Amit Sharma, J
1. The present application under Section 438 of the Code of Criminal Procedure seeks grant of anticipatory bail in FIR No. 0135/2018 under Sections 420 and 409 of the Indian Penal Code, registered at P.S. Crime Branch, Sunlight Colony, Delhi.
2. The present FIR was registered on a complaint filed by Sh. H.E. Said Absieh Warsama, Ambassador of Republic of Dijbouti in India. It was alleged that Ms. Rama Krishna Karuturi, the applicant who is the Director of M/s Karuturi Global Limited (‘KGL’) entered into an agreement dated 10.09.2011 through its sister concern, M/s Karuturi Overseas Limited, Dubai (‘KOL’) with the Government of Djibouti. By virtue of the said agreement, KOL was supposed to provide 10,000 hectares of land in Ehiopia for agricultural purposes. It was further alleged that in the year 2012, KOL entered into a second agreement dated 23.02.2012 with the Government of Djibouti for development of 5,000 hectares of land. It was alleged that in order to assist KOL in performing its obligations. the Central Bank of Djibouti issued bank guarantee in the sum of 6.5 Million USD in favour of Bank of Africa. Accordingly, Bank of Africa issued a loan/credit of 6.5 Million USD to KOL. However, KOL allegedly failed to perform its obligations and repay the said loan. It is alleged that consequently, Bank of Africa insisted that the Government of Djibouti repay the loan amount of 6.5 Million USD. It was further the case of the complainant that in the year 2013, the applicant issued a letter of ‘Acknowledgment of Debt’ dated 10.02.2013 acknowledging to pay 5 Million USD alongwith interest to the Government of Djibouti. It was alleged that the obligations as undertaken by the applicant were not honored and thus, the present FIR came to be registered.
3. Learned counsel for the applicant submitted that the present FIR arises from a complaint dated 04.05.2018 containing misleading facts. It was submitted that several bonafide transactions took place between KGL and KOL on one hand and the Republic of Djibouti and its appointed advisory/consultant firm, namely, Multiplex Biotech FZC (‘Multiplex’) on the other. It is submitted that aforesaid KGL and KOL, the company of which the present applicant is a Director performed contracts entered into with the Republic of Djibouti and Multiplex, and had suffered losses. It is further submitted that in addition to the aforesaid losses, an amount of approximately 3.5 Million USD (in cash as well as cash equivalent i.e. machinery) had been returned.
4. Learned counsel for the applicant submitted that the genesis of the dispute are that two tripartite agreements dated 10.09.2011 and 23.02.2012 entered into between KOL, Republic of Djibouti, and Multiplex. It was submitted that as per the first tripartite agreement dated 10.09.2011, entered into between the Government of Djibouti, KOL and Multiplex Limited, KOL was to provide 10,000 hectares of agricultural land for production of rice and other crops. It was submitted by learned counsel appearing on behalf of the applicant that the said land was provided which was leaseowned by M/s Karturia Agro Products Limited (‘KAPL’) and the lease deed with respect to the same has been handed over to the Investigating Officer. It is submitted that the Government of Djibouti had to give a bank guarantee/stand by Letter of Credit (‘LC’) at the rate of 300 USD per hectare to KOL/KAPL. However, unfortunately, the crops were destroyed as a result of floods in Ethiopia. It was pointed out that this fact had been specifically admitted by the Republic of Djibouti through its various email addressed to the present applicant. Some of the said emails including the email dated 18.11.2012 have been annexed with the present application. It was further submitted that this was a force majeure circumstance under the agreement for which there is a specific clause in the said agreement.
5. It was further submitted that during this period and despite the above mentioned circumstances, another tripartite agreement dated 23.02.2012, pertaining to consultancy and management services was entered into between Republic of Djibouti, KOL and Multiplex for developing 5000 hectares of agricultural land in Ethiopia. It was submitted that as per the said agreement, the total value of project was estimated at about 6.99 Million USD. Republic of Djibouti had to arrange a bank guarantee to the extent of the said estimated amount in favour of the bankers of KOL before the commencement of the project work. It is submitted that the Republic of Djibouti furnished bank guarantees only to the extent of 3.5 Million USD. Out of these proceeds, in terms of agreement, and as admitted by the Republic of Djibouti, a sum of 1.565 Million USD was paid to Multiplex by KOL. It was further submitted that since KOL was facing financial crisis on account of heavy loss due to floods, KOL offered to pay the remaining amount to the tune of approximately 2 Million USD in kind by delivering farming equipment to the Republic of Djibouti.
