Madhu Sudan Mohanty Vs Republic of India (CBI)

@JUDGMENTTAG-ORDER

S.K. Mishra, J.@mdashThis is an application under Section 439 of the Cr.P.C. filed by the petitioner, who happens to be the publisher of Oriya newspaper, namely "Orissa Bhaskar" and the Chief Executive of J P Constructions Pvt. Ltd. The petitioner has been arrested by the C.B.I. in connection with his role in the Chit Fund Scam and his involvement in Artha Tatwa Infra India Limited (in short "AT Group''), which was headed by accused Pradip Kumar Sethy.

2. The investigation of the case was taken over by the C.B.I. as per the direction of the Hon''ble Supreme Court in the case of Subrata Chattoraj Vs. Union of India (UOI) and Others, , where the Hon''ble Supreme Court taking into consideration the magnitude of the Chit Fund Scam has directed that with respect to Odisha State, the CBI shall investigate the larger conspiracy into the affairs of the 44 companies and also track the money trail. The Supreme Court has held that the investigation into the scam is not confined to those directly involved in the affairs of the companies but may extend to several others, who need to be questioned about their role in the sequence and unfolding of events that has caused ripples in several fronts.

3. Mr. Y. Das, learned Senior Advocate appearing for the petitioner in course of hearing elaborately argued in the matter. According to him, the petitioner being the owner of Orissa Bhaskar has done different advertisements of the AT group and in connection with such publication in the newspaper, money has been given to the petitioner between 2009 and 2012 and, as such, being the publisher of the newspaper, the petitioner has received cheques of Rs. 57,75,025/- although there were bills against AT Group for Rs. 60,78,500/-. He further submitted that though the petitioner was arrested on 14.09.2014 and the Central Bureau of Investigation (C.B.I.) has taken him on remand, no document could be seized either from his residence or from the office of the present petitioner. It is submitted by the learned Senior Advocate that there is no prima facie case to hold that the petitioner was involved with the criminal conspiracy with accused Pradip Sethy. In his elaborate argument, learned Senior Advocate also files several documents including the income Tax Returns, which is filed after being audited, and states that the money has been received by the petitioner as the Managing Director of Tilak Raj Publications Pvt. Ltd. does not show that he has committed any conspiracy and has been wrongly implicated in this case. Further, he states that there is no apprehension of fleeing from justice or tampering with the evidence. Hence, it is submitted that he should have been released on bail.

4. The Bail application was heard on two dates. On the first listing, K. Raghavacharyulu, Special Public Prosecutor, New Delhi appeared for the C.B.I. and contested the Bail Application of the petitioner. On the adjourned date, the further hearing was taken up and the learned Retainer Counsel for the C.B.I., namely Sri V. Narasingh argued on behalf of the prosecution and read out statements of several witnesses to show that the petitioner has close nexus with the main accused Pradeep Sethy. In the meantime, the C.B.I. has submitted charge-sheet against the present petitioner and others for commission of offences punishable under Sections 120B, 294, 341, 406, 409, 420, 467, 468, 471, 506/34 of the IPC and Sections 3, 4 and 5 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978.

5. Perusal of the statements of witnesses reveals that several witnesses have stated about the complicity of the present petitioner in the affairs of the AT Group Dilip Kumar Mohanty is working as Supervisor, Tilak Raj Publications Private Limited. Prior to that he was working in J.P. Constructions Private Limited. He says that it is a company owned by the present petitioner. He has stated that J.P. Constructions Pvt. Limited is practically doing no work since last five years. Witness Banabihari Sarangi, Assistant Advertisement Manager, Tilak Raj Publications Private Limited states that he knows Pradeep Kumar Sethy through Madhu Sudan Mohanty, the present petitioner. Pradeep Sethy was the head of the AT Group during 2010 to 2013. Sri Sethy is a close friend of the present petitioner. The witness further states that generally both of them met each other at Artha Tatwa office at Kharavel Nagar or at Jaydev Vihar. He further states that as per the instruction of the petitioner, he had met Shri Sethy on different occasions at his office and also he had received huge amounts in cash and has deposited the same at different banks. He has also given the details of the money received and deposited by him in the name of Madhu Sudan Mohanty or T.R. Publication.

6. Tripati Prasad Dash was working as a Vice-President (Marketing), Tilak Raj Publications Pvt. Ltd. by referring to the documents he has stated that the petitioner has received Rs. 60,42,500/- from the AT Group during the period from February, 2010 to July, 2012. He has further stated that the present petitioner was a close associate of Pradeep Sethy, head of Artha Tatwa Group. He further states that the petitioner has collected the aforesaid amount in the name of advertisement and sponsorship programme from AT Group owner Pradeep Sethy. He has further stated that for getting advertisements and sponsorship programmes, there must be agreement/offer letter/quotation executed between the parties i.e. Tilak Raj Publication and AT Group. But in the instant case, no agreement/offer letter/quotation was executed in between the above parties. The witness has very specially stated that Pradeep Kumar Sethy has parked his amount collected from the public with the petitioner in the name of sponsorship and advertisement through his company''s bank accounts.

