taken note of, along with the period of sentence. After all, an economic offence cannot be classified as such, as it may involve various activities and may differ from one case to another. Therefore, it is not advisable on the part of the court to categorize all the offences into one group and deny bail on that basis. Suffice it to state that law, as laid down in the following judgments, will govern the field:-

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Precedents

91. P. Chidambaram v. Directorate of Enforcemen t , (2020) 13 SCC 791:

23. Thus, from cumulative perusal of the judgments cited on either side including the one rendered by the Constitution Bench of this Court, it could be deduced that the basic jurisprudence relating to bail remains the same inasmuch as the grant of bail is the rule and refusal is the exception so as to ensure that the accused has the opportunity of securing fair trial. However, while considering the same the gravity of the offence is an aspect which is required to be kept in view by the Court. The gravity for the said purpose will have to be gathered from the facts and circumstances arising in each case. Keeping in view the consequences that would befall on the society in cases of financial irregularities, it has been held that even economic offences would fall under the category of "grave offence" and in such circumstance while considering the application for bail in such matters, the Court will have to deal with the same, being sensitive to the nature of allegation made against the accused. One of the circumstances to consider the gravity of the offence is also the term of sentence that is prescribed for the offence the accused is alleged to have committed. Such consideration with regard to the gravity of offence is a factor which is in addition to the triple test or the tripod test that would be normally applied. In that regard what is also to be kept in perspective is that even if the allegation is one of grave economic offence, it is not a rule that bail should be denied in every case since there is no such bar created in the relevant enactment passed by the legislature nor does the bail jurisprudence provide so.

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Therefore, the underlining conclusion is that irrespective of the nature and gravity of charge, the precedent of another case alone will not be the basis for either grant or refusal of bail though it may have a bearing on principle. But ultimately the consideration will have to be on case-to-case basis on the facts involved therein and securing the presence of the accused to stand trial.

92. Sanjay Chandra v. CBI (2012) 1 SCC 40:

"39. Coming back to the facts of the present case, both the courts have refused the request for grant of bail on two grounds: the primary ground is that the offence alleged against the accused persons is very serious involving deep-rooted planning in which, huge financial loss is caused to the State exchequer; the secondary ground is that of the possibility of the accused persons tampering with the witnesses. In the present case, the charge is that of cheating and dishonestly inducing delivery of property and forgery for the purpose of cheating using as genuine a forged document. The punishment for the offence is imprisonment for a term which may extend to seven years. It is, no doubt, true that the nature of the charge may be relevant, but at the same time, the punishment to which the party may be liable, if convicted, also bears upon the issue. Therefore, in determining whether to grant bail, both the seriousness of the charge and the severity of the punishment should be taken into consideration.

40. The grant or refusal to grant bail lies within the discretion of the court. The grant or denial is regulated, to a large extent, by the facts and circumstances of each particular case. But at the same time, right to bail is not to be denied merely because of the sentiments of the community against the accused. The primary

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purposes of bail in a criminal case are to relieve the accused of imprisonment, to relieve the State of the burden of keeping him, pending the trial, and at the same time, to keep the accused constructively in the custody of the court, whether before or after conviction, to assure that he will submit to the jurisdiction of the court and be in attendance thereon whenever his presence is required. xxx xxx xxx

46. We are conscious of the fact that the accused are charged with economic offences of huge magnitude. We are also conscious of the fact that the offences alleged, if proved, may jeopardise the economy of the country. At the same time, we cannot lose sight of the fact that the investigating agency has already completed investigation and the charge-sheet is already filed before the Special Judge, CBI, New Delhi. Therefore, their presence in the custody may not be necessary for further investigation. We are of the view that the appellants are entitled to the grant of bail pending trial on stringent conditions in order to ally the apprehension expressed by CBI."

ROLE OF THE COURT

93.The rate of conviction in criminal cases in India is abysmally low. It appears to us that this factor weighs on the mind of the Court while deciding the bail applications in a negative sense. Courts tend to think that the possibility of a conviction being nearer to rarity, bail applications will have to be decided strictly, contrary to legal principles. We cannot mix up consideration of a bail application, which is not punitive in nature with that of a possible adjudication by way of trial. On the contrary, an ultimate acquittal with continued custody would be a case of grave injustice.

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94. Criminal courts in general with the trial court in particular are the guardian angels of liberty. Liberty, as embedded in the Code, has to be preserved, protected, and enforced by the Criminal Courts. Any conscious failure by the Criminal Courts would constitute an affront to liberty. It is the pious duty of the Criminal Court to zealously guard and keep a consistent vision in safeguarding the constitutional values and ethos. A criminal court must uphold the constitutional thrust with responsibility mandated on them by acting akin to a high priest."

6. He contended that in catena of judgments at the time of consideration of application for bail, the court should consider three facts ie. (i) flight risk or likelihood of fleeing justice (ie. leave the country); (ii) likelihood of tampering with evidence and (iii) likelihood of influencing witnesses. All these factors are satisfied in favour of the applicant and therefore the applicant may be granted bail. Further contention of the learned counsel for the applicant is that the applicant is not a flight risk, considering his social stand, the family and business which is entirely based in India and that the applicant has cooperated in the investigation and his statements have been duly recorded. He further contended that as per the Investigating Agency, it is a big scam with wide implication in the society but the role of each of the applicant should be seen individually. There is no substantial evidence brought on record by the respondent/Agency against the applicant showing his involvement in the manufacturing of duplicate holograms, acquiring illegal commission from the liquor suppliers for

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unaccounted sale of liquor or sale off the record, unaccounted illicit country made liquor. He has placed his reliance in the matter of

Jalaluddin Khan Vs. Union of India, Cr.A. NO. 3173/2024 before the Apex Court wherein it has been observed as under:

19. Therefore, on plain reading of the charge sheet, it is not possible to record a conclusion that there are reasonable grounds for believing that the accusation against the appellant of commission of offences punishable under the UAPA is prima facie true. We have taken the charge sheet and the statement of witness Z as they are without conducting a mini-trial. Looking at what we have held earlier, it is impossible to record a prima facie finding that there were reasonable grounds for believing that the accusation against the appellant of commission of offences under the UAPA was prima facie true. No antecedents of the appellant have been brought on record.

20. The upshot of the above discussion is that there was no reason to reject the bail application filed by the appellant.

21. Before we part with the Judgment, we must mention here that the Special Court and the High Court did not consider the material in the charge sheet objectively. Perhaps the focus was more on the activities of PFI, and therefore, the appellant's case could not be properly appreciated. When a case is made out for a grant of bail, the Courts should not have any hesitation in granting bail. The allegations of the prosecution may be very serious. But, the duty of the Courts is to consider the case for grant of bail in accordance with the law. "Bail is the rule and jail is an exception" is a settled law. Even in a case like the present case where there are stringent conditions for the grant of bail in the relevant statutes, the same rule holds good with

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only modification that the bail can be granted if the conditions in the statute are satisfied. The rule also means that once a case is made out for the grant of bail, the Court cannot decline to grant bail. If the Courts start denying bail in deserving cases, it will be a violation of the rights guaranteed under Article 21 of our Constitution."