6. It was stated that the said arrangement was agreed upon by the Republic of Djibouti which is evident from an email dated 05.01.2013 annexed with the present application. It is further urged that the communications annexed with the present application have been handed over to the Investigating Officer which would reflect that the Republic of Djibouti was accepting the equipment sent by the present applicant in lieu of the money received by him.
7. It was further submitted by learned counsel for the applicant that all the agreements entered into between the entities have an arbitration clause and the same was not initiated by the Republic of Djibouti. After the expiry of limitation, the present complaint was filed on 04.05.2018. It is submitted that the present dispute is purely of a civil nature. The present applicant has never denied receiving the money in the accounts of his company. It is submitted that the applicant has duly joined investigation as and when called for and has cooperated fully. In support of his contentions, learned counsel appeairng on behalf of the applicant placed reliance on the following judgments:
i. Indian Oil Corporation v. NEPC India Ltd. & Ors., (2006) 6 SCC 736.
ii. Mukhesh Khurana v. State of NCT of Delhi, 2022 SCC OnLine Del 1032.
iii. Wolfgang Rein & Ors. v. State & Anr., 2012 SCC OnLine Del 3341.
iv. Sushila Aggarwal & Ors. v. State (NCT of Delhi) & Anr., (2020) 5 SCC 1.
v. Harsh Sawhney v. Union Territory (Chandigarh Admn.), (1978) 2 SCC 365.
8. Per contra, learned counsel for the complainant submitted that the contentions of the present applicant are not bona fide. It was submitted that no accounts of losses purportedly incurred due to floods have been supplied to the Investigating Officer. It was contended that the entire land of the applicant company in Ethiopia was unfit for agriculture. It was submitted that the Chairman of Multiplex gave a statement to the Investigating Officer that the applicant did not hand over any land and none was earmarked for agriculture, despite repeated requests to provide the same. \
9. It was contended that no account of machinery supplied by the applicant to the Republic of Djibouti has been given by the applicant. It was further submitted that the applicant had executed an acknowledgement of debt dated 10.02.2013 for an amount of 5 Million USD and has not shown that he had paid the said amount. It was submitted that the money received by the applicant through his companies was taken by him without any work done under the aegis of the aforesaid agreement.
10. Learned counsel for the complainant submitted that the applicant was given interim protection vide order dated 11.05.2022 and thereafter, he did not cooperate with the investigation and thus, custodial interrogation of the applicant is required. It has been vehemently argued that the interim protection granted to the present applicant should be vacated and the applicant should be taken into judicial custody for further investigation. Learned counsel for the complainant placed reliance on the following judgments:
i. Vivekananda Mishra v. State of Uttar Pradesh & Ors., MANU/SC/1133/2022, and in particular paragraphs 12, 13 and 24 thereof.
ii. Sidharth Chauhan v. State, MANU/DE/3476/2021, and in particular paragraphs 31-33 and 38-40 thereof.
iii. Sunil N. Godhwani v. State, MANU/DE/1419/2020, and in particular paragraph 30 thereof.
Reliance was placed on the aforesaid judgments to argue that in case of economic offences, the discretionary relief under Section 438 of the Cr.P.C. for anticipatory bail should not be granted.
11. The status report authored by Mr. Sushil Kumar, Asstt. Commissioner of Police, Anti Extortion and Kidnapping Cell, Crime Branch, New Delhi, states as under:
“06. That during the further course of investigation a notice dated 24.06.2022 was issued to join the investigation and to provide documents to accused at his address 1391, 9th main, 3rd Cross, Judicial Layout, Banglore. In response to the notice the accused appeared in person to join the investigation of the case on 05.07.2022 and 07.07.2022, and filed his replies. He further joined the investigation on 06.10.2022.
