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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
CRIMINAL MISC.APPLICATION (FOR ANTICIPATORY BAIL ) NO. 4677 of
CRIMINAL MISC.APPLICATION NO. 4679 of 2014
CRIMINAL MISC.APPLICATION NO. 4680 of 2014
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE J.B.PARDIWALA
- Whether Reporters of Local Papers may be allowed to see the judgment ?
- To be referred to the Reporter or not ?
- Whether their Lordships wish to see the fair copy of the judgment ?
- Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ?
- Whether it is to be circulated to the civil judge ?
TEESTA ATUL SETALVAD & 1….Applicant(s)
STATE OF GUJARAT….Respondent(s)
MR MIHIR THAKORE, SR.ADVOCATE with MS MANISHA NARSINGHANI WITH M/S. MIHIR DESAI AND KALPESH N SHASTRI, ADVOCATE for the Applicant(s) No. 1 – 2 MR MAHESH JETHMALANI, SPECIAL PUBLIC PROSECUTOR WITH MR PK JANI, ADDL. ADVOCATE GENERAL WITH MR AC CHOKSHI, for the Respondent(s) No. 1
CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA
Date : 12/02/2015
Since all the three applications with a prayer for anticipatory bail arise from a selfsame FIR, those were heard analogously and are being disposed of by this common judgment and order.
The Criminal Misc. Application No.4677 of 2014 is treated as the lead matter.
This motion for anticipatory bail has been made on behalf of the applicants (husband and wife) and relates to an FIR registered with the D.C.B. Crime Police Station, Ahmedabad, vide I-CR No.1 of 2014 of the offence punishable under Sections 420, 406, 468, 120B of the Indian Penal Code and Section 72(A) of the Information and Technology Act.
- The case of the prosecution may be summarised as under :
The State of Gujarat witnessed one of the worst communal riots in the year 2002. During the period of riots, a residential society in the name of Gulbarg Society, situated in Ahmedabad, was ransacked and set on fire. Many people residing in the said society lost their lives, which includes aged women and children. In all 69 people lost their lives.
The applicants herein are running two trusts in the form of Non-Governmental Organizations, viz. “Citizens for Justice and Peace” (CJP) and “Sabrang Trust”. The applicants who are husband and wife are the trustees of the Trusts along with few other persons.
A complaint in writing dated 12th March 2013 was addressed by 11 inhabitants of the Gulbarg Society, which includes one Mr.Firozkhan Saeedkhan Pathan, to the Joint Commissioner of Police, Crime Branch, Ahmedabad city, stating that every year the members of the NGOs have been organizing a function in the memory of those who lost their lives in the riot. It is alleged that during such functions, various schemes for the rehabilitation of the riot victims, financial support and support for the reconstruction of the houses were announced by the applicant no.1, viz. Teesta Setalvad, under the banner of her two NGOs.
It is alleged that over a period of time, the applicant established a close rapport with the riot affected victims. In the month of December 2007, the applicant no.1 put forward an idea of purchasing the entire Gulbarg Society at the then market price and thereafter convert the same into the “Gulbarg Society Museum of Resistance”. It is alleged that she promised to make good the payment within a month if the members of the society were ready and willing to sell their respective residential units. It is alleged that she also requested the unfortunate inhabitants of the society to cooperate and help her in raising funds through publications, interviews, programmes, etc. The formal proposal in that regard was submitted by the Sabrang Trust in January 2008.
The members of the society were also assured of full reimbursement towards the rent borne by them over a period of time while occupying the rental premises since their individual houses were destroyed. The consent of all the members of the society was obtained in June 2008 and a resolution to that effect
dated 29th June 2008 was also passed by the society.
It is alleged that although such representations were made by the accused persons, no financial support was extended for the reconstruction of the houses to the inhabitants of the society nor any amount towards the reimbursement of the rent was paid to them. It is alleged that the society was also not converted into a museum even after a period of more than 4 years from the date of passing of the resolution. It is the case of the first informant that the members of the society, therefore, addressed a letter dated 21st February 2013 to the applicant no.1, requesting her to furnish the details of the amounts collected as donations for the reconstruction of their houses and for conversion of the society into a museum. The said letter was never replied at any point of time. It is the case of the first informant that the applicants herein kept on projecting the victims of the riots as the unfortunate human-beings before the whole world and the media, and thereby, the applicants kept on seeking sympathy and received huge amount of donations.
Ultimately, a memorandum was submitted by 15 members of the society to the Commissioner of Police with a request to prohibit the outsiders from entering the Gulbarg Society. Such memorandum is dated 28th February 2013. The said application referred to the advertisement published in a magazine called “Communalism Combat” and its website fervently requesting the people at large to generously donate to help develop a memorial for the victims of the communal violence, viz. “Gulbarg Society Museum of Resistance”. The “Communalism Combat” is a magazine owned by the applicants, wherein both the applicants are the Editors.
It is alleged that the CJP and Sabrang Turst run and managed by the applicants are guilty of collecting huge foreign funds as donations from various international organizations in the name of providing financial assistance, legal assistance, etc. to the 2002 Gujarat Riot victims. The applicants also referred to the details furnished by the Ministry of Home Affairs, Government of India, stating that according to the FC
Form-3 submitted by the CJP, foreign donations to the tune of Rs.63 lac were received between 2009 and 2011 and were credited in the IDBI Bank Account No.014104000204204736 of the CJP and donations to the tune of Rs.88 lac were received during the period between 2008 and 2011 and were credited in the Union Bank of India Account No.369102010802885 of the Sabrang Trust.
The Commissioner of Police took cognizance of the said complaint lodged in writing, and having found more than a prima facie case, ordered registration of the FIR, which came to be registered with the D.C.B. Crime, Ahmedabad, on 4th January 2014.
It appears from the materials on record that the applicants herein are permanent residents of Mumbai. The two Trusts referred to above are also registered at Mumbai. Therefore, apprehending arrest at the hands of the police in connection with the present FIR, the applicants first approached the High Court of Bombay by filing anticipatory bail application No.14 of 2014. The High Court of Bombay, vide its order dated 10th January 2014, granted interim protection to the applicants. The matter was thereafter heard by a learned Single Judge of the Bombay High Court and the application for anticipatory bail was ordered to be rejected on 31st January 2014 substantially on the ground of territorial jurisdiction of the High Court of Bombay. However, the High Court of Bombay granted a transit bail for a period of four weeks to enable the applicants to file an appropriate application before the appropriate forum in the State of Gujarat.
It appears that the order of the Bombay High Court dated 31st January 2014 rejecting the anticipatory bail application was challenged before the Supreme Court by filing SLP. The SLP (Cri) No.1770 of 2014 was disposed of by the Supreme Court vide order dated 24th February 2014, which reads as under :
“The matter relates to grant of Anticipatory bail under
Section 438 of the Code of Criminal Procedure. The
Bombay High Court vide impugned order dated 31st January, 2014 allowed the petitioners to move before appropriate Court in Gujarat for said relief and granted Transit Bail for four weeks so as to enable the petitioner to approach before the appropriate Court at Gujarat. Having heard the learned Counsel for the petitioners, we are not inclined to interfere with the impugned order.
However, taking into consideration the nature of the case and submission made on behalf of the petitioners, we extend the Transit Bail in favour of petitioners upto 31st March, 2014 so as to enable the petitioners to approach the appropriate Court in Gujarat. If such petition is filed, the appropriate Court in Gujarat will consider the same independently without being influenced by any observation made by the Bombay High Court.
The question of law about jurisdiction of High Court is kept open.
The special leave petition stands disposed of.”
After the disposal of the SLP, the applicants herein preferred Criminal Misc. Application No.761 of 2014 before the City Sessions Court, Ahmedabad, and prayed for anticipatory bail. The anticipatory bail application came to be rejected vide order dated 25th March 2014 passed by the learned Additional Sessions Judge, City Sessions Court No.15, Ahmedabad.
Being dissatisfied with the order passed by the City Sessions Court, the applicants have come up with this application, praying for anticipatory bail.
It appears from the various orders recorded uptil now that on 28th March 2014 rule was issued in this application, making it returnable on 4th April 2014. In the course of hearing of this application, I was informed by both the sides that on that particular date i.e. on 28th March 2014, an oral statement was made on behalf of the State that till the conclusion of the application, the applicants would not arrested. It appears that thereafter on one ground or the other, the matter was being adjourned from time to time. Ultimately, the same was notified before this Court on 12th January 2015. The arguments of both the sides were concluded on 6th February 2015 at around 5:00 p.m. and the judgment was kept reserved.
- Submissions on behalf of the Applicants :
Mr.Mihir Thakore, the learned senior advocate appearing on behalf of the applicants, vehemently, submitted that the FIR lodged against the applicants is nothing but an abuse of process of law. He submitted that the same is politically motivated. The principal argument of Mr.Thakore, while making good his case for anticipatory bail is, the malafides alleged against the State Government. Mr.Thakore submits that his clients have fought very hard from day one against the State Government as, according to the applicants, it is only the State Government who was responsible for the Godhra carnage and the riots which flared up thereafter in the entire State of Gujarat.
Mr.Thakore submits that his clients, through the two Trusts, have thoroughly exposed the State Government so far as their dubious role in the riots is concerned. Mr.Thakore submits that his clients are instrumental in securing many convictions of those persons who have been found guilty of murder during the period of riots.
Mr.Thakore submits that with a view to seek revenge, a false case has been framed against the applicants, and on the basis of such a false case, they are now sought to be arrested. Mr.Thakore submits that his clients are Journalists by profession and are highly reputed persons in the society. They have been striving hard for serving the cause of justice by helping the innocent victims of political vendetta.
Mr.Thakore submitted that the allegations of misappropriation are totally false and baseless. No such amount has been misappropriated by the applicants for their personal use. According to Mr.Thakore, the documents speak for themselves. Mr.Thakore submitted that his clients are ready and willing to extend full cooperation for effective investigation but no case for custodial interrogation is made out having regard to the nature of the allegations.
Mr.Thakore submitted that the entire matter relates to accounts. It is for the Investigating Officer to look into the accounts with the help of any expert and find out whether any amount has been misappropriated or not. For that purpose, arrest of the applicants and custodial interrogation is not necessary.
Mr.Thakore submitted that the other trustees of the two Trusts are people with great reputation. One of those is a noted Poet and a Lyricist and one another is a well-known Architect who had designed the New Taj Intercontinental at Mumbai. He has submitted that the accounts of the Trusts are being regularly audited, and even the reports of the Auditor make the picture clear that nothing has gone in the pockets of the applicants.
Mr.Thakore has placed strong reliance on the following decisions of the Supreme Court :
- Gurbaksh Singh Sibia v. State of Punjab, 1980(2) SCC 565;
- Hema Mishra v. State of U.P., 2014(4) SCC 453;
- Pokar Ram v. State of Rajasthan and others, 1985(2) SCC 597; and
- Siddharam Satlingappa Mhetre v. State of Maharashtra and others, 2011(1) SCC 694
In such circumstances referred to above, Mr.Thakore prays that the application merits consideration and the applicants be ordered to be released on anticipatory bail in the event of their arrest by the police.
