Bombay High Court
Sumeet Jawaharlal Jain And Anr vs The State Of Maharashtra on 31 August, 2021
Author: Prakash D. Naik
Bench: Prakash D. Naik
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CRIMINAL APPELLATE JURISDICTION
ANTICIPATORY BAIL APPLICATION NO. 976 OF 2019
WITH
INTERIM APPLICATION NO. 1504 OF 2020
WITH
INTERIM APPLICATION NO. 553 OF 2019
1. Sumeet Jawaharlal Jain
Age :- 39 Years, Occ : Business
2. Ramesh Jugraj Mehta
Age :- 53 Years, Occ : Business
Both at Office Address : Poonam Park,
Vevoor, Taluka & Dist. Palghar. ... Applicants
Versus
1. The State of Maharashtra
Through Palghar Police Station.
2. Amit B. Parekh
Age :-Adult, Occ - Unknown,
R At B-5, Shivbhavani Tower,
C.S. Complex Road, Anand Nagar,
Dahisar (E), Mumbai ... Respondents
ALONG WITH
ANTICIPATORY BAIL APPLICATION NO. 977 OF 2019
WITH
INTERIM APPLICATION NO. 1501 OF 2020
1. Sumeet Jawaharlal Jain
Age :- 39 Years, Occ : Business
2. Ramesh Jugraj Mehta
Age :- 53 Years, Occ : Business
Both at Office Address : Poonam Park,
Vevoor, Taluka & Dist. Palghar. ... Applicants
Versus
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1. The State of Maharashtra
Through Palghar Police Station.
2. Sonal N. Rathod
Age :-Adult, Occ - Unknown,
R At Shanti Apartment No.1
C/403, Mathuradas Extension Road,
Kandivli (W), Mumbai 400 067. ... Respondents
ALONG WITH
ANTICIPATORY BAIL APPLICATION NO. 978 OF 2019
WITH
INTERIM APPLICATION NO. 1503 OF 2020
1. Sumeet Jawaharlal Jain
Age :- 39 Years, Occ : Business
2. Ramesh Jugraj Mehta
Age :- 53 Years, Occ : Business
Both at Office Address : Poonam Park,
Vevoor, Taluka & Dist. Palghar. ... Applicants
Versus
1. The State of Maharashtra
Through Palghar Police Station.
2. Alpa Sanjay Wadhwana
Age :-Adult, Occ - Unknown,
R At A-303, Gohil Mansion,
Iraniwadi Road No.2, Opp. Asian Bakery,
Kandivli (W), Mumbai 400 067. ... Respondents
ALONG WITH
ANTICIPATORY BAIL APPLICATION NO. 979 OF 2019
WITH
INTERIM APPLICATION NO. 1502 OF 2020
1. Sumeet Jawaharlal Jain
Age :- 39 Years, Occ : Business
2. Ramesh Jugraj Mehta
Age :- 53 Years, Occ : Business
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Both at Office Address : Poonam Park,
Vevoor, Taluka & Dist. Palghar. ... Applicants
Versus
1. The State of Maharashtra
Through Palghar Police Station.
2. Vikram K. Patel
Age :-Adult, Occ - Unknown,
R At A-304, Ekta Nagar,
Blue Oasis, Blue Empire Complex,
Ekta Nagar, Kandivli (W), Mumbai 400 067. ... Respondents
.....
Mr. Aabad Ponda, Senior Advocate a/w Mr. Prayag Joshi i/by
Mr. Ashotosh R. Gole, Advocate for the Applicants in all
Anticipatory Bail Applications and Interim Applications.
None for the Applicant in Interim Application No. 553 of 2019.
Mr. S. R. Agarkar, APP for the Respondent No.1 - State.
Mr. Mahesh V. Rajpopat, Advocate for Respondent Nos.2 in all
Anticipatory Bail Applications.
.....
CORAM : PRAKASH D. NAIK, J.
DATE : 31st AUGUST, 2021
PER COURT:
1. The applicants are apprehending arrest in connection
with C.R. Nos. I-26 of 2019, I-27 of 2019, I -28 of 2019 and I-29 of
2019 registered with Palghar Police Station, Dist. Palghar on 23 rd
January, 2019 for offences under Sections 406 and 420 of Indian
Penal Code (for short "IPC") and Sections 3, 4 & 8 of Maharashtra
Ownership Flats (Regulation of the promotion of construction, sale,
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management and transfer) Act, 1963 (for short "MOFA Act") and
Sections 3 & 4 of Maharashtra Protection of Interest of Depositors
(in Financial Establishments) Act, 1999, (for short 'MPID Act'),
pursuant to the directions of learned J.M.F.C. Palghar under Section
156(3) of Cr.P.C. in respective complaints filed by complainants.