7. It is contended that the statement of the applicant recorded under Section 27 of the Evidence Act on the basis of which it is alleged that the the burnt holograms were seized from the applicant is not admissible in the eye of law for the reasons as under:

i) there is difference between recovery on the basis of Section 27 of the Evidence Act and Search under Section 100 of the Cr.P.C. In the present case, on search being made, the burnt holograms were seized which has not been done on the basis of disclosure under Section 27 of the Evidence Act. The Investigating Officer was aware of the exact location of the burnt holograms prior to recording the statement of the applicant and therefore seizure on the basis of disclosure by the applicant is irrelevant. He has placed his reliance in the matter of Allarakha Habib Memon Etc. Vs. State of Gujarat 2023 INSC 590.

ii) the holograms which were seized, were never the part of the crime as the same were unused holograms which are nothing but scrap. Even if the version of the Investigating Agency is admitted then also no offence is made out against the applicant.

Iii) While conducting FSL, it was found that there is discrepancy between the seized holograms and the holograms which were compared and marked as Ex. B and C.

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8. It is therefore submitted that there is no ground of arrest against the applicant which is a violation of judgment passed by the Hon'ble Supreme Court in the matter of Prabir Purkayastha Vs. State (NCT of Delhi) Dairy No. 42896 of 2023 wherein it has been held as under:

30. Hence, we have no hesitation in reiterating that the requirement to communicate the grounds of arrest or the grounds of detention in writing to a person arrested in connection with an offence or a person placed under preventive detention as provided under Articles 22(1) and 22(5) of the Constitution of India is sacrosanct and cannot be breached under any situation. Non- compliance of this constitutional requirement and statutory mandate would lead to the custody or the detention being rendered illegal, as the case may be.

31. Furthermore, the provisions of Article 22(1) have already been interpreted by this Court in Pankaj Bansal(supra) laying down beyond the pale of doubt that the grounds of arrest must be communicated in writing to the person arrested of an offence at the earliest. Hence, the fervent plea of learned ASG that there was no requirement under law to communicate the grounds of arrest in writing to the accused appellant is noted to be rejected."

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49. It may be reiterated at the cost of repetition that there is a significant difference in the phrase 'reasons for arrest' and 'grounds of arrest'. The 'reasons for arrest' as indicated in the arrest memo are purely formal parameters, viz., to prevent the accused person from committing any further offence;

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for proper investigation of the offence; to prevent the accused person from causing the evidence of the offence to disappear or tempering with such evidence in any manner; to prevent the arrested person for making 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 the Investigating Officer. These reasons would commonly apply to any person arrested on charge of a crime whereas the 'grounds of arrest' would be required to contain all such details in hand of the Investigating Officer which necessitated the arrest of the accused. Simultaneously, the grounds of arrest informed in writing must convey to the arrested accused all basic facts on which he was being arrested so as to provide him an opportunity of defending himself against custodial remand and to seek bail. Thus, the 'grounds of arrest' would invariably be personal to the accused and cannot be equated with the 'reasons of arrest' which are general in nature."

9. The above judgment is squarely applicable to the present case. In para 20 it has been mentioned that the grounds of arrest must be informed to the accused and has observed thus:

20. Resultantly, there is no doubt in the mind of the Court that any person arrested for allegation of commission of offences under the provisions of UAPA or for that matter any other offence(s) has a fundamental and a statutory right to be informed about the grounds of arrest in writing and a copy of such written grounds of arrest have to be furnished to the arrested person as a matter of course and without exception at the earliest. The purpose of informing to the arrested person the grounds of arrest is salutary and sacrosanct inasmuch as, this information would

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be the only effective means for the arrested person to consult his Advocate; oppose the police custody remand and to seek bail. Any other interpretation would tantamount to diluting the sanctity of the fundamental right guaranteed under Article 22(1) of the Constitution of India.

10. In the matter of Ram Kishor Arora Vs. Directorate of Enforcement, CRIMINAL APPEAL NO. 3865 OF 2023 (@ SLP (Crl.) No. 12863 of 2023),t has been held that the reasonably convenient or reasonably requisite time to inform the arrestee about the grounds of his arrest would be twenty four hours of the arrest wherein it has been stated as under:

21. In view of the above, the expression "as soon as may be" contained in Section 19 of PMLA is required to be construed as- "as early as possible without avoidable delay" or "within reasonably convenient" or "reasonably requisite"

period of time. Since by way of safeguard a duty is cast upon the concerned officer to forward a copy of the order along with the material in his possession to the Adjudicating Authority immediately after the arrest of the person, and to take the person arrested to the concerned court within 24 hours of the arrest, in our opinion, the reasonably convenient or reasonably requisite time to inform the arrestee about the grounds of his arrest would be twenty- four hours of the arrest."

11. He has contended that if the charge sheet is filed, it cannot mean that the rights of the accused are not violated and has relied upon the judgment of the Supreme Court in the matter of Prabir Purkayastha Vs. State (NCT of Delhi) wherein it has been stated that :

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The right to be informed about the grounds of arrest flows from Article 22(1) of the Constitution of India and any infringement of this fundamental right would vitiate the process of arrest and remand. Mere fact that a charge sheet has been filed in the matter, would not validate the illegality and the unconstitutionality 3 (2000) 8 SCC 590 committed at the time of arresting the accused and the grant of initial police custody remand to the accused."

12. He submits that the prosecuting agency has failed to place any document on record which would demonstrate that the applicant was running M/s. Anurag Traders from the premises from where the holograms were seized. The applicant has not been provided with the copy of the ground of arrest which in terms of Article 22 of the Constitution of India read with Section 50(1) of the Code of Criminal Procedure is a fundamental right of the accused as enshrined. Article 22 of the Constitution of India :

Protection against arrest and detention in certain cases (1) No person who is arrested shall be

detained in custody without being informed, as

soon as may be, of the grounds for such arrest

nor shall he be denied the right to consult, and to be defended by, a legal practitioner of his

choice.

Section 50 (1) of the Cr.P.C

50. Person arrested to be informed of grounds of arrest and of right to bail.

(1) Every police officer or other person arresting any person without warrant shall forthwith communicate to him full particulars of the offence

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for which he is arrested or other grounds for such arrest.

(2) Where a police officer arrests without warrant any person other than a person accused of a non- bailable offence, he shall inform the person arrested that he is entitled to be released on bail and that he may arrange for sureties on his behalf.

13. He has placed his reliance in the matter of Pankaj Bansal Vs. Union of India and Others in Criminal Appeal No. 305-3052 of 2023

that while interpreting the owrd 'inform" held that 'grounds of arrest' needs to be physically served to the Accused and non supply of grounds of arrest would render an arrest as illegal and the person is liable to be released forthwith.

