Gujarat High Court
Vishal S/O Harish Kumar T.N vs State Of Gujarat on 12 April, 2022
Author: Umesh A. Trivedi
Bench: Umesh A. Trivedi
R/CR.MA/18711/2021 ORDER DATED: 12/04/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL MISC.APPLICATION NO. 18711 of 2021
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VISHAL S/O HARISH KUMAR T.N.
Versus
STATE OF GUJARAT
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Appearance:
MR ANKIT SHAH(6371) for the Applicant(s) No. 1,2
MR MITESH AMIN, SENIOR ADVOCATE, PUBLIC PROSECUTOR
for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE UMESH A. TRIVEDI
Date : 12/04/2022
ORAL ORDER
[1.0] This application is filed by the applicants under Section 439 of the Code of Criminal Procedure praying to release them on regular bail, who are facing FIR, which was initially registered under Sections 406 and 420 of the Indian Penal Code as well as under Sections 66 C and 66 D of the Information and Technology Act, 2000, which came to be registered at C.R. No.11196040210039 of 2021 with Cyber Crime Police Station, Vadodara City.
[2.0] Brief facts of the case as alleged in the FIR are that during the period as mentioned in the FIR, the first informant was prompted from one 'App', bearing number as mentioned in the FIR through whatsapp message, requesting him to generate user ID as also the password over the link sent through the 'App' offering him attractive commission on a purchase through those user ID as also the password tempting Page 1 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 him to invest Rs.1,53,700/-, which was then transferred to the account number as mentioned in the FIR opened with the ICICI Bank in the name of Bruiser Technology Pvt. Ltd. Directors whereof were the present applicants - accused. It is further alleged in the FIR that after the aforesaid amount was invested, no commission was ever offered. Initially some meager amount was offered in return thereof to gain the confidence of the first informant to gain more and more in the said transaction. The first informant from his account kept with HDFC Bank deposited Rs.83,700/-, from IDFC Bank, deposited Rs.63,000/- and from Bank of Maharashtra deposited Rs.7000/-, and threfore, in all Rs.1,53,700/- came to be deposited by him. For withdrawal of the attractive commission, he was asked to cross the next stage and in that attempt the said amount deposited were transferred to the aforesaid fictitious account opened in the name of Bruiser Technology Pvt. Ltd., as aforesaid, whose Directors were present applicants, who opened the said account in the Bank. Initially, in a Police Station, under local application the complaint was made and thereafter it was regularly registered as the aforesaid FIR.
[2.1] Pursuant to the registration of the aforesaid FIR, the applicants came to be arrested on 24.09.2021. After the arrest, investigation was carried out and concluded on 17.11.2021 and charge-sheet submitted to the competent Court on 18.11.2021 against the present two applicants wherein one Shashikumar R.S. - co-accused was shown to be an absconding - accused. If charge-sheet paper is looked into, it appears that it is nothing but a mockery of investigation into such a serious fraud citing four witnesses, which includes, first Page 2 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 informant, Police Station Officer who recorded the FIR, Investigating Officer and one Madhusudan A.M. Venkatesh, who is owner of Brick Space, whose statement is not recorded, who is alleged to have provided the virtual office space. Surprisingly, the accused, who is shown to be absconding in the charge-sheet filed against the applicants, who appears to be the kingpin had applied for an order of anticipatory bail before this Court and at the time of admitting the matter, this Court issued rule on 26.10.2021 and made it returnable on 10.12.2021. The said Shashikumar R.S. assured the Court to appear before the Police on 27.11.2021. Though Public Prosecutor appeared on an advance copy, Investigating Officer did not know about it. The appearance on 27.11.2021 before the Police Station was to cooperate with the investigation. However, on that day, the said accused did not appear before the Police may be for whatever reason. It was never informed to the Court on the subsequent occasion that under what pretext he did not appear before the Investigating authority. While making rule returnable and on the statement made by that accused to appear before the Investigating Officer on a particular date, he came to be protected. However, without there being any order for again remaining present before the Investigating Officer or direction from the Court, he volunteered himself, who was shown to be absconding by the Investigating authority, appeared and his statement exonerating himself came to be recorded on 18.12.2021. The matter was on board before the Court on 10.12.2021 where the learned advocate representing that accused sought for time, which was granted as a last chance and interim relief came to be extended without disclosing to the Court either by that accused himself or by the State and subsequent thereto Page 3 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 his statement came to be recorded on 18.12.2021. Based on such statement exonerating himself and charge-sheet filed against the present accused, which was nothing less than a mockery of investigation, considering the material available with the Court, that accused came to be granted an order of anticipatory bail.
