1. The present applications under Section 438 Cr.P.C. have been filed by the accused-applicants seeking anticipatory bail apprehending their arrest in FIR registered by the Central Bureau of Investigation (for short ‘CBI’) EO-1, New Delhi in RC No.219 2019 E 0004, Police Station CBI/EO-1, New Delhi, under Sections 120-B read with 420, 468 and 471 IPC and Section 13(2) read with 13(1)(d) of Prevention of Corruption Act, 1988 and substantive offences thereof.

2. The facts, in brief, are that M/s H.K. Enterprises is a partnership firm and it has two partners, Harmesh Kumar and Ravindra Ahlawat. A case was registered on 10.6.2019 on the basis of a complaint dated 15.1.2019 of Sri Pawan Kumar Gaur, AGM/Regional Head, Union Bank of India (UBI), Regional Office, Meerut, U.P. alleging that borrowers and guarantors i.e. M/s H.K. Enterprises and its partners during the period of September, 2017 entered into a criminal conspiracy and in pursuance thereof, they submitted false/forged documents along with the loan application. On the basis of these documents, a Cash Credit Limit of Rs.20 Crores was sanctioned to M/s H.K. Enterprises on 24.10.2017 by Union Bank of India, Regional Office, Meerut on the recommendations of the Union Bank of India, Mid Corporate Branch, Kaushambi, Ghaziabad.

3. The propose for which the loan/Cash Credit Limit was sanctioned, was for wholesale trading/supplying of building materials such Bricks, Cement, Steel, Rodi, Marble, Tiles and Wood, including plywoods, woodboard and hardboard etc. Subsequently, two temporary overdrafts for Rs.64 Lakhs were also sanctioned.

4. It is alleged that the loan amounts in pursuance of criminal conspiracy were diverted by the borrowers for purposes other than for which the loan was sanctioned and the same were fraudulently siphoned off within one month from the first disbursement on 30.10.2017, through the accounts of their associated concerns/related parties/their own current accounts. The loan account became irregular from December, 2017 to March, 2018 and turned into “NPA” within six months, resulting in wrongful loss to the bank to the tune of Rs.20.60 Crores. Further, the said account was also declared as fraud on 9.8.2018. The wrongful loss along with interest caused to the bank was Rs.21.87 Crores.

5. While sanctioning the loan to M/s H.K. Enterprises, the sanctioning authority had considered another firm M/s S.M. Enterprises, Proprietorship of Bharat Kalra, S/o Harmesh Kumar as a group concerned of M/s H.K. Enterprises. Both the firms had shown their business of the same nature i.e. trading of building materials/construction materials and their office addresses were also the same. M/s S.M. Enterprises was already sanctioned a Cash Credit Limit of Rs.16 Cores by the same bank in March, 2017 and it was also sanctioned an ad-hoc limit of Rs.4 Crores on 7.10.2017 despite the fact that there was very poor turnover in its account and had already siphoned off its entire loan. The said fact could get established on the basis of its stock statement and statement of the loan account.

6. Accused-applicant Bharat Kalra, Proprietor of M/s S.M. Enterprises was actively managing the affairs of borrower firm M/s H.K. Enterprises. Despite such adverse facts of the loan of the group concerned, another loan of Rs.20 Crores was also fraudulently sanctioned to M/s H.K. Enterprises within few days i.e. on 24.10.2017, which resulted in siphoning off another Rs.20 Crores of the bank within one month during 30.10.2017 to 28.11.2017. Later on, the loan account of M/s S.M. Enterprises also turned into NPA.

7. During the course of investigation, it could be found out that M/s H.K. Enterprises had no licence/permission for storage and transportation of sand, crushed stone, pebble etc. from the Mines Department of the District concern and, therefore, M/s H.K. Enterprises was not authorised to carry on business of sand, crushed stones, pebbles (stone) etc.