The more important issue presently is as to how

the ED is required to 'inform' the arrested

person of the grounds for his/her arrest.

Prayer (iii) in the writ petitions filed by the

appellants pertained to this. Section 19 does not specify in clear terms as to how the arrested

person is to be 'informed' of the grounds of arrest and this aspect has not been dealt with or

delineated in Vijay Madanlal Choudhary

(supra). Similarly, in V. Senthil Balaji (supra), this Court merely noted that the information of

the grounds of arrest should be 'served' on the

arrestee, but did not elaborate on that issue.

Pertinent to note, the grounds of arrest were

furnished in writing to the arrested person in that case. Surprisingly, no consistent and uniform

practice seems to be followed by the ED in this

regard, as written copies of the grounds of arrest

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are furnished to arrested persons in certain parts of the country but in other areas, that practice is not followed and the grounds of arrest are either read out to them or allowed to be read by them.

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29. In this regard, we may note that Article 22(1) of the Constitution provides, inter alia, that no person who is arrested shall be detained in custody without being informed, as soon as may be, of the grounds for such arrest. This being the fundamental right guaranteed to the arrested person, the mode of conveying information of the grounds of arrest must necessarily be meaningful so as to serve the intended purpose. It may be noted that Section 45 of the Act of 2002 enables the person arrested under Section 19 thereof to seek release on bail but it postulates that unless the twin conditions prescribed thereunder are satisfied, such a person would not be entitled to grant of bail. The twin conditions set out in the provision are that, firstly, the Court must be satisfied, after giving an opportunity to the public prosecutor to oppose the application for release, that there are reasonable grounds to believe that the arrested person is not guilty of the offence and, secondly, that he is not likely to commit any offence while on bail. To meet this requirement, it would be essential for the arrested person to be aware of the grounds on which the authorized officer arrested him/her under Section 19 and the basis for the officer's

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'reason to believe' that he/she is guilty of an offence punishable under the Act of 2002. It is only if the arrested person has knowledge of these facts that he/she would be in a position to plead and prove before the Special Court that there are grounds to believe that he/she is not guilty of such offence, so as to avail the relief of bail. Therefore, communication of the grounds of arrest, as mandated by Article 22(1) of the Constitution and Section 19 of the Act of 2002, is meant to serve this higher purpose and must be given due importance.

30. We may also note that the language of Section 19 of the Act of 2002 puts it beyond

doubt that the authorized officer has to record in writing the reasons for forming the belief that the person proposed to be arrested is guilty of an offence punishable under the Act of 2002. Section 19(2) requires the authorized officer to forward a copy of the arrest order along with the material in his possession, referred to in Section 19(1), to the Adjudicating Authority in a sealed envelope. Though it is not necessary for the arrested person to be supplied with all the material that is forwarded to the Adjudicating Authority under Section 19(2), he/she has a constitutional and statutory right to be 'informed' of the grounds of arrest, which are compulsorily recorded in writing by the authorized officer in keeping with the mandate of Section 19(1) of the Act of 2002. As already noted hereinbefore, It seems that the mode of informing this to the persons arrested is left to the option of the ED's authorized officers in different parts of the country, i.e., to either furnish such grounds of arrest in writing or to allow such grounds to be read by the arrested person or be read over and explained to such person.

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32. That being so, there is no valid reason as to why a copy of such written grounds of arrest should not be furnished to the arrested person as a matter of course and without exception. There are two primary reasons as to why this would be the advisable course of action to be followed as a matter of principle. Firstly, in the event such grounds of arrest are orally read out to the arrested person or read by such person with nothing further and this fact is disputed in a given case, it may boil down to the word of the arrested person against the word of the authorized officer as to whether or not there is due and proper compliance in this regard. In the case on hand, that is the situation insofar as Basant Bansal is concerned. Though the ED claims that witnesses were present and certified that the grounds of arrest were read out and explained to him in Hindi, that is neither here nor there as he did not sign the

document. Non-compliance in this regard would entail release of the arrested person straightaway, as held in V. Senthil Balaji (supra). Such a precarious situation is easily avoided and the consequence thereof can be obviated very simply by furnishing the written grounds of arrest, as recorded by the authorized officer in terms of Section 19(1) of the Act of 2002, to the arrested

person under due acknowledgment, instead of leaving it to the debatable ipse dixit of the authorized officer.

33. The second reason as to why this would be the proper course to adopt is the constitutional objective underlying such information being given to the arrested person. Conveyance of this information is not only to apprise the arrested person of why he/she is being arrested but also to enable such person to seek legal counsel and, thereafter, present a case before the Court under

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Section 45 to seek release on bail, if he/she so chooses……..

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35. On the above analysis, to give true meaning and purpose to the constitutional and the statutory mandate of Section 19(1) of the Act of 2002 of informing the arrested person of the grounds of arrest, we hold that it would be necessary, henceforth, that a copy of such written grounds of arrest is furnished to the arrested person as a matter of course and without exception. The decisions of the Delhi High Court in Moin Akhtar Qureshi (supra) and the Bombay High Court in Chhagan Chandrakant Bhujbal (supra), which hold to the contrary, do not lay down the correct law. In the case on hand, the admitted position is that the ED's Investigating Officer merely read out or permitted reading of the grounds of arrest of the appellants and left it at that, which is also disputed by the appellants. As this form of communication is not found to be adequate to fulfil compliance with the mandate of Article 22(1) of the Constitution and Section 19(1) of the Act of 2002, we have no hesitation in holding that their arrest was not in keeping with the provisions of Section 19(1) of the Act of 2002. Further, as already noted supra, the clandestine conduct of the ED in proceeding against the appellants, by recording the second ECIR immediately after they secured interim protection in relation to the first ECIR, does not commend acceptance as it reeks of arbitrary exercise of power. In effect, the arrest of the appellants and, in consequence, their remand to the custody of the ED and, thereafter, to judicial custody, cannot be sustained.

36. The appeals are accordingly allowed, setting aside the impugned orders passed by the Division Bench of the Punjab & Haryana High Court as well as the impugned arrest orders and arrest memos along with the orders of remand

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passed by the learned Vacation Judge/Additional Sessions Judge, Panchkula, and all orders consequential thereto.

The appellants shall be released forthwith unless their incarceration is validly required in connection with any other case.

14. Further it has been relied upon the matter of Gautam Navlakha Vs. National Investigating Agency in Cr.A. No. 510 of 2021 (arising out of slp (Criminal) No. 1796/2021). It has been categorically stated by the learned counsel for the applicant that the seized holograms were never used in the crime and the holograms were burnt only under the instructions of Arvind Singh and Amit Singh.