[2.2] Not deterred, even that co-accused had filed a quashing petition in the present FIR on the ground that now dispute is amicably settled between the parties and on the first date of hearing, even advocate on behalf of the first informant appeared. It is another thing that Court did not quash the FIR at the relevant time.
[2.3] The investigation into this offence in a right direction came to be initiated subsequent to the oral directions recorded in the order directing the Investigating Officer to remain present looking at the papers of charge-sheet, which Investigating Officer has avoided number of times on one or the other pretext being busy in the investigation in this offence or other offence but by the time he appeared and when the Supervising Officer could sense the seriousness of the offence with the arrest of other accused, further charge-sheet has come to be filed invoking conspiracy to the present offence. Though it may be lacking in invocation of several other offences to be invested by appropriate authorities under different Acts like Companies Act, Prevention of Money Laundering Act and so on, some material appears to have been collected, possibly having some substance in what is asserted in the FIR about the fraud committed by the accused named in it and other persons. Despite investigation into other direction Page 4 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 is still going on, conclusion into the present offence uptill now reached shows that it is a case of online cyber fraud, which is not limited to dupe the first informant himself but several other victims not only throughout the State of Gujarat but in others parts of country as well. The reference of the material collected during the course of investigation would be made in the later part of this order. Suffice it to say that investigation into this huge scam, which involves thorough investigation into the incorporation of fictitious companies /Shell Companies, submission of forged documents for the purpose, detailed investigation into serious fraud committed by Shell Companies, which may attract even the provisions of Money Laundering Act as investigation revealed that the amount of nearly Rs.44 Crores out of Rs.60 Crores into the seven accounts opened in the name of five fictitious Companies have gone outside the country, some Central agency, who have all infrastructures throughout the country, to investigate the same in a short span of time, which otherwise local investigating authority is restricted within stipulated time.
[3.0] Mr. Ankit Shah, learned advocate for the applicants, submitted that the applicants are arrested on 24.09.2021 and since then they are in custody, and therefore, since now supplementary charge-sheet is filed against other co-accused where no further material except invoking Section 120B of the Indian Penal Code is alleged, the applicants are required to be released on bail.
[3.1] He has further submitted that even the co-accused Shashikumar R.S. with whom the applicants claim to be working as interns as they intended to prosecute their studies Page 5 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 to become Chartered Accountant, were prompted to become Directors for a short span during which in all seven accounts were opened in their capacity as Directors for the five fictitious Companies. Therefore, as such, for their involvement into such huge scam, there is no material except they were made Directors for a particular period and thereafter they resigned and the period during which the FIR has come to be filed they were no more Directors in the said Company, according to them. He has further submitted that co-accused - Chartered Accountant, Shashikumar R.S., has also settled the case qua him with the first informant, and therefore, a quashing petition with the consent of the first informant is already filed, which is pending. Therefore, he has submitted that since there is no material against the applicants and the maximum sentence as provided in the offences alleged against them is seven years, they are required to be released on bail.
[4.0] Mr. Mitesh Amin, Senior Advocate, learned Public Prosecutor, submitted that despite supplementary charge- sheet filed against six of the accused subsequently arrested, crucial investigation is still pending into the direction finding out the beneficiaries over and above the present applicants and other co-accused spread over in different parts of country, and therefore, since prima facie involvement of the present applicants are made out, for few months, they may be kept in custody so that other relevant material, which may be against the present applicants also and which can be utilized against them if can be found out. In that view of the matter, he has requested that the Court may not exercise discretionary jurisdiction to grant bail to the applicants at present.