8. The loan was sanctioned against hypothecation of stocks as primary security with 25% margin money to be inducted by the borrowers from their own sources. The collateral securities were taken as immovable properties in the form of 34 shops of M/s Mass Con India Private Limited, Ghaziabad valued at Rs.20 Crores. Accused-applicants Harmesh Kumar, Ravindra Ahlawat and M/s H.K. Enterprises were borrowers and guarantors. The guarantors also included the accused- applicant, Devender Kumar, and M/s Mass Con India Private Limited through its directors Ravindra Ahlawat and Devender Kumar.

9. It is alleged that the accused-applicants had submitted forged documents to show that the borrowers financial health was sound. However, the bank officials including the Branch Manager, Smt. Shefali Sharma, co-accused, dishonestly did not verify those documents and had recommended for sanctioning of the loan. It is further alleged that Sri A.M. Kulshreshtha, the then DGM, Union Bank of India, Regional Office, Meerut had also abused his official position for sanctioning of the loan and their roles have been specified in the charge sheet for commission of offence. The CBI in its charge sheet has listed several documents in which the fabrication was made and the amounts were inflated.

10. It is also alleged that both the partners of M/s H.K. Enterprises had submitted forged purchase order dated 4.9.2017 purportedly to be issued by M/s R.K. Bararia for purported purchases of construction materials worth Rs.30 Crores from M/s H.K. Enterprises during 15.9.2017 to 31.3.2018. The bank officials in criminal conspiracy with the present accused-applicants in the executive summary dated 12.10.2017 had mentioned that the firm was trading/supplying building materials and the party had obtained orders worth approximately Rs.53 Crores from reputed builders R.K. Bararia and SKM Infra for supply of all types of building material, which will be repeated on regular basis. However, these purchase orders were found to be forged.

11. As per the charge sheet, the released loan amounts were paid to the sister concerns by accused-applicants Harmesh Kumar and Ravindra Ahlawat or in the companies/firms where they and their family members or relatives were directors/proprietors. An amount of Rs.110.05 Lakhs, out of Rs.189.92 Lakhs was paid to M/s SKY Infra on 30.10.2017 and 31.10.2017 form the loan account of M/s H.K. Enterprises. It was said that the orders for supply of goods from M/s SKY Infra were cancelled, but the said amount was deposited back in the loan account. Further, the statement of account of M/s SKY Infra revealed that bulk of the amount received by it was paid to M/s SM Enterprises (Proprietor Bharat Kalra, S/o Harmesh Kumar).

12. Rs.80,10,280/- was paid through the account of M/s Krishna Jute Bag Co. and Blue Horse Overseas, which was received in the account of M/s Nitya Enterprises, which is another proprietorship firm of the accused Harmesh Kumar. Rs.65,49,100/- was received in the account of M/s Palak Enterprises, which is a firm of the wife of accused Harmesh Kumar and Rs.80,04,500/- was received in the account of Ms/ S.M. Enterprises, which is a firm of the son of accused Harmesh Kumar. It is said that siphoning off the loan amount is fully established on the part of the accused in criminal conspiracy with other co-accused.

13. From the loan account of M/s H.K. Enterprises, Rs.5.39 Crores was paid in favour of M/s Nitya Enterprises, which is a proprietorship firm of accused Harmesh Kumar himself and as per the GST returns of M/s H.K. Enterprises, there are no details of purchases from M/s Nitya Enterprises. The CBI has collected the evidence to the effect that payments of Rs.5.39 Crores to M/s Nitya Enterprises were not genuine business transactions. The statement of account of M/s Nitya Enterprises would also reveal that the received amounts from the loan account of M/ s H.K. Enterprises were further paid to different persons, including M/s SM Enterprises. It is alleged that the accused-applicants had siphoned off Rs.20 Crores in criminal conspiracy with the other accused persons and the loan amount was withdrawn and paid to the respective persons through cheques/RTGS.

14. Accused-applicant Ravindra Ahlawat is a partner of M/s H.K. Enterprises and Director of M/s My City Mega Mart Private Limited, M/s Yashika Engineers India Private Limited and M/s Mass Buildwell LLP and substantial loan amount was diverted and siphoned off. He had intentionally came out of the partnership/directorship of all those firms/companies on 5.9.2017, but continued utilizing cheques of the bank accounts of these companies to siphon off the loan amount of M/s H.K. Enterprises.

