Madhya Pradesh High Court
Manish Khare vs The State Of Madhya Pradesh on 30 September, 2019
Equivalent citations: AIRONLINE 2019 MP 1167
1 M.Cr.C.No.36320 of 2019
HIGH COURT OF MADHYA PRADESH
PRINCIPAL SEAT AT JABALPUR
Single Bench : Hon'ble Shri Rajeev Kumar Dubey, J.
Misc. Criminal Case No.36320/2019
Manish Khare
vs.
State of Madhya Pradesh
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Shri Vijay Shankar Pandey, Advocate for the applicant.
Shri H.S. Chhabra, Standing counsel for the respondent/EOW.
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ORDER
Reserved on : 27/09/2019 Delivered on : 30/09/2019 This is First bail application under Section 439 of Cr.P.C. Applicant Manish Khare has been arrested on 14/04/2019 in connection with Crime No.12/2019 registered at Police Station, Economic Offences Wing (EOW), Bhopal (M.P.) for the offence punishable under Sections 120-B, 420, 467, 468, 471 of the IPC and Section 66 of the Information Technology Act, 2000 and Section 7 read with Section 13(2) of the Prevention of Corruption Act, 1988.
2. As per prosecution story, M.P. State Electronics Development Corporation Ltd. (hereinafter referred to as "MPSEDC") is a body working under State of M.P. Department of Science and Technology. Department of Information Technology, Govt. of Madhya Pradesh adopted the e-Tendering System using online platform in 2006. In the year 2012 Government of Madhya Pradesh appointed MPSEDC, as the Nodal Agency for MP e- procurement portal. MPSEDC selected M/s Tata Consultancy Services with Antares Systems Ltd. as the new Implementation Agency for end-to-end e-
Digitally signed by RANJEET AHIRWAL Date: 30/09/2019 18:20:48 2 M.Cr.C.No.36320 of 2019Procurement solutions. The agreement with TCS & Antares was signed in the year 2013. The New Service Providers undertook the Customization, Integration, Implementation and Maintenance of Single, Unitary, Web Based e-Procurement Software (Portal) with the specified modules which also include E-Tendering. Co-accused Manohar M.N. was the Vice President of Antares Systems Ltd. and was the project in-charge on behalf of the company. Co-accused Nandkishor Brahme was posted as OSD in MPSEDC from the year 2012 and was assigned the duty as Nodal Officer of E- Tendering Project. In E-Tendering Project, MPSEDC made a platform available to various Government Departments for floating tenders. In the tendering processes the concerned Department which issued the tender uploaded its tender on the portal, on which last date of filing tender and the time of its opening was mentioned. While issuing the tender, the concerned officer also attached the public key of his digital signature. The tenderer after registering himself on MP e-Procurement portal filled the tender and after filing the tender, submitted the tender on the portal after it was encrypted by the public key of the officer concerned attached with the tender. After submission of the tender, no departmental officer, e-tendering company or other person could open the tender before its opening time.