07. That in his reply he stated that in 2011, Govt. of Djibouti had signed an agreement with M/S Karuturi Overseas Limited for development of 10,000 Hectare of land in Ethiopia at the rate of US$300/Hectare. He also stated that it was a joint venture between Govt. of Djibouti, Karuturi Overseas Limited and Multiplex Bio-tech. He further stated that the Govt. of Djibouti entered in another agreement in 2012, which is also a triplicate agreement. He also stated that against the Agreement of the year 2011, the Central Bank of Djibouti asked the Bank of Africa to issue a SBLC guarantee to HSBC for US$ 3 Million for the purpose of investing in the joint venture. Accordingly HSBC, Dubai issued loan to the Govt. of Djibouti and the fund was disbursed in the account of M/s Karuturi Overseas Limited. Further the same process was followed against the agreement of 2012 and loan of US$ 3.5 Million was granted to the Govt. of Djibouti by HSBC, Dubai and amount was disbursed in the account of M/s Karuturi Overseas Limited on the request of Govt. Of Djibouti. He further stated that the initial US$ 3 million was invested in cropping 10000 hectare of land in Ethiopia and all crops were destroyed due to flood. He further stated that out of US$ 3.5 Million, M/S Karuturi Overseas Limited transferred US$ 1.565 Million to the account of Multiplex Bio-Tech, as per the direction of Govt. Of Djibouti. He further stated that he had signed the Acknowledgment of Debt of US$ 5 Million but against that he had already supplied the machineries and equipments worth over US$ 5 Million to the Govt. of Djibouti. These facts will be verified from the concerned authority/bank during further course of investigation.
08. That during the course of investigation certified copies of order of liquidation of M/s Karuturi Global Limited has been obtained from NCL T. As per the order of the Hon’ble NCLT Benguluru dated 25.01.2021 the M/s Karuturi Global Limited was ordered to be Liquidated and a Liquidator was appointed.
09. That investigation of the case is in progress. In view of the above facts and circumstances, the undersigned is ready to abide by any directions of this Hon’ble Court.”
12. Thereafter, another status report dated 21.02.2023 authored by Mr. Sushil Kumar, Asstt. Commissioner of Police, Anti Extortion and Kidnapping Cell, Crime Branch, New Delhi, was placed on record, wherein it has been stated as under:
“01. That in continuation to the previous status report filed in the present matter, it is further submitted that during the course of investigation several notices were issued to the allege Ram Krishna Karuturi to provide certain · information and documents pertaining to the alleged offence.
02. That in compliance to the notices issued to alleged Ram Krishna Karuturi, he has provided all the bank accounts numbers of Karuturi Overseas Limited including the bank account in which Karuturi Overseas Limited had received amount of 6.5 Million USD against the Stand by Letters of Credit. He also provided the registration details of Karuturi Overseas Limited along with the financial statements of the company of the year 2010-2011, 2012-2013 and 2013-2014 besides the other information. All the bank accounts of Karuturi Overseas Limited are HSBC Bank, Barclays Bank, Emirates NBD Bank and Mirbaud Geneva Bank all situated in Dubai, United Arab of Emirates. As per the alleged the amount of USD 6.5 million was received in the HSBC Bank account of Karuturi Overseas Limited. Alleged also provided the Bank Account details of the Multiplex Bio-tech FZC, in which he had transferred USD 1.565 Million, which is in Abu Dhabi Commercial Bank, Dubai.
03. That during the course of investigation notices have been sent to the Indian branches of these banks for providing bank account statements along with other details but none of them provided any detail stating that they have no access to the bank accounts of Dubai Branch.
04. That during the course of investigation a notice was sent to Mr. P R Raman, Liquidator, Karuturi Global Limited to provide all bank account statements of Karuturi Overseas Limited along with other details of the company. In · reply to the notice the liquidator has informed that bank account statements of Karuturi Overseas Limited are not available with him. However, he has provided the financial statements of Karuturi Overseas Limited of the year 2010-2011, 2012-2013 and 2013-2014. He further informed that financial statement of Karuturi Overseas Limited of year 2011-2012 is not available.
