Isaac N A vs State Of Kerala

P.V.Kunhikrishnan, J

These Bail Applications are filed under Section 439 of the Criminal Procedure Code (Cr.P.C.)

The petitioners in these cases are accused in Crime No.363/2024 of Fort Cochin Police Station, Crime No.302/2024 of Hill Palace Police Station, Crime Nos.166/2024, 174/2024, 175/2024, 183/2024, 179/2024, 177/2024, 186/2024, 180/2024, 185/2024, 188/2024 & 189/2024 of Koothattukulam Police Station, Crime Nos.204/2024, 205/2024 & 625/2024 of Ernakulam Central Police Station, Crime No.455/2024 of Muvattupuzha Police Station, Crime No.535/2024 of Thoppumpady Police Station, Crime No.188/2024 of Kuravilangadu Police Station and Crime No.433/2024 of Ernakulam South Police Station. Different cases are registered against the petitioners in these cases mainly alleging offences punishable under Sections 420 IPC.

The prosecution case in brief is as follows:

The petitioners being the Chairman and Managing Director of Nedumpilli Finance, with the intention to cheat and to make unlawful gain from the defacto complainants in these cases, received huge amount as deposit for a period of 5 years and cheated the defacto complainants without returning the deposit amount and its interest. Hence it is alleged that the accused committed the afore said offences.

Heard the learned counsel for the petitioners and the learned Public Prosecutor.

The learned counsel for the petitioners submitted that the petitioners' company is a non-banking financial company (NBFC) namely Nedumpilli Finance Company Limited, incorporated on 30.12.1996 as evident by Annexure A2. It is submitted that the company is having validly registered license and is working under the supervision of the RBI. It is also submitted that, as per the license conditions, regulations and rules issued by the RBI in respect of working of NBFC's, the company is permitted to collect funds, permit investments from the public by way of financial instruments like Debentures, Preference Shares and Subordinate debt. The petitioners admit the deposits made by the defacto complainants in almost all the cases. It is also submitted that the petitioners paid a prominent amount as interest till July 2023. According to the petitioners, due to an audit finding report by the RBI, the RBI cancelled the company's certificate of registration as a Non-Banking Financial Institution as per an order dated 17.11.2022. Annexure A3 is the copy of the letter dated 22.11.2022 issued by the RBI cancelling the certificate of registration of the petitioners' company. Challenging the order of the RBI, it is submitted that the petitioners preferred a Writ petition before this Court and this Court was pleased to pass an interim order stating that, no coercive steps shall be taken against the petitioners. Annexure A4 is the order. It is also submitted that the petitioners preferred an appeal before the Appellate Authority, Ministry of Finance, Government of India and the same was dismissed by the Appellate Authority upholding the finding of the RBI. Challenging the above order, the petitioners filed W.P.(C)No.23932/2023 before this Court and the order passed by the Appellate Authority is stayed as evident by Annexure A5 order is the submission. It is submitted that the cancellation of the certificate of registration by the RBI caused a huge impact on the financial management of the company. It is submitted that, even after that the petitioners paid interest on the deposit to the customers till July, 2023. The petitioners were arrested on 08.03.2024 and they were in custody from that day onwards. It is submitted that, one of the petitioner is aged 73 years and he is suffering from different ailments.

The learned Public Prosecutor opposed the Bail application and submitted that the petitioners cheated several persons and this Court may not release them on bail.

This Court considered the contentions of the petitioners and the Public Prosecutor. It is true that there are several victims in these cases. The petitioners admit that they have collected fund from the defacto complainants in these cases and because of the financial problem, the same was not disbursed. This Court perused the orders passed by this Court in the Writ petitions also. The petitioners submitted that they are trying to settle the entire issue with the defacto complainants in these cases. If that be the case, the continued detention of the petitioners may not help anybody. There can be a direction to the petitioners to surrender their passport, if any, before the court below and the petitioners can be released on bail after imposing stringent conditions.

Moreover, it is a well accepted principle that the bail is the rule and the jail is the exception. The Hon'ble Supreme Court in Chidambaram. P v Directorate of Enforcement (2019 (16) SCALE 870), after considering all the earlier judgments, observed that, the basic jurisprudence relating to bail remains the same inasmuch as the grant of bail is the rule and refusal is the exception so as to ensure that the accused has the opportunity of securing fair trial.

Considering the dictum laid down in the above decision and considering the facts and circumstances of this case, these Bail Applications are allowed with the following directions:

Petitioners shall be released on bail on executing a bond for Rs.50,000/- (Rupees Fifty Thousand only) each with two solvent sureties each for the like sum to the satisfaction of the jurisdictional Court.

Petitioners  shall  appear  before  the Investigating Officer for interrogation as and when required. The petitioners shall co-operate with the investigation and shall not, directly or indirectly make any inducement, threat or promise to any person acquainted with the facts of the case so as to dissuade them from disclosing such facts to the Court or to any police officer.

Petitioners shall not leave India without permission of the jurisdictional Court.

Petitioners shall not commit an offence similar to the offence of which they are accused, or suspected, of the commission of which they are suspected.

Petitioners shall appear before the investigating officer on all Mondays till final report is filed.

Petitioners shall surrender their passport before the Jurisdictional court. If there is no passport, they will file an affidavit to that effect before the Jurisdictional court.

If any of the above conditions are violated by the petitioners, the jurisdictional Court can cancel the bail in accordance to law, even though the bail is granted by this Court.