C.K. Vijayan vs State Of Kerala And Ors

B.A. No.6695/2020 is filed by the 1st accused for regular bail under Section 439 of Cr.P.C. while B.A.No.6714/2020 is filed by accused Nos.2 and

3 in the same crime No.606/2020 of Maradu Police Station for anticipatory bail application under Section 438 of Cr.P.C. The accused persons have

allegedly committed offences punishable under Sections 120B, 406, 420, 468 and 471 of IPC.

The prosecution case, in brief, is that the applicants had started a company by the name M/s Statice Hotels Private Ltd incorporated in the year

16.02.2010 with the applicants are directors. The company was started in the year 2005 and subsequently, the name was altered to Lokanta Hotels

and Resorts Private Ltd. The 1st accused was the Managing Director and the other accused were the directors. The company was started mainly

with the object of starting hotels and was engaged in the business of hospitality and real estate business. The company also purchased land in Maradu

Village adjoining the Edappally Aroor Bye pass near Vyttila in the year 2011. The company allegedly obtained permission to start a four star hotel in

the property having built up area of 18250 sq.ft and the construction of the hotel complex was started in the year 2018 and was also completed. Due

to paucity of funds, to start the business, the de facto complainant, the 3rd respondent and her husband Sri Radhakrishnan Kandoth, who is an NRI,

offered to invest money in the company in the year 2018. Accordingly, the de facto complainant through her husband invested about 11.53 crores.

The prosecution allegation is that the 1st accused had resigned from the directorship of the company on 16.09.2018 and having resigned from the

directorship of the company, he concealed that fact and induced the de facto complainant and her husband to invest money as per the MOU which

was entered on 08.10.2018. Under the circumstances, the 1st accused had from the very inspection of the understanding with the de facto

complainant and her husband the intention to deceive them dishonestly and despite his resignation from the company, he had received the amount

which was transferred. It is also further contended that as early as on 01.11.2017, accused Nos.2 and 3, who are the wife of the 1st accused and his

sister in law, were disqualified for their illegal practices. Under the circumstances, all the three accused entered into conspiracy to deceive the de

facto complainant and her husband and induced them to invest huge sums of money. It is also submitted that the de facto complainant was initially

offered 31.26% of the shares of the company but was actually given only 9.7% of the shares. In the MOU also there was an understanding that 34%

of the shares would be transferred into her name which actually never acted upon. The 1st accused was arrested on 09.10.2020 and remains in

custody. He was transferred to the Covid Center for treatment. The prosecution was granted permission to question him in the Covid Center so far no

application was filed for his custodial interrogation.

The applicants were also contend that they have produced all the documents as Annexures in these two applications for bail and anticipatory bail.

But the prosecution has not seized any of those relevant documents so as to further the cause of investigation. The fact that the applicants have

produced all those documents would indicate that they are willing to co-operate with the investigation. The 1st accused has been in remand since

09.10.2020 and he is willing to co- operate with the investigation and therefore further in incarceration of the 1st accused may not serve any purpose.

It is contended that accused Nos.2 and 3 are ladies.

They are also willing to co-operate with the investigation. They have not absconded so far. They are willing to produce all the documents pertaining to

the affairs of the company as directors and therefore their custodial interrogation may not be necessary and they may be granted anticipatory bail.

Heard the learned senior counsel Sri.S.Sreekumar appearing for the applicants, and the learned counsel Sri.Navaneeth N.Nath appearing for the de

facto complainant and also the learned Senior Public Prosecutor Sri.C.N.Prabhakaran appearing for the State. Records and documents produced

were perused.

The argument of the learned senior counsel appearing for the applicants is that there is absolutely no material to indicate that the applicants had any

intention to cheat the de facto complainant and her husband and had dishonestly induced them to deliver huge sums of money for the purpose of

business. According to him, the business of the hotel started on 31.12.2019 and the inauguration was completed. But unfortunately, because of the

pandemic situation the functioning of the hotel had to be shut down because of the lockdown. The company ran into loss and the applicants were not

able to fulfill their obligations to give the de facto complainant's share in the business. Because the company ran into loss, the applicants had offered to

sell the valuable land standing in the company's name in favour of the de facto complainant and her husband, for that the de facto complainant was not

willing. She had approached the Company Law Tribunal with a petition against the applicants and the company and that is pending consideration. It is