15. Accused-applicant Ravindra Ahlawat was responsible for siphoning off of Rs.1,19,60,000/- of the loan amount through Account No.30750400000039 of M/s Yashika Engineers India Private Limited as this company had not carried out genuine business with M/s H.K. Enterprises and the accused Ravindra Ahlawat had misutilized this amount through cheques under his signatures to receive the payments himself and to make payments to accused Devender Kumar and Rajneesh Kumar.

16. M/s My City Mega Mart Private Limited was also responsible for siphoning off the loan amount of Rs.8,85,16,750/- as this company had not carried out genuine business with M/s H.K. Enterprises. Further, Ravindra Ahlawat had utilized the amounts received in the Account No.30750400000015 through cheques under his signatures to make payments to himself, Devender Kumar, M/s Mass Con India Private Limited and others. Further, from Account No.71082011000079, approximately Rs.3,22,50,000/- was credited in the account of M/s Mass Con India Private Limited, which was utilized to close the loan account of Ms/ Mass Con India Private Limited with Punjab & Sindh Bank, Karol Bagh, New Delhi for releasing the property from the bank and for other purposes. The same property was again mortgaged for the present loan. Accused-applicant Ravindra Ahlawat was having 50.58% share in M/s Mass Con India Private Limited and he was one of its two directors, therefore, he was the beneficiary of the siphoned off loan amount through the account of M/s Mass Con India Private Limited.

17. Accused, Devender Kumar, who was another director in this company with Rs.45.94% share, was one of the signatory on the loan acceptance paper which mentioned that the loan of M/s Mass Con India Private Limited with Punjab & Sindh Bank, Karol Bagh, Ne Delhi would be closed from their own sources.

18. S/Sri Dileep Kumar, Brijesh Sahai and N.I. Jafri, learned Senior Advocates, Sri Shiv Sagar Singh and Sri Iman Ullah for the accusedapplicants submit that the accused-applicants have pledged properties worth Rs.20 Crores for securing the loan. The bank has filed proceedings under SARFAESI Act, which are not being contested by the accusedapplicants. The pledged properties are in the possession of the bank and the bank can realise its amount by disposing of the said properties. It is further submitted that it is a case of business failure and there is no offence as alleged, has been committed by the accused-applicants.

19. Learned counsel for the accused-applicants have also submitted that the offence entails punishment upto seven years. Accused-applicants have cooperated in the investigation and no purpose would be served in keeping them in custody as the charge sheet has already been filed. It is also submitted that the accused-applicants may be enlarged on anticipatory bail by putting any condition as this Court may deem fit and proper in the facts and circumstances of the case.

20. On the other hand, Sri Sanjay Kumar Yadav, learned counsel or the CBI and Sri Ratnendu Kumar Singh, learned AGA have opposed the prayer for anticipatory bail and have submitted that the accusedapplicants in criminal conspiracy with the bank officials have committed the huge fraud and thereby they had obtained loan of rupees more than 20 Crores, which they had siphoned off, which is evident from the charge sheet itself. It is further submitted that the cases of financial fraud which affects the banking system or economy of the county are to be visited with different approach and, therefore, the accused-applicants are not entitled to be enlarged on anticipatory bail. It is also submitted that the accused-applicants have directly filed these anticipatory bail applications before this Court without approaching the trial court concerned first.

21. I have considered the submissions advanced by the learned counsel for the parties and perused the record.

22. The economic crimes of such mammoth scale and width are craftily planned and executed. It is well settled that economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. While granting bail, the Court has to keep in mind the nature of accusations, magnitude and gravity of offence and nature of evidence in support of accusations.

23. The Supreme Court in the case of Y.S. Jagan Mohan Reddy Vs. Central Bureau of Investigation, (2013) 7 SCC 439 [LQ/SC/2013/568] has opined in paragraphs 34 and 35 as under:-

"34. 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

35. 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 the witnesses being tampered with, the larger interests of the public/State and other similar considerations."