15. Lastly, he submits that that the applicant has not been called in the investigation since the registration of the FIR by the respondent/Investigating Agency but has been arrested directly under the garb of a search operation which clearly shows the mala fide nature of the investigation carried out. The applicant had only been summoned by the respondent as part of the preliminary enquiry which has been completely suppressed for the reasons best known to the applicant. It is contended that the applicant has not been summoned after registration of the FIR as part of the investigation therein and the respondent/Investigating Agency has directly proceeded to arrest under the garb of a search procedure in a completely mala fide and brazen manner contrary to law. He has placed reliance in the matter of Arnesh Kumar Vs. State of Bihar (2014) 8 SCC 273 and Satender Kumar

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Antil Vs. Central Bureau of Investigation (2022) 10 SCC 51. In

Arnesh Kumar (supra) it has been held that :

5. Arrest brings humiliation, curtails freedom and cast scars forever. Law makers know it so also the police. There is a battle between the law makers and the police and it seems that police has not learnt its lesson; the lesson implicit and embodied in the Cr.PC. It has not come out of its colonial image despite six decades of independence, it is largely considered as a tool of harassment, oppression and surely not considered a friend of public. The need for caution in exercising the drastic power of arrest has been emphasized time and again by Courts but has not yielded desired result. Power to arrest greatly contributes to its arrogance so also the failure of the Magistracy to check it. Not only this, the power of arrest is one of the lucrative sources of police corruption. The attitude to arrest first and then proceed with the rest is despicable. It has become a handy tool to the police officers who lack sensitivity or act with oblique motive.

6. Law Commissions, Police Commissions and this Court in a large number of judgments emphasized the need to maintain a balance between individual liberty and societal order while exercising the power of arrest. Police officers make arrest as they believe that they possess the power to do so. As the arrest curtails freedom, brings humiliation and casts scars forever, we feel differently. We believe that no arrest should be made only because the offence is non-bailable and cognizable and therefore, lawful for the police officers to do so. The existence of the power to arrest is one thing, the justification for the exercise of it is quite another. Apart from power to arrest, the police officers must be able to justify the

25

reasons thereof. No arrest can be made in a routine manner on a mere allegation of commission of an offence made against a person. It would be prudent and wise for a police officer that no arrest is made without a reasonable satisfaction reached after some investigation as to the genuineness of the allegation. Despite this legal position, the Legislature did not find any improvement. Numbers of arrest have not decreased. Ultimately, the Parliament had to intervene and on the recommendation of the 177th Report of the Law Commission submitted in the year 2001, Section 41 of the Code of Criminal Procedure (for short 'Cr.PC),in the present form came to be enacted. It is interesting to note that such a recommendation was made by the Law Commission in its 152^ndand 154^th Report submitted as back in the year 1994. The value of proportionality permeates the amendment relating to arrest."

16. It is contended that the applicant is now in judicial custody and the period of custodial interrogation is concluded and has thus suffered long period of pre-trial detention and therefore he maybe released from custody. He has contended that time and again it has been reiterated by the Apex Court that the Right to Speedy trial is a facet of fundamental right to life of an accused under Article 21 of the Constitution of India. He has referenced the judgments of the Apex Court in the matter of Manish Sisodia Vs. CBI and ED (2023) SCC OnLine SC 1393; Satender Kumar Antil Vs. Bentral Bureau of Investigation (2022) 10 SCC 51; Surinder Singh @ Shingara Singh Vs. State of Punjab (1977) 4 SCC 291. It is therefore contended by the learned Senior Counsel for the applicant that the investigation has not yet commenced

26

and the charges cannot be framed and the trial will take sometime to conclude, the applicant may be granted bail. It is contended that vide order dated 27.11.2024 in SLP (Cri.) No. 14697/2024 (Trilok Singh Dhillon Vs. State of CG) one of the co-accused has been granted bail and therefore on the ground of parity the present applicant is entitled for bail.

17. In reply to the submissions made by the learned counsel for the applicant, it has been contended by the learned State counsel that the ground of parity is not available to the present applicant to that of the co-accused who had been granted bail on medical grounds. However, the State has preferred SLP (Cri.) before the Apex Court and vide order dated 29.11.2024, set aside the order dated 14.06.2024 (in M.Cr.C. No. 3455/2024) of the High Court and remanded the matter to the High Court for reconsideration of the bail application to the co-accused.

18. It has been further contended that on 11.07.2023, the EOW after receiving communication and due verification on being satisfied that prima facie a cognizable offence was committed, FIR No. 04/2024 was registered against the applicant and other co-accused persons (total of 71 accused) under Sections 7 & 12 of the Prevention of Corruption Act and Sections 420,467,468,471 and 120-B IPC. From the said charge sheet, it has been revealed that the applicant along with the co-accused Anwar Dhebar was the head of the criminal syndicate comprising of the high level State government officials, private persons and political

27

executives of the State government were operating in the State of Chhattisgarh. This alleged syndicate collected illegal money in three different ways:

Part A- illegal commission charged from liquor

supplier for official sale of liquor in the State of Chhattisgarh.

Part B - Sale of unaccounted illicit countrymade liquor from State run shops done with the

involvement of distillers, hologram manufacturers, bottle makers, transporters, man power

management and District Excise Officials.

Part C - Annual Commission from distillers for

allowing them to operate a syndicate and divide

the market share amongst themselves.

19. He further contended that in the investigation, it was revealed that massive corruption took place in the State Excise Department and the accused applicants were involved in altering liquor policy for personal gratification through illegal means. It is contended that during the investigation by the EOW , it was revealed that the liquor was divided into two categories namely country liquor (CL) and Indian Manufactured Foreign Liquor (IMFL). The country liquor is produced in the State o Chhattisgarh only from three distilleries ie. M/s. Chahttisgarh Distilleries Ltd., M/s. Bhatia Wines and Merchants Private Ltd. and M/s. Welcome Distilleries Pvt. Ltd. It was further revealed in the investigation that since it was difficult to extract cash bribes for foreign liquor makers in respect of IMFL and FL and that there was strong demand for good quality foreign brands, in the month of April 2020, the syndicate introduced a fourth type of mechanism to extort bribes from FL makers

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by introducing the concept of FL-10A licenses. These licenses were against given to there chosen associates of Anwar Dhebar. These license holders were to act as the 'collectors' or intermediary and buy foreign liquor and then sell it to the Chhattisgarh Government warehouses and generated commission of about 10% on foreign liquor. The licenses were given with a promise that 50-60% final profit amount of the FL-10A licensee be paid to the syndicate. The multi national companies were briefed about this mechanism by Arunpati Tripathi, who was appointed by one Anil Tuteja. The FL-10A license was given to three persons who were ready to hike prices and ensure payment of cash bribes to Sanjay Mishra (M/s. Nexgen Power Engitech Prviate Limited), Atul Kumar Singh and Mukesh Manchanda (M/s. Om Sai Beverages Pvt. Ltd. and Asheesh Saurabh Kedia (M/s. Dishita Ventures Private Limited) and thus a total amount of Rs. 1660,41,00,056/- was made by the syndicate from the financial year 2019-20 to financial year 2022-23 and had caused a huge loss to the State Exchequer. Thus, from the investigation done till date, it is clear that massive corruption had taken place in the Excise Department of Chhattisgarh since the year 2019. The Excise Departments were set up to regulate the supply of liquor, ensure quality liquor to users and to prevent hooch tragedies and earn revenue for the State have been misused by the criminal syndicate led by Anwar Dhebar and the present applicant who extorted maximum personal benefit for themselves with the help of co- conspirators ie. Arunpathi Tripathi and Trilok Singh Dhilllon and Others.