2. The complainant in C.R. No. I-26 of 2019 which is
subject matter of Anticipatory Bail Application No.976 of 2019 has
alleged that the applicants are partners of partnership firm "M/s.
Poonam Lifestyle". Agreement of sale for development of the lands
was executed by the accused with the owners of lands Gat Nos.
66/1, 66, 67/1 and 68. The accused have launched the scheme of
construction of the flats and shops of "M/s. Poonam Lifestyle" and
made advertisement of the scheme. After getting information of the
scheme the informant made inquiry with applicant No.1 and others
and he agreed to purchase the flat for consideration amount of
Rs.8,32,000/-. The applicants had promised that, if the entire
amount is paid at one time, the purchaser will be exempted from
paying stamp duty, registration fees, flat tax, service tax etc. The
informant gave two cheques and paid the entire amount of
Rs.8,32,000/- on 27th June, 2012. It was promised that the
possession of the flat would be given within 24 months. However,
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thereafter, the applicants and others avoided execution of
agreement. In the year 2017, the agreement was executed in favour
of the informant and promised that the possession of the flat would
be handed over by July - 2017. However, the applicants have not
handed over the possessions of the flat to the informant. The
accused borrowed loan from the Bank of Baroda for construction of
the buildings of "M/s. Poonam Lifestyle" project but they failed to
pay the installments of the bank hence, the bank had attached the
property of the project. In spite of paying the entire consideration
amount, accused have not constructed the project and have not
given possession of the flat.
3. The case of the complainant in C.R. No. 27 of 2019
which is subject matter of Anticipatory Bail Application No. 977 of
2019 is that the applicants are the partners of partnership firm
"Poonam Lifestyle". After getting information of the scheme, the
informant made inquiry with applicant No.1 and others and agreed
to purchase the flat for consideration amount of Rs.8,32,000/-. The
applicants had promised that if the entire amount is paid at one
time, the purchaser would be exempted from stamp duty,
registration fees, flat tax, service tax etc. The informant paid the
entire amount by giving two cheques of Rs.8,32,000/- on 13 June,
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2012. It was promised that the possession of the flat would be
handed over within 24 months. However, thereafter, the applicants
and others avoided to execute the agreement. In - 2017, the
agreement was executed in favour of the informant and it was
promised that the possession of the flat would be handed over till
July - 2017. However, the possession of the flat was not handed
over to the informant. The informant further came to know that the
accused have borrowed the money from the Bank of Baroda for
construction of the buildings and since they failed to pay the
installment of the bank, the bank has attached the property of the
project. In spite of paying the entire amount of consideration, the
project was not constructed and the possession of the flat was not
handed over to the informant.
4. The complainant in C.R. No. 28 of 2019 which is
subject matter of Anticipatory Bail Application No. 978 of 2019 has
alleged that the complainant made inquiry with applicant No.1 and
others pursuant to the advertisement of the scheme and the
complainant agreed to purchase the flat for consideration amount
of Rs.7,60,000/-. The applicants had promised that on payment of
entire amount at one point of time, the purchaser will be exempted
from paying stamp duty, registration fees, flat tax, service tax etc.
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The informant paid the entire amount of Rs.7,60,000/- in the year
- 2014 to the applicants. It was promises that the possession would
be be handed over within 24 months. However, thereafter, the
applicants and others avoided to execute the agreement. In - 2017,
the agreement was executed that promise to handover the
possession of the flat in December - 2017. The applicants have not
handed over the possession to the informant. Subsequently, the
informant learnt that the accused have borrowed money from Bank
of Baroda for construction of the buildings of "Poonam Lifestyle"
project but they failed to pay the installments of the bank and the
property of the project has been attached by the bank. In spite of
paying the entire amount, the possession of the flat was not handed
over to the complainant.
