[ 3168 I

IN THE HIGH COURT FOR THE STATE OF TELANGANA

AT HYDERABAD
FRIDAY, THE EIGHTEENTH DAY OF SEPTEMBER
TWO THOUSAND AND TWENTY
: PRESENT:
THE HON'BLE SRI .IUSTICE K.LAKSHMAN

CRIMINAL PETITION NOS: 3980, 3976,3977 AND 3990 OF 2020

CRLP. No. 3980 of 2020

Between:
Sri Kancl.rarla Sriharibabu @ K. Babji, S/o. Radha Krishna Rao

Petitioner/Accused No. I
AND
The State ofTelangana, through ACB-CIU, Hyderabad rep. by its Special Public Prosecutor,
High Court of Telangana, Hyderabad
Respondent/Complainant

Petition under Sections 437 & 439 of Cr.P.C, praying that in the circumstances stated in

support of the Criminal Petition, the High Court may be pleased to direct release of the

Petitioner/A I on Bail pending enquiry and trial in connection with Crime No.04/RCO-CIU-
ACB/2020. Dt. 03.09.2020 of Central Investigation Unit, Anti-Com-rption Bureau, Telangana,
Hyderabad;

'l'he petition coming on for hearing, upon perusing the Petition filed in support thereof

and upon hearing the arguments of Sri T. Niranjan Reddy learned Senior Counsel Representing
Sri 'l'Nagarjuna Reddy Advocate for the Petitioner and Sri V. Ravi Kiran Rao, Special Counsel
lbr r\CB Cases lbr the respondent

CRLP. No. 3976 of 2020

Between:
Smt. Sujatha Kancharla, Wio. Sriharibabu Kancharla @ Babji
Petitioner/Accused No. 2
ANT)
l'he State ofTelangana, through ACB-CIU, Hyderabad rep. by its Special Public Prosecutor,
High Court of Telangana, Hyderabad.
Respondent/Complai nant

Petition under Sections 437 & 439 of Cr.P.C, praying that in the circumstances stated in

support of the Criminal Petition, the High Court may be pleased to direct release of the
Petitioner/A2 on Bail pending enquiry and trial arising out of Crime No.04/RCO-CIU-
ACB/2020, Dt, 03.09.2020 of Central Investigation Unit, .driti-Corruption Bureau, Telangana,
Hyderabad;

The petition coming on for hearing, upon perusing the Petition filed in suppo( thereof

and upon hearing the arguments of Sri T. Niranjan Reddy learned Senior Counsel Representing
Sri f Nagariuna Reddy Advocate for the Petitioner and Sri v. Ravi Kiran Rao, Special counsel
Ibr ACB Cases for the respondent
CllI-P. No. 3977 ot2021)
Iletw ecn:
Sri l(ukala Kmpasagar l{edr:r'. Sr'o. Sri flanumantha Reddy
Pet itioner/Accused No. 3

AND
l'he State ofTelangana, through ACB-CIU. Flyderabad represented by its Special l'ublic
Prosecutor. High Court of T:langana. Ilyderabad.
Respondent/Complainant

Petition under Sections 437 & 439 of Cr.P.C, praying that in the circumstances stated in

support of the Criminal Petition, the High Court may be pleased to enlarge and release the
Petitioner/A3 by granting bail in F.l.R. No.O4/RCO-CIU-ACB12020 OF ACB-CIU-
H YDERABAD, dt. 03 I 09 l2r)20 ;

The petition coming on for hearing, upon perusing the Petition filed in support thereol
and upon hearing the argunrents of Sri S. Niranjan Reddy leamed Senior Counsel Representing
Ms. Gorantla Sri Ranga Pujitha Advocate for the Petitioner and Sri V. Ravi Kiran Rao. Special
Counsel for ACB Cases for the respondent