III. Submissions on behalf of the Respondent – State :
On the other hand, this application has been vehemently opposed by Mr.Mahesh Jethmalani, the learned Special Public Prosecutor appearing for the State. Mr.Jethmalani submitted that no case worth the name is made out for anticipatory bail. He submits that the allegations are very serious. He submits that huge amounts have been converted by the applicants for their personal use through their credit cards. The amount which was received by way of donations was meant for the poor and the needy i.e. the riot victims. By creating sympathy for the riot affected victims, the applicants were successful in obtaining huge amount by way of donations. The documentary evidence on record would suggest that they have not been able to satisfactorily account for the same. Huge amounts were transferred from the Trusts’ accounts to the personal accounts of the husband and the wife, which are 10 in number. He has submitted that there are huge cash withdrawals with no corresponding vouchers in that regard. He submitted that huge amounts have been paid towards their personal expenditure on credit cards. Mr.Jethmalani pointed out that for years together the accounts were not audited so far as the two Trusts are concerned and then all of a sudden one fine day they got the accounts of past couple of years audited through the two Auditors. The principal argument of Mr.Jethmalani is that there has been total non-cooperation at the end of the applicants so far as the investigation is concerned. He submits that the money which was meant for the poor and the needy have been misappropriated by the applicants for their own materialistic pleasure and comfort. Huge amount has been used for the purchase of items like wine, shoes, holiday resorts, air-tickets, etc. Mr.Jethmalani pointed out that although it is the case of the applicants that they have spent the money for their own personal use from their own income, yet they did not even furnish their income tax returns before the Investigating Officer.
Mr.Jethmalani submitted that by merely producing few documents, the need for custodial interrogation cannot be done away with. It is only the applicants who are in know of the matter and the facts which are within their personal knowledge. Mr.Jethmalani pointed out that the applicants are also guilty of tampering with the witnesses, more particularly, they have restrained the Auditors from furnishing the necessary details and data to the Investigating Officer. According to Mr.Jethmalani, this itself is a ground on which the application deserves to be rejected.
Mr.Jethmalani submits that the two Trusts are being run and managed by the applicants on their own. The other trustees are just for the name sake. They have no idea about the management of the affairs of the Trusts. He submitted that being trustees, they are also drawing salary, which is otherwise not permissible in law and is an offence.
Mr.Jethmalani submitted that the applicants are guilty of making false representations before the people and they are guilty of duping not only the donors but even those who have been deprived of the financial help meant for them.
In such circumstances referred to above, Mr.Jethmalani prays that there being no merit worth the name in this application, the same deserves to be rejected.
- ANALYSIS :
Having heard the learned counsel appearing for the parties and having gone through the materials on record, the only question that falls for my consideration in this application is, whether any case is made out for grant of anticipatory bail.
At this stage, I need to point out that the arguments were concluded on 6th February 2015. The judgment was kept reserved. On 13th February 2015, Mr.Thakore mentioned the matter submitting that his clients have furnished all the vouchers and other documents including the income tax returns to the Investigating Officer. Mr.Thakore wanted to place few documents in that regard, however, since the arguments were already concluded and the judgment was kept reserved, I did not deem fit to take such documents on record. The other side also vehemently opposed such mentioning of the matter after the arguments were concluded.
Before I proceed to consider the matter on merits, I would like to quote few paragraphs of the averments made in the affidavit-in-reply filed by the State of Gujarat duly affirmed by Shri K.N.Patel, Assistant Commissioner of Police, Cyber Crime Cell, Crime Branch, Ahmedabad city :
“The learned City Sessions Judge has also been pleased to note that in the applications preferred by the present applicants the entire thrust of the Petitioner’s defence is that as NGOs and that they have been registered under the Public Trust Act, their accounts are duly audited and that the Charity Commissioner, Mumbai, has raised no query regarding their accounts. During the course of investigation the prosecution has been informed by the office of the Charity Commissioner that Sabrang Trust has not filed audit reports for six years i.e. from 2002-03, 2003-04, 2004-05, 2005-06, 2006-07 and 2007-08. Furthermore copies of the few audited accounts received from the Charity Commissioner shockingly reveal huge discrepancies and omissions to the extent that over and above donations received, even amounts received from the Govt of India as grants, are no where reflected in the ‘Income & Expenditure Account’ of the trust. The same would be elaborately dealt with subsequently in the reply. Suffice it to say that the resistance of the petitioners to any kind of scrutiny by the Gujarat Police, being resisted under the guise of accounts being audited is also a falsified.”
“The IO addressed a communication dated 18.3.2013 to the present Petitioners, seeking copies of Audited account statements and Balance Sheet, of CJP and Sabrang Trust for the Last ten years apart from other information regarding foreign donations received from national and international institutions for providing financial and legal assistance to riots victims and the utilization of the said funds. Specific queries were raised with regard to the receipt and utilization of donations received from the national/international bodies and private individuals for providing legal and financial assistance to riots victims in the accounts of CJP and Sabrang Trust. In response thereto, vide communication dated 26.3.2013, the petitioners declined to furnish any specific details sought for. Except maligning the Gujarat State Police, constitutional functionaries and alleging victimization, the petitioners did not reply to any of the querries raised.”
“The concerned IO addressed the second communication dated 8.5.2013, seeking information as sought for vide communication dated 18.3.2013, calling upon the petitioners to co-operate with the investigation and furnish necessary details. Vide letter dated 20.5.2013, the petitioners informed the IO that they had received Rs. 4,60,000/- towards the proposed “Dream Museum”, their “accounts were audited and submitted to the relevant authorities and investigating into the matter reflects the vindictive attitude of the forces trying to subvert the process of justice”. However, no details sought for by the IO were furnished.
The I.O addressed communications to the Ministry of Home Affairs (MHA), seeking details of the permission granted to CJP and Sabrang Trust, enabling receipt of foreign donations under Foreign Contribution (Regulation) Act (FCRA). The MHA intimated the IO that CJP and Sabrang Trust obtained FCRA registration on 21.11.2007 bearing registration no. 083781099 and no.
083781100 under the category of “Educational, Social” and “Economic Educational” respectively. MHA also furnished copies of Form FC-6, mandatorily required to be submitted by every NGO annually declaring details of the foreign funds received. Condition no. 3 of the FCRA registration specifically stipulates that the association cannot bring out any publication (registered under PRB Act, 1867) or act as correspondent, columnist, editor, printer or publisher of a registered newspaper or engage in the production or broadcast of audio news or audio visual news or current affairs programs through electronic mode or any other electronic form or any other mode of mass communication at a later stage thereby attracting provisions of the Section 3(1)(g) and (h) of the FC(R) Act, 2010. In addition thereto, the association is forbidden from getting involved in any activity of political nature. Details of accounts of CJP and Sabrang trust were received from the IDBI Bank and the Union Bank of India.
It is noteworthy that when the Petitioners failed to provide even the copies of audited balance sheets and books of accounts of CJP and Sabrang Trust, the IO, addressed a communication to the Charity Commissioner, Mumbai for providing the same. The Office of the Charity Commissioner, Mumbai, has furnished some of the audit reports of Sabrang Trust and CJP which are clearly in variance with the bank statements received. A bare scrutiny of the accounts have revealed huge discrepancies.
- Sabrang Trust:
Audit reports of the following years i.e 2008-09, 2009-10, 201011, 2011-12 and 2012-13 have been received.
Audit reports of 6 years i.e 2002-03, 2003-04, 2004-05, 2005-06, 2006-07 and 2007-08 have not been filed with the Charity Commissioner.
- Citizens for Justice & Peace:
Audit reports of following years i.e 2003-04, 2004-05,
2005-06, 2006-07, 2007-08, 2008-09, 2009-10, 2010-11, 2011-12 and 2012-13 have been received from office of the Charity Commissioner.
It is respectfully submitted that on scrutiny of available audited reports (Income & Expenditure Account (I & E A/C), as provided by the office of the Charity Commissioner, Mumbai, major apparent discrepancies are observed which are as under: A. Sabrang Trust:
|Financial Year||Donation as per Audit Report||Donation as per bank statement||Amount Difference|
|Total in Rs||58,95,456||3,63,58,622||3,04,63,166|
- As against receipt of Rs.3,63,58,622 which reflected in the Bank statement, in the audited reports only Rs.58,95,456 has been shown. A huge discrepancy of Rs.3,04,63,166 is noticed in just above five years. Since for the rest of the years audit reports are not available, further investigation has not been possible.
- It is humbly submitted that on scrutiny of SB-GeneralA/c No.369102010037953 of Sabrang Trust, it was
noticed that the Govt. of India, Ministry of HRD, has paid through RTGS Approx Rs1.40 crores to Sabrang Trust as per details given below:
- Rs 58,72,500 on 17.02.2011
- Rs 26,66,570 on 13.07.2012
- Rs 54,20,848 on 06.07.2013
- On scrutiny of Audit reports for the year 2010-11 of
Sabrang trust it was noticed that this amount of Rs
58,72,500 is not reflecting in the Income & Expenditure Account for the year ending 31st March- 2011. Such a huge sum received from Govt. of India is found missing from the books of account and the Auditors too have found no reason to examine this.
- It is humbly submitted that in the audit report of Sabrang Trust for the financial year 2011-2012, no income as interest received is reflected in the books of accounts however, scrutiny of the accounts of Sabrang trust reveals that during the financial year 2011-12, the trust has earned interest income of Rs.1,13,973. These details too seem to have missed the Auditor’s scrutiny. CITIZENS FOR JUSTICE & PEACE:
|Financial Year||Donation as per Audit Report||Donation as per bank statement||Amount Difference|
|2003-04||12,83,058||2,85,947||+ 9, 97,111|
NOTE: The above analysis is based on only 2 accounts of CJP with IDBI Bank i.e. SB A/c N0-014104000105705 and FCRA A/C No-014104000204736.
(i) It is humbly submitted that as in case of Sabrang Trust referred above, the donations received as reflected in the Audit reports of CJP are far less as against the amounts reflected in the bank statement. For example, during the years 2008-09 upto 2012-13 the total donation amount shown in the audit reports of CJP above is Rs.29,48,2,490 however as per the bank statement the amount of donation is Rs.3,25,85,572 i.e. discrepancy of an amount of Rs.31,03,082 in just three years.
A bare scrutiny of above table reveals that the accused in connivance with the auditors, have manipulated their accounts as well as the audit reports submitted before statutory authorities. It will not be out of place to mention here that IO has also addressed letters to the concerned Auditors of Sabrang trust and CJP, to provide information related to their audit reports.”