7. Pradyumna Kesari Praharaj was working as Senior Territory Manager, AT Group during the period from October, 2009 to June, 2013. He states that he knows the present petitioner, who happens to be the Managing Director of Tilak Raj Publications Private Limited, Bhubaneswar and J.P. Constructions Pvt. Limited, Bhubaneswar. This witness further states in his statement recorded under Section 161 Cr.P.C. that the petitioner was a close associate of Pradeep Kumar Sethy during the relevant period. The petitioner is involved in day to day functioning of AT Group business though he was not in any post/office bearer in AT Group. He further states that it was within the knowledge of the present petitioner that Pradeep Kumar Sethy was collecting amount from public alluring the depositors of higher returns. Even then, he has also motivated various depositors for depositing money with AT Group. He further states that he knows Pradeep Kumar Sethy in collusion with the petitioner has taken and deposited crores of rupees in the accounts of the petitioner and his companies during the period 2010-2013. He has specifically stated that the petitioner or his employees used to come to AT Office on different dates during the relevant period. The witness has also seen Pradeep Sethy handing over lakhs of rupees on different dates during the relevant period either to the petitioner or to Dilip Kumar Mohanty for keeping in the accounts of the petitioner or in the account of the company. It is stated that the said amounts were given in cash.

8. Thus, it is clear from the records and in the investigation made by the C.B.I. that J.P. Constructions Private Limited has virtually not doing any work during the relevant period. But moneys were being transferred from the account of the AT Group and deposited in the account of J.P. Constructions Private Limited and also money has been deposited in the accounts of Tilakraj Publication. It was contended by Mr. V. Narasingh, the retainer counsel for the C.B.I. that these transactions were camouflage to park the ill-got money of Pradeep Sethy. From the materials available on record, it is clear that the transactions between the petitioner and Pradeep Sethy, head of the AT Group are devised to park the ill got money of Pradeep Sethy received from depositors.

9. The Supreme Court in the reported case of Arun Bhandari Vs. State of U.P. and Others, , has held that sometimes a case may apparently look to be of civil nature or may involve a commercial transaction but such civil disputes or commercial disputes in certain circumstances may also contain ingredients of criminal offences and such disputes have to be entertained notwithstanding that they are also civil disputes.

10. In the aforesaid case, the Hon''ble Supreme Court took into consideration its previous decisions rendered in Md. Ibrahim and Others Vs. State of Bihar and Another, , wherein the Hon''ble Supreme Court has held as follows:

"8. This Court has time and again drawn attention to the growing tendency of the complainants attempting to give the cloak of a criminal offence to matters which are essentially and purely civil in nature, obviously either to apply pressure on the accused, or out of enmity towards the accused, or to subject the accused to harassment. Criminal Courts should ensure that proceedings before it are not used for setting scores or to pressurize parties to settle civil disputes. But at the same time, it should be noted that several disputes of a civil nature may also contain the ingredients of criminal offences and if so, will have to be tried as criminal offences, even if they also amount to civil disputes."

11. The Hon''ble Supreme Court in the case of Central Bureau of Investigation Vs. V. Vijay Sai Reddy, ; at paragraph 34 has held that while granting bail, the Court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of witnesses being tampered with, the larger interests of the public/State and other similar considerations. The Hon''ble Supreme Court has also directed to keep in mind that for the purpose of granting bail, the legislature has used the words "reasonable grounds for believing" instead of "the evidence" which means the Court dealing with the grant of bail can only satisfy itself as to whether there is a genuine case against the accused and that the prosecution will be able to produce prima facie evidence in support of the charge. The Hon''ble Supreme Court has further held that it is not expected at the stage of considering the Bail Application to have the evidence establishing the guilt of the accused beyond reasonable doubt.

12. In the case of Y.S. Jagan Mohan Reddy Vs. Central Bureau of Investigation, , the Hon''ble Supreme Court held that economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offences having deep-rooted conspiracies and involving huge loss of public funds need to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country.

13. Keeping the aforesaid considerations in mind, this Court is of the opinion that the petitioner''s involvement in the commission of the crime alleged is prima facie made out. It is also apparent on record that most of the witnesses, who will be testifying against the present petitioners, were working with him either as employee of the M/s. J.P. Constructions Private Limited or of the M/s. Tilakraj Publications Private Limited. Keeping in view the aforesaid considerations, this Court is of the opinion that if the petitioner is released on bail, then there is every possibility of the gaining over the witnesses cited by the C.B.I. against him. So considering this aspect and the greater and larger interest of the State and Society this Court is not inclined to grant bail to the petitioner, even though charge-sheet has been submitted in the meantime.

Accordingly, the Bail Application is dismissed.