CRLP. No. 3990 of 2020

Between:
Sri Bandi Venkateshwarlu (! Venkateshwar Reddy, S/o. Gali Reddy

['ct itioncr/Acc used No. 6

AND
The State olTelangana. thrc,ugh ACB-CIU, Hyderabad represented by its Special I']ublic
Prosecutor, High Court of Telangana, I{yderabad
RcspondenL/Complainant

Petition under Sections 437 & 439 of Cr.P.C, praying that in the circulnstances stated in

suppon ol the Criminal Petition, the High Court may be pleased to enlarg.' and release the
Petitioner/A6 by grantinlg bail in F.l.R. No.04/RCO-CIU-ACB12020 OF ACB-CIU-
HYDERABAD, dr. 03.09.2()20;

The petition coming on for hearing, upon perusing the Petition filed in support thereof
and upon hearing the argunrents of Sri D. Lakshmikant Reddy Advocate for the Petitioner and
Sri V. Ravi Kiran Rao. Special Counsel for ACB Cases for the respondent
The Court made the followi;rg
COMMON ORDER:
 2 KL,J
Crl.P. No.3980 0f2020 & batch

THE HON'BLE JUSTICE K.LAKSHMAN

CRIMINAL PETITION Nos.3980 3976 3977 AND 3990 0F 2020

COMMON ORDER:

These applications are filed by respective petitioners for grant

of regular bails. The petitioners are Accused Nos.l, 2,3 and 6

respectively in Crirne No. O4iRCO-CIU - ACB I 2020, dated 03.09. 2020,

pending on the file of the Central Investigation Unit, Anti-Corruption

Bureau, Telangana, Hyderabad. The oflences alleged against them

are under Sections - 7, 13 (1) (c) (d) of the Prevention of Corruption

Act,1988 (for short'P.C. Act'),7 (a) (c) of the P.C. Act (as amended

in 2018) read with Section - 13 (2) of the P.C. Act, 12 of the P.C. Act,

and Sections - 420 read with 120-B and34, and also 109 ofthe Indian

Penal Code, 1860 (for short 'lPC') .

2. Heard Mr. T. Niranjan Reddy, Iearned Senior Counsel

lepresenting Mr. T. Nagarjuna Reddy, learned counsel appearing on

behalf of the petitioners - Accused Nos.l and 2 in Crl. P. Nos.3980

and3976 of 2020 respectively; Mr. S. Niranjan Reddy, learned Senior'

Counsel representing Ms. Gorantla Sri Ranga Pujitha, learned counsel

appearing on behalf of the petitioner - Accused No.3 in Crl.P.

No.3977 of 2020; and Mr. Lakshmikanth Reddy Desai, learned

counsel appearing on behalf of the petitioner - Accused No.6 in Crl.P.

No.3990 of 2020.

3. Perused the entire material placed on record.

 -)
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Crl.P. Ito 3980 o/2020 & batch

1 As stated supra, the petitioners in the above said Criminal

Petitions are Aocused Nos. 1,2,3 and 6 in Crime No.04/RCO-CILI-

ACBI2020, dated 03.09.2020, and the contentions raised b1 them and

the contentions of the ACB are mostly common and, therefore, all

these bail appli:ations are being disposed of by way of a common

order.

C,.\SE OI-THE PROSECUTION:

5. It is t re case of the prosecution that the Director Genelal,

Vigilar.rce and Enforcement, sent an aleft note on 06.04.2018 about the

irregularities an,J corrupt practices in the office of the Directorate of

Insurance Medical Services, Hyderabad. Vide ptoceedings dated

28.06.2019, the Principal Secretary, Labour, Employment, Training

and Factories Department, ordered the Director Genelal, .A.CB,

Hl,derabad, to tal<e up inquiry and report. Thereafter, the Director

General, ACB, Hyderabad vide Memo dated 12.07.2019 ordered to

conduct regular nquiry into the said allegations.