pointed out by the learned Senior counsel appearing for the applicants that the entire matter is a civil dispute which has to be resolved either amicably

or through the Company Law Tribunal or by means known to law and the registration of criminal case against the applicants is only with the intention

to force them to arrive at a settlement. It is submitted that the applicants have absolutely no intention to cheat the de facto complainant. It is also

submitted that no documents whatsoever were forged and apart from the allegations made by the de facto complainant there is no material to

conclude that there were documents forged. All the records pertaining to meetings and the attendance are produced by the applicants to prove that

there was no forgery as alleged. Under the circumstances, the learned senior counsel submits that the applicants may be released on regular bail and

anticipatory bail as prayed for.

The learned Public Prosecutor contends that the applicants have other criminal cases registered against them. They have criminal background and

antecedents. Therefore, releasing them on bail at this stage, where the investigation is still at its infancy would seriously prejudice the cause of

investigation. Therefore, they may not be released on bail.

The learned counsel appearing for the de facto complainant also submits that investigation is still at a very nascent stage and therefore co-operation

of the applicants is most essential and they may be directed to co-operate with the investigation and may not be released on bail at this stage.

After having considered the arguments raised on either sides, and also by the State and on perusal of the documents produced by the applicants in

their application for regular bail and anticipatory bail, I find that the applicants have produced records everything regarding the functioning of the

company. Whether there was any dishonest intention in the applicants inducement of the de facto complainant to pump in money into the hotel

business is something which can only be borne out from the records pertaining to the transactions. There is bank transaction in favour of the company

even subsequent to the alleged date of MOU, huge sums of money have been paid and withdrawn. It is also pertinent to note that in fact the

construction of the hotel was completed with the money allegedly contributed by the de facto complainant through her husband, which according to the

learned senior counsel appearing for the applicants is an indication that the applicants did not have any intention to cheat the de facto complainant. The

hotel business did not run because of pandemic situation, otherwise there would have been no complaint raised by the de facto complainant and she

would have been happy with the profits that may have accrued to her share. Regarding the criminal antecedents, the learned senior counsel appearing

for the applicants contends that all those criminal cases were registered in connection with family disputes with the applicants and their relatives in

connection with joint business. Criminal cases have been registered to force the applicants to settle the business disputes. Those are also primarily civil

disputes to be settled by the court of competent civil jurisdiction.

Considering the fact that the 1st accused has not yet taken into custody for custodial interrogation, I find that it is not possible for him to be

subjected to custodial interrogation because he has been in custody more than 15 days. The only way to question him now would be on his co-

operation by appearing before the investigating officer. I find no reason to hold that the applicants may not co-operate with the investigation and would

not appear for interrogation before the investigating officer. Since the 1st accused has been in custody and cannot be taken up for custodial

interrogation, the custodial interrogation of accused Nos.2 and 3 also may not be necessary at this stage. Therefore, I find that the 1st accused is

entitled to regular bail while accused Nos.2 and 3 are entitled to anticipatory bail on certain conditions, to ensure that the investigation progresses

smoothly without any hindrance.

In the result, the Bail Applications are allowed and the 1st accused is directed to be released on bail on execution of bond for Rs.1,00,000/-(Rupees

one lakh only) with two solvent sureties, each for the like amount to the satisfaction of the jurisdictional court. Accused Nos.2 and 3 are directed to

surrender before the investigating officer within two weeks and in the event of they being arrested, they shall also be released on bail on execution of

bond for Rs.1,00,000/- (Rupees one lakh only) each with two solvent sureties each for the like amount to the satisfaction of the investigating officer.

All the applicants are released subject to following conditions:

(i) They shall surrender their passport before the jurisdictional court and shall not go abroad without permission of the court. In case they do not have

a passport, they shall file an affidavit to that effect.

(ii) They shall appear before the investigating officer on all Mondays between 9 a.m. and 12 noon for a period of two months or till the filing of the

final report, whichever is earlier.

(iii) They shall produce all documents, which are called upon to be produced by the investigating officer.

(iv) They shall not get involved in similar cases during the pendency of the bail,

(v) They shall not tamper with evidence, intimidate or influence the witnesses .

In case of violation of the bail conditions, the prosecution is at liberty to move for cancellation of the bail before the jurisdictional court.