CIRP not a Ground to seek Documents from CBI during Investigation: Delhi HC dismisses accused’s Plea u/s 91 CrPC [Read Order]

The Delhi High Court has ruled that pendency of corporate insolvency resolution process (CIRP) proceedings under the Insolvency and Bankruptcy Code (IBC) cannot be invoked by an investigated person to seek production of documents from the Central Bureau of Investigation (CBI) during the course of investigation.

The observation was made by the Delhi High Court while dismissing a petition filed by Shantanu Prakash, a former director of Educomp Infrastructure and School Management Limited (Educomp).

The facts preceding this petition regard an investigation conducted by the CBI in connection with alleged financial irregularities involving loans disbursed by a consortium of banks - including Axis Bank, Yes Bank, Union Bank and the State Bank of India to Educomp.

After the CIRP was initiated and the management was handed over to the resolution professional, a complaint was filed by the State Bank of India against the Petitioner herein for offences under the Prevention of Corruption Act, 1988, for which the investigation is ongoing.

The petitioner was served a summons as part of the investigation, to which he stated that it was impossible for him to answer these queries regarding 13-15 year old transactions without access to the Company's records, which had been handed over to the Resolution Professional in 2018.

During his interrogation, the petitioner sought the production of these bank statements and board records from the CBI and various banks, claiming he could not meaningfully participate in the investigation without them. The petitioner also unsuccessfully filed an application before the Special Judge at New Delhi seeking instructions for the release of the documents.

In the present petition, Arshdeep Singh Khurana, Neena Nagpal, Malak Bhatt, Vishvendra Tomar, Tannavi Sharma, Rashvendra Tomar and Nishtha Juneja appeared for the petitioner and referred to Section 91 of the Code of Criminal Procedure, 1973 (Cr.P.C.) which ensures the production of documents “necessary or desirable” for the investigation.

The CBI, represented by Anupam S. Sharma, Prakarsh Airan and Harpreet Kalsi opposed stating that the stage for the supply of documents to the accused, arises only after the filing of the Police Report (Charge Sheet) under Section 173 Cr.P.C., in compliance with Section 207 Cr.P.C.

Justice Neena Bansal Krishna observed that the power under Section 91 is a discretionary one, to be exercised by the Court or an Investigating Officer only when such production is deemed "necessary or desirable."

In the present case, it was noted that the accused has no right to demand document production at the investigation stage to "refresh his memory" or dictate how the probe should be conducted.

The Court relied on the principles laid down in Nitya Dharmananda @ K. Lenin vs. Gopal Sheelum Reddy (2018) among others to affirm that the right of an accused to seek documents generally arises after the investigation is completed and the chargesheet is filed and not during the active investigation.

Accordingly, the Delhi High Court found no requirement to interfere with the earlier ruling of the Special Judge where the application was noted to be premature, emphasizing that an investigation is the exclusive domain of the agency.

However, the High Court maintained that the Investigating Officer should allow the petitioner sufficient time to examine voluminous or old records when being confronted with them to be able to give complete and informed answers towards the investigation.

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