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The excise policy in the State of Chhattisgarh was amended in the year 2017 and Chhattisgarh State Marketing Corporation was created for sale of retail liquor through its stores in the State of Chhattisgarh.

20. He contended that the present applicant used to purchase the used empty bottles from the market (junk dealers) and after cleaning them, used to supply them to big dealer and till the year 2019-20 he used to sell them to one Navneet Gupta, who is the main dealer supplying these empty bottles to distilleries. He also used to supply them to Sarveshwari Bottling Plant Pvt. Ltd. Siltara. In the year 2016-17, the Sarveshwari Bottling Plant Pvt. Ltd. Siltara was taken on contract by the applicant after he got acquainted with accused Arvind Singh and his nephew Amit Singh. Navneet Gupta had a monopoly in supplying the empty bottles to distilleries till the year 2019-20.When the Income Tax Department raided his office, the work of supplying empty bottles to the distilleries stopped. Thereafter, the present applicant and Arvind Singh along with Amit Singh supplied the empty bottles to distilleries through a firm called Adeep Empire. It is with the help of Arvind Singh and Amit Singh, the applicant was running his office from the vacant warehouse near Dhaneli Chowk, Bilaspur Road which belongs to co- accused Anwar Dhebar. The said premises was thereafter constructed with rooms for the purpose of office and sheds were prepared to wash the empty bottles. Meanwhile, the firm of the applicant named as Anurag Traders got the contract of supplying empty bottles to Welcome Distillery, Bilaspur. The applicant also supplied the empty bottles to

30

Bhatia Wines Distillery by the syndicate. The entire process of buying bottles from the market, washing and transporting them was looked after by the applicant and the suppliers used to pay Rs. 10/- per box as commission to the people of the syndicate. Thus, three bottle suppliers, trusted and controlled by the syndicate were given contracts to supply empty bottles to the three main distilleries for arranging additional bottles for the production of B-part liquor. Each bottle supplier used to show the supply of empty bottles to the distilleries through over- invoicing, due to which about 20% of the unaccounted bottles were received by the distilleries to produce B-part liquor.

21. Another method which has been used was that the distillers used to show about 20-30% breakage of the bottles supplied to them in their accounts and these extra bottles were used by the distilleries for filling B-part liquor. The arrangement of duplicate holograms for B-part liquor was done by the Prism Holograms and Security Prviate Ltd. Kasna, Greater Noida. Serial Numbers and QR codes were imprinted on the holograms sent from Greater Noida to Raipur unit o Prizm Hologram and the distilleries, bottling units and unauthorized bars used them as per their demand by getting the challan cleared in the Excise Department and issuing permits and sending them to to the concerned place. The vehicles were loaded with original as well as duplicate holograms and from Raipur, the owner of the Prizm Holograms Vidhu Gupta used to inform about the same to the co-accused Dilip Pandey and further it was informed by him to Amit Singh about the holograms

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which were then sent to co-partner Deepak Duary at Dhaneli who used to transport the truck to the godown of the present applicant at Dhaneli. From Dhaneli godown the trucks were loaded with holograms and the duplicate hologram waxes were unloaded from the vehicle coming from Greater Noida and loaded in the vehicles and transported to the distilleries. The rest of the original holograms were loaded in the truck and sent to the office of Dilip Pandey at GST Bhawan, Naya Raipur. The present applicant was responsible to monitor the above procedure in the godown.

22. It has been contended that the above mentioned facts were confirmed by the statements of the drivers of the trucks concerned. It has been further stated that the money from the sale of B-part liquor in 15 districts of the State was collected by one Vikas Agrawal @ Subbu, Arvind Singh and Amit Singh and thereafter the amount was counted in the office of the applicant at Dhaneli Godown and thus, the work of keeping and counting the sale amount of B-part liquor and collecting the money was done by Vikash Agrawal.

23. In the month of June 2022, thee Excise syndicate stopped the sale of B-part liquor in the government liquor shops and at that time, some duplicate holograms were kept in the ware house at Dhaneli which were instructed by the syndicate to destroy by burning and erasing the evidence and therefore the applicant burnt the leftover holograms in the warehouse and thereafter buried the same in the back

32

side of the office. On receiving the information, search was made out in the office of the applicant and on his memorandum, the duplicate holograms which were half burnt have been recovered in front of the witnesses.

24. It has been contended by the learned State counsel that the applicant was involved in the syndicate and used to supply extra empty bottles for B-part liquor, distribution of duplicate holograms in Dhaneli godown, collection and counting of sale amount of B-part liquor, seizure of duplicate holograms hidden by burning the duplicate holograms on the back side of the office as per the memorandum statement given under Section 27 of the Evidence Act and the explanation given by the applicant, his involvement in the crime has been established. He contended that a private limited company in the name of NS Bottling and Beverages Praval was formed by the applicant he along with the wife of Arvind Singh were the directors. From the memorandum statement of the applicant, seizure proceedings, clarification memorandum, supplementary statements of the witnesses under Section 164 Cr.P.C. and the report related to the duplicate hologram of the resent applicant has been fully proved.

25. It has been contended by the learned State counsel that the applicant through his firm used to buy empty bottles from the market and after clearing them, used to supply the same to the distilleries. During this period, the applicant independently supplied to Bhatia Wines Distillery, Welcome Distillery, Bilaspur. During investigation, panchnama

33

was prepared by the Investigating Agency regarding the seizure of duplicate holograms and recorded the explanation memorandum made by the applicant and other witnesses. On perusal of the abovementioned statement the applicant was found to be actively involved in the crime and is the active member of the criminal syndicate . He has placed his reliance upon the judgments of the Apex Court in the matter of State of UP Vs. Amarmani Tripathi (2005) 8 SCC 21, which reads as under:

Reliance is next placed on Dolat Ram and

others vs. State of Haryana 1995 (1) SCC 349,

wherein the distinction between the factors

relevant for rejecting bail in a non-bailable

case and cancellation of bail already granted, was brought out :

"Rejection of bail in a non-bailable case at the initial stage and the cancellation of bail so granted, have to be considered and dealt with on different basis. Very cogent and overwhelming circumstances are necessary for an order directing the cancellation of the bail, already granted. Generally speaking, the grounds for cancellation of bail, broadly (illustrative and not exhaustive) are:

interference or attempt to interfere with the due course of administration of justice or evasion or attempt to evade the due course of justice or abuse of the concession granted to the accused in any manner. The satisfaction of the court, on the basis of material placed on the record of the possibility of the accused absconding is yet another reason justifying the cancellation of bail. However, bail once granted should not be cancelled in a mechanical manner without considering whether any supervening circumstances have

34

rendered it no longer conducive to a fair trial to allow the accused to retain his freedom by enjoying the concession of bail during the trial."

