Prayer to cancel the bail
The petition has been filed by the defacto complainant in Cr.No. 2 of 2023 registered under Sections 406, 420, 294(b) and 506(i) of IPC by the first respondent seeking to cancel the bail granted to the second respondent/accused by the Judicial Magistrate-I, Ulundurpet in C.M.P.No. 3002 of 2023 dated 13.07.2023.
Crux of the case
3. It is the case of the prosecution that the accused were running a chit fund and had cheated the petitioner to a sum of Rs.10,00,000/-. A sum of Rs.2,00,000/- had been repaid through the bank account of the daughter of the petitioner/defacto complainant and another sum of Rs.10/- lakhs had been repaid by cash. There was a balance of Rs.38,66,650/- to be repaid. The petitioner had therefore lodged a complaint leading to registration of FIR in Cr.No. 2 of 2023 under the aforementioned provisions.
4. By an order dated 30.01.2023, the learned Judicial Magistrate-I, Ulundurpet had granted bail by imposing the normal conditions of execution of bond and production of sureties and appearance before the respondent daily for a period of 15 days and thereafter as and when required. The second respondent was also directed to appear before the said Court every Monday until further orders.
Petitioner side Contention
5. Aggrieved by the grant of bail, the petitioner herein filed Crl.O.P.No. 2927 of 2023 before this Court under Section 439(2) Cr.P.C., to cancel the bail granted by the Judicial Magistrate-I, Ulundurpet. By order dated 01.03.2023, a learned Single Judge of this Court, on examination of all the facts particularly the allegation that the learned Judicial Magistrate-I, Ulundurpet, had granted bail without any condition to deposit cash or title deed and had granted bail by a cryptic order and that there were further complaints against the second respondent/first accused, had allowed the said original petition and cancelled the bail granted by the Judicial Magistrate-I, Ulundurpet to the second respondent/first accused. The first respondent/investigating Officer was directed to secure the second respondent in manner known to law.
6. The second respondent was thereafter secured on 12.05.2023. She was remanded to custody and continued to be in custody till 30.06.2023. The second respondent then filed C.M.P.No. 3002 of 2023 under Section 167(2) Cr.P.C to enlarge her on bail. That application was taken up for consideration on 13.06.2023 by the Judicial Magistrate-I, Ulundurpet. In that order, it had been observed that the second respondent/first accused was in custody from 03.01.2023 till 31.01.2023 and again from 12.05.2023 to 13.06.2023 for alleged offences under Section 406, 420, 294(b) and 506(i) IPC. It had been stated that by taking the two spells of custody into consideration, the second respondent/first accused has been in custody for 62 days and final report had not been filed within the stipulated period of 60 days and therefore, the second respondent /first accused was entitled for statutory bail under Section 167(2) Cr.P.C., and accordingly, enlarged her on bail on execution of sureties, with directions not to indulge in tampering of witness and to co-operate with the investigating agency. That order is now sought to be cancelled by the defacto complainant.
7. It has been contended by the learned counsel that though the averments in the First Information Report revealed that the second respondent/first accused had cheated the defacto complainant to a sum of more than Rs.50/- lakhs and after repayment of a part of that amount was still due and payable more than Rs.30/- lakhs, the Judicial Magistrate-I, Ulundurpet, had granted bail without imposing any condition. 8. It was also contended that the learned Judicial Magistrate-I, Ulundurpet, had wrongly appreciated the provisions under Section 167(2) Cr.P.C., relating to grant of statutory bail if final report was not filed within a period of 60 days from the date of initial remand and had applied that particular provision to the second respondent, whose earlier bail had been cancelled by a learned Single Judge of this Court. 9. According to the learned counsel, when the second respondent/first accused was again taken into custody, it would not mean continuation of the earlier period of remand. It is stated that the Judicial Magistrate-I, Ulundurpet, had therefore wrongly applied the provision under Section 167(2) Cr.P.C and granted bail.
Respondent side contentions
10. The learned Government Advocate (Crl.Side) appearing for the first respondent contended that when the second respondent/ first accused had been granted bail in the first instance, she had produced sureties and thereafter, the right of the Magistrate to further remand the accused under Section 167 Cr.P.C., had come to an end. It is further contended that having availed the right to be granted bail, the second respondent cannot claim a further right under Section 167(2) Cr.P.C. It had been contended by the learned Government Advocate (Crl.Side) that Section 167(2) Cr.P.C., would not be applicable in the second instance and there cannot be clubbing of two separate broken periods of custody. It had also been contended that the order passed granting bail under Section 167(2) Cr.P.C., has to be interfered with by this Court.