Page 6 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 [4.1] He has further submitted that the applicants are
closely related and cousins of the main accused - Shashikumar R.S., Chartered Accountant, with whom they claim to be interns and they are part and parcel of the conspiracy hatched by them collectively from the incorporation of the fictitious Companies based on forged documents and digital signatures obtained in the name of different persons, may be as Directors, received and downloaded in e-pass token, which were obtained by co-accused - Chartered Accountant, Shahshikumar R.S., being 50 in number and downloaded by him, who misused and mis-utilized those digital signatures for the purpose of resignation of Directors and making new Directors alongwith incorporation of the fictitious Companies based on forged documents. He has further submitted that so far as the applicants are concerned, investigation reveals so far that they were Directors at the relevant time of five different Shell Companies and in all seven Bank Accounts were opened signing as Directors of those Shell Companies. He has further submitted that within short span in those different Bank Accounts of five Shell Companies, they accumulated Rs.60 Crores of rupees of different victims spread over the country, statements of all of them could not be recorded because of paucity of time to investigate the huge scam, which has robbed off the country of its economy. He has further submitted that the user ID and the password would be provided to the account holders only, which is basically a secret thing. The accused - applicants, who are Directors and the account holders of the Company as Directors have to account for utilization of such user ID and password for not only accumulating but transferring every amount accumulated in those fictitious accounts. It is further submitted that out of Page 7 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 those different accounts money has been transferred to other 90 different accounts, again in a Shell Companies, which is 90 in number. The said transactions, through different Companies, appear to be endless and such transfer is either an electronic transfer, online transfer, which require use of user ID as also password. He has further submitted that for online transfer an OTP would be generated and sent to the registered mobile number of the account holder, and therefore, except the applicants no one would be able to account for the same. According to his submission, if that mobile number does not belong to them, it is for them to explain whose mobile number it is and why it was given for opening of an fictitious account in the name of fictitious Company. It is further submitted that part of money trail either directly or through accounts of co- accused Shashikumar R.S. or his firm has gone to the present applicants, and therefore, their involvement into the conspiracy and the huge scam is established. Referring to page 247 of the affidavit-in-reply, which is list of registered mobile numbers for opening five bank accounts, which can be seen from the record, reveals that at least for three mobile numbers at local addresses of Bangalore when attempted to be investigated, it is found to be registered in fictitious names based on forged KYC, and therefore, it is submitted that while opening bank account the applicants could not have furnished such mobile numbers, without their involvement into the case, as registered mobile numbers on which for every online transactions one time password would be sent.
[4.2] It is further submitted that the amount transferred from the fictitious accounts are either through NEFT or RTGS by way of online transaction and it has been done by Chinese Page 8 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 national and other persons stationed at different countries and IP addresses of all those person outside the country and also in the country are required to be collected and thorough investigation into it is required more efficiently with other different investigating agencies. It is further submitted that this fraud of huge magnitude affecting the economy of the country, for which the applicants are also responsible as active participants in the fraud alongwith the co-accused Shashikumar R.S., who is cousin of present applicants, appears prima facie to be offences under Money Laundering Act as well alongwith the offences under the Companies Act where the provisions of sentence is more stringent than the present Sections mentioned in the charge-sheet. However, before invoking the same, investigation into it is by different agencies, who have been informed about such huge scam and till then when further investigation is still undergoing, it is submitted that hearing of this application may be further deferred awaiting the outcome of it.
[4.3] For obtaining digital signatures even the mobile numbers of the applicants or e-mail generated over the same have been utilized. It is further submitted that for online video verification as revealed from the statement of witnesses, they have been duped to make such verification online offering them job but as claimed by those witnesses. They have neither applied for any digital signature nor they have consented for becoming the Director into any Company. It is further submitted that so far as grant of anticipatory bail to the co- accused is concerned, either at the time when anticipatory bail was granted, no material of present nature was either available or presented before the Court. Not only that, an Page 9 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 opinion dated 05.03.2022 from the office of Public Prosecutor is sent to the State Government for preferring cancellation of anticipatory bail order granted in favour of the co-accused. In such circumstances, according to his submission, even that factor cannot be taken into consideration while determining regular bail application of the present accused against whom ample material is found and collected during the course of investigation. He has further submitted that when prima facie involvement is revealed, which is sufficient to deny them bail, more particularly, when investigation is still continued, instead for few months, it may be deferred. Referring to the complex nature of investigation having large scale ramifications throughout the country the Investigating Officer needs some more time. If at this stage bail is granted, it would be against the interest of the society as well, and therefore, he has submitted that the application preferred by the applicants may kindly be rejected.
[5.0] Having heard learned advocate for the applicants as also learned Public Prosecutor, one thing is certain that this is not an offence of either a criminal breach of trust or cheating as submitted by the learned advocate for the applicants. Here is a case where online cyber fraud of huge magnitude is committed with the active participation of the present applicants alongwith his cousin brother, the co-accused - Shashikumar, Chartered Accountant, duping different persons to invest by generating user I.D. and password through a link prompting them to deposit amount in it offering them either job or attractive commission if purchase is made through that account. As such, this FIR is filed by an individual, who is duped of only Rs.1,53,700/- but investigation reveals that Page 10 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 there are several victims spread over throughout the country from whom Rs.60 Crores have been obtained in such a fictitious account opened and transferred to different other shell Companies incorporated and operated by Shashikumar R.S. with the help of the applicants as also other co-accused, and therefore, prima facie, it does not appear to be merely a case of cheating or criminal breach of trust as submitted by the learned advocate for the applicants.