“It is respectfully submitted that the Auditors have submitted their replies to the IO. The analysis of their replies reveal serious discrepancies/concealment of facts as per details given below:
- A) SABRANG TRUST
- a) The investigating authority in its communication dated 27.03.2014 addressed to the Auditor of Sabrang Trust, M/s DM Sathe and Co., Mumbai has specifically sought complete details of the accounts of the Sabrang Trust. However, the auditors have choose to provide payment details with regards to only one account, concealing the fact that the petitioners have withdrawn huge cash amounts, transferred large sums to their personal/individual accounts as well as in the accounts of their privately owned companies, from 2 other accounts of Sabrang Trust during the same period as per the details given below:
Amount transferred from three accounts of SABRANG
TRUST to Teesta Setalvad
|ParticularsTeesta Setalvad||FCRA A/c * In Rs.||HRD A/c** In Rs.||SB-Gen A/c*** In Rs.|
|a) Amount as per bank account statementb) Amount as per statement provided by D.M.Sathe, auditor ofSabrang Trust||22,49,95615,58,000||8,59,435No information provided by C.A.||4,97,762No information provided by C.A.|
Amount transferred from three accounts of SABRANG TRUST to Javed Anand
|ParticularsJaved Anand||FCRA A/c * In Rs.||HRD A/c** In Rs.||SB-Gen A/c*** In Rs.||Total|
|a) Amount as per bank account statementb) Amount as per statement provided by D.M.Sathe, auditor ofSabrang Trust||19,18,67613,87,650||7,58,320No information provided by C.A.||34,743No information provided by C.A.||27,11,53813,87,650|
Amount transferred from three accounts of SABRANG TRUST to Sabrang Communication & Publishing Pvt Ltd.
|ParticularsSabrangCommunication& PublishingPvt Ltd||FCRA A/c * In Rs.||HRD A/c** In Rs.||SB-Gen A/c*** In Rs.||Total|
|a) Amount as per bank account statement||45,02,848||22,54,766||19,91,870||87,49,484|
|b) Amount as per statement provided by D.M.Sathe, auditor ofSabrang Trust||28,35,920||No information provided by C.A.||No information provided by C.A.||28,35,920|
Amount transferred from three accounts of SABRANG
|ParticularsCashWithdrawal||FCRA A/c * In Rs.||HRD A/c** In Rs.||SB-GenA/c*** In Rs.||Total|
|a) Amount as per bank account statementb) Amount as per statement provided by D.M.Sathe, auditor ofSabrang Trust||12,75,00010,00,000||11,02,000Noinformation provided by C.A.||18,93,925Noinformation provided by C.A.||42,70,00010,00,000|
* FCRA A/c No.369102010802885 with UBI ** HRD A/c No 369102010806781 with UBI. *** SB-General A/c No 369102010037953 with UBI
- As per the information gathered from the office of the Charity commissioner, Mumbai, the Petitioners have not submitted Audited Copies of the “Balance Sheet” and “Income & Expenditure Account” of Sabrang Trust till
April 2014, for the following 6 years i.e 2002-03, 200304, 2004-05, 2005-06, 2006-07 and 2007-08 which is mandatory requirement.
Non submission of audited accounts to the Charity Commissioner continuously for 6 years automatically demolishes the argument of the Petitioner’s that “Their Accounts were audited and submitted to the relevant authorities”. It appears that for this very reason the Petitioners have refused to share any information with the authorities as regards to the working of the 2 NGOs.
- It humbly submitted and also note worthy that the auditor D M Sathe in their reply to the IO, have given a certificate clearly stating that “ No grants were received (by Sabrang Trust) in the Financial year 2012-13 and
2013-14” but the Bank statements reflect that Sabrang
Trust has received Rs.26,66,570 in the Financial year 2012-13 and Rs.54,20,848 in the Financial year 2013-14 as grants from the Ministry of HRD, Govt of India, New Delhi by way of an RTGS transfer.
- It is also note worthy that the Auditor D M Sathe, in their reply to the IO, have given payments details of financial years 2007-08 to 2011-12 only, the years of which auditors have submitted audited copies to the Charity Commissioner Office. They have not given any payment details of the Petitioners for the years 20022008, i.e. the 6 years for which audit reports were not submitted to the Charity Commissioner. This deliberate attempt by the auditors to conceal the facts from investigating authorities is a subject mater of investigation.
- B) Citizens for Justice & Peace (CJP)
- It is humbly submitted that similarly an analysis of reply sent by M/s Haribhakti & Company, the Chartered Accountants of Citizens For Justice & Peace (CJP) the following discrepancies were noticed.
- The aggregate amount mentioned by them towards credit card payment of the Petitioners was shown as Rs 13,26,960 however as per the bank statements this amount is Rs 20,04,817.
- It is note worthy that the Petitioners in their various replies/pleadings have admitted to having made expenditure of very personal nature including purchase of wines, branded shoes, grocery, clothes etc through Credit Cards from the accounts of the Trust CJP, however the Chartered Accountant in their reply has claimed that “none of such personal expenses have been debited in the books of accounts of CJP”. These contradictory statements are subject matter of investigation.
- Chartered Accountant M/s Haribhakti & Company in their reply also categorically stated that “We have not noticed that the funds of CJP were used by its Trustees for the purpose other than its objects”, however they seem to have missed noticing that trustees have transferred Rs 82.35 lacks from the Trust account to their own company i.e. Sabrang Communication & Publishing Pvt Ltd.
- The Chartered Accountant has also not commented on 50 cheques issued from the accounts of the CJP by the Petitioners towards Credit Card payments. The Chartered accountants has not given any justification on huge cash withdrawal by the petitioners from these accounts also.
- It is note worthy that the IO informed the CA that “both the accused persons in their reply in the session court have claimed that they were authorized by the board of trustees to make such expenses” i.e. (Personal expenses) information was sought for from the CA to provide the copies of all such resolutions. In response to this specific question, the CA of CJP instead of providing copies of those specific resolutions, has provided copies of resolutions which were related to adoption of financial statements for the year 2008-9, 2009-10, 2010-11 and 2011-12, It is apparent that the Petitioners were not authorized by the board of Trustees to make such personal expenses from the Trust accounts.
From the scrutiny of replies received from Chartered Accountants of Sabrang Trust and CJP, prima facie it is established that it is not only a serious case of embezzlements of public funds received by the
Petitioners for charitable purposes is also a case of grave negligence on the part of auditors also.”
The investigation of accounts revealed the following facts:
Statement of Financial Irregularities By Teesta
Setalvad & Javed Anand In The Account of Citizens
For Justice & Peace (CJP) & Sabrang Trust
|Name of the Institution||Foreign|
In Rs.Total Amount In Rs. SABRANG TRUST :
A) FCRA A/c
No.369102010802885 with UBI
Period 10.04.07 to
B) SB-General A/c No
369102010037953 with UBI
Period 01.01.01 to 03.04.14
C) HRD A/c No 369102010806781 with UBI.
Period 23.02.11 to
CITIZENS FOR JUSTICE 1,35,10,311
5,14,02,546 & PEACE :
A) FCRA A/c
Period 12.04.07 to
B) SB A/c No .
Period 26.02.2004 to
TotalGrand TOTAL 9,74,75,100
Note: With the emergence of these two new accounts, the total donation in Sabrang Trust has gone to Rs 4.61 crores as against Rs 1.35 Crores as referred to earlier. These facts were never disclosed before any Court by the the Petitioners in their Petitions and pleadings.”
“It is humbly submitted that on the Analysis of the Personal Account of Teesta Setalvad and Javed Anand following facts have emerged.
(A) Account Analysis Teesta Setalvad:
- SB A/c No.369102010003883 with UBI, Mumbai:
Account Opening Date: 01/01/2001
- Deposit From 01.01.2001 to 31.12.2001 NIL
- Deposit From 01.01.2002 to 31.12.2002 NIL Deposit from 16.03.2003 to 17.01.2014 Rs 1,53,70,519
- SB A/c No.014104000142595 with IDBI Bank, Mumbai:
Account Opening Date: 30/04/2005
- Deposit from 30.04.05 to15.01.2014 Rs
Total Rs 2,21,95,519
(Rs 2.22 Crore) (B) Account Analysis Javed Anand :
- SB A/c No.369102010006884 with UBI, Mumbai:
Account Opening Date: 01/01/2001
- Deposit from 01.01.2001 to 31.12.2001 NIL
- Deposit from 01.01.2002 to 31.12.2002 NIL
- Deposit from 1.1.2003 to 18.02.2014 Rs 96,43,000
- SB A/c No.014104000142601 with IDBI Bank, Mumbai:
Account Opening Date: 30/04/2005
- Deposit from 30.04.05 to 26.12.13 Rs 39,65,000
(Rs 1.36 crores)
Note 1: Analysis of above SB accounts of Petitioners accused no 1 & 2, it was found that they are receiving huge amount in their personal account from Citi Bank N.A. On inquiry from Citi Bank about these credit entries, the bank has informed that an amount of Rs 29,20,000 has been received in the account of Accused no-1, from Ashoka Foundation, Arlington, USA. It appears that the Petitioners have directly accepted the foreign donation in their SB accounts which requires thorough investigation.
Note 2: Analysis of SB account no 369102010003883, of
Accused no 1, it was also noticed that an amount of Rs 6,05,442 was credited on 13.11.2003 in this account. On inquiry from UBI, it was informed that it was a foreign remittance ( Apprx $ 13500) received in the SB account of Ms Setalvad. It appears that the Petitioner no-1 has directly accepted the foreign remittance in her SB account which is also a subject matter of investigation. Note 3: The analysis of the 2 accounts of CJP and the 3 accounts of Sabrang Trust and 1 account of Sabrang Communication & Publication Pvt Ltd, has revealed that the Petitioners Teesta Setalvad and Javed Anand, are drawing salary /reimbursement regularly from all the 6 accounts simultaneously which requires thorough investigation.
Note 4: It is humbly submitted that 2 accounts of CJP in IDBI Bank and 1 account of Sabrang Trust in Union Bank of India were seized by the Police vide communication dated 14.01.2014. The Banks in compliance with the instructions, seized the accounts on 20.01.2014. Till such time the Police had knowledge of only 3 accounts as the accounts of CJP and Sabrang Trust. However as soon as these three accounts were seized, on 23.01.2014 the petitioner immediately transferred Rs 24,50,000 and Rs 11,50,000 from the other 2 accounts of Sabrang trust unknown to the investigation authority, i.e. from account no 369102010806781 and account no 369102010037953 of Sabrang Trust respectively by way of Demand Drafts of Rs 36,00,000 has been drained in a single day.”