3. On 11th April, 2018 at the time of opening of three tenders Nos. 91, 93 & 94 floated by the Madhya Pradesh Jal Nigam Maryadit (here in after referred as "MPJNM") the computer displayed a message that "the contents of the document had been modified". On that service provider company Antares Systems Ltd. was directed to submit the report after inquiry. In the first report given by the team of Antares Systems Ltd after examining the system they mentioned that there was no irregularity and only attributed the message to technical defect. However, they also stated that further technical analysis was going on. Thereafter, on 05/05/2019 Antares Systems Ltd. again gave the Root Cause Analysis Report (R.C.A.) mentioning therein that the tenders had been tampered with. On that the then Managing Director of MPSIDC informed MPJNM for canceling these bids and also directed Antares Systems Ltd. to enquire all the tenders, which were floated by the various Government department between 01/01/2018 to 30/04/2018 on E-
Digitally signed by RANJEET AHIRWAL Date: 30/09/2019 18:20:48 3 M.Cr.C.No.36320 of 2019Portal. On that the team of employees of Antares Systems Ltd. again enquired the matter and gave the report to the effect that during the check period six other tenders i.e. tender of MP Road Development Corporation No.786, Public Works Department Tender Nos. 49813, 49982 & 49985 and tender of Water Resources Department Nos. 10030 & 10044 were also manipulated similarly. Thereupon, on the direction of Chief Secretary of M.P. Government a preliminary enquiry was conducted by the Economic Offence Wing. In the preliminary enquiry it was found that after changing the bid price of tender Nos. 91, 93 & 94 of MPJNM amounting to Rs.1,769 crore the M/s GVPR Engineers Limited Hyderabad for tender No.91, M/s the Hume Pipe Company Limited Mumbai for tender No. 93 and M/s JMC Projects India Limited Mumbai for tender No. 94 were made lowest bidder (L1), likewise by tampering the two tenders of the Public Works Department Tenders Nos.49985 & 49982 amounting to Rs.13.46 crores, M/s Ramkumar Narwani Bhopal, were made lowest bidder, in the Tender no. 4981319 amounting to 15 crores, Sorathiya Velji Ratna and Company Vadodara were made lowest bidder. After tampering the tender of Madhya Pradesh Road Development Corporation amounting to Rs.7.86 crores M/s Madhav Infra projects Vadodara, Water Resources Department tender Nos.10030 & 10044 total amounting to Rs.1135 Crore, M/s Max Mantena Micro JV Hyderabad & Sorathiya Velji Ratna Baroda were made a lower bidder, due to which companies earned illegal profits.
4. On the basis of that preliminary evidence and findings of a probe report of the Computer Emergency Response Team, New Delhi, Crime No.12/2019 was registered at Economic Offences Wing, Bhopal (M.P.) for the offence punishable under Sections 120-B, 420, 468, 471 of the IPC, Section 66 of the Information Technology Act, 2000 and Section 7 read with Section 13(2) of the Prevention of Corruption Act against applicant and other co-accused persons.
5. From the report of the Computer Emergency Response Team, New Delhi and the other evidence collected by the investigating agency during investigation it was found that in the year 2016, OSMO Pvt. Ltd. (applicant Digitally signed by RANJEET AHIRWAL Date: 30/09/2019 18:20:48 4 M.Cr.C.No.36320 of 2019 Vinay Choudhary and co-accused Varun Chaturvedi, the Managing Directors of OSMO and co-accused Sumit Golwalkar, the Marketing Director of that company) entered into an agreement with Antares Ltd. in order to check the reasons why the whole system of E-tendering had slowed down and was engaged to conduct a performance test of the E-tendering system and come up with concrete steps to tackle the slow speed. During the performance test, OSMO was provided with user IDs and Bidder IDs by the Antares Ltd. In the month of June, 2016 OSMO stated that it was not able to conduct a performance test of the whole system and thus could not complete the process of testing.
6. It is further stated that the manipulation was done by one of the user ID and bid IDs. For manipulating the tenders of MPJNM, a demo file was created on MP eprocurement portal. That file was created using ID PT 4, which was given to OSMO IT Solutions at the time of performance testing and they also used digital signature certificate (DSC) of Keshav Rao Uikey. The IP address registered while creating the said demo file was 27.60.163.98 and 27.60.185.14 which was linked with mobile No. 9755092919. The SIM of this mobile number was registered in the name of co-accused Varun Chaturvedi and was being used by applicant Vinay Choudhary. Thereafter, hackers entered into the database through the staging server, where original tenders were stored and this process was done through virtual private network (VPN), the access of which was only with co-accused Nandkishore Bramhe. After reaching the database server hackers accessed the file where the original tenders were saved. They copied the details of all the bidders, who submitted the bids, which were encrypted. After copying the bids they again came back to the demo tender file created by them earlier and by using bidder ID number 15597 and vendor ID number QK 829 846 pasted the said bids in demo file. The vendor ID used for this purpose was the same, which was issued to OSMO for performance testing in the year 2016. After pasting the encrypted bid in the demo file, the hackers assessed the system again on 03-03-2018 i.e. the date on which the said bids stood decrypted as the date of opening the demo tender was mentioned as 03-03-2018. Thus, they were able to see the figures/bids submitted by all the bidders in encrypted form.