17. They also relied on the decision in S.N. Bhattacharjee vs. State of West Bengal 2004

(11) SCC 165 where the above principle is reiterated. The decisions in Dolat Ram and Bhattacharjee cases (supra) relate to applications for cancellation of bail and not appeals against orders granting bail. In an application for cancellation, conduct subsequent to release on bail and the supervening circumstances alone are relevant. But in an appeal against grant of bail, all aspects that were relevant under Section 439 read with Section 437, continue to be relevant. We, however, agree that while considering and deciding appeals against grant of bail, where the accused has been at large for a considerable time, the post bail conduct and supervening circumstances will also have to be taken note of. But they are not the only factors to be considered as in the case of applications for cancellation of bail.

18. It is well settled that the matters to be considered in 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 charge;

(iii) severity of the punishment in the event of conviction; (iv) danger of 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 tampered with; and (viii) danger, of course, of justice being thwarted by grant of bail (see Prahlad Singh Bhati vs. NCT,

35

Delhi 2001 (4) SCC 280 and Gurcharan Singh vs. State (Delhi Administration) AIR 1978 SC

179). While a vague allegation that accused may tamper with the evidence or witnesses may not be a ground to refuse bail, if the accused is of such character that his mere presence at large would intimidate the witnesses or if there is material to show that he will use his liberty to subvert justice or tamper with the evidence, then bail will be refused. We may also refer to the following principles relating to grant or refusal of bail stated in Kalyan Chandra Sarkar vs. Rajesh Ranjan, 2004 (7) SCC 528:

"11.The law in regard to grant or refusal of bail is very well settled. The court granting bail should exercise its discretion in a judicious manner and not as a matter of course. Though at the stage of granting bail a detailed examination of evidence and elaborate documentation of the merit of the case need not be undertaken, there is a need to indicate in such orders reasons for prima facie concluding why bail was being granted particularly where the accused is charged of having committed a serious offence. Any order devoid of such reasons would suffer from non- application of mind. It is also necessary for the court granting bail to consider among other circumstances, the following factors also before granting bail; they are:

a. The nature of accusation and the severity of punishment in case of conviction and the nature of supporting evidence.

b. Reasonable apprehension of tampering with the witness or apprehension of threat to the complainant.

c. Prima facie satisfaction of the court in support of the charge. (see Ram Govind

36

Upadhyay vs. Sudarshan Singh, 2002 (3) SCC 598 and Puran vs. Ram Bilas 2001 (6) SCC 338."

This Court also in specific terms held that:

"the condition laid down under section 437(1)(i) is sine qua non for granting bail even under section 439 of the Code. In the impugned order it is noticed that the High Court has given the period of incarceration already undergone by the accused and the unlikelihood of trial concluding in the near future as grounds sufficient to enlarge the accused on bail, in spite of the fact that the accused stands charged of offences punishable with life imprisonment or even death penalty. In such cases, in our opinion, the mere fact that the accused has undergone certain period of incarceration (three years in this case) by itself would not entitle the accused to being enlarged on bail, nor the fact that the trial is not likely to be concluded in the near future either by itself or coupled with the period of incarceration would be sufficient for enlarging the appellant on bail when the gravity of the offence alleged is severe and there are allegations of tampering with the witnesses by the accused during the period he was on bail."

26. He has contended that the factors enunciated to be considered while granted bail, the Apex Court inter alia has held that:

(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 charge; (iii) severity of the punishment in the event of conviction; (vi) danger of accused absconding or fleeing if released on bail; (v)

37

character, behaviour, means, position and standing of the accused; (vi) likelihood of the offence being repeated; (vii) reasonable apprehension of the witnesses being tampered with; and (viii) danger, of course, of justice being thwarted by grant of bail. Further it has held that mere fact that the accused had been incarcerated for a certain period of time is also not a factor for granting bail to the applicant.

27. As has been held by the Apex Court in the matter of Dolat Ram Vs. State of Haryana 1995 (1) SCC 349 wherein the distinction between the factors relevant for rejecting bail in a non-bailable cases and cancellation of bail already granted have to be considered and dealt with on different basis. The Apex Court in the matter of Gulabrao Babukar Deokar Vs. State of Maharastra (2013) 16 SCC 190, has observed that :

In the instant case, the attempts made by the

appellant to pressurize the witnesses and even

the investigating officer are clearly placed on

record through the affidavit of the Deputy S.P.

Mr. Pawar. On that ground also it could be said

that the appellant will be pressurizing the

witnesses if he is not restrained. This being the

position, we cannot find any fault with the order

of the High Court cancelling the bail on that

ground also. The order does record the cogent

and overwhelming circumstances justifying

cancellation of bail. The nature and

seriousness of an economic offence and its

impact on the society are always important

considerations in such a case, and they must

squarely be dealt with by the Court while

passing an order on bail applications."

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28. In another decision of the Apex Court in the matter of Mahipal Vs. Rajesh Kumar (2020) 2 SCC 118 held that it is necessary to consider relevant factors while granting bail and if those relevant facts (as enumerated in Amarmani Tripathi (supra) have not been taken into consideration while considering the application for bail, the bail is found on irrelevant considerations, indisputably the superior court can set aside the order of such a grant of bail. Lastly, it is submitted that at the stage of bail, the statements under Section1 61 Cr.P.C, can be looked into and has relied upon the judgment of the Apex Court in the matter of

Indresh Kumar Vs. State of Uttar Pradesh in Criminal Appeal No. 938 of 2022. He submits that the applicant, on the instructions of the syndicate, destroyed the holograms kept in his godown by burning and erasing the evidence and thus had tried to tamper the evidence by destroying the duplicate holograms, therefore the applicant is not entitled for bail.

29. Heard learned counsel for the parties and perused the contents of bail application and bestowed the thoughtful material aspects involved in the case.

30. Before deciding the case in hand, the factors enumerating in the case which should be taken in consideration while granting or refusing bail in a non-bailable case. The apex court in the matter of state of up vs Amarmani Tripathi, reported in 2005 (8) SCC 21, vide paragraph- 18 and in Criminal Appeal no. 448 OF 2021 (@ Special Leave

39

Petition (Crl.) No. 3577 0F 2020) (Sudha Singh Versus The State of Uttar Pradesh & Anr, judgment delivered on 24-04-2021] has decided certain factors to be taken in consideration while deciding bail application in non-bailable offences as under:-

"It is well settled that the matters to be considered in an application for the bail are:-

(i) whether there is any prima-facie or reasonable ground to believe that the accused has committed the offence;

(ii) nature and gravity of charge;

(iii) severity of the punishment in the event of conviction; (iv) danger of the accused absconding or fleeing if released on bail; (v) character, behavior, means, position and standing of the accused; (vi) likelihood of the offence being repeated;

(vii) reasonable apprehension of the witnesses being tampered with; and (viii) danger, of-course the justice being thwarted by grant of bail.