“It is respectfully submitted that Petitioners no 1 & 2 in their joint affidavit dated 20.03.2014 before the Sessions Court, Ahmedabad, have narrated several procedures of how the grants/donations are sanctioned and given to the NGOs by the International bodies and its utilization certificate from the Auditors etc to book the expenditure. The cogent documentary bank details demonstrating direct transfers of substantial amount in petitioner’s name, credit card payments running into lacs of Rupees, major discrepancies in Audit Reports,non submission of Audit reports , remains unexplained. Mere oral denials cannot obliterate facts received from Nationalized banks, MHA, Charity Commissioner etc which clearly substantiate the charge of mis-appropriation of crores of public funds. Mere auditing of accounts cannot be presumptive of their lack of involvement and preclude investigation. The Petitioners by their conduct have revealed that they are not ready and willing to cooperate with the investigation. As trustees, they should have readily offered their accounts for investigation and scrutiny.”
“It is respectfully submitted that in so far as the allegation of Petitioners no 1 & 2 for obtaining personal Credit Card details by the Police is concerned, it is submitted that on scrutiny of account statement of CJP and Sabrang Trust, it was noticed that substantial amount has been paid from these accounts towards the Credit card bill payments, hence it was found necessary to investigate the nature of payments made from the accounts of Trusts for these Credit cards. After receiving the Credit cards payment details it was noticed that the payment of purely personal nature have been undertaken by the Petitioners from the Trust Accounts.
- BRIEF DETAILS OF PURELY PERSONAL EXPENDITURE MADE BY PETITIONER NO-1 FROM THE FUNDS OF CJP:
From the scrutiny of credit card payments the most shocking revelation came from the payment made towards wine and liquor purchases from Chincholi Wines Mumbai and Duty Free Shops of Mumbai Airport, Movie Tickets, regular hair salon and grocery expenses.
Expenditure on purchase of branded shoes, beauty products, Purchase of clothes from branded show rooms in India, Islamabad and Rome, online shopping from Flipkart, Amazon and Google storage in US Dollars, purchases of electronic goods, music systems, dinning expenses at five star hotels, purchases of jewellery, watches, suitcases, health equipments, articles from emporiums, Art Galleries Islamabad, payment to JK Tourism, Online payments in foreign currency towards SAT/college board entrance exams in US, UK Universities for admissions.
Shopping expenses in Pakistan, Kuwait, US, Canada, Europe have been noticed in the credit card expenses, raises serious doubts about the nature of social work being undertaken by the accused no.1 from the funds received from various donors in CJP
- BRIEF DETAILS OF PURELY PERSONAL EXPENDITURE MADE BY PETITIONER NO-2 FROM THE FUNDS OF SABRANG TRUST:
The data received from the Union Bank of India show that substantial amounts are spent by Petitioner no-2 was towards shopping, entertainment, foreign goods purchase, domestic requirements and other
ancillary expenses of absolutely personal nature such as Hair Salon expenses, purchases from Mona Lucky Stores, Reliance Fresh, Beauty Stores, cottage Industries, Royal Fashion Corner, Medicines, Cakes, shoes from Vogele Shoes Geneva, Manor AG departmental store, Geneva, watches, dining in high end restaurants in India and abroad, clothes from branded show rooms, stay in Marriot Hotel, Islamabad, Agoda Hotel, London and Duty free shopping at Abu Dhabi airport etc raises serious doubts about the nature of social work being undertaken by the accused no.2 from the funds received from various donors in Sabrang Trust.”
In the additional affidavit-in-rejoinder filed by the State of Gujarat, the details of the false statements made by the applicants on oath have been furnished. Those are as under :
“It is respectfully submitted that in view of pleading which now stand concluded, following relevant and undisputed facts of suppressions of materials facts/incorrect statements on oath before the various Courts including this Hon’ble Court are clearly borne out on record as per details given below:-
- A) The Petitioners in Criminal Writ Petition No 173/2014 filed in the Bombay High Court on 15.01.2014 for quashing of present FIR No 1/2014, at page no 11, para (G) of the Petition stated that:
“As required under the Bombay Public Trust Act, 1950 the Accounts of Sabrang Trust are audited annually by Chartered Accountants and are filed with the Charity Commissioner, Mumbai along with the Auditor’s Report every year. Similarly, as required under the Bombay Public Trust Act, 1950 the Accounts of CJP are audited annually by Chartered Accountants and are filed with the
Charity Commissioner, Mumbai along with the
Auditor’s Report every year”
Copies of relevant pages of CWP No-173/2014 are annexed herewith as ANNEXURE C.
- The Petitioners in Criminal Writ Petition No 293/2014 filed in the Bombay High Court on 24.01.2014 for deceasing the accounts of Sabrang Trust & CJP etc, at page no Q115 para (h) of the Petition stated that:
“As required under the Bombay Public Trust Act, 1950 the Accounts of CJP are audited annually by the Chartered Accountants and arefiled with the Charity Commissioner, Mumbai along with the Auditor’s Report every year. Similarly, as required under the Bombay Public Trust Act, 1950 the Accounts of Sabrang Trust are audited annually by the Chartered Accountants and are filed with the Charity Commissioner, Mumbai, along with the
Auditor’s Report every year”
Copies of relevant pages of CWP No-293/2014 are annexed herewith as ANNEXURE D.
- The Petitioners in Misc Criminal Application No 761/2014 filed before the Sessions Court, Ahmedabad on 21.02.2014, in Affidavit-in-rejoinder of the Applicants dated 10.03.2014 for grant of anticipatory bail, at page no 4 para (6) of the Affidavit-in-rejoinder stated that:
“Both the trusts have been regularly filing their returns with the Charity Commissioner as well as with the Income Tax Department.”
Copies of relevant pages of CWP No-761/2014 are annexed herewith as ANNEXURE E.
- The Petitioners in Misc Criminal Application No 4677/2014 filed before this Hon’ble Court on 27.03.2014 for grant of anticipatory bail and quashing judgment and order dated 25.03.14 passed by the Ld City Session Judge, Ahmedabad in MCA No 761/2014, at page no 24 para (cc) of the Petition stated that:
“Both the trusts have been regularly filing their returns with the Charity Commissioner as well as with the Income Tax Department”
Copy of relevant pages of CWP No-4677/2014 is annexed herewith as ANNEXURE F.
- The Petitioners in Special Criminal Application No 2710/2014 filed before this Hon’ble Gujarat High Court on
07.07.2014 for de-freezing of accounts of Sabrang Trust, CJP etc, at page no 10 para (h) )of the Petition stated that:
“(h) As required under the Bombay Public Trust Act, 1950 the Accounts of CJP are audited annually by the Chartered Accountants and are filed with the Charity Commissioner, Mumbai along with the Auditor’s Report every year. Similarly, as required under the Bombay Public Trust Act, 1950 the Accounts of Sabrang Trust are audited annually by the Chartered Accountants and are filed with the Charity Commissioner, Mumbai, along with the Auditor’s Report every year”
The Petitioners at para (j) again repeated the same statement as under:-
“( j) The Audited accounts of both the CJP & Sabrang Trust that have beenregularly submitted, every year, with the Charity Commissioner and till date there have been no adverse remark by the Auditors concerning any financial irregularity not has there been any query from the Charity Commissioner’s office regarding the same. Copies of relevant pages of CWP No-2710/2014 are annexed herewith as ANNEXURE G.”
Some of the facts which are admitted by the applicants have also been highlighted. Those are as under :
“The Petitioners in their various Petitions, Applications and pleadings as mentioned herein above have categorically and repeatedly mentioned that the accounts of their both NGOs i.e. “Sabrang Trust and Citizens for Justice & Peace(CJP) are audited and submitted to the Charity Commissioner/Income Tax Department along with Auditor’s Reports every year”. The entire thrust of the Petitioner’s defence all throughout has been that as NGOs, they have been registered under the Public Trust Act and their accounts are duly audited and submitted to the Charity Commissioner, Mumbai, every year and the Charity
Commissioner has raised no query regarding their accounts till date.
Investigation has revealed that the Petitioners have not been filing their annual Audited Reports and statements of Accounts to the Charity Commissioner, every year, as repeatedly claimed by them and proved from the following alarming facts emerged during the investigation:
- a) Citizens for Justice & Peace (CJP):
Audited Reports and statement of Accounts of CJP for the Period from 2003-04 to 2009-10 i.e. of 7 years were submitted on 06.01.2012 in the office of the Charity Commissioner. Mr Javed Anand, Petitioner No-2, also accused no 2, filed an Affidavit dated 05.01.2012 to the Charity Commissioner, Mumbai, and sought condonation of this delay and stated that :
“I say that the delay occurred due to our understanding of section 34 of the Bombay Public Trusts Act, 1950 and Bombay Public Trust Rules 1951 because of which trustees of CJP assumed that it is the auditors who are required to file the annual reports with the office of the Deputy Charity Commissioner. Our Auditors Messers Haribakti & Company, chartered Accountants, have also been filing our Income Tax Returns regularly with the Income Tax Department which was the additional reason for our assumption that they must also be submitting Audit Report with your office. We recently learnt from the Auditors that they had in turn assumed that the Trustees were filing the reports with your office. Owing to this unfortunate slip in communication the Audited statements of accounts, the stipulated schedules and the Auditors report have not filed with your office for the years ending 31st March 2004 till –March 31,2010 and I hereby request you to kindly condone the delay in submission of accounts of our Trust.”
The Petitioner No-2 in the said Affidavit has also stated that “I now enclose herewith the accounts duly audited by the Chartered Accountants/Certified Auditor for the period from April1, 2003 to March, 31, 2010 for your perusal and records. I say in Future the Accounts of our Trust will be submitted in time”
Copy of Affidavit dated 05.01.2012 filed by Petitioner No2 is annexed herewith as ANNEXURE H.
It is pertinent to note that the Petitioners in their additional Affidavit in rejoinder dated 23.07.2014 (served in the Court on 26.08.2014) running into 44 pages, have not even once mentioned that audited reports of CJP were also not submitted on time by the Petitioners and that they have sought 7 years condonation of delay from the Charity Commissioner in January 2012.
- b) Sabrang Trust:
Audited Reports and Statement of accounts of Sabrang Trust for the Period 2003-04 to 2007-08 i.e. of 5 years were submitted only on 26.03.2014 in the office of the Charity Commissioner, that too, after the filing the present FIR. Mr Javed Anand, Petitioner No-2, submitted an Affidavit dated 19.02.2014 to the Charity Commissioner, Mumbai, for condonation of delay and stated:
“I say that the delay occurred due to our understanding of section 34 of the Bombay Public Trusts Act, 1950 and Bombay Public Trust Rules 1951 because of which trustees of Sabrang Trust assumed that it is the auditors who are required to file the annual reports with the office of the Deputy Charity Commissioner. Our Auditors Messers D M Sathe & Associates,, chartered Accountants, have also been filing our Income Tax Returns regularly with the Income Tax Department which was the additional reason for our assumption that they must also be submitting Audit Report with your office. Some of our original records of annual returns were maintained at the office of our Auditors. We recently learnt from the Auditors that they had in turn assumed that the Trustees were filing the reports with your office. Owing to this miscommunication, the Audited statements of accounts, the stipulated schedules and the Auditors report have not filed with your office for the years ending 31st March 2004 till –March 31,2008 and I hereby request you to kindly condone the delay in submission of accounts of our Trust.”