5. The complainant in C.R. No. 29 of 2019 which is
subject matter of Anticipatory Bail Application No. 979 of 2019 has
alleged that the informant had made inquiry with the accused and
agreed to purchase the flat for consideration amount of
Rs.7,84,000/-. The informant paid the entire amount of
Rs. 7,84,000/- by cheque in the year 2013. It was promised that the
possession would be handed over within 24 months. The accused
avoided execution of agreement in favour of the informant. The
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possession of the flat was not handed over.
6. The complainant Amit B. Parekh in C.R. No. 26 of
2019 had purchased flat in building No. 15, A-103. The
complainant Sonal Rathod in C.R. No. 27 of 2019 had purchased
the flat in building No.10, A-104. The complainant Alpa Wadhwana
in C.R. No. 28 of 2019 had purchased the flat in building No.6, B-
001 and the complainant Vikram Patel in C.R. No. 29 of 2019 had
purchased the flat in building No.10, A-203.
7. The applicants had preferred applications for
anticipatory bail in connection with all the complaints and the said
applications were rejected by separate orders dated 18 th April,
2019.
8. Learned Senior Advocate Mr. Aabad Ponda
representing the applicants in all the applications with learned
Advocate Mr. Ashotosh Gole has advanced several submissions in
support of the relief sought in this applications. It is submitted that
the building permission in respect to the project was issued on 1 st
August, 2012. Thereafter, the area of construction was reduced and
fresh C.C. was issued on 6th June, 2016. The architect had issued
the completion certificate in respect to building No.15. The project
was registered with RERA. Application was made for water
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connection. Steps were taken for installation of electricity. The
work relating to building No.15, A, B, C & D wings is 100%
complete. The delay had occurred on account of circumstances
beyond the control of applicants. The environmental clearance was
delayed. The Palghar Municipal Counsel had not issued occupation
certificate. There was no intention to cheat. The construction in
respect to all the buildings had commenced. Most of the buildings
were completed. The bank has not taken physical possession of the
project. The firm had initiated proceedings before Debt Recovery
Tribunal. One time settlement offer was given to the Bank of
Baroda. The accused firm had paid the amount of Rs.6,90,00,000/-
to the bank. The offence under Section 406 of IPC is not made out.
Considering the fact that efforts were made to complete the project
of construction and since most of the buildings were almost
completed, it cannot be alleged that there was intention to deceive.
It is further submitted that the offence under the provisions of
MPID Act is not made out. The firm of the accused cannot be
termed as financial establishment as defined under the MPID Act.
The Police had refused to take cognizance of the complaint, hence,
the complainant had filed private complaint in which the directions
were issued under Section 156(3) of Cr.P.C. The complainant had
also initiated proceedings before the consumer Court. The
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applicant's firm had preferred Writ Petition before this Court.
Wherein, one of the contentions was that when there is designated
Court with powers of Magistrage under M.P.I.D. Act, cognizance
taken and action initiated by learned JMFC is without jurisdiction.
The said petition is admitted on 5th March, 2020. Relief of
de-freezing the bank account was granted. It is submitted that
construction in respect to the various project is completed to the
extent of 100%, 60%, 90% and 80%. It is only on account of the
circumstances which were beyond control of applicants. Some of
the buildings could not be completed. The applicants are willing to
refund the amount invested by the complainants and other
investors. The applicants have filed additional affidavits dated 12 th
July, 2019, 14th July, 2020 and 22nd February, 2021 and relied upon
several documents. It is submitted that custodial interrogation of
the applicants is not necessary. The applicants had followed up with
the Chief Executive Officer, Palghar Municipal Counsel for issuance
of the occupation certificate. All documents are handed over to the
investigating officer. The letter written by Palghar Municipal
Counsel to EOW, Palghar dated 16th September, 2019 mentions the
status of the construction and there is reference to the fact that
some of the buildings were 100% completed. Reliance is placed on
the decisions of the Supreme Court in the case of State of Gujrat
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V/s. Jaswantlal Nathalal, AIR 1968 Supreme Court 700, wherein
the Court has dealt with ingredients of Section 406 of IPC. It is
submitted that in the light of the observations made in the
paragraph 8 of the decision, wherein it was observed that mere
transaction of sale cannot amount to an entrustment in support of
the submissions of the applicants that the offence under Section
406 of IPC is not made out.
9. Learned APP submitted that intention of cheating is
writ large. False promises were made to several persons, who had
purchased the flats. It was promised that the possession will be
handed over within stipulated time. They were induced to part
with 100% consideration amount. There was deliberate delay in
executing the agreements. In spite of accepting the entire amount,
the possession of the flats are not handed over to the purchasers.