6. It is he further case of the prosecution that the regular

inquiry revealed that Mr. K. Srihari Babu alias Babji, proprietor of

Ir4/s. Omni Medi, had played a key role in all the transactions u,ith

ulterior motive and mala fide intention, colluded with the officials, his

associates and others in obtaining purchase orders of Hemocue FIB

Cuvettes manulactured by IWs. Hemociie AB Sweden (Unit of DHR

Holdings Private l-imited) from the Director, IMS (DMS), Hyderabad,

through his be turmi firm i.e., Legend Enterprises, during the year
 ,+ KL,J
Crl.P. No.3980 of2020 & batch

2017-18. He has involved in Circular Trading with the firms floated

by him, his wife - Mrs. K. Sujatha (A-2) and Mr.K. Krupasagar Reddy

(A-3), co-conspirators. It is further alleged that Accused No. I 1n

furtherance of his common intention and conspiracy had exercised his

personal influence, taken control of the Officials of Directorate of

Insurance Medical Services (DIMS) either by bribing them or by

threatening them.

7. lt is further alleged by the prosecution that there are rnany

purchases in respect of various items including supply of HB Cuvettes

at exorbitant rates over a period of time and caused wrongful loss to

the Public Exchequer running into Crores and Crores of rupees. It is

also alleged by the prosecution that Accused No.1 has floated a shell

company and indulged in a circular trading and caused wrongful gain

to himself and others in collusion with the Officials of Indian Medical

Service (IMS), Hyderabad. Supplies are being shown by M/s. Omni

Health Care to N4/s. Omni Medi, N4/s. Omni Medi to M/s. Omni

Enterprises and M/s. Omni Enterprises to \4/s. Legend Enterprises

without any order number from the buyers and without any other

reference.

8. It is further alleged by the prosecution that the inquiry

further revealed that Mrs. K. Sujatha - Accused No.2, wife of Accused

No.1, proprietor of I\4/s. Omni Health Care has intentionally shown

sales of M/s. Hemocue AB Sweden to M/s. Omni Medi without actual

delivery of material. Further, both the said firms i.e., M/s. Omni
 -l
KL.]
Crl.P. No.3980 of2020 & barch

Medi. M/s. Omni Health Care are located in the salne premises. Thus,

Accused No.2 has deliberately raised fictitious sales invoices through

M/s. Omni Health Care to I\4/s. Omni Medi and claimed input tax

credit in its GSI' rvithout actual delivery of material.

9. It is lurther alleged that during the regular inquiry, it was

noticed that Mr. K. Krupasagar Reddy (A-3), used to hand over blank

signed cheques to Accused No.1, who used to withdraw the amount

which was received by \4/s. Legend Enterprises in S.B. Account fi'om

P.A.O., T.S., and used to transfer some amount into Accused No.1's

bank account.

10. It is further alleged by the prosecution that as per the

records, M/s. [Jr:mocue AB Sweden, has appointed ]r4ls. Omni Healtlr

Care as its Distributors. An agreement was executed to the said

effect. The sai,l agreement was signed by Mr. B. Venkateshwarlu

(Accused No.6) in the capacity of Manager of IWs. Omni Health Care.

On verification, it was observed that Accused No.6 is no wa./

connected with the said IWs. Omni Health Care and he is not an

ernployee of the said proprietary concem. He is an employee of Mis.

Omni Medi, to which Accused No.1 is the proprietor. Thus. Accused

No.6 has cheated NtUs. Hemocue AB Sweden by falsely claiming that

he is the Manage,r of lvl/s. Omni Health Care though he is not even an

employee ol it
 6 KL.J
Crl.P. No.3980 of2020 & barch

I 1. It is further alleged that IVI/s. Legend Enterprises was

incorporated only for the purpose of supply of Lab Kits, Reagents etc.,

to DIMS. On verification of the product Hemocue IIB Cuvettes

(supplied to DIMS) of Hemocue AB, Sweden Company, has revealed

that the DIMS has purchased the said Hemocue HB Cuvettes at

Rs.16,500/- per box/unit. Whereas, tn the open market, the

Distributor selling it at Rs.4,800/- per box/unit. Thus, M/s. Legend

Enterprises quoted exorbitant rates and got profit ol Rs. ll,700/- on

each box/unit.