11. The learned counsel for the second respondent / first accused however supported the order of the learned Judicial Magistrate-I, Ulundurpet, and pointed out that the second respondent / first accused had been in custody from 03.01.2023 till 30.01.2023 when bail was granted but was actually in custody till 02.02.2023 the day when she furnished securities and stated that the first spell of custody was for a period of 31 days. It was again contended that she had been again taken into custody on 12.05.2023. She was granted bail on 14.06.2023 when sureties had been furnished and this spell of custody was for a period of 34 days. The learned counsel therefore clubbed both the two period of custody and stated that the second respondent had been in custody for a total period of 65 days which is beyond the statutory period of 60 days given to the investigating agency to file the final report and therefore stated that the Judicial Magistrate-I, Ulundurpet had correctly applied the provision under Section 167(2) Cr.P.C., and had granted bail to the second respondent.
Relied with Supreme Court Judgment
12. In this connection, the learned counsel placed reliance on the Judgement of the Hon’ble Supreme Court reported in (2022) 13 SCC 542 [ Gautam Navlakha Vs. National Investigation Agency], wherein the Hon’ble Supreme Court had examined whether broken periods of custody can be counted for the purpose of default period. The learned counsel placed reliance on paragraph Nos. 66 & 67 of the said Judgment. They are as follows:-
“83. Let us take another example. After ordering remand, initially for a period of 15 days of which 10 days is by way of police custody and 5 days by way of judicial custody, the Magistrate enlarges an accused on bail. The High Court interferes with the order granting bail on the basis that the bail ought not to have been granted. Resultantly, the person who on the basis of the order of bail, has come out of jail custody, is put back into the judicial custody or jail custody. The order is one passed by the High Court. The order granting custody by the High Court cannot be treated as one which is not anchored in Section 167CrPC. Therefore, we would think that though the power is vested with the Magistrate to order remand by way of appropriate jurisdiction exercised by the superior courts, (it would, in fact, include the Court of Session acting under Section 439) the power under Section 167 could also be exercised by courts which are superior to the Magistrate.
84. Therefore, while ordinarily, the Magistrate is the original court which would exercise power to remand under Section 167, the exercise of power by the superior courts which would result in custody being ordered ordinarily (police or judicial custody) by the superior courts which includes the High Court, would indeed be the custody for the purpose of calculating the period within which the charge-sheet must be filed, failing which the accused acquires the statutory right to default bail”.”
16. The learned counsel placed reliance on this dissenting opinion for the contention that when there were two separate spells of detention, they must both clubbed together and not viewed independently.
19. The facts in the present case are straight forward. The second respondent sought bail in Cr.No. 2 of 2023 registered under Sections 406, 420, 294(b) and 506(i) of IPC and filed C.M.P.No. 365 of 2023 before the Judicial Magistrate-I, Ulundurpet. That application was taken up for consideration on 30.01.2023 and bail was granted with the normal conditions of producing sureties and appearing before the respondent and to co-operate during the course of investigation.
21. Thereafter, the petitioner/defacto complainant filed Crl.O.P.No. 2927 of 2023 seeking to cancel the order granting bail primarily on the ground that the Judicial Magistrate-I, Ulundurpet had not imposed any conditions for grant of bail though the offence was one of cheating to an amount of more than Rs.30/- lakhs which amount was outstanding.
22. This Application in Crl.O.P.No. 2927 of 2023 came up for consideration before a learned Single Judge of this Court on 01.03.2023 and the learned Single Judge cancelled the order granting bail holding that conditions had not been imposed and a cryptic order had been passed. A direction had also been issued to take the second respondent/first accused into custody.
24. In the first instance, when the second respondent/first accused was remanded by the Judicial Magistrate-I, Ulundurpet on 03.01.2023, it was a remand under Section 167(2)Cr.P.C.
26. This provision gives the authority to the Magistrate to remand an accused for a period of 15 days initially and thereafter for a maximum period of 90 days if the offence attracts a punishment of not less than 10 years or life imprisonment or punishable with death and for a maximum period of 60 days for any other offence if final report had not been filed. This would conversely mean that the investigating officer should file the final report on completion of investigation within a period of 90 days depending on the nature of the offence and within the period of 60 days again depending on the nature of the offence.