Apart from the complainants and intervenors, there are several
other purchasers of the flats, who had booked the flats by paying
entire consideration. Loan was obtained from the Bank of Baroda
by mortgaging the project. On failure of installments of the loan
payment, the properties were attached. In spite of attachment of
property, the accused had executed the agreement with the
purchasers of flat. Assuming that the writ petition challenging the
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provisions of MPID Act is pending before this Court, the
complainant has independent right to initiate proceedings under
Sections 406 & 420 of IPC and under the provisions of MOFA Act.
The accused have received amount of Rs.5,62,44,946/- from 39
investors. The accused had obtained loan of Rs.14,50,00,000/-
from Bank of Baroda. There are about 500 or more persons who
had invested the amount in the said project and the amount in the
crime may be enhanced. Occupation certificate has not been issued.
The Police Sub Inspector, EOW, Palghar has filed affidavit in reply
dated1st July, 2019 opposing the application for anticipatory bail. It
is submitted that custodial interrogation of the applicant is
necessary.
10. Learned Advocate for the complainants/intervenors
submitted that the offence is of serious nature. The purchasers
were induced to book the flat. Although, entire payment was made
towards purchase of flat, the possession was not handed over to
them. The quality of the construction is poor. The dishonest
intention is writ large. Sections 406 & 420 of IPC is made out. The
complainant has filed affidavit opposing the application for
anticipatory bail. It is submitted that except making false promises
no action was initiated by the applicants to handover the
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possession. Although the promises were made there was no
willingness to comply the same. All the other projects in the vicinity
for construction had started, completed and ready with requisite
permissions to occupy from the relevant authorities. But only the
present project i.e. Poonam Park is incomplete. There were various
requirements for obtaining permissions, clearance certificate from
various competent authority which was not taken by the applicants
for the project. The said requirement was never disclosed by them
to the complainants and others. It was not mentioned in the
allotment letter nor in the agreement that there are pending
permissions to be obtained by the applicants from various
authorities for the said project. Even after receiving bank loan of
Rs.14,50,00,000/-, accused accepting huge amount from
purchasers. The applicants could not clear the dues of the material
supplier, contractors etc. and did not take permissions from various
authorities. The applicants have themselves contented that the
environmental clearances were not given. Without obtaining
mandatory permissions, the applicants have induced various
purchasers to purchase the flats and the consideration was
accepted. Some of the purchasers had paid the entire payment in
the year - 2012. However, the promises were not fulfilled. He
pointed out letters dated 9th August, 2012 and 18th April, 2015
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addressed to complainant Amit B. Parekh. Wherein, it was
mentioned that he has been allotted flat No.104 on the first floor in
B-wing for lump-sum price of Rs.8,42,000/- in the proposed project
of Poonam Park. Regular agreement will be executed after the
detailed particulars are sought from him. It was also mentioned
that the payments are presently made by him to "M/s. Poonam
Lifestyle" on account of loans and advances. The regular agreement
of sale would be entered into between them wherein the payments
would be made by him will be treated as payments towards
purchase of flat. Possession will be given after 24 months. In the
letter dated 18th April, 2015 it was mentioned that Flat No.103 is
allotted on the first floor in A-wing. It was also stated that presently
the payment made by him is on account of loans and advances.
11. I have perused the documents on record including
various affidavits filed by respective parties. It is pertinent to note
that the informant and others had invested huge amount to
purchase the flats from year - 2012 and they were promised that
the possession of flats would be given within two years. The
applicants had failed to complete the project. Before launching the
project the applicants ought to have taken all the sanctions,
permissions from the competent authority. They were supposed to
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anticipate the cause of delay for completing the project and
thereafter, accused should have entered into agreements by making
things clear to the purchasers. Apparently, the accused had kept the
purchasers in dark by inducing them to invest money in the project
for purchase of the flat.
12. The contention of the applicant is that several
buildings constructed by them are on the verge of completion. It is
pertinent to note that since last several years possessions has not
been handed over to the purchasers. The occupation certificate is
not yet granted to the applicants. It is the contention of the
applicants in the application itself that the commencement
certificate was issued in 2012. Subsequently, the area of
construction was reduced and fresh commencement certificate was
issued in 2016. The environmental clearances were not granted for
the project. The submission of learned counsel for the applicants
that provisions of Sections 406 and 420 cannot be considered. The
investigation is in progress. The complainants had invoked Sections
406, 420 of IPC, and the provisions of MOFA Act. It appears that
the writ petition challenging under the provisions of MPID Act is
pending in this Court. However, there is no interim relief to not
proceed with the investigation under the provisions of MPID Act.