The Petitioner No-2 in the said Affidavit has also stated that “I now enclose herewith the accounts duly audited by the Chartered Accountants/Certified Auditor for the period from April1, 2003 to March, 31, 2008 for your perusal and records. I say in Future the Accounts of our Trust will be submitted in time”
Copy of Affidavit dated 19.02.2014 submitted by Petitioner No-2 on 26.03.2014 i.e. after more than one month, in the office of the Charity Commissioner is annexed herewith as ANNEXURE I.
The Petitioners in their additional Affidavit in rejoinder dated 23.07.2014 have admitted to have submitted 5 years Audited Reports of Sabrang Trust in one go on March, 26th, 2014 i.e. after filing of the present FIR. Affidavit dated 19.02.2014 by Petitioner no-2, along with audited reports of Sabrang Trust, was actually filed in the office of the Charity on 26.03.2014 i.e. after a lapse of 5 weeks. When the accounts were yearly prepared and audited, as repeatedly claimed by the Petitioners, why petitioner took more than 5 weeks to actually submit the audited reports in the office of the Charity Commissioner is subject matter of investigation.
- c) It is pertinent to note that the Petitioner no-2 in his affidavit dated 05.01.2012 to the Charity Commissioner for condonation of 7 years delay in the case of CJP and Affidavit dated 19.02.2014 for condonation of 5 years delay in the case of Sabrang Trust made identical pleas.
- In the case of CJP, 7 years delay in submitting the audited accounts for the years APRIL 2003- 31st MARCH 2010 was noticed by the Petitioners in the year 2012 and 7 years accounts were filed simultaneously seeking condonation of delay in January 2012. The grounds for this gross lapse and irregularity in accounting for public funds running into crores of rupees meant for the charitable purposes is very casually explained away by the Petitioners as “a communication gap between the Auditor and the Trustees” The culpability of the petitioners/accused is apparent from the fact that in the case of Sabrang Trust, 5 years audited annual accounts from APRIL 2003 To 31st MARCH 2008 were filed in the year 2014, i.e. after the filing of the present FIR in January 2014, raising an identical plea of “miscommunication with the Auditors”.
- It is pertinent to note that when the Petitioners noticed 7 years delay in submission of audited annual accounts & reports of CJP in January 2012, it is beyond all reasonable comprehension, that as managing trustees receiving crores of rupees as funding, they did not check into the filing of the audited annual accounts of their another NGO Sabrang Trust till February 2014. From the available records and admission, it is evidently clear that, it is only when the FIR came to be filed in January 2014 for embezzlement of funds, that the petitioners apprehended the likelihood of their accounts being scrutinized and they rushed to get them prepared & filed in March 2014.
- As Managing Trustees of SABRANG TRUST, the Petitioners have made incorrect statements on oath in 2 petitions before the Hon’ble High Court of Bombay (WP No- 173/2014 filed on 15.01.2014, CWP No-293/2014 filed on 24.01.2014), SLP No 1770/2014 filed on 20.02.2014 in the Hon’ble Supreme Court and MCA No
761/2014 filed on 21.02.2014 before the Sessions Court, Ahmedabad and whilst stating on oath that they have annually submitted regular audited accounts, whereas in fact till 26th MARCH 2014, annual accounts for the period APRIL 2003 to 31st MARCH 2008 i.e continuously of 5 years, were not even filed before the Charity Commission.
- These two Affidavits filed by the Petitioners in the office of the Charity Commissioner for condonation of delay, eastablishes beyond reasonable doubt, that the Petitioners were not filing their Annual Audited Report and Statement of Accounts of both the trusts in the office of the Charity Commissioner regularly every year, which is a mandatory requirement for every registered Trust, and that they have repeatedly lied on oath before various Courts as per details mentioned above. Since, the Income
Tax department has not furnished any information to the IO, it is not known whether the Petitioners are similarly lying about their regularly filing I T Returns to the Income Tax Department.
This conduct of the accused also speaks volumes about their style of functioning, their faith in the Judicial System of the Country. It is humbly submitted that this Hon’ble court would take a serious note of series of misconduct/mis-representation by the Petitioners who choose to mislead the Hon’ble court to secure favourable orders by stating falsehoods.”
Thus, from the above, it is evident that the accounts were also not audited for a long period of time, and it is only when the FIR was registered wherein serious allegations of misappropriation of lacs of rupees have been alleged that all of a sudden the accounts from April, 2003 to March, 2008 were got audited in the year 2014.
It appears from the affidavit-in-reply filed by the State and the submissions of Mr.Jethmalani, the learned advocate appearing on behalf of the State, that detailed investigation of the following transactions is necessary :
(a)From the accounts of the Sabrang Trust and CJP, a total amount of Rs.1,69,84,669=00 have been transferred to the Sabrang Communication & Publishing Pvt Ltd, a company owned by the petitioners.
(b)From the accounts of the Sabrang Trust and of CJP, an amount of Rs.46,91,250=00 and Rs.28,34,804=00 were transferred to the personal accounts of the petitioner nos. 1 & 2 respectively.
(c)From the accounts of the Sabrang Trust and CJP, the petitioners have withdrawn Rs.1,08,73,782=00 as cash.
(d)From the accounts of the Sabrang Trust and CJP, the petitioners have paid Rs.29,66,121=00 towards Credit Card payments.
(e)The petitioners have endeavored to explain the credit card payment running into lakhs of rupees by stating that all such personal expenditure were repaid to the NGO accounts. This employment of public donations to personal use needs to be investigated. The petitioners have not submitted any debit/ credit vouchers and/or cheques details to prove their statement.
(f) Upon scrutiny of the saving accounts Nos.014104000142595 &
014104000142601 of the petitioner nos. 1 & 2 with the IDBI, Mumbai, it was noticed that both the accounts were opened on
30.04.2005. The FCRA permission from MHA for CJP and Sabrang Trust was granted in November, 2007. Proposal to purchase the Gulbarg Society was mooted by petitioner no.1 orally in December, 2007 and formally in January, 2008, Resolution was passed by the society accepting her proposal in June, 2008 and thereafter the advertisements commenced and monies started pouring in. Further no substantial income of any nature, except from the CJP and Sabrang Trust, is noticed in both the above mentioned personal accounts of the petitioners, which were further invested in fixed deposits, shares and mutual funds such as ICICI Prudential, Reliance Capital, Kotak Mahindra, Franklin Templeton etc.
(g)The donations received by the Sabrang Trust and CJP are utilized for personal purposes.
(h)Receipt of donations to the tune of Rs.29,20,000=00 from
Ashoka Foundation, Arlington, USA, in the personal accounts of
Ms.Setalvad and Rs.6,05,442=00 as foreign remittance in Ms.Setalvad’s personal account.
(i) Monthly withdrawal of salary by both the accused from all the six accounts of CJP, Sabrang Trust and Sabrang Communications.
It also appears that the custodial interrogation is necessary for the following reasons :
- The case of the prosecution is based on cogent documentary evidence received from the Charity Commissioner, Mumbai, Ministry of Home Affairs, New Delhi, various Banks, etc. Financial details received from these authorities require detailed investigation.
- The petitioners have never remained present before any investigating agency and have employed every means to avoid the due process of law. The petitioners seek to avoid custodial interrogation by the investigating authorities by dismissing cogent documentary evidence as accounting jugglery. Approximately 44% of the total donations received in the Sabrang Trust and approximately 35% of the total donations received in the CJP, were transferred to their personal accounts.
- Cash withdrawal running into over Rs 1.09 crore need to be further scrutinized and examined wherein Rs.50,000=00 to Rs.5,00,000=00 have been withdrawn as cash on a single day.
- Credit card details received from the UBI and Citi Bank revealed expenditure of purely personal nature running into lacs of rupees being serviced from the CJP and Sabrang Trust accounts through cheques signed by the petitioners.
- Investigation has also revealed frequent foreign trips to Pakistan, Abu Dhabi, Kuwait, Switzerland, U.A.E. etc. Investigation is merited into the nature of these visits and the expenses incurred thereon.
- The petitioners have sought to dismiss cash withdrawals, bank transfers and credit card payments on the specious plea of having their accounts audited. Investigation has already proved that there are major discrepancies in the Audits Reports. The nature of expenditure as revealed from the data received from the Citi Bank shows that substantial amount is spent on entertainment, shopping, domestic requirements and other expenses of purely personal nature. Online payment of hundreds of U.S. Dollars, Pounds, Canadian Dollars towards college board entrance exams in colleges in U.S, UK, from the NGO Trust accounts raises doubts about the nature of social work undertaken by these NGOs.
- Whether the Board of Trustees of the Sabrang Trust and CJP have ever authorized the accused nos. 1 and 2 to incur such purely personal expenditure and whether the same is permissible in law, is the subject matter of investigation. It needs to be examined as to how the Chartered Accountants who have audited the accounts of these two Trusts have missed examining the use of the funds by the Trustees for the purposes other than charitable.
- The statements of the 13 witnesses recorded till date clearly indicate that not a single rupee is received by them towards financial aid or rehabilitation or construction of Museum. Investigation has revealed that it is only after the publication of interviews, photographs, articles relating to the Gujarat riots and more particularly after the massive campaign in 2008 onwards for collecting funds for establishment of the “Museum of Resistance” for the Gulbarg Society that funds started flowing into the two NGOs in crores, 44% of which in the Sabrang Trust and 35% of the CJP have been transferred to their personal accounts.
- The CJP and the Sabrang Trust were granted registration under the Foreign Contribution Regulation Act (FCRA) by the Ministry of Home Affairs in November,
- The CJP and Sabrang Trust respectively opened the FCRA accounts in I.D.B.I. and Union Bank of India. In December, 2007, the accused placed a proposal before the residents of the Gulbarg Society, to purchase the entire land and building of the Gulbarg Society at the current market price and further reimburse them for the rent which they had paid for all these years. Lucrative as the proposal sounded, it was unanimously accepted by all the residents and members of the Gulbarg Society, Ahmedabad, in June, 2008.
- The manner in which the petitioners have dealt with the public funds needs to be investigated, considering that whilst on the one hand, as stated by several witnesses, not a single rupee of financial aid has ever been received by any of the riots victims, crores of rupees received for the upliftment/ rehabilitation of the riots victims and for construction of a unique “Museum of Resistance” has been transferred to their personal accounts, credit card payments and expenses of purely personal nature. Whilst financial condition of the victims remained unchanged over the years, the accused, who, till February 2003, had not even deposited Rs.10,000=00 in their accounts, in the short time, have amassed crores of rupees of funds.
- The matter involves commission of a grave economic offence as the petitioners are managing trustees of the two NGOs.
Since a lot has been argued by both the sides so far as the scope and ambit of Section 438 is concerned, I deem it necessary to consider the position of law.