31. Indeed, these guidelines are not exhaustive, nonetheless, these have to be considered while passing an order in a bail application in a non-bailable offence. The aforementioned factors for grant or refusal of bail in non- bailable offences as the case in hand are discussed under the following headings.

7. Prima-facie or reasonable ground to believe that the applicant/accused has committed the offence:-

It is profitable to reiterate here, that case FIR No. RC0042023A0003 dated 08.02.2023 has been registered by

40

the CBI, Jammu u/s 120-B of IPC r/w Section 7 of the Prevention of Corruption Act 1988 against the petitioner on the basis of complaint dated 07.02.2023 lodged by one Pankaj Kumar Verma S/o Sh. Sarvan Kumar R/o Lotus Villa,

232 Sector-1 Jalpura Greater Noida UP alleging demand of bribe of Rs.2.30 lacs by accused Sajad Ahmed Chief Accounts Officer JKTDC through Shokat Ali for processing of payment in respect of bills submitted by the complainant, on receipt of the complaint the verification thereof was carried out by Sh. Sanjay Kumar PSI wherein demand of bribe by the accused Sajjad Ahmed from the complainant through Shokat was confirmed, pursuant to which a trap was laid and both the accused persons namely, Sajjad Ahmed Chief Accounts Officer JKTDC and Shokat Ali Lecturer Govt. Polytechnic College Jammu were caught red-handed while demanding and accepting bribe of Rs.2.30 lacs from the complainant in presence of independent witnesses and both the accused were arrested and taken into custody on 08.02.2023 after following all the legal procedure.

32. From the allegations, it clearly transpires, that there is a prima- facie case against the applicant. The disputed point for determination before this court is, even when there is a prima-facie case against the accused, what should be the approach of court in the matter of grant or refusal of bail ?

33. To appreciate this fact, it has to be taken note of that while granting bail to the applicant it is necessary for the court to examine the nature and gravity of the circumstances under which the offence is committed. It is a trite law that personal liberty is a very precious

41

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.

34. 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 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. After referring to the observation in Emperor v. Hutchinson, reported in AIR 1931 All. 356, where the Court held that grant of bail is the rule and refusal is the exception, this Court added:

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"6. However, we should not be understood to mean that bail should be granted in every case. The grant or refusal of bail is entirely within the discretion of the judge hearing the matter and though that discretion is unfettered, it must be exercised judiciously and in a humane manner and compassionately. Also, conditions for the grant of bail ought not to be so strict as to be incapable of compliance, thereby making the grant of bail illusory". The observations and directions in Dataram Singh (supra) were in the context of arrest and long custodial detention in a crime case under Section 138 of the Negotiable Instruments Act, 1881 for issuing cheques and then stopping payment of the cheque. Bail application had been rejected, first by the Trial Court and then by the High Court even after about five months of detention of the accused in custody.

35. Ex facie, the allegations are grave, the punishment is severe and it cannot be said that there are no materials on record at all.

P.Chidambaram Vs. Directorate of Enforcement" reported in (2020)

13 SCC 791, wherein Hon'ble Apex Court held as hereunder:

"Thus from cumulative perusal of the judgments cited on either side including the one rendered by the Constitution Bench of this Court, it could be deduced that the basic jurisprudence relating to bail remains the same inasmuch as the grant of bail is the rule and refusal is the exception so as to ensure that the accused has the opportunity of securing fair trial.

However, while considering the same the gravity of the offence is an aspect which is required to be kept in view by the Court. The gravity for the said purpose will have to be gathered from the facts and circumstances arising in each case. Keeping in view the consequences that would befall on the society in cases of financial

43

irregularities, it has been held that even economic offences would fall under the category of "grave offence" and in such circumstance while considering the application for bail in such matters, the Court will have to deal with the same, being sensitive to the nature of allegation made against the accused. One of the circumstances to consider the gravity of the offence is also the term of sentence that is prescribed for the offence the accused is alleged to have committed. Such consideration with regard to the gravity of offence is a factor which is in addition to the triple test or the tripod test that would be normally applied. In that regard what is also to be kept in perspective is that even if the allegation is one of grave economic offence, it is not a rule that bail should be denied in every case since there is no such bar created in the relevant enactment passed by the legislature nor does the bail jurisprudence provides so. Therefore, the underlining conclusion is that irrespective of the nature and gravity of charge, the precedent of another case alone will not be the basis for either grant or refusal of bail though it may have a bearing on principle. But ultimately the consideration will have to be on case to case basis on the facts involved therein and securing the presence of the accused to stand trial."

36. Specifically, heed must be paid to the stringent view taken in this regard for grant of bail with respect to economic offences. In this regard, it is pertinent to refer to the following observations of this Court in Y.S. Jagan Mohan Reddy:

"34. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offences having deeprooted conspiracies and involving huge loss of public funds need to be viewed

44

seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country.

35. While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations."

This Court has adopted this position in several decisions, including Gautam Kundu v. Directorate of Enforcement and State of Bihar v. Amit Kumar. Thus, it is evident that the above factors must be taken into account while determining whether bail should be granted in cases involving grave economic offences."

37. In the present case, the applicant has been charged for the offences punishable under Sections 420, 467, 468, 471, and 120-B IPC and Sections 7 & 12 of the Prevention of Corruption Act. It is the case of the prosecution that from the charge sheet, it is alleged that the present applicant was involved in the criminal syndicate and was helping in the liquor scam through his firm Anurag Traders and the criminal syndicate comprised of high level State government officials, private persons and political executives who extorted illegal commission from the sale of liquor and was also involved in unauthorized sale of unaccounted liquor through government liquor shops in the State of Chhattisgarh. During the course of investigation, it was found that massive corruption had

45

taken place in the Excise Department since the year 2019. Instead of earning revenue for the State, the present applicant in association with the syndicate had caused huge financial loss to the State exchequer and the estimated proceeds of crime is around Rs. 16,000 + crores.

38. In the matter of Nimmagadda Prasad v. Central Bureau Of Investigation . of Investigation,(2013) 7 SCC 466 their Lordships of the Supreme Court have held that economic offence is a grave offence affecting the economy of the country as a whole and observed as under:-

"23. Unfortunately, in the last few years, the country has been seeing an alarming rise in white-collar crimes, which has affected the fibre of the country's economic structure. Incontrovertibly,economic offences have serious repercussions on the development of the country as a whole.

25. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offence having deep- rooted conspiracies and involving huge loss of public funds needs to be viewed seriously and considered as a grave offence affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country."