[5.1] The applicants, who were Directors at the relevant time got opened accounts in the name of Shell Companies where they were Directors and in those accounts through different transactions huge amount is deposited and then siphoned off to other shell Companies only with their active participation into the offence as user ID and password would be offered to the account holders only and none else. As claimed in the application since for opening bank account in the name of the Company, presence of local Directors needed and the promoter Directors could not go from Jarkhand, the applicants were made Directors for opening of bank account and within short span they resigned as Directors.
[5.2] However, from the papers of investigation, it appears that it is again a pretext and their deep involvement into the offence, which is very clear when the person, who is claimed to be promotor Directors, have been duped to make some online video verification for the purpose of job and they never obtained or received any digital signatures, which are being used for resignations of promotor Directors and in place the applicants are made Directors of the said Company for the purpose of opening account with the Bank in their name. The Page 11 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 very incorporation of the Shell Company is also nothing but a fraud as comes out from the statement of the Chartered Accountant - Santosh D.N., who is said to have incorporated the said Company. According to his statement, the digital signatures appended to for incorporating the Shell Companies in his name was digital signature of him, which was never utilized by him but it is utilized by the Chartered Accountant - Shashikumar R.S. - co-accused. As per the claim of the applicants and the investigation reveal that the promotor Directors resigned from the Company - Bruiser Technology Pvt. Ltd and the present applicants were made Directors into the said Company with a view to facilitate opening of a bank account in the name of the Company. The Company came to be incorporated, though fictitious, in the name of two promotor Directors only. Generally, the Central Government shall appoint the required number of Directors on resignation of those Directors, who shall hold office till the Directors are appointed by the Company in a general meeting. There appears no such procedure followed either for incorporating or for resignation or inducting any other Directors in place of two promotor Directors, as claimed. Since a fictitious Company was incorporated, there is no question of any Board of Directors existing so as to facilitate resignation from the office of the Directorship giving notice in writing to the Company. Even if it is there, it is nothing but again an attempt to throw dust in the eyes of the investigation as also the Court. If everything is created under a fictitious name, even the so called resignation can also be created by the very conspirators, who have siphoned off huge amount running into crores of rupees in the accounts of those five Shell fictitious Companies. As stated earlier, all the victims, by now, could not have been Page 12 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 approached by the present Investigating Officer throughout the country. The fact remains that the amount collected in the said fictitious account of Shell Companies have been in turn diverted to the other fictitious Companies and from there also onward transfer to other countries. As mentioned in the affidavit-in-reply filed by the Investigating Officer, report of IP addresses of the electronic transfers made from those accounts obtained from Amazon Service Pvt. Ltd. reveal the user's locations in China, Hong Kong, Taiwan as also US. The bank will furnish /allot user ID and password for the first time to the account holders only. The present applicants are account holders as Directors of a Shell Company - Bruiser Technology Pvt. Ltd., and therefore, they only can account, to whom they have forwarded their user I.D. and password to operate the account or they are the persons who have operated those accounts. The very fact that with the said user I.D. and password several transactions are made is a proof of their thick involvement in the deep rooted conspiracy to siphon off hard earned money of citizens of India. As stated earlier, the mobile numbers furnished to the concerned Banks for opening of the accounts in the name of Shell Companies, though were registered in India (in different States), but subsequently there location was found in China or that particular number was never found in operation. As stated earlier, even three different mobile numbers, which were furnished to the Bank for opening of an account were in the name of fictitious persons, who could not be traced on the fake addresses provided for obtaining such mobile numbers or sim cards based on forged documents. It is surprising that the investigating authority has not thought it fit to invoke the offence of forgery into the offence when so many transactions Page 13 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 have been made based on forged documents in the name of fictitious persons. Be that as it may, the fact remains that the present is such a large scale conspiracy running into much more figure than it was comprehended by the Investigating Officer, which is yet to be thoroughly completed and without the help of central agency, it is not likely to be over within a reasonable time. This huge scam is beyond the imagination of one and all. As submitted by the learned Public Prosecutor at the very said registered addresses of the present five Shell Companies, the investigation reveals that approximately 1900 plus Companies have been registered over the very said addresses, which speaks about the magnitude of the scam under the present offence. The complex nature of investigation required, having vide ramification throughout the country, and therefore, concluding investigation by the Police Agency of a District, that too, within reasonable time is next to impossible.