I may begin with the decision of the Supreme Court in the case of Balchand Jain v. State of M.P., AIR 1977 SC 366. Fazal Ali, J. observed in no uncertain terms as follows :
“Section 438 does not contain unguided or uncanalised powers to pass an order for anticipatory bail, but such an order being of an exceptional type can only be passed if, apart from the conditions mentioned in S.437, there is a special case made out for passing the order. The words “for a direction under this section” and “Court may, if it thinks fit, direct” clearly show that the Court has to be guided by a large number of considerations including those mentioned in S.437 of the Code.”
Balchand Jain (supra) was a case, wherein the primary question before Their Lordships was, whether anticipatory bail can be granted with regard to an offence under rule 184 of the Defence and Internal Security of India Rules. His Lordship Bhagwati, J. in his concurring judgment first observed as to the nature of this power as follows :
“Now, this power of granting ‘anticipatory bail’ is somewhat extraordinary in character and it is only in exceptional cases where it appears that a person might be falsely implicated, or a frivolous case might be launched against him, or there are reasonable grounds for holding that a person accused of an offence is not likely to abscond, or otherwise misuse his liberty while on bail’ that such power is to be exercised. And this power being rather of an unusual nature, it is entrusted only to the higher echelons of judicial service, namely, a Court of Session and the High Court.”
The exceptional nature of this power was further highlighted by Fazal Ali, J. who prepared the main judgment in the following words:–
“It would thus appear that while the Law Commission recommended that provision for an order of anticipatory bail to be effective when a person is arrested should be made, at the same time it stressed that this being an extraordinary power should be exercised sparingly and only in special cases.”
As regards the guidelines and the limitations on the exercise of the power under Section 438, the Supreme Court laid them down in the following terms (at p. 377 of AIR):–
“We have already stated that S. 438 of the Code does not contain the conditions on which the order for anticipatory bail could be passed. As S. 438 immediately follows S. 437 which is the main provision for bail in respect of nonbailable offence it is manifest that the conditions imposed by S.437(1) are implicitly contained in S. 438 of the Code. Otherwise the result would be that a person who is accused of murder can get away under S. 438 by obtaining an order for anticipatory bail without the necessity of proving that there were reasonable grounds for believing that he was not guilty of offence punishable with death or imprisonment for life. Such a course would render the provisions of S. 437 nugatory and will give a free licence to the accused persons charged with nonbailable offences to get easy bail by approaching the Court under S. 438 and by-passing S. 437 of the Code.
This, we feel, could never have been the intention of the Legislature. Section 438 does not contain unguided or uncanalised powers to pass an order for anticipatory bail, but such an order being of an exceptional type can only be passed if, apart from the conditions mentioned in S. 437, there is a special case made out for passing the order. The words “for a direction under this section” and ‘Court may, if it thinks fit, direct’ clearly show that the
Court has to be guided by a large number of considerations including those mentioned in S. 437 of the Code.”
Balchand Jain (supra) laid down the following proposition for the grant of anticipatory bail.
“(1) That the power under Section 438, Criminal Procedure Code, is of an extra-ordinary character and must be exercised sparingly in exceptional cases only;
- That the said power is not unguided or uncanalised, but all the limitations imposed in the proceeding S. 437, Criminal Procedure Code, are implicit therein and must be read into S. 438 as well; and
- That in addition to the limitations imposed in S. 437, the petitioner must further make out a special case for the exercise of the power to grant anticipatory ba”
The broad canvas against which the significant question aforesaid has to be examined cannot be better spelled out than in the memorable words of Lord Porter in Emperor v.
Khwaja Nazir Ahmad, AIR 1945 PC 18(at p. 22):
“In their Lordships’ opinion however, the more serious aspect of the case is to be found in the resultant interference by the Court with the duties of the police. Just as it is essential that every one accused of a crime should have free access to a Court of Justice so that he may be duly acquitted if found not guilty of the offence with which he is charged, so it is of the utmost importance that the judiciary should not interfere with the police in matters which are within their province and into which the law imposes upon them the duty of enquiry. In India as been shown there is a statutory right on the part of the police to investigate the circumstances of an alleged cognizable crime without requiring any authority from the judicial authorities, and it would, as their Lordships think, be an unfortunate result if it should be held possible to interfere with those statutory rights be an exercise of the inherent jurisdiction of the Court. The functions of the judiciary and the police are complementary not overlapping and the combination of individual liberty with a due observance of law and order is only to be obtained by leaving each to exercise its own function, always, of course, subject to the right of the Court to intervene in an appropriate case when moved under Section 491, Criminal Procedure Code, to give directions in the nature of habeas corpus.”
There is thus the authority of the Privy Council itself which has been re-affirmed by their Lordships of the Supreme Court times out of number for the proposition that the Code confers a statutory right on the police to investigate into cognizable crime without the sanction of any judicial authority. Therefore, it is unnecessary to elaborate on this aspect and the briefest reference to Chapter XII of the Code regarding the information of cognizable offences to the police and their powers to investigate therein would suffice. Section 154 requires that information regarding the commission of cognizable offence shall be reduced in writing and prescribes the procedure for recording the same. Section 156 in the clearest terms lays down that the Officer-in-charge of a police station may without the order of a Magistrate investigate forthwith into such a cognizable case. The succeeding Section 157 whilst providing for the procedure for investigation in terms empowers the police to take measures for the discovery and arrest of the offender.
In this context, it is worthwhile to recall that by virtue of S. 57 of the Code, a police officer would be entitled to detain in custody such a person for twenty-four hours exclusive of the time necessary for the journey from the place of arrest to the Magistrate’s Court without seeking the sanction of any Court or Magistrate. This right of the police indeed seems to have constitutional sanction by virtue of Article 22(2) of the Constitution of India which is almost in similar terms. However, if the investigation cannot be completed with the period of 24 hours aforesaid, the Code makes express provision therefor by Section 167 and sub-section (2) of the same is pertinent and the relevant part thereof may be set down here for facility of reference:–
“167 (1) x x x x
(2) The Magistrate to whom an accused person is forwarded under this section may, whether he has or has not jurisdiction to try the case, from time to time, authorise the detention of the accused in such custody as such Magistrate thinks fit, for a term not exceeding fifteen days in the whole; and if he has no jurisdiction to try the case or commit it for trial, and considers further detention unnecessary he may order the accused to be forwarded to a Magistrate having such jurisdiction.
(a) the Magistrate may authorise detention of the accused person, otherwise than in custody of the police, beyond the period of fifteen days if he is satisfied that adequate grounds exist for doing so.”
Now reading the relevant provisions together, it is plain that in a serious cognizable offence, the Code authorises the arrest and detention in custody of the offender for the first twenty-four hours without the interposition of the Magistracy and further police custody up to a period of 15 days with the authority of the Magistrate. It is clear, therefore, that the arrest and interrogation in police custody for cognizable crime is not only visualised but expressly authorised by the Code. On behalf of the respondent-State, indeed the stand is that this is not merely a right of the police but a duty enjoined upon them and is the life blood of any effective investigation into a serious crime. It is contended on their behalf that if the power under Section 438, Cr.P.C., is used indiscriminately and as a routine it would denude and render nugatory the provisions of Section 167 of the Code even in those cases where the investigative agency can lay legitimate claim to the effective interrogation and offender in their custody.
After Balchand, the Supreme Court delivered the decision in the case of Gurbaksh Singh Sibia (supra). In Gurbaksh Singh Sibia (supra), the Supreme Court examined the various facets of this provision. The Supreme Court has observed in regard to the legislative intent of the provision :
“The Legislature conferred a wide discretion on the High Court and the Court of Session to grant anticipatory bail because it evidently felt firstly, that it would be difficult to enumerate the conditions under which anticipatory bail should or should not be granted and secondly, because the intention was to allow the higher Courts in the echelon a somewhat free hand in the grant of relief in the nature of anticipatory bail. That is why, departing from the terms of Ss. 437, 439, S. 438(i) uses the language that the High Court or the Court of Sessions ‘may if it thinks fit’ direct that the applicant be released on bail.”
While examining the amplitude of judicial discretion given by Section 438, the Supreme Court observed :
“The true question is whether by a process of construction, the amplitude of judicial discretion which is given to the High Court and the Court of Session, to impose such conditions they may think fit while granting anticipatory bail, should be cut down by reading into the Statute conditions which are not to be found therein, like those evolved by the High Court or canvassed by the learned Solicitor General. Our answer, clearly and emphatically is in the negative. The High Court and the Court of Session to whom the application for anticipatory bail is made ought to be left free in the exercise of their judicial discretion to grant bail if they consider it fit so to do on the particular facts and circumstances of the case and such conditions as the case may warrant. Similarly they must be left free to refuse bail if the circumstances of the case so warrant. On considerations similar to those mentioned in S. 437 or which are generally considered to be relevant under Section 439 of the Code.”
While repelling the contention that the anticipatory bail cannot be granted unless it is shown that proposed allegation is mala fide, the Supreme Court observed :
“It is understandable that if mala fides are shown anticipatory bail should be granted in generality of the cases. It is not easy to appreciate why an application for anticipatory bail must be rejected unless accusation is shown to be mala fide.”
In regard to the scope and ambit of Section 438, the Supreme Court observed :
“The expression “if it thinks fit which occurs in S. 438(i) in relation to the power of the High Court or the Court of Session, is conspicuously absent in S. 437(i). We see no valid reason for re-writing S. 438 with a view not to expanding the scope and ambit of the discretion conferred on the High Court and the Court of Session but, for the purpose of limiting it.”
The Supreme Court also examined the fact as to whether the discretion vested in the Court under Section 438 can be exercised in relation to the offences punishable with death or life imprisonment unless the Court is satisfied that such a charge appears to be false or groundless and observed as under :
“We see no warrant for reading into this provision the conditions subject to which bail can be granted under Section 437(i) of the Code. That section, while conferring the power to grant bail in case of non-bailable offences, provides by way of exception that a person accused or suspected of the commission of a non-bailable offence shall not be so released, if there appears to be reasonable grounds for believing that he has been guilty of an offence punishable with death or imprisonment for life. If it was intended that the exception in S. 437(i) should govern the grant of relief under Section 438(i) nothing would have been easier for the Legislature than to introduce into the latter section a similar provision.”
The law on the subject is thus very clear and this Court’s powers to grant anticipatory bail are unfettered. That, however, does not solve the issue which is essentially of exercise of discretion and, which discretion has to be exercised judicially in the light of facts and circumstances of each and every case.
Balchand Jain (supra) and Gurbaksh Singh (supra) later on came to be considered by the Supreme Court in Siddharam Satlingappa Mhetre (supra), wherein the Supreme Court explained in detail the scope and ambit of anticipatory bail.
“SCOPE AND AMBIT OF ANTICIPATORY BAIL:
- A good deal of misunderstanding with regard to the ambit and scope of section 438 Cr.P.C. could have been avoided in case the Constitution Bench decision of this court in Sibbia’s case (supra) was correctly understood, appreciated and applied.