12. It is further alleged that there is violation of guidelines

issued under G.O. Ms. No.51 for purchase of medical equipment. The

Accused in collusion with each other quoted exorbitant price and

made wrongful gain. Indent bearing Nos.1310/A/CDS-II/2017 dated

31.07.2017 and lTl9lNCDS-1U2017 dated 16.\0.2017 would

disclose the said fact. The Inquiry also further reveals that there is

escalation of prices. On issue of purchase orders in t'avour of M/s.

Legend Enterprises, Mr. Nagaraju (Accused No.7), employee of M/s.

Omni Medi, received the same from DIMS on behalf of shell firm

M/s. Legend Enterprises. The kits i.e., HB Cuvettes of M/s. Hemocue

Sweden were shown as supplied frorn M/s. Omni Health Care to M/s.

Ornni Enterprises through M/s. Omni Medi without actual supply ol

kits. The supplies were shown only on paper and lastly the supplies
were made to DIMS through shell firn.r M/s. Legend E,nterprises

Thus, Accused No.1 has resorted to circular trading through the

 KL,J
Crl.P *'o.3980 t'f 2020 & batch

aforesaid firms and gained wrongfully. It is also alleged that on

verification of Stock registers, 567 UnitslBoxes of FIB Cuvettes are

found mission. l'hus, the Accused in connivance with each other and

also officials of 1N4S Department conspired with ulterior motive, malct

fide intention c:ommitted irregularities, corrupt practices, illegal

activities, falsified the records, obtained wrongful gain to themselves

and for others thereby caused loss to the Government Exchequer.

Thus, the Accused have comrnitted the above said offences.

CONTENTTONS OF THE PETITI ONERS- ACCUSED Nos.l. 2.3 & 6

13. Mr. T. Niranjan Reddy, leamed Senior Coutrsel,

representing Mr. T. Nagarjun Reddy, leamed counsel for Accused

Nos.1 and 2, v,'ould submit that the police, CCS Unit, ACB,

Telangana, Hyderabad, has registered a case in Crime No.8/RCO-

CIU-ACB/2019. dated 25.09.20\9 against the Director, IMS and

others for the offe:nces under Sections -13 (1) (c) (d), 7 (a), 13 (1) (a)

read with Sec.13 2) of P.C. Act and Sections - 477A,465,468,471,

420 read, with lll0B and Section 34 of IPC. In the said crime.
Accused No.l in the present crime is shown as Accused No.7. He

would further submit that the ACB Officials have also registered

another case in Crime No.l0/RCO-CIU-ACB/2019. dated 25.10.2019

for the offences urder Sections -13 (1) (c) (d), 7 (a), 13 (l) (a) read

with Sec.13 (2) of P.C. Act and Sections - 477A,465,471,420 read

with 120B and Set:tion 34 of IPC. In the said case. Accused No. l in

the present cornplirint is shown as Accused No.8. Another case in

 8 KI,,J
Crl.P. No.3980 of2020 & batch

Crime No. i 3/RCO-CIU-ACB 12019, dated 30.1.2.20 1 9 registered for

the offences under Sections -13 (l) (c) (d), 7 (a), 13 (1) (a) read with

Sec.13 (2) of P.C. Act and Sections - 420 read with 1208 and Section

34 of IPC. In the said crime, Accused No.l in the present crime is

shown as Accused No.1, Accused No.3 in the present crime is shown

as Accused No.4, Accused No.2 in the present crime is shown as

Accused No.7, Accused No.6 in the present crime is Accused No.8.

By referring to the same, the learned Senior Counsel would subrnit

that the ACB Officials have implicated the petitioners/Accused Nos. l,

2,3 and 6 in the present crime on the very same allegations. The

petitioners have obtained regular bails and also protection from this

Couft on certain conditions. They were injail for considerable period.

