Dhanvyavasaya Stapanam vs State Of Kerala

Ziyad Rahman A.A., J

The petitioners are the accused Nos.1 to 3, in Crime No.2437/2022 of Thrissur Town East Police Station. The offences alleged against the petitioners are under Sections 406 and 420 r/w. Section 34 of the Indian Penal Code (IPC). The 1st accused is an establishment and is a financial institution represented by the 2nd petitioner, who is claimed to be the Managing Partner of the 1st petitioner. The 1st petitioner establishment is being run by 2nd and 3rd petitioners. The allegation against the petitioners is as follows:

The husband of the defacto complainant has been having financial transactions with the petitioners for the last 20 years. In the year 2020, the defacto complainant, based on assurance given by petitioners 2 and 3 that the amount will be returned to them as and when required, deposited an amount of Rs.12,50,000/-with the 1st accused firm. However, when the defacto complainant requested for the return of the said amount along with interest in the year 2022, they did not do so. The complaint was submitted in such circumstances based on which the crime was registered, and the investigation is now in progress. As the petitioners apprehend arrest in connection with the investigation of the said crime, this application is submitted for Anticipatory Bail.

Heard Sri.P.Vijaya Bhanu, the learned Senior Counsel for the petitioners, Sri. M.P.Prashanth, the learned Public Prosecutor for the State, Sri. N.U.Harikrishna, learned counsel appearing for the additional respondents 2 to 5.

The learned Senior Counsel for the petitioners submitted that the petitioners are innocent of all allegations. The 1st petitioner firm was initially started by the father of the 2nd petitioner 70 years ago, which was later taken over by the petitioners 1 and 2 and had been functioning since then very smoothly. However, during the Covid-19 pandemic, the business of the firm sustained some losses as some of the customers who were the subscribers of the chitty conducted by petitioners failed to repay the amount due to the petitioners and resultantly some financial crises occurred, which affected the repayment of the amount to the persons who deposited amounts with the firm. According to him, the firm has immovable properties worth Rs.50 Crores in the heart of Thrissur Corporation, and total liability would come to Rs.45 Crores only. According to him, all earnest efforts are being taken to repay the aforesaid amount, and no culpability could be attributed against the petitioners. It is further pointed out that the 2nd petitioner is aged 66 years, and the 3rd petitioner, who is the wife of the 2nd petitioner, is aged 62 years. In such circumstances, the learned Senior Counsel seeks an order granting Anticipatory Bail. It is submitted that they are prepared to abide by any conditions that this court may impose.

The learned Public Prosecutor, on the other hand, would seriously oppose the aforesaid contention. A report submitted by the Assistant Commissioner of Police, C-Branch, Thrissur City, who is conducting the present investigation, was also placed before this court for perusal. In the said report, it is specifically stated that, as part of investigation, they could seize 48 receipts issued by the accused persons against the deposit they had accepted from the public. Out of those receipts, 26 were issued in the name of ‘Dhanavyavasaya Sthapanam’ and 22 were issued under the name ‘Dhanavyavasaya Bankers’. It is further pointed out that in any of the receipts, the registration number of the establishment is not mentioned. No details of any license granting permission to accept the deposits are specified. Besides the same, on inquiry with the Assistant Registrar of Companies, it was informed that, no Company by the name Dhanavyavasaya Sthapanam had been registered under the provisions of Companies Act. The only licence that the Investigating Officer could recover is a licence bearing registration No.32080453716 dated 14.12.2022 issued by the Deputy Commissioner, IAC office in favour of Dhanavyavasaya Bankers, under the Kerala Money Lenders Act, to carry on the business of money lending in the said premises. It is pointed out that, the said licence would only enable M/s.Dhanavyavasaya Bankers to carry on the business of money lending, and it would not empower the said firm to collect deposits from the public. Moreover, even though most of the receipts were issued in the name of Dhanavyavasaya Sthapanam, no licence either under Kerala Money Lenders Act or under any other enactments could be recovered by the Investigation team. It is stated in the said report that some of the receipts seized by the Police contain signatures of persons other than 2nd and 3rd petitioners herein, even though the authorised persons to issue such certificates are the petitioners 2 and 3 herein. It is also stated that in the investigation conducted so far, 31 depositors were cited as witnesses and the total amount of money swindled is estimated to be Rs.4,77,84,270/-. Since the petitioners have collected deposits without any authority or licence in this regard, the offences under the provisions of Banning of Unregulated Deposit Schemes, 2019 (BUDS Act) are also incorporated. The proceedings under the said Act are also now in progress. In such circumstances,  it  was  contended  by  the  learned Public Prosecutor that the custodial interrogation of the petitioners is necessary as a large number of documents are to be recovered from the possession of the petitioners. Several other complaints are being received against the petitioners at various Police Stations of Thrissur City. As on the date, 46 cases have been registered against accused persons apart from this case and the total amount swindled by the accused as per the cases so far reported comes to Rs.13,04,89,865/-. The Police are expecting more cases to come as the petitioners have collected deposits from a large number of people. The learned counsel appearing for the additional respondents 2 to 5 also raised similar contentions and seeks for dismissal of the bail application.