- This Court in the Sibbia’s case (supra) laid down the following principles with regard to anticipatory bail:
- Section 438(1) is to be interpreted in light of Article 21 of the Constitution of India.
- Filing of FIR is not a condition precedent to exercise of power under section 438.
- Order under section 438 would not affect the right of police to conduct investigation.
- Conditions mentioned in section 437 cannot be
read into section 438.
- Although the power to release on anticipatory bail can be described as of an “extraordinary” character this would “not justify the conclusion that the power must be exercised in exceptional cases only.” Powers are discretionary to be exercised in light of the circumstances of each case.
- Initial order can be passed without notice to the Public Prosecutor. Thereafter, notice must be issued forthwith and question ought to be re- examined after hearing. Such ad interim order must conform to requirements of the section and suitable conditions should be imposed on the applicant.
- The Law Commission in July 2002 has severely criticized the police of our country for the arbitrary use of power of arrest which, the Commission said, is the result of the vast discretionary powers conferred upon them by this Code. The Commission expressed concern that there is no internal mechanism within the police department to prevent misuse of law in this manner and the stark reality that complaint lodged in this regard does not bring any result. The Commission intends to suggest amendments in the Criminal Procedure Code and has invited suggestions from various quarters. Reference is made in this Article to the 41st Report of the Law Commission wherein the Commission saw `no justification’ to require a person to submit to custody, remain in prison for some days and then apply for bail even when there are reasonable grounds for holding that the person accused of an offence is not likely to abscond or otherwise misuse his liberty. Discretionary power to order anticipatory bail is required to be exercised keeping in mind these sentiments and spirit of the judgments of this court in Sibbia’s case (supra) and Joginder Kumar v. State of U.P. and Others (1994) 4 SCC 260.
Relevant consideration for exercise of the power
- No inflexible guidelines or straitjacket formula can be provided for grant or refusal of anticipatory bail. We are clearly of the view that no attempt should be made to provide rigid and inflexible guidelines in this respect because all circumstances and situations of future cannot be clearly visualized for the grant or refusal of anticipatory bail. In consonance with the legislative intention the grant or refusal of anticipatory bail should necessarily depend on facts and circumstances of each case. As aptly observed in the Constitution Bench decision in Sibbia’s case (supra) that the High Court or the Court of Sessions to exercise their jurisdiction under section 438 Cr.P.C. by a wise and careful use of their discretion which by their long training and experience they are ideally suited to do. In any event, this is the legislative mandate which we are bound to respect and honour.
- The following factors and parameters can be taken into consideration while dealing with the anticipatory bail:
- The nature and gravity of the accusation and the exact role of the accused must be properly comprehended before arrest is made;
- The antecedents of the applicant including the fact as to whether the accused has previously undergone imprisonment on conviction by a Court in respect of any cognizable offence; iii. The possibility of the applicant to flee from justice;
- The possibility of the accused’s likelihood to repeat similar or the other offences.
- Where the accusations have been made only with the object of injuring or humiliating the applicant by arresting him or her.
- Impact of grant of anticipatory bail particularly in cases of large magnitude affecting a very large number of people.
- The courts must evaluate the entire available material against the accused very carefully. The court must also clearly comprehend the exact role of the accused in the case. The cases in which accused is implicated with the help of sections 34 and 149 of the Indian Penal Code, the court should consider with even greater care and caution because over implication in the cases is a matter of common knowledge and concern;
- While considering the prayer for grant of anticipatory bail, a balance has to be struck between two factors namely, no prejudice should be caused to the free, fair and full investigation and there should be prevention of harassment, humiliation and unjustified detention of the accused;
- The court to consider reasonable apprehension of tampering of the witness or apprehension of threat to the complainant;
- Frivolity in prosecution should always be considered and it is only the element of genuineness that shall have to be considered in the matter of grant of bail and in the event of there being some doubt as to the genuineness of the prosecution, in the normal course of events, the accused is entitled to an order of bail.
- The arrest should be the last option and it should be restricted to those exceptional cases where arresting the accused is imperative in the facts and circumstances of that case.
- The court must carefully examine the entire available record and particularly the allegations which have been directly attributed to the accused and these allegations are corroborated by other material and circumstances on record.
- These are some of the factors which should betaken into consideration while deciding the anticipatory bail applications. These factors are by no means exhaustive but they are only illustrative in nature because it is difficult to clearly visualize all situations and circumstances in which a person may pray for anticipatory bail. If a wise discretion is exercised by the concerned judge, after consideration of entire material on record then most of the grievances in favour of grant of or refusal of bail will be taken care of. The legislature in its wisdom has entrusted the power to exercise this jurisdiction only to the judges of the superior courts. In consonance with the legislative intention we should accept the fact that the discretion would be properly exercised. In any event, the option of approaching the superior court against the court of Sessions or the High Court is always available.
- Irrational and Indiscriminate arrest are gross violation of human rights. In Joginder Kumar’s case (supra), a three Judge Bench of this Court has referred to the 3rd report of the National Police Commission, in which it is mentioned that the quality of arrests by the Police in India mentioned power of arrest as one of the chief sources of corruption in the police. The report suggested that, by and large, nearly 60% of the arrests were either unnecessary or unjustified and that such unjustified police action accounted for 43.2% of the expenditure of the jails.
- Personal liberty is a very precious fundamental right and it should be curtailed only when it becomes imperative according to the peculiar facts and circumstances of the case.”
Thus, considering Balchand Jain (supra), Gurbaksh Singh (supra) and Siddharam Satlingappa Mhetre (supra), it is clear that a balance must be struck between the two factors, namely, no prejudice should be caused to the investigation, and at the same time, the Court should also ensure that there is no undue harassment and humiliation to the accused. Beside this, the nature and gravity of the accusation and the exact role of the accused is also necessary to be looked into after evaluating the entire material against the accused. In short, what has been laid down by the Supreme Court in Siddharam Satlingappa Mhetre (supra) is that the arrest should be a last option and should be restricted to those exceptional cases where arresting the accused is imperative. I may add here that custodial interrogation is one of the most important factors which the Court should consider while considering the plea of the accused for anticipatory bail.
My attention has been drawn by Mr.Thakore, the learned senior advocate appearing for the applicants, to a very recent pronouncement of the Supreme Court in the case of Hema Mishra v. State of Uttar Pradesh and others, (2014)4 SCC 453, wherein His Lordship Dr.A.K.Sikri, J. in a concurring but a separate judgment made the following observations in paragraphs 30 and 31 :
“30. It is pertinent to explain that there may be imminent need to grant protection against pre-arrest. The object of this provision is to relieve a person from being disgraced by trumped up charges so that liberty of the subject is not put in jeopardy on frivolous grounds at the instance of the unscrupulous or irresponsible persons who may be in charge of the prosecution. An order of anticipatory bail does not in any way, directly or indirectly, take away for the police their right to investigate into charges made or to be made against the person released on bail.
- The purposes for which the provisions of anticipatory bail are made are quite obvious. One of the purposes of the arrest is that the accused should be available to the investigating machinery for further investigation and questioning whenever he is required. Another purpose is that the trial should not be jeopardized and for this purpose the restrictions on the movements of the accused are necessary. The genuineness of the alleged need for police custody has to be examined and it must be balanced against the duty of courts to uphold the dignity of every man and to vigilantly guard the right to liberty without jeopardizing the state objective of maintenance of law and order.”
I am not impressed by the submissions of Mr.Thakore that the applicants deserve to be released on anticipatory bail because they have levelled serious allegations of malafides against the State Government. The malafides must be specifically alleged and required to be proved by the applicants. By merely hurling allegations of malafides, the accused who is otherwise prima facie involved in a crime is not automatically entitled to anticipatory bail. The extraordinary power conferred upon the Courts of Justice under Section 438 of the Code of Criminal Procedure needs to be exercised very guardedly and with a little care and circumspection.
Having gone through the materials on record, I have noticed something very shocking, and at the same time, extremely sad. There are serious allegations against the applicants of misuse and misappropriation of huge amount received by them through various donors. The money which should have gone to the poor and the needy appears to have been prima facie misused for their personal pleasure and comfort. Although in the course of lengthy arguments it was vehemently submitted that the applicants are ready and willing to cooperate with the investigation, yet I have noticed that there is no cooperation worth the name. It is only after the arguments were concluded that the applicants thought fit to part with their income tax returns and vouchers.
The applicants did appear before the Investigating Officer once or twice and they were put number of questions for the purpose of effective investigation. Mr.Jethmalani, in the course of hearing of these applications, made available for my perusal the case-diary, wherein number of questions were put to the applicants and the stock reply which I find is necessary to be quoted :
“As the question relates to accounts, the reply of which is given in our affidavit. If there is no reply, and if you will give me in writing, we will give you reply for the same.”
To very few specific questions as regards purchase of air tickets, holiday resorts bills, fees paid in dollars so far as the education of children is concerned, credit card payments, expensive shoes, clothes, beauty parlour bills, etc., the stock reply was, “Please give me in writing, we will give you reply for the same”.
To few other questions, the only reply was, “At present I do not remember it. Sir, if you will give me in writing, I will provide information of the same later on”.
To a specific question as regards the personal expenses incurred using the credit cards from the bank accounts of the CJP and the Sabrang Trust, the reply was, “I state that we have submitted the detailed reply regarding use of Credit Card in Page No(s). 606 to 613 and Page No(s).617 to 659, in
“Annexure-A (Colly) of Affidavit Dated 18/06/2014 to our Miscellaneous Criminal Application No.4677/2014 filed before the Honourable High Court of Gujarat. We have also informed in Audit Report of Shri D.M.Shathe and Haribhakti that we have not incurred any personal expenses from Trust Bank Account (s). This information is asked for only to harass and defame us. You have not produced any documentary proof regarding your allegation in the matter.”
To a specific question regarding vouchers, the reply was, “ if we are asked in writing to submit vouchers of particular time and expenses, thereafter, we will provide you the same. As per the legal advice, we have obtained, it is neither necessary nor desirable to submit the same for the present investigation.”
To a specific question regarding the income tax returns, the reply was, “You have demanded copies of I.T.Returns for the years from 2004-05 to 2012-13, but we are not bound to produce the same (before you).”
If everything is in the affidavit filed before this Court, and if everything is to be looked into by the Investigating Officer and understand from the affidavit, then that hardly can be a ground for grant of anticipatory bail.
The above is suggestive of the fact that there is no cooperation at all. At any cost, the applicants want to evade the interrogation and are not ready and willing to disclose the true facts. If such are the answers given by the applicants to the questions put by the Investigating Officer at a stage when they are under the umbrella of an oral interim protection, I wonder what would be the position when they appear before the Investigating Officer armed with a full-fledged anticipatory bail order.
It is at that stage and in such circumstances that the custodial interrogation becomes a very important factor.