[5.3] The clandestine activities of the conspirators of the huge scam started from circulating whatsapp messages by way of an app obtaining so called investment in the bank accounts opened by the applicants as Directors of the fictitious Company and in turn transferring it to other Shell Companies, which are even spread abroad reflects the active participation and connivance with each other by all the accused, including the applicants, which cause loss running into crores of rupees to several citizens of India and they do not deserve any sympathy for the present.
[5.4] The tall claim made by the applicants that since they are studying in B.Com and want to pursue course of Page 14 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 Chartered Accountancy, they acted as interns with the Chartered Accountant - Shashikumar R.S. - co-accused falls to the ground when the investigation reveal that they are cousins of that Chartered Accountant - Shashikumkar R.S. and the applicants are still studying and have not completed even their B.Com course. Not only that, from the address of one of the applicants, Shashikumar R.S. and that applicant stays nearby. Raising such claim is nothing but an attempt to divert the investigation as also the Court in an incorrect direction. With full knowledge and connivance of the present applicants, money drained out of the Company, possibly used for some other purposes through other resources cannot be ruled out.
[5.5] The investigation reveals statement of two of the witnesses - Chitransh Raj as also Shubam Kumar, which reveal that through the brother of one of the co-accused, their documents under pretext of offering job in Bangalore as also their video was obtained under the pretext that due to covid pandemic online verification is necessary based on which digital signature is issued in their name, which were never applied by them nor received by them. That statements further reveal that they were shocked to know that they have been shown as promoter Directors in 19 Shell Companies registered on the address of Urban Desk. It is further revealed that they were made Directors in Shell Companies without their consent and knowledge and they came to know about such things when their another friend, who was duped by the co-accused - Shashikumar R.S. and his brother, received notice under Section 207 of the Companies Act, 2013 from ROC Delhi. Even those witnesses have also filed complaint to ROC, Bangalore. There are other witnesses similarly situated Arvind, Page 15 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 Ravi Vijay, Guru Kiran.
[5.6] Considering the overall nature of evidence collected during the course of investigation so far, as all norms for applying digital signature certificates and incorporating Companies have been flouted only for the purpose of committing fraud, no agency bothered even after it has been brought to its notice by the investigating Officer intimating them about the flouting other laws also.
[5.7] The reliance placed on an order of anticipatory bail granted in favour of the co-accused - Chartered Accountant, Shashikumar R.S. by the applicants in support of their plea for regular bail is misplaced for more than one reasons. Firstly, the Investigating authority did not collect all these material, which is on record right now. Banking upon only the first chargesheet where only four witnesses cited, as aforesaid, leaving no potential material, which is now at least collected and in face of it, the order of anticipatory bail granted in favour of that accused will deter this Court from considering the same, more particularly, when it has been asserted that regarding the order of anticipatory bail granted in favour of the Chartered Accountant, Shashikumar R.S. co-accused an opinion dated 05.03.2022 has been sent requesting for cancellation of it to the State Government, which is pending consideration. As submitted by learned Public Prosecutor, no decision is yet taken thereof till 11.05.2022, I may not comment upon that. Suffice it to say that there is ample evidence not only against the present applicants but against co-accused also as revealed from the papers of investigation, and therefore, even on the ground of parity based on an order Page 16 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022 R/CR.MA/18711/2021 ORDER DATED: 12/04/2022 of anticipatory bail, as aforesaid, cannot be entertained for granting regular bail to the present applicants. Not only that, the present applicants are having criminal antecedents of similar nature as reflected from the affidavit filed by the Investigating Officer before the Session Court objecting to grant of regular bail to the present applicants.
[5.8] In view of the fact that the applicants with the help of other co-accused duped citizens and lured them to part with their hard earned money either in lieu of getting job or earning attractive commission if purchase is made through those accounts, they were asked to open their accounts, their activities appears to be on a large scale beyond comprehension and these are only few FIRs, which appears to have been filed by now only in two States. I see no reason to entertain their bail application as while framing of the charge the Court may frame appropriate charge based on papers of investigation available with it despite they have not been charge-sheeted for those offences by the Investigating authority. Hence, the present application is rejected. Rule is discharged.
(UMESH A. TRIVEDI, J.) siji Page 17 of 17 Downloaded on : Sat Apr 16 20:45:55 IST 2022