Digitally signed by RANJEET AHIRWAL Date: 30/09/2019 18:20:48 5 M.Cr.C.No.36320 of 2019After seeing the amount filed by each bidder another demo file was created in the second demo file, the encrypted bids as visible in the first demo file were pasted in the second demo file. Again by using the bidder ID No.15597 having vendor ID number QK29846 they manipulated the bids and made the person they wanted to benefit as the lowest bidder. After making the change in the second demo file and placing a wrong bidder L1 hackers copied the encrypted/manipulated bid value and again by using the staging server reached the database server through a VPN, access of which was given to co-accused Nandkishore Bramhe, opened the original tender file and pasted the said encrypted manipulated bid value next to the name of the bidder they wanted to benefit and thus manipulated the bids.
7. The specific allegation against the applicant is that he was the middleman who took money from Sarothia Velji and gave the same to co- accused persons for manipulating the bid and co-accused persons made Sarothia Velji as L1 bidder in the tender by manipulating the bids.
8. Learned counsel appearing on behalf of the applicant submitted that the applicant is innocent and has falsely been implicated in the offence. It is alleged that the applicant took money from Sarothia Velji for manipulating NIT of tender No.10044. But from the account statement of the applicant's firm M/s. Milestone Builders and Developers it is clear that between 23.01.2017 to 12.07.2017, Rs.2,21,53,892/- were transferred from the account of firm Sarothia Velji to the account of M/s. Milestone Builders and Developers. During that period NIT of tender No.10044 was not issued. These transactions were before the issuance of NIT of tender No.10044 dated 20.12.2017. So on the basis of those transactions, it cannot be said that applicant took money from Sarothia Velji for making him the lowest bidder in NIT of tender No.10044. The transactions also show that applicant had a business relation with Sarothia Velji prior to issuing of NIT of tender No.10044. He further submitted that the applicant had business transactions with the firm Sarothia Velji and Shricon Multi Infra Developers. Alleged transactions were done between M/s. Milestone Builders and Developers, firm Sarothia Velji and Shricon Multi Infra Developers for business purposes Digitally signed by RANJEET AHIRWAL Date: 30/09/2019 18:20:48 6 M.Cr.C.No.36320 of 2019 not for manipulating the tender bid. Police only on the basis that money was transferred from the account of firm Sarothia Velji to the account of the applicant's firm M/s. Milestone Builders and Developers wrongly implicated the applicant in the crime. There is no other direct evidence on record to connect the applicant with the crime.
9. He further submitted that It is alleged that applicant Vinay Choudhary and co-accused Varun Chaturvedi in connivance with other co-accused persons manipulated the bids, but the present applicant has no role in the functioning of e-Procurement Software (Portal). It is also alleged that on 27.09.2017 Rs.40,00,000/- were transferred from the account of applicant's firm M/s. Milestone Builders and Developers to the account of Shricon Multi Infra Developers , in which the co-accused Vinay Choudhary and his brother Avinash K. Choudhary were the partners, but the said amount was received by Shricon Multi Infra Developers as a loan from M/s. Milestone Builders and Developers and the said amount of Rs.40,00,000/- was repaid by M/s. Milestone Builders and Developers to Shricon Multi Infra Developers.