Custodial interrogation is qualitatively more elicitation oriented than questioning a suspect who is well ensconced with a favorable order under Section 438 of the Code. In a case like this effective interrogation of suspected person is of tremendous advantage in disinterring many useful informations and also materials which would have been concealed. Success in such interrogation would elude if the suspected person knows that he is well protected and insulated by a pre-arrest bail during the time he interrogated. Very often interrogation in such a condition would reduce to a mere ritual. The argument that the custodial interrogation is fraught with the danger of the person being subjected to thirddegree methods need not be countenanced, for, such an argument can be advanced by all accused in all criminal cases. The court has to presume that responsible Police Officers would conduct themselves in a responsible manner and that those entrusted with the task of disinterring offences would not conduct themselves as offenders. (see State Rep. by the C.B.I. v. Anil Sharma, (1997)7 SCC 187.
The case on hand, in my opinion, is one of custodial interrogation in public interest taking into consideration the fact that money meant for the poor and those being largely affected by riots is alleged to have been embezzled. Day-in and day-out we are witnessing with regret and sorrow that our political executives and bureaucracy are being involved in corruption cases. Now, even the NGOs who claim to work for the upliftment of the poor and the downtrodden of the society have started to involve themselves in such acts. The materialistic race is going on in every section of the society and this disease of corruption has eaten the very roots of our system. If the custodial interrogation of an accused is necessary in public interest and that the gravity of the allegation is such that the custody of the accused should be handed over to the police for fair and impartial interrogation, the provision of Section 438 of the Code should not be invoked in favour of such an accused.
So far as the aspect of custodial interrogation in public interest is concerned, I am supported by a decision of the Supreme Court in the case of Er.K.K.Jerath v. Union Territory, Chandigarh and others, 1998 Cri.L.J. 2555, wherein the Court observed in paragraphs 3, 4 and 5 as under :
“3. Shri R.K. Jain, learned senior counsel for the petitioner relying upon the decision of this Court in Joginder Kumar vs. State of U.P. & Ors. 1994(4) SCC. 260, Shri Gurbaksh Singh Sibbia & Ors. vs. State of Punjab 1980 (2) SCC 565. Nandini Satpathy vs. P.L. Dani & Anr. 1978 (2) SCC 424, and Babu Singh & Ors. vs. State of U.P. 1978. (1) SCC 579, submitted that the matter will have to be examined from the constitutional angle bearing in mind the scope of Articles 20(2) and 21 of the Constitution. He contended that though an accused person could be arrested, it may not be appropriate to detain him in custody in every case and when there is presumption of innocence in his favour until the charge against him is established, it would not at ll be consistent with the philosophy of the Constitution that such a person should be subjected to interrogation by application of psychological or ambient pressures much less physical torture. And he very vehemently stressed that this Court has a duty to protect a citizen against such inroads of these fundamental right. He relied upon the decisions in : (i) 1994 (4) SCC 260 (ii) 1980 (2) SCC 565 (iii) 1978 (2) SCC 424 and (iv) 1978 (1) SCC 579 to contend that in law an accused person could be arrested and if arrested, is entitled to bail unless detention in needed in public interest.
- Shri Arun Jaitley and Sri Gopal Subramaniam, learned Senior Advocates for the respondents, brought to our notice that there were several special features in this case which clearly indicate that retaining the petitioner in custody till the investigation is over is absolutely necessary and is in public interest, which far outweighs the interest of the petitioner.
- We do not wish to enter into any detailed discussion on these legal aspects raised by the learned counsel for the respondents as this Court in the several decision referred to by the learned counsel for the petitioner has explained the scope of the provisions of Articles 20(2) and 21 of the Constitution and Section 486 of the Code of Criminal Procedure and their inter-relationship. We may only state in considering a petition for grant of bail necessarily if public interest requires detention of citizen in custody for purposes of investigation could be considered and rejected as otherwise there could be hurdles in the investigation even resulting in tempering of evidence. This very aspect has been borne in mind by the High Court . On the facts and in the circumstances of the case, we do not think there is any god reason to interfere with the order made by the High Court in refusing bail at this state of the proceedings. The special leave petition is, therefore, dismissed.”
I should be conscious of the fact that I am not dealing with an application for grant of regular bail after arrest. The principal “bail and not jail” would be more germane while considering the application for post arrest bail.
The consideration which should weigh with the Court while dealing with a request for anticipatory bail in these type of cases need not be the same as for an application to release on bail after arrest.
I may quote with profit a decision of the Supreme Court in the case of Pokar Ram v. State of Rajasthan and others, 1985 SC 969, wherein in para 5 the following observations were made :
“Relevant considerations governing the court ‘s decision in granting anticipatory bail under Sec. 438 are materially different from those when an application for bail by a person who is arrested in the course of investigation as also by a person who is convicted and his appeal is pending before the higher court and bail is sought during the pendency of the appeal. Three situations in which the question of granting or refusing to grant bail would arise, materially and substantially differ from each other and the relevant considerations on which the courts would exercise its discretion, one way or the other, are substantially different from each other. This is necessary to be stated because the learned Judge. in the High Court unfortunately fell into an error in mixing Up all the considerations, as if all the three become relevant in the present situation.”
By merely pleading malafides, the applicants cannot escape from their liability. I should not shut my eyes to the other aspects of the matter, more particularly, the serious allegations of misappropriation to the tune of lacs of rupees by merely accepting the submission of malafides. Malafides is something which definitely should be considered, but if there is other materials on record to prima facie indicate the complicity and involvement of the accused, then only on the ground of malafides anticipatory bail should not be granted. On account of malafides, some times, the Court may find some exaggeration, but that does not mean that the entire case put forward by the prosecution is false or baseless.
It also appears from the materials on record that on account of some pressure or influence that might have been exerted by the applicants, the Auditors who are stationed at Mumbai have also not cooperated with the investigation.
As observed earlier, the facts of this case are quite shocking and disturbing. How can one seek materialistic pleasure and happiness at the expense of the poor and needy persons. How can one even use five paise which is meant for the poor and the needy. The facts of this case reflect the sorry state of affairs of the NGOs. People from all corners of the world are ready to help them. There are people who may not be able to directly help and, therefore, they use the NGOs to help the poor and the needy. The donations are made with lot of trust and hope that ultimately the money would reach to the poor and the needy. However, here is a case where, in the name of the poor, needy and unfortunate riot affected victims, lacs of rupees was received and embezzled.
A person who considers the happiness and the pain of others as those of his own, is, in my opinion, the real social worker.
Whilst giving freedom to the civil society to function with flexibility is positive, too much freedom can lead to abuses by certain groups or individuals calling themselves an ‘NGO’, thus giving civil society a bad name. Situations like these have a negative impact on the many honest NGOs and create a situation of low trust in the NGOs. This, in turn, leads to a situation where funding is not easily obtained and where the public is less ready to contribute to the sector. Ultimately, it is only the poor and the needy who are the sufferers. It is, therefore, very important to have strict laws regulating accountability and monitoring of the NGOs so as to maintain a high trust level and good functioning.
Proper registration, genuine board composition, compliance with procedures, and well laid-out policies relating to activities and resource mobilisation are the basic attributes of the well-governed organisations. Broadening and deepening the regulatory process, as well as enhancing the capacity of the department to carry it out, would be the best government response to this controversy.
A lot was argued regarding the reputation of the two applicants. My attention has been drawn to the various awards received by the two Trusts. It was also sought to be argued that the trustees are well-renowned persons of great repute. Well, by only looking towards the awards and the medals the hard reality should not be ignored. So far as the well-renowned persons being the trustees are concerned, I may only say that the two Trusts appear to be a one-woman and one-man show. The other trustees, I doubt, whether have any idea as regards the affairs of the Trusts. They may have lended their names unmindful that they may also lend up some day in difficulty.
After bestowing my anxious consideration, including the perusal of the case-diary referred to above, I have reached to the conclusion that no case is made out for exercise of the discretionary power under Section 438 of the Code of Criminal Procedure.
For the foregoing reasons, the Criminal Misc. Application No.4677 of 2014 fails and is hereby rejected.
It goes without saying that any observations touching the merits of the case are purely for the purpose of deciding the question of grant of anticipatory bail and shall not be construed as an expression of the final opinion in the main matter.
So far as the other two applications are concerned, i.e. Criminal Misc. Application Nos.4679 of 2014 and 4680 of 2014, it is submitted very fairly by Mr.Jethmalani that no custodial interrogation is required of the applicants. He submitted that, therefore, the State has no objection if the anticipatory bail is granted to the applicants of the other two applications.
In view of such stance of the State, the two applications being Criminal Misc. Application Nos.4679 of 2014 and 4680 of 2014 are hereby allowed, by directing that in the event of arrest of the applicants of the Criminal Misc. Application Nos.4679 of 2014 and 4680 of 2014 in connection with the FIR registered with the D.C.B. Crime Police Station, Ahmedabad, the applicants shall be released on bail on their furnishing a personal bond of Rs.10,000/- (Rupees ten thousand only) each with one surety of the like amount on the following conditions that they shall:
- cooperate with the investigation and make themselves available for interrogation whenever required;
- remain present at the concerned Police Station on 19th February 2015 between 11.00 a.m. and 2.00 p.m.;
- not directly or indirectly make any inducement, threat or promise to any person acquainted with the facts of the case so as to dissuade him/them from disclosing such facts to the court or to any police officer;
- not obstruct or hamper the police investigation and not to play mischief with the evidence collected or yet to be collected by the police;
- at the time of execution of bond, furnish the address to the Investigating Officer and the Court concerned and shall not change their residence till the final disposal of the case till further orders;
- not leave India without the permission of the Court, and if having passport, shall deposit the same before the trial Court within a week; and
- it would be open to the Investigating Officer to file an application for remand if he considers it just and proper and the learned Magistrate would decide the same on merits;
Despite this order, it would be open for the Investigating Agency to apply to the competent Magistrate for police remand of the applicants. The applicants shall remain present before the learned Magistrate on the first date of hearing of such application and on all subsequent occasions as may be directed by the learned Magistrate. This would be sufficient to treat the accused in the judicial custody for the purpose of entertaining application of the prosecution for police remand. This is, however, without prejudice to the rights of the accused to seek stay against an order of remand if, ultimately, granted, and the powers of the learned Magistrate to consider such a request in accordance with law.
It is clarified that the applicants, even if, remanded to the police custody, upon completion of such period of police remand, shall be set free immediately, subject to the other conditions of this anticipatory bail order.
At the trial, the trial Court shall not be influenced by the prima facie observations made by this Court while enlarging the applicants on bail. Rule is made absolute to the aforesaid extent. Direct service is permitted.
After the order is pronounced, Mr.Thakore, the learned senior advocate appearing on behalf of the applicants of the Criminal Misc. Application No.4677 of 2014, prays for extension of the oral interim protection granted to the applicants.
In view of what has been stated above, the prayer is rejected.