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The allotment letters produced by learned Advocate for intervenors
refers to the averment that the payments made by purchaser were
presently marked as on account of Loans and Advances. The
affidavit filed by the EOW, Palghar indicates that the applicants are
partners of partnership firm "M/s. Poonam Lifestyle". They had
entered into the agreement for development of land. The owner of
the land bearing Gat Nos. 66/1, 66, 67/1 & 68 of Village Vevoor,
Taluka & Dist. Palghar. They had launched the scheme of
construction of flats and shops. "M/s. Poonam Lifestyle" had made
development of the scheme and after getting information of the
scheme the complainant and others made inquiry about the project.
They agreed to purchase the flats. Promises were made that if the
entire amount is paid at one time the purchaser will be exempted
from paying stamp duty, registration fees, flat tax, service tax etc.
The complainant in all these cases have parted entire payment. In
the year 2012 and 2014 apparently agreements were executed.
Subsequently, after causing delay the agreements were executed
and promises were made to handover the possession within
stipulated time which has not been done. The accused cannot give
execuses that the competent authority has not granted permissions.
It is their responsibility that all requisite permissions were obtained
before inducing purchasers to purchase flats. The investigation
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revealed that in 2011, the complainant and others received
allotment letters from the accused. Thereafter, again they changed
the measurement of the flats and consideration and issued fresh
allotment letter and thereafter registered the agreement for sale
with investors. The said agreements were registered in 2017, in
which it was admitted by the applicant/accused that the possession
would be handed over on or before July - 2017. During the
investigation it was transpired that the accused had received
amount of Rs.5,62,44,946/- from several investors. During
investigation, it was transpired that the accused had obtained loan
from Bank of Baroda and the entire project of "Poonam Park" was
mortgaged with bank for the loan of Rs.14,50,00,000/-. Since the
applicants/accused failed to repay the loan amount within
stipulated period, the Bank of Baroda had initiated proceedings
under Securitization and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 (SARFAESI). The
District Collector Palghar had initiated the directions to attach the
property and handover the possession of the whole scheme to the
bank. The possession notice was also affixed on 3rd December, 2016
on the said property. The applicants have however contended that
they have initiated the proceedings before the SARFAESI and
offered one time settlement. It is also contented that Six Crores
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were paid by them to the bank. However, the fact still remains that
loan which was obtained was to the tune of Rs.14,50,00,000/- and
the entire loan has not been repaid. It is pertinent to note that the
investors were not aware that the entire project has been
mortgaged and without understanding encumbrances, they had
parted an amount towards the purchase of flats. The affidavit filed
by the EOW mentions that there are near about about 500 or more
persons who had invested their amount in the said project and
therefore the amount misappropriated could enhance. By order
dated 17th December, 2020 this Court had vacated the interim
protection granted to the applicant. The applicants had moved the
Honb'le Apex Court and considering the fact the application is due
for hearing before the High Court, it was directed that no coercive
action be initiated against applicant.
13. For all the reasons stated above, the applications are
devoid of merits. The applications are required to be rejected.
14. Hence, I pass the following order:
ORDER
i) Anticipatory Bail Application Nos. 976 of 2019, 977 of 2019, 978 of 2019 & 979 of 2019 are rejected and stand disposed of accordingly;
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ii) All Interim Applications stand disposed of accordingly.
(PRAKASH D. NAIK, J.)
15. At this stage, learned counsel for the applicants submits that interim protection was running in favour of the applicants for a long period of time and the same may be continued for a period of 4 weeks to enable the applicants to move before the Hon'ble Apex Court for relief. The submissions is strongly opposed by learned APP and learned counsel for the intervenor.
16. Considering the fact that the interim protection was granted to the applicants and it was in operation for a long period of time, the interim protection shall continue for a period of four weeks.
(PRAKASH D. NAIK, J.)
Digitally signed
by SAJAKALI
SAJAKALI LIYAKAT
JAMADAR
LIYAKAT Date:
JAMADAR 2021.09.04
14:11:40
+0530
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