05. That during the course of investigation a notice was also sent to Mr. Mahesh G Shetty, the Director of Multiplex Bio-Tech FZC to provide certain information pertaining to this offence as he was one of the signatory of both the tripartite Agreements. In his reply he informed that his company Multiplex Bio-Tech FZC was working with Govt. Of Djibouti since 2009. He further stated that Multiplex Bio-Tech FZC is now not an active entity since 2014. He further stated that as per the tripartite agreement dated 10.09.2011 Mulitiplex Bio-Tech was supposed to conduct all the agricultural activities and Karuturi Overseas Limited was to provide 10000 hectare of land in Gambela, Ethiopia alongwith Agro Inputs, machineries and to create and to create infrastructure required for the project. But the Kauruturi Overseas Limited never provided the 10,000 hectare of land for agriculture. The Karuturi Overseas Limited kept the allotment delayed on the pretext one over another but never allocated the land. He further stated that since Karuturi never allocated 10000 hectare of land to Govt. Of Djibouti as per the agreement hence no agriculture work was started ever. He further informed that the second agreement was about development of 5000 hectare of land of Serofta Modem Farm and Goffer Fams, which were in possession of Govt. Of Djibouti and were being managed by Multiplex Bio-Tech FZC since 2009. According to the second agreement Govt. Of Djibouti supposed to issue SBLC of USD 6.99 Million in the favour of Karuturi Overseas Limited and initially SBLC of 50% amount i.e. 3.5 Million USD was issued. This amount was supposed to be paid to Multiplex Bio-Tech FZC by Karuturi Overseas Limited but Karuturi Overseas Limited only paid USD 1.565 Million to Multiplex and again Karuturi Overseas Limited kept USD 2 Million.
06. Since, both the companies i.e. Karuturi Overseas Limited and Multiplex Bio-Tech FZC were registered in United Arab Emirates and all the bank accounts of these companies are in Dubai, UAE. Hence, a Mutual Legal Assistance Request to the Government of United Arab Emirates has been initated with request to provide the bank account statements along with other details pertaining to both the companies. The Mutual Legal Assistance Request has been forwarded to Ministry of Home Affairs, Government of India through Government of NCT of Delhi after getting approval from the Director of Prosecution. Now, after approval of Government of NCT of Delhi, MLA Request will be forwarded to the Government of United Arab Emirates by the Ministry of Home Affairs, Government of India.
07. That investigation of the case is in progress. In view of the above facts and circumstances, the undersigned is ready to abide by any directions of this Hon’ble Court.”
13. Heard learned counsel for the parties and perused the records.
14. The gist of the complaint made by the Republic of Djibouti is that the present applicant who was the Director of KOL had entered agreements as stated hereinbefore and without performing his part of contract, obtained a sum of 5 Million USD.
15. As per the first tripartite agreement dated 10.09.2011, Multiplex was supposed to conduct agricultural activities and KOL was required to provide 10,000 hectares of land in Ethiopia alongwith other valuable inputs suitable for the projects. It was alleged that KOL never provided the said 10,000 hectares of land for agriculture and therefore, no agricultural work was ever started as per the terms of the agreement. However, despite that, another tripartite agreement dated 23.02.2012 was entered into between the same parties and as per the said agreement, 5000 hectares of land in possession of the Government of Djibouti was to be managed by Multiplex and KOL was supposed to be a consultant. It is under this agreement that the Government of Djibouti was supposed to advance 6.99 Million USD in favour of KOL and initially an advance of 50% of the said amount, i.e., 3.5 Million USD. It is an admitted fact that out of this, 3.5 Million USD, 1.656 Million USD was given to Multiplex at the asking of the Republic of Djibouti.
16. Since it is the case of the complainant that no work took place in that project, the question arises as to what happened to the aforesaid 1.65 Million USD given to Multiplex. As far as the remaining 2 Million USD is concerned, it is the case of the applicant that the same was returned by KOL by providing machinery which is being sought to be demonstrated by way of emails on behalf of the applicant.
