Allahabad High Court denies early bail for fraud defendant

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The Lucknow Bench of the Allahabad High Court has rejected the early bail application of a man accused of defrauding a bank and embezzling funds.

A single-judge bench of Judge Brij Raj Singh passed the order while hearing an application for early bail from various criminals filed by Sujay Uday Desai.

The Application for Early Bail was filed on behalf of the Applicant in a criminal case pending in the CBI Special Judicial Magistrate Court, Lucknow arising out of the FIR under Sections 120-B, 420, 467, 468, 471 IPC registered at CBISCB Lucknow Police Station, Lucknow District with a prayer to expand it on early bail.

The FIR was filed on 11.06.2020 bearing the FIR registered by Complainant, Niranjan Panda, Chief Regional Manager, Regional Office, Indian Overseas Bank, Lucknow, under Sections 120B, 420, 467, 468, 471 IPC at Central Bureau of Investigation, Special Crime Branch, Lucknow.

Counsel for the Petitioner argued that although the indictment was filed in the case, the Petitioner’s application for early bail is defensible in view of the Supreme Court’s decision in the case of Bharat Chaudhary and another v State of Bihar and another, (2003) 8 SCC 77.

It was further argued that the Applicant is innocent and did not commit the offense and is not named in the FIR. The applicant’s lawyer then maintained that he had not been arrested during the investigation. Therefore, after the filing of the indictment, the petitioner should not be remanded in custody and there is no reason to dismiss him for cooperating with the investigation.

It was further argued on behalf of the plaintiff that the goods were transferred between the foreign seller Globiz and the foreign buyer in this sequence of the business transaction. The transfer of ownership of the goods was effected by endorsement on the bill of lading, which is common practice. When importing transactions, the bill of lading was provided to Globiz by the foreign supplier.

Counsel for the Claimant also argued that in the same area concerning the Frost Group’s flagship company, namely Frost International Limited (FIL), the SFIO and ED had taken legal action and that the Claimant had been arrested by the SFIO and Ed. In both cases the applicants had been released on bail by the Supreme Court and the High Court respectively.

The plaintiff’s attorney stated that the plaintiff had no role in the preparation of the documents relating to the trading business and that the allegation of infringement could not be attributed to the plaintiff.

The plaintiff’s lawyer further stated that the trading documents were prepared by foreign parties and sent to Globiz in India through the banks as soon as they were accepted. After acceptance by Globiz, these documents were then transmitted by the banks to the foreign acquirer for their acceptance. Commercial documents have been approved by several banks once for the import part of the transaction and once for the export part of the transaction, but the applicant has not prepared the document.

The plaintiff’s attorney also said bank officials were not named as defendants in the case. It has been claimed that bank officials checked and verified the documents, but they are not charged.

The applicant’s lawyer stated that there was no possibility of tampering with evidence or influencing witnesses since the documents had already been collected. There is no question of influencing the witnesses in any way, therefore, the applicant can be released on bail.

Counsel for the petitioner further argued that no breach of Articles 120B, 420, 467, 468, 471 CPI is established in the case.

Counsel for the claimant argued that there is no evidence that any bank funds were embezzled or embezzled.

On the other hand, CBI lawyer Anurag Kumar Singh argued that the plaintiff is the director and chief executive officer of Frost International Ltd, Globiz Exim Pvt Ltd is a Frost group company in which the plaintiff is a shareholder , promoter and responsible for the day. – day-to-day business operations in Kanpur.

It was further argued that it is admitted in the case of the plaintiff that the total amount defrauded by the Frost Group of Companies is around Rs 4000 crore. In this case, M/s Globiz Exim Pvt Ltd Rs 10.01 crore and M/s Olympic Oil Industries Pvt Ltd Rs 6.67 crore.

The CBI lawyer said an investigation into fraudulent activities by two other companies involved in the credit facilities used is ongoing.

The Court said it was therefore clear that in the said case, the Supreme Court granted interim protection for a period of eight weeks and ordered Aman Preet to apply for regular bail in the trial court.

The Court ruled,

In the judgment of Satender Kumar Antil (supra), the applicable guideline in the case is category B/D in which it is provided that when the accused appears before the court in accordance with the procedure, the request for Bail must be decided on the merits. The case relates to the defrauded huge amount of Rs 10.01 crore and a specific allegation is made in the indictment against the plaintiff that he was in charge of all business and financial activities of the group of companies Frost including M/s Globiz Exim Private Limited and used to contact Rajesh Bothra and they were involved in importing goods from Singapore based M/s Fareast Distribution and exporting the same goods from M/s Gulf Distribution Ltd under the alleged (LC) M/s Globiz Exim Private Limited and its directors, namely Arvind Srivastava and Saral Verma have actually defrauded the amount of Rs 10.01 crore. The company through its directors in the criminal conspiracy as well as Sujay Desai had accepted the fake document knowing full well that the same were fake as evidenced by the documents presented before IOB, Kanpur.

“Looking at all the facts and circumstances of the above discussion, on the issue of economic infringement to the tune of Rs 10.01 crore, and the role of the claimant who was dealing with the day-to-day affairs of the business, I do not find this to be a suitable case for early bail,” the court observed in denying the request.

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