24. The Supreme Court in the case of State of Bihar and another Vs. Amit Kumar alias Bachcha Rai, (2017) 13 SCC 751 [LQ/SC/2017/651 ;] in paragraphs 9 and 13, while considering the bail application of an accused involved in economic offence of huge magnitude, has held as under:-

"9. We are conscious of the fact that the accused is charged with economic offences of huge magnitude and is alleged to be the kingpin/ringleader. Further, it is alleged that the respondent-accused is involved in tampering with the answer sheets by illegal means and interfering with the examination system of Bihar Intermediate Examination, 2016 and thereby securing top ranks, for his daughter and other students of Vishnu Rai College, in the said examination. During the investigation when a search team raided his place, various documents relating to property and land to the tune of Rs 2.57 crores were recovered besides Rs 20 lakhs in cash. In addition to this, allegedly a large number of written answer sheets of various students, letterheads and rubber stamps of several authorities, admit cards, illegal firearm, etc. were found which establishes a prima facie case against the respondent. The allegations against the respondent are very serious in nature, which are reflected from the excerpts of the case diary. We are also conscious of the fact that the offences alleged, if proved, may jeopardise the credibility of the education system of the State of Bihar

13. We are also conscious that if undeserving candidates are allowed to top exams by corrupt means, not only will the society be deprived of deserving candidates, but it will be unfair for those students who have honestly worked hard for one whole year and are ultimately disentitled to a good rank by fraudulent practices prevalent in those examinations. It is well settled that socio-economic offences constitute a class apart and need to be visited with a different approach in the matter of bail [Nimmagadda Prasad v. CBI, (2013) 7 SCC 466 [LQ/SC/2013/567] : (2013) 3 SCC (Cri) 575; Y.S. Jagan Mohan Reddy v. CBI, (2013) 7 SCC 439 [LQ/SC/2013/568] : (2013) 3 SCC (Cri) 552] [LQ/SC/2013/568] . Usually socio-economic offence has deep-rooted conspiracies affecting the moral fibre of the society and causing irreparable harm, needs to be considered seriously."

25. In the case of Rohit Tandon Vs. Directorate of Enforcement, (2018) 11 SCC 46, [LQ/SC/2017/1644] the Supreme Court has again reiterated the consistent view that 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. Paragraphs 21 and 22, which are relevant, are extracted hereunder:-

"21. The consistent view taken by this Court is that 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. Further, when attempt is made to project the proceeds of crime as untainted money and also that the allegations may not ultimately be established, but having been made, the burden of proof that the monies were not the proceeds of crime and were not, therefore, tainted shifts on the accused persons under Section 24 of the 2002 Act.

22. It is not necessary to multiply the authorities on the sweep of Section 45 of the 2002 Act which, as aforementioned, is no more res integra. The decision in Ranjitsing Brahmajeetsing Sharma v. State of Maharashtra [Ranjitsing Brahmajeetsing Sharma v. State of Maharashtra, (2005) 5 SCC 294 [LQ/SC/2005/460] : (2005) SCC (Cri) 1057] [LQ/SC/2005/460] and State of Maharashtra v. Vishwanath Maranna Shetty [State of Maharashtra v. Vishwanath Maranna Shetty, (2012) 10 SCC 561 [LQ/SC/2012/964] : (2013) 1 SCC (Cri) 105] [LQ/SC/2012/964] dealt with an analogous provision in the Maharashtra Control of Organised Crime Act, 1999. It has been expounded that the Court at the stage of considering the application for grant of bail, shall consider the question from the angle as to whether the accused was possessed of the requisite mens rea. The Court is not required to record a positive finding that the accused had not committed an offence under the Act. The Court ought to maintain a delicate balance between a judgment of acquittal and conviction and an order granting bail much before commencement of trial. The duty of the Court at this stage is not to weigh the evidence meticulously but to arrive at a finding on the basis of broad probabilities. Further, the Court is required to record a finding as to the possibility of the accused committing a crime which is an offence under the Act after grant of bail."