17. Be that as it may, the aforesaid events are disputed questions of fact. The contention of the learned counsel for the complainant that the applicant had executed an acknowledgement of debt dated 12.02.2013 and by not paying the same, the offence as alleged has been committed requires investigation. It is the counterclaim of the present applicant that he had returned the said money and for that purpose, he is relying on the emails dated 14.09.2013, 02.12.2013 and 06.03.2013 demonstrating supply of machinery post the aforesaid date of acknowledgement.
18. On a pointed query from this Court with respect to the requirement of custodial interrogation of the present applicant, the Investigating Officer stated that the same is required as the applicant is not providing the statement of account of KOL maintained with HSBC Bank situated in Dubai, United Arab Emirates. It is pertinent to note that in the status report itself it has been mentioned that KOL as well as Multiplex were registered in United Arab Emirates and all bank accounts of these companies are in Dubai. Therefore, a mutual legal assistance request has to be sent to the Government of United Arab Emirates to provide the account statements alongwith details pertaining to the company. Learned counsel for the applicant also submitted that latter has also written to the bankers in Dubai requesting them to supply the account statements from 01.04.2016 but has not received any response. It was submitted that the said communication has been given to the Investigating Officer. It is further noted that admittedly, both the companies i.e. KOL and KAPL are under liquidation. Presuming, purely for the sake of argument, that the statements of account are recovered at the instance of the applicant, during his custodial interrogation, the same would still have to be verified by the Investigating Officer which would again require him to follow the process as per the Mutual Legal Assistance Treaty.
19. The Hon’ble Supreme Court, in ‘Siddharam Satlingappa Mhetre v. State of Maharashtra, (2011) 1 SCC 694’, while considering the factors to be borne in mind by a Court while deciding an application for anticipatory bail, held as under:
“112. The following factors and parameters can be taken into consideration while dealing with the anticipatory bail:
(i) The nature and gravity of the accusation and the exact role of the accused must be properly comprehended before arrest is made;
(ii) 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;
(iv) The possibility of the accused’s likelihood to repeat similar or other offences;
(v) Where the accusations have been made only with the object of injuring or humiliating the applicant by arresting him or her;
(vi) Impact of grant of anticipatory bail particularly in cases of large magnitude affecting a very large number of people;
(vii) 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 the accused is implicated with the help of Sections 34 and 149 of the Penal Code, 1860 the court should consider with even greater care and caution because overimplication in the cases is a matter of common knowledge and concern;
(viii) 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;
(ix) The court to consider reasonable apprehension of tampering of the witness or apprehension of threat to the complainant;
(x) 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.”
20. Looking at the aforesaid facts and circumstances, it is apparent that the investigation in the present case is likely to take substantial amount of time on account of the fact that the evidence which needs to be collected are overseas. Emails provided by the present applicant have to be verified with respect to their claims of return of machinery to the complainant. The evidence is documentary in nature and no apprehension has been expressed with respect to the present applicant being a flight risk.
21. In view of the facts and circumstances of the present case, the application for anticipatory bail is allowed.
22. In the event of his arrest in connection with the present FIR, the applicant is directed to be released forthwith, upon his furnishing a personal bond in the sum of Rs. 1,00,000/- (Rupees One Lakh) alongwith two sureties of the like amount to the satisfaction of the Investigating Officer/Arresting Officer, further subject to the following terms and conditions:
i. The memo of parties shows that the applicant is residing at 1391, (th Main, 3rd Cross, Judicial Layout, Bangalore - 560067. In case of any change of address, the applicant is directed to inform the same to the learned Trial Court and the Investigating Officer.
ii. The applicant shall not leave India without the prior permission of the learned Trial Court.
iii. The applicant is directed to give all his mobile numbers to the Investigating Officer and keep them operational at all times.
iv. The applicant shall not, directly or indirectly, tamper with evidence or try to influence the witnesses in any manner.
v. The applicant shall join the investigation, as and when required by the Investigating Officer.
vi. In case it is established that the applicant tried to tamper with the evidence, the bail granted to the applicant shall stand cancelled forthwith.
23. Needless to state, nothing mentioned hereinabove is an opinion on the merits of the case.
24. The application stands disposed of along with all the pending application(s), if any.
25. Order be uploaded on the website of this Court, forthwith.