39. Very recently, in the matter of Subramanian Swamy v. Central Bureau of Investigation, (2014) 8 SCC 682 the Apex Court (Constitution Bench) while declaring Section 6-A of the Delhi Special Police Establishment Act, 1946 unconstitutional, observed as under:-

"Corruption is an enemy of nation and tracking down corrupt public servants and punishing such persons is a necessary mandate of the PC Act, 1988. It is difficult to justify the classification which has been made in Section 6-A because the goal of

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law in the PC Act, 1988 is to meet corruption cases with a very strong hand and all public servants are warned through such a legislative measure that corrupt public servants have to face very serious consequence."

"Corruption is any enemy of nation and tracking down corrupt public servant, howsoever high he may be, and punishing such person is a necessary mandate under the PC Act, 1988. The status or position of public servant does not qualify such public servant from exemption from equal treatment. The decision making power does not segregate corruption officers into two classes as they are common crimedoers and have to be tracked down by the same process of inquiry and investigation."

40. The case of the prosecution is that the EOW had received a communication from the Enforcement Directorate and after due verification and on being satisfied, registered FIR No. 04/2024 under Sections 7 & 12 of the Prevention of Corruption Act and Sections 420, 467, 468, 471, and 120-B IPC against the applicant. It has been revealed that a criminal syndicate has been operating in the State of Chhattisgarh which was extorting illegal commission in the sale of liquor and was also involved in unauthorized sale of unaccounted liquor through government liquor shops. During the course of investigation, plethora of evidence regarding criminal involvement and illegal gratification of number of government officers including the applicant has been unearthed and their role in the crime has been established.

41. It is apparent that the applicant was one of the main accused in the liquor scam. Having regard to the nature of allegations made

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against the applicant and the manner in which the present applicant is alleged to have involved in the commission of the offence and that the investigation is still going on and also taking note of the fact that the applicant along with the co-accused persons has caused huge financial loss to the State exchequer and the estimated proceeds of crime is around Rs. 16000 + crores.

42. This huge unexplained money and the disproportionate wealth earned through the syndicate and causing loss to the State Exchequer and for which the proceeding under Sections 7 & 12 of the Prevention of Corruption Act is said to have been registered against the present applicant. The law in regard to grant or refusal of bail is very well settled. The general principles regarding granting or refusing bail are enumerated in several judgments of the Apex Court. Generally, the following matters are to be considered in granting or refusing bail to a person accused of a non-bailable offence (1) The nature of the offence

(2) The severity of the punishment which conviction will entail (3) The character, behaviour, means and standing of the accused (4) The circumstances which are peculiar to the accused (5) The status and position of the accused in relation to the victim or the complainant (6) Reasonable possibility of securing the presence of the accused during the trial (7) Reasonable apprehension of the witnesses being tampered with (8) The larger interests of the public or the State or the society (9) Likelihood of the accused fleeing from justice (10) Absence or presence

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of materials in support of the accusation (11) Likelihood of the offence being repeated (12) Frivolity in prosecution.

43. 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.

44. Economic offences, having deep-rooted conspiracies and involving huge loss of public funds, need to be viewed seriously and considered as grave offences (See Y.S Jagan Mohan Reddy v. Central Bureau Of Investigation . :

(2013) 7 SCC 439 : AIR 2013 SC 1933). An economic offence is committed with cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the community (See

State of Gujarat v. Mohanlal Jitamalji Porwal : (1987) 2 SCC 364 :

AIR 1987 SC 1321). Economic offences have serious repercussions on the development of the society as a whole. The entire community would be aggrieved if the economic offenders, who ruin the economy of the State, are not brought to book in a proper manner.

45. 'Bail is the rule and jail is the exception' is the well established principle but competing forces present in the facts and circumstances of each case have to be measured before enlarging a person on bail. Socio-economic offences have deep impact affecting the moral fiber of

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the society and it is a matter needs to be considered seriously (See State of Bihar v. Amit Kumar @ Bachcha Rai : AIR 2017 SC 2487).

46. It is prima facie clear that on the one hand, the prosecution agency is claiming that the matter is of a huge economic loss to the State Exchequer and the offence is of highly serious nature and on the other hand, the distillers who are allegedly supplying illegal liquor causing huge financial loss to the State exchequer and the estimated proceeds of crime is around Rs. 16000+ crores, yet they have not been made accused despite the fact that their names are mentioned in the complaint as member of the syndicate. Even though some of the witnesses have admitted in their statements before the police and the statements recorded under Section 164 of the Cr.P.C. that they were involved in the syndicate crime but they are listed as prosecution witnesses without being granted pardon by the competent court. Prima facie it appears that the prosecution has adopted an inconsistent stance being both hot and cold in its approach and has acted in a pick and choose manner in investigation. It is stated by the learned counsel for the respondent that the applicant was involved in the criminal syndicate and maximum personal benefits were acquired by the syndicate but surprisingly, no recovery in relation to the earnings made by the illegal liquor has been made from the present applicant. Be that as it may, the applicant cannot take advantage at this stage because further investigation is going on as per argument of learned Counsel for the State. In the present case, the applicant was involved in the criminal

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acts of the syndicate and that he received commission from the liquor suppliers. However, no recovery of unaccounted money has been made in this regard and as per the investigating agency, the investigation is pending, hence, a conclusive determination of their role is yet to be made. On perusal of the records, it appears that the co-accused Trilok Singh Dhillon was a liquor contractor and he received commission from the liquor suppliers in his bank account and he is not a member of the syndicate but has facilitated the payment of bribes to the syndicates in collusion with other co-accused. In the present case, the applicant is a member of the syndicate from the beginning and prima facie it appears that the duplicate holograms were supplied to the distilleries from the firm of the applicant ie. Anurag Traders and it was distributed to different shops ie. Welcome Distilleries, Bhatia Wines and others. It has also come on record that the duplicate holograms were kept in the ware house at Dhaneli godown as it was used as a distribution Centre of duplicate holograms by the excise syndicate of which the applicant was the owner. During investigation, on the instructions of the syndicate, the holograms were destroyed by burning and erasing the evidence and the applicant has tried to tamper the evidence by destroying the duplicate holograms and therefore the applicant is not entitled for bail on the ground of parity to that of the co-accused Trilok Singh Dhillon.

47. Thus, keeping in mind the binding observations of their Lordships of the Supreme Court in cases of Balakrishna Dattatrya Kumbhar & Nimmagadda Prasad (supra) that economic offences are grave

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offence affecting the economy of the country as a whole and serious repercussions on the development of the country and in view of the fact that corruption is a really a human rights violation specially right to life liberty, equality and non discrimination, and it is an enormous obstacle to the realization of all human rights and the charges alleged against the applicant are extremely serious and have been committed in the State of Chhattisgarh, further taking into consideration the fact that charge- sheet has been filed against the applicant this Court is not inclined to grant regular bail to the applicant.

48. In view of the aforesaid circumstances, the prayer for grant of bail to the applicant is liable to be rejected and it is hereby rejected. Sd/-

Digitally signed

by SUGUNA (Arvind Kumar Verma) SUGUNA

DUBEY

DUBEY

Date: Judge2024.12.11 06:33:26 -0500

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