26. Again, in the case of Serious Fraud Investigation Office Vs. Nittin Johari and another, (2019) 9 SCC 165, [LQ/SC/2019/1415] the Supreme Court has held that stringent view should be taken by the Court towards grant of bail with respect to economic offences. Paragraphs 24, 25, 26 and 27 of the aforesaid case are extracted hereunder:-

"24. At this juncture, it must be noted that even as per Section 212(7) of the Companies Act, the limitation under Section 212(6) with respect to grant of bail is in addition to those already provided in CrPC. Thus, it is necessary to advert to the principles governing the grant of bail under Section 439 of CrPC. Specifically, heed must be paid to the stringent view taken by this Court towards grant of bail with respect of economic offences. In this regard, it is pertinent to refer to the following observations of this Court in Y.S. Jagan Mohan Reddy [Y.S. Jagan Mohan Reddy v. CBI, (2013) 7 SCC 439 [LQ/SC/2013/568] : (2013) 3 SCC (Cri) 552] [LQ/SC/2013/568] : (SCC p. 449, paras 34-35) "34. 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. 35. 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 the witnesses being tampered with, the larger interests of the public/State and other similar considerations." This Court has adopted this position in several decisions, including Gautam Kundu v. Directorate of Enforcement [Gautam Kundu v. Directorate of Enforcement, (2015) 16 SCC 1 [LQ/SC/2015/1678] : (2016) 3 SCC (Cri) 603] and State of Bihar v. Amit Kumar [State of Bihar v. Amit Kumar, (2017) 13 SCC 751 [LQ/SC/2017/651 ;] : (2017) 4 SCC (Cri) 771] . Thus, it is evident that the above factors must be taken into account while determining whether bail should be granted in cases involving grave economic offences.

25. As already discussed supra, it is apparent that the Special Court, while considering the bail applications filed by Respondent 1 both prior and subsequent to the filing of the investigation report and complaint, has attempted to account not only for the conditions laid down in Section 212(6) of the Companies Act, but also of the general principles governing the grant of bail.

26. In our considered opinion, the High Court in the impugned order has failed to apply even these general principles. The High Court, after referring to certain portions of the complaint to ascertain the alleged role of Respondent 1, came to the conclusion that the role attributed to him was merely that of colluding with the coaccused promoters in the commission of the offence in question. The Court referred to the principles governing the grant of bail as laid down by this Court in Ranjitsing Brahmajeetsing Sharma v. State of Maharashtra [Ranjitsing Brahmajeetsing Sharma v. State of Maharashtra, (2005) 5 SCC 294 [LQ/SC/2005/460] : 2005 SCC (Cri) 1057] [LQ/SC/2005/460] , which discusses the effect of the twin mandatory conditions pertaining to the grant of bail for offences under the Maharashtra Control of Organised Crime Act, 1999 as laid down in Section 21(4) thereof, similar to the conditions embodied in Section 212(6)(ii) of the Companies Act. However, the High Court went on to grant bail to Respondent 1 by observing that bail was justified on the "broad probabilities" of the case.

27. In our considered opinion, this vague observation demonstrates non-application of mind on the part of the Court even under Section 439 CrPC, even if we keep aside the question of satisfaction of the mandatory requirements under Section 212(6)(ii) of the Companies Act."

27. The Court has to take into consideration while considering the anticipatory/regular bail application, nature of offence and the Court should refuse the bail if the offence is serious and is of huge magnitude, particularly, in economic offences. Corruption is a menace which is eating the vitals of economy of this country.

28. Considering the facts and circumstances of the case and the allegation that the accused-applicants in criminal conspiracy with each other and the bank officials had siphoned off the loan amount by submitting the forged and fabricated papers and misleading the bank and also the fact that they siphoned off the said loan amount, this Court is of the view that they are not entitled to be enlarged on anticipatory bail.

29. Anticipatory bail applications are accordingly rejected.

30. However, it is provided that if the accused-applicants surrender before the trial court concerned within five days from today and apply for regular bail, their bail applications shall be considered expeditiously in accordance with law without being influenced by any of the observation made by this Court while rejecting their anticipatory bail applications.