27. In the instant case, the investigating officer was under obligation to file a final report within a period of 60 days from the date of first remand, namely, 30.01.2023. However, even before the expiry of the period of 60 days, the second respondent/first accused had applied for bail and had been granted bail by the learned Judicial Magistrate-I, Ulundurpet. That bail was not granted under Section 167(2) Cr.P.C., but under Section 437(2) Cr.P.C.
29. This grant of bail is on the reasons stated by the Court. The Court then exercises its discretion to grant bail.
30. In the instant case, the bail granted to the second respondent/first accused had been cancelled under Section 439(2) Cr.P.C., by an order dated 01.03.2023 in Crl.O.P.No. 2927 of 2023 by the High Court. Consequently the second respondent/first accused had been again taken into custody. The Judicial Magistrate-I, Ulundurpet had again remanded the accused.
31. The Hon’ble Supreme Court in Gautam Navlakha referred supra had given an illustration of two broken periods and had also stated that statutory bail can be granted when the High Court had cancelled the bail. The Hon’ble Supreme Court had stated as follows:-
“The order granting custody by the High Court cannot be treated as one which is not anchored in Section 167 of the Cr.P.C.”
32. In the instant case, the Hon’ble High Court had cancelled the bail under Section 439(2) Cr.P.C. It had been further explained that the power under Section 167 could also be exercised by Courts which are superior to the Magistrate, which would indicate that the High Court can also enlarge the accused under Section 167(2) Cr.P.C. The Hon’ble Supreme Court had further stated as follows:-
“In such circumstances broken periods of custody can be counted whether custody is suffered by the order of the Magistrate or superior courts, if investigation remains incomplete after the custody, whether continuous or broken periods pieced together reaches the requisite period; default bail becomes the right of the detained person”.
33. In view of the above ratio, I hold that the order granting bail under Section 167(2) Cr.P.C., by the learned Judicial Magistrate has to be upheld in C.M.P.No. 3002 of 2023 dated 13.07.2023. 34. The other aspect is whether the Magistrate could impose conditions while granting bail under Section 167(2) Cr.P.C.
35. In Rakesh Kumar Paul [Rakesh Kumar Paul v. State of Assam, (2017) 15 SCC 67 : (2018) 1 SCC (Cri) 401], where the investigation is not completed within 60 days or 90 days, as the case may be, and no chargesheet is filed by 60th or 90th day, the accused gets an “indefeasible right” to default bail, and the accused becomes entitled to default bail once the accused applies for default bail and furnish bail. Therefore, the only requirement for getting the default bail/statutory bail under Section 167(2) CrPC is that the accused is in jail for more than 60 or 90 days, as the case may be, and within 60 or 90 days, as the case may be, the investigation is not completed and no charge-sheet is filed by 60th or 90th day and the accused applies for default bail and is prepared to furnish bail. No other condition of deposit of the alleged amount involved can be imposed. Imposing such condition while releasing the accused on default bail/statutory bail would frustrate the very object and purpose of default bail under Section 167(2) CrPC. As observed by this Court in Rakesh Kumar Paul [Rakesh Kumar Paul v. State of Assam, (2017) 15 SCC 67 : (2018) 1 SCC (Cri) 401] and in other decisions, the accused is entitled to default bail/statutory bail, subject to the eventuality occurring in Section 167 CrPC, investigation is not completed within 60 days or 90 days, as the case may be, and no chargesheet is filed by 60th or 90th day and the accused applies for default bail and is prepared to furnish bail.
36. In view of the reasons stated, the order of the learned Judicial Magistrate No.I, Ulundurpet in C.M.P.No. 3002 of 2023 dated 13.07.2023 is upheld. This Petition stands dismissed.
Party
Jaya Selvi … Petitioner/Defacto Complainant vs. 1. State By: The Station House Officer Elavanasoorkottai Police Station Kallakurichi District. … Respondent/Respondent 2. Amalameri … Respondent/Accused-1, Crl.O.P.No.18509 Of 2023 ,Dated On – 30, November 2023 – coram:- In The High Court Of Judicature At The Hon’ble Mr. Justice C.V.Karthikeyan
https://mhc.tn.gov.in/judis/index.php/casestatus/viewpdf/1086995
Author’s note (by Ramprakash Rajagopal with the permission of Reshma Azath)
It is the case of the prosecution that the accused were running a chit fund and had cheated the petitioner to a sum of Rs.10,00,000/-.