They have been complying with the conditions imposed by this Court.

Even then, the ACB Officials have implicated the petitioners in the

present crime. The reason mentioned in the remand case diary for

arest of the petitioners in order to prevent them from causing the

evidence of the offence to disappear or tamper with such evidence in

any manner etc. The reasons mentioned for arrest of the petitioners

are unjustified. He would further submit that the ACB Officials did

not follow the procedure laid down under Code of Civil Procedure,

more pafticularly, Section 41A, and also the guidelines issued by the

Hon'ble Supreme Court in Arnesh Kumar v. State of Biharr.

Accused No.2 is a woman. She is in jail from 04.09.2020 and she is

'. (2014) 8 scc 273

 9 KI,.I
CrLP..vo j98A of2020 & batch

entitled for benefit under Sections 437 and 439 of Cr.P.C. There are

no grounds for arrest of the petitioners herein. The contents of the

complaint are Lrcking the ingredients of the offences alleged against

the petitioners herein. The allegations are one and the same

14. Mr. li. Nirajan Reddy, leamed Senior Counsel representing

Ms. Gorantla Sri Ranga Pujitha, leamcd counsel for the petitioner -

Accused No.3. would submit that the ACB Officials had implicated

the petitioner - Accused No.3 in a false case. The contents of the

complaint are lacking the ingredients of the offences alleged against

Accused No.3. The allegations levelled against l.rim in Crime

No.l3/RCO-CIL-ACB/2019, and the present crime are one and the

same. Though the investigation is pending in the said crime, the ACB

Officials have registered a fresh crime for the very same allegations.

Therefore, the cc,mplaint itself is not maintainable. He would further

submit the petitioner - Accused No.3 has filed Crl.P. No.1 18 of 2020

seeking anticipamry bail, and this Court granted the same on certain

conditions. I'he.\CB Officials have anested the petitioner - Accused

No.3 when he we,nt to the ACB Office to report in compliance of the

order granted by this Courl in the above said Crirninal Petition. He

has adopted the other arguments advanced by Mr. T. Niranjan Reddy,

leamed Senior C,runsel. He would further submit that the date and

place of occurren,le of the earlier cl'ime and the present crime rvould

disclose the mala Jide intention of the ACB Officials in implicating

the petitioner in the present crime. There is no complaint against the

 10 KI,.J
Ctl.P. No.3960 of2020 & batch

petitioner - Accused No.3 herein that he has violated the conditions

imposed by this Court while granting anticipatory bail and there is no

allegation of non-cooperation of the petitioners with the Investigating

Officer. The petitioner - Accused No.3 is in jail from 04.09.2020 and

according to him, the ACB Officials have arrested the Accused No.3

on 03.09.2020 when the petitioner went to the ACB Office to report

before the Investigating Officer incompliance of the order passed by

this Court. With the said contentions, the learned Senior Counsel

sought to consider the bail application of the petitioner and the

petitioner will abide by the conditions to be irnposed by this Courr.

15. Mr. Lakshrnikanth Reddy Desai, learned counsel for the

petitioner - Accused No.6 would adopt the arguments advanced by the

leamed Senior Counsel and would supplement that Accused No.6 is

LW.5 in Crime No.8/RCO-CIU-ACBl20l9 and he is Accused No.S in

Crime No.13/RCO-CIU-ACB/2019. There are no specific oveft acts

against Accused No.6. He would further submit that Accused No.6

has filed Crl.P. No.293 of 2020 under Section 482 of Cr.P.C. to quash

the above said Crime No.13/RCO-CIU-ACB/2019 and this Court

granted interim protection with a direction to appear before the ACB

Officials, surrender passport and cooperate with the Investigating

Officer etc. and the same is extended from time to time. When the

petitioner - Accused No.6 went to the oflrce of the ACB to report

before the Investigating Officer, they have arested the petitioner

illegal. He is in jail from 04.09.2020. The petitioner - Accused No.6

 t1 KL,J
OI.P No.3980 of 202A,N barch

1
will abide by any condition to be imposed by this Coun while
granting bail.