10. He further submitted that from the evidence collected by the prosecution during investigation it also appears that the firm Sarothia Velji and Shricon Multi Infra were directly connected with each other and the amount Rs.26,00,000/- on 20.02.2018 and Rs.25,00,000/- on 23.02.2018 were transferred from the account of Sarothia Velji to the account of Shricon Multi Infra. When co-accused Harish Sorthia partner of firm sorthia Velji and Vinay Chaturvedi partner of firm Shricon Multi Infra were directly connected, what was the need for them to make the applicant an intermediary. So only on the basis that the applicant has a business transaction with firm Shricon Multi Infra and firm Sarothia Velji it can not be said that the applicant was also involved in the crime. Police only based on a memorandum of applicant implicated applicant in the crime. There is no likelihood of his absconding or tampering with the prosecution evidence. He is in custody since 10/04/2019 and conclusion of the trial will take time. Other co-accused persons have already been granted bail by this court. So Digitally signed by RANJEET AHIRWAL Date: 30/09/2019 18:20:48 7 M.Cr.C.No.36320 of 2019 applicant is also entitled for bail on the ground of parity. On the strength of aforesaid submissions, it is prayed that the applicant be released on bail.
11. Learned counsel for the respondent/EOW submitted that from the evidence collected by the EOW it is revealed that the manipulation in the tenders was done by co-accused Vinay Chaudhary with the help of co- accused Varun Chaturvedi and Sumit Golwalkar. Co-accused Vinay Choudhary and Avinash K. Choudhary (brother of Vinay Choudhary) and Sumeet Golwalkar, were the partners in Shricon Multi Infra. Sarothia Velji, who was made L1 bidder by them by manipulating the bids, transferred money in the account of Shricon Multi Infra Developers, through applicant's firm M/s. Milestone Builders and Developers which shows the nexus of the applicant in the crime. From the memorandum of Manish Khare recorded by the police under Section 27 of the Evidence Act, it is revealed that Sarothia Velji gave money to him regarding manipulation in the bids and he transferred that amount in the account of Shricon Multi Infra. Learned counsel further submitted that the investigation regarding other tenders is still going on, so the applicant who is one of the main accused of the crime should not be released on bail.
12. It is alleged that applicant was the middleman who took money from Sarothia Velji and gave the same to co-accused persons for manipulating the bid and co-accused persons made Sarothia Velji as L1 bidder by manipulating the bids. Police only on the basis of transaction of money and memorandum of applicant, implicated the applicant in the crime. But it also appears from the account statement of the applicant's firm M/s. Milestone Builders and Developers that between 23.01.2017 to 12.07.2017, Rs.2,21,53,892/- were transferred from the account of firm Sarothia Velji to the account of M/s. Milestone Builders and Developers. During that period NIT of tender No.10044 was not issued. It also appears that the firm Sarothia Velji and Shricon Multi Infra were directly connected with each other and the amount Rs.26,00,000/- on 20.02.2018 and Rs.25,00,000/- on 23.02.2018 were transferred from the account of Sarothia Velji to the account of Shricon Multi Infra. There is no allegation against the applicant that applicant Digitally signed by RANJEET AHIRWAL Date: 30/09/2019 18:20:48 8 M.Cr.C.No.36320 of 2019 himself manipulated the bids. Applicant is in custody since 14.04.2019, charge sheet has been filed and conclusion of trial will take time. So, without commenting on the merits of the case, the application is allowed and it is directed that the applicant Manish Khare be released on bail upon his furnishing personal bond in the sum of Rs.50,000/- (Rs. Fifty Thousand Only) with one surety in the like amount to the satisfaction of the concerned C.J.M/trial Court for his appearance before the concerned Court on all such dates as may be fixed in this behalf by the trial Court during the pendency of trial.
13. This order will remain operative subject to compliance of the following conditions by the applicant :-
1. The applicant will comply with all the terms and conditions of the bond executed by him;
2. The applicant will cooperate in the trial;
3. The applicant will not indulge himself in extending inducement, threat or promise to any person acquainted with the fact of the case so as to dissuade him from disclosing such facts to the Court or to the Police Officer, as the case may be;
4. The applicant shall not commit an offence similar to the offence of which he is accused;
5. The applicant will not seek unnecessary adjournments during the trial; and
6. The applicant will not leave India without prior permission of the trial Court.
C.C. on payment of usual charges.
(Rajeev Kumar Dubey) Judge (ra) Digitally signed by RANJEET AHIRWAL Date: 30/09/2019 18:20:48