Here, if a chit fund establishment is involved in cheating by not returning the deposit money is a serious offence as per section 5 of Tamil Nadu Protection of Interests of Depositors (In Financial Establishments) Act, 1997 (Tamil Nadu Act 44 of 1997) [in short TNPID Act] which is read as follows:
“section 5: Default in repayment of deposits and interest honouring the commitment. – Notwithstanding anything contained in Chapter II, where any Financial Establishment defaults the return of the deposit or defaults the payment of interest on the deposit, or fails to return in any kind, or fails to render service for which the deposit has been made, every person responsible for the management of the affairs of the Financial Establishment shall be punished with imprisonment for a term which may extend to ten years and with fine which may extend to one lakh of rupees and such Financial Establishment is also liable for a fine which may extend to one lakh of rupees.”
Right, now the core question is Whether the Chit fund establishment (though not registered as company) would come within the purview of section 2(2) & (3) of TNPID Act? and, The answer is ‘Yes’ as declared by the Hon’ble Madras High Court in S.Nandhini vs.State of Inspectof or Police, Economic Offence Wing-II – (Coram: Lordship Mr. Justice N. Anand Venkatesh, J) – Criminal Original Petition No. 7112 of 2017; Criminal Miscellaneous Petition No. 5146 of 2017, 5147of 2017, 16479 of 2018 – 22-01-2019 reported in (2019) 1 LW(Cri) 197 the relevant paragraph is reproduced as follows:
“23. The nature of transaction in this case involves deposits made by the general public. Deposits by its very nature creates an obligation to the person who receives it to return it to the person who made the deposit. The definition of the term deposit under Section 2(2) of the Act, will also take within its fold the amount received by any person or entity in the name of subscription for a chit transaction. If this subscription amount is not repaid and a default is committed, naturally it becomes an offence under Section 5 of the Act. The definition of the term deposit under Section 2(2) r/w Section 5 of the Act, clearly takes within its fold the subscription/deposits received in the name of a chit transaction and giving it a restricted meaning, will defeat the very object of the Act”.
Therefore, as we have learned from the aforesaid judgment that cheating by Chit fund financial establishment is a serious offence and not a Magisterial offence which shall be triable only by the TNPID Special Court.
Now another question arises whether the Special Judge of TNPID Special Court is a ‘Session Judge’ or not is no longer res-integra inasmuch as the legal position was very much settled by the Hon’ble Madras of Madras High Court Division Bench in G. Sheik Mohaideen vs. S. Deivendran – (Before : M. Sathyanarayanan and P.N. Prakash, JJ) – Criminal Revision Case No. 841 of 2011 – 07-06-2018 reported in (2018) 1 LW (Cri) 841 : (2018) 2 MWN(Cri) 229 : (2018) 3 MLJ (Criminal) 1 (Mad-DB) and the relevant paragraph is reproduced as follows:
“25. In fine, we hold that:
A Special Court constituted under the TNPID Act is not a Court of Magistrate. The Presiding Officer of the Special Court can only be a person of the cadre of a District and Sessions Judge. As a sequitur, we hold that appeals from judgments of convictions or acquittals passed by a Special Court under the TNPID Act would lie to the High Courtunder Chapter XXIX Cr.P.C., irrespective of the quantum of sentence.
An appeal under Section 11 of the TNPID Act is confined to the orders passed by the Special Court under Sections 7 to 10 of the TNPID Act and under the Code of Civil Procedure, 1908 and will not include judgments of convictions or acquittals.
The law laid down in Antony [Antony and 3 others Vs. the State represented by Inspector of Police, Economic Offences Wing-II, Nagercoil, Kanyakumari District, (2011) 2 LW(Crl) 298] to the extent that it is inconsistent with the law laid downherein, will stand overruled”.
Now, despite to the aforesaid pronunciations of the Madras High Court judgments The Station House Officer Elavanasoorkottai Police Station Kallakurichi District has sent the First Information Report to the Learned Judicial Magistrate court, Ulundurpet. The Station House Officer ought to have forward the concerned FIR to the TNPID Special court inasmuch as the Special court holds the original jurisdiction to grant, reject or cancel bail application.
In the present case, the advocates who argued the petition did not bring the aforesaid judgments and Act to the notice of the Hon’ble Madras High Court single bench.
Finally, the question of law emerges now is, Whether the bail granted by the Learned Magistrate under section 167 (2) Cr.P.C is “legal” inasmuch as the TNPID Special Court holds the original jurisdiction? I leave it to the readers.
Yours,
Ramprakash Rajagopal,
Advocate, Tamilnadu.
Further study