I have carefully gone through the records and considered the contentions raised by either side.

The specific contention put forward by the learned counsel for the petitioners is that, the 1st petitioner-firm is carrying out its operation for the past 70 years smoothly. Accordingly, to him, the financial stringency occurred due to the developments owing to the Covid-19 pandemic, and no culpability could be attributed to them. However, the aforesaid contentions cannot be accepted as such, in view of the fact that the specific contention raised by the learned Public Prosecutor is by placing reliance upon the nature of receipts issued by the accused to the depositors. As pointed out by the learned Public Prosecutor, on perusal of the copy of some of the receipts produced before me indicates that the same were issued in the name of Dhanavyavasaya Sthapanam without any authentication. No registration number or licence number for accepting the said deposits are seen mentioned. Similarly, some receipts are issued in the name of Dhanavyavasaya Bankers. However, in that receipt also, the registration number or any details regarding the licence of sanction to collect deposits are not mentioned. Moreover, the contention of the learned Public Prosecutor that the 1st petitioner-firm does not have any licence to accept the deposits from the public, is not denied by the petitioners. The only explanation offered by the petitioners is that earlier they used to function under the name Dhanavyavasaya Bankers, and later some restrictions have been imposed by the Government in using the term ‘Bankers’ along with the name and on account of such restrictions, they have changed the name to Dhanavyavasaya Sthapanam. However, the crucial aspect to be noticed is that, apart from mere submission regarding the change of name, no documents are forthcoming to substantiate the same. Moreover, even if the said contention is accepted, the fact remains that the Dhanavyavasaya Sthapanam also does not have any licence to accept deposits from the public. The only licence they have is the licence obtained in the name of Dhanavyavasaya Bankers under the provisions of Kerala Money Lenders Act which would not, under any circumstances, enable the petitioners to collect deposits from the public. In view of the acceptance of unauthorized deposits, proceedings under BUDS Act are also initiated and are pending.

Thus, after considering all the relevant aspects, I am of the view that taking note of the gravity of the allegations, the huge quantity of the amounts allegedly swindled by the petitioners, granting of Anticipatory Bail is not at all proper. As rightly pointed out by the learned Public Prosecutor, an order of anticipatory bail at this stage would hamper the investigation as, in all probabilities, the custodial interrogation of the petitioners appears to be necessary. The learned Public Prosecutor also points out that several documents are to be recovered.

In such circumstances, for the reasons mentioned above, I do not find that this is a fit case in which the powers of this Court under Section 438 of CrPC can be invoked to protect the personal liberty of the petitioners. Accordingly, this Bail Application is dismissed. However, considering the fact that the petitioners are senior citizens, they are granted the liberty to surrender before the Investigating Officer within a period of two weeks from today.