In a significant case of Dewan Housing Finance Corporation Ltd. (DHFL) , the Delhi High Court quashed the plea by the Central Bureau of Investigation (CBI) to quash the bail granted to the ex-promoter.
The petitioner, CBI sought to quash and/or cancel the order dated 03.12.2022 passed by Spl. Judge, whereby the respondents have been granted default bail under Section 167 (2) Criminal Procedure Code (Cr.P.C), 1973.
M/s Dewan Housing Finance Corporation Ltd. (DHFL), Kapil Wadhawan, the then Chairman & MD of DHFL, Dheeraj Wadhawan, Director of DHFL, Shri Sudhakar Shetty, M/s Amaryllis Realtors LLP (ARLLP) and other unknown persons including public servants, entered a criminal conspiracy thereby cheating and inducing a consortium of 17 banks led by Union Bank of India (UBI) to sanction huge loans aggregating to Rs. 42,000 Crores approx.
It was alleged that the respondents accused siphoned off, and misappropriated a significant portion of the said funds by falsifying the books of account of DHFL and deliberately and dishonestly defaulted on repayment of the legitimate dues, thereby causing a wrongful loss of Rs. 34,000 Crores approx. to the consortium lenders during the periods January 2010 to December 2019.
Based on the allegation, the petitioner filed the chargesheet under section 173 Cr.P.C. was filed before the Special Judge (CBI), New Delhi on 15.10.2022 against eighteen individuals including Respondents and fifty-seven companies/entities for the commission of offences punishable under section 120B read with 206, 409, 411, 420, 424, 465, 468 & 477A of Indian Penal Code (IPC), 1860 and under section 13(2) read with 13(1)(d) of the Prevention of Corruption Act, 1988 and substantive offences thereof.
Section 173 of CrPC provides the filing of the report of the police officer on completion of the investigation. The opening words of Section 173 provide that every investigation under this chapter shall be completed without unnecessary delay.
Justice Dinesh Kumar Sharma observed that merely because in the charge sheet if the investigating agency has stated they want to conduct further investigation, the charge sheet cannot be termed as a preliminary charge sheet. The police have a right to conduct further investigation. At the same time, the investigating agency under the garb of further investigation cannot be allowed to file the police report without completion of the investigation, only to defeat the right of statutory bail.
To fulfil the provision of Section 167 of Crpc , the charge sheet has to be filed upon completion of the investigation. It may be possible that the investigation against the persons who are charge-sheeted is complete and further investigation of other accused persons is continuing, then the persons against whom the investigation is complete cannot be extended the benefit of the statutory bail. While dismissing the petition, the Court viewed that the offence alleged against the accused persons are very serious and very high in magnitude and the material collected by the investigating agency was too short. The Court held that “merely because cognizance has been taken, the right to statutory bail cannot be extended or defeated.”
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