I 6. 'Ihe l:amed Senior Counsel have also placed reliance on

the principle Iai,J down in Gudikanti Narasimhulu v. P.P. High

Court of A.P.2. ,loginder Kumar v. State of U.P.3, Sanjay Chandra

v. CBIa, Hema Mishra v. State of U.P.s, T,T. Antony v. State ol'

Kerala6 ancl Amitbhai Anilchandra Shah v. CBIT on the principle o1'

relevant considelations in granting bail and registration ol second

cf lme.

CON'TEN'I IONS OF THE ACB

17. Mr. V. Ravi Kiran Rao, leamed Special Counsel for ACB

would contend that the allegations levelled against the petitioners are

serious in nature. On the regular inquiry conducted by the ACB

Officials revealed the Circular Trading committed by the petitioners

and the role plaled by them in commission of offence in collusion

with the Ofllcials of IMS. They have floated shell firms, created t'ake

documents, quoled exorbitant price and gained wrongfully by

resorting Circula' Trading and thus, they have caused loss to the

Government Exchequer. It is an economic offence. The allegations

levelled against the petitioners are serious in nature. In vierv of the

offence under Secrtion 13 of the P.C. Act, punishment for the same is

. ( i978) l SCC240
. (1994) 4 SCC 260
. (2012) l scc 40
. (2014) 4 SCC 4s3
. (200r)6 scc l8r
. (20r3) 6 SCC 348
 l2 KL,J
Crl.P. No.3980 of2020 & batch

ten ( 10) years and, therefore, there is no need for ACB Officials to

follow Section 4lA of Cr.P.C. and in fact, the same is not applicable

The petitioners in collusion with other Accused have violated the

guidelines mentioned in G.O.Ms.No.51 for purchase of medical

equipment. The cause of action for registering the present crime is

different from the other crimes. The ACB Officials have every right

to register a case depending upon the commission of offence and

period etc. The petitioners herein without approaching the Court

below filed the present applications before this Court straightway and,

therefore, the present bail applications are not maintainable. The

petitioners are not co-operating with the Investigating Officers and in

view of the protection/orders passed by this Court, the ACB Officials

are unable to proceed with the investigation. Under the guise of the

said orders, the petitioners are not co-operating with the Investigating

Offrcers. There is every possibility of interfering with the

investigation by the petitioners in the event of their enlargerrent on

bail. With the said contentions, the leamed Special Counsel sought to

dismiss the present applications.

18. As stated above, the petitioners - Accused Nos.l, 2, 3 and 6

have filed the present Criminal Petitions under Sections 437 and 439

of Cr.P.C. seeking regular bail. Therefore, it is trite to refer to

Sections 437 and 439 of Cr.P.C. Under Section 439 of Cr.P.C., this

Court is having power to grant bail to any person Accused of an

olfence and in custody be released on bail and if the offence is of the

nature specified in sub-section 3 of Section 437 by irnposing any

 13 KL.J
Crl.P. No398A of2020 & balch

condition which this Court considers necessary for the purpose

mentioned in tle said sub-section. Section 437 of Cr.P.C. deals with

granting of bail in case of non-bailable offence and as per proviso to

Section 437 (2) of Cr.P.C., the Court may direct a person referred to

Clause - (i) or Olause - (ii) be released on bail if such person is under

the age 16 years or is a woman or is sick or infirm.

19. ln Mahipal v. Rajesh Kumar @ Polias, a Two-Judge

Bench of the Hon'ble Apex Court, Dr. D.Y. Chandrachud J., speaking

lor the Courl, rliscussed with regard to the power of granting bail

under Section 439 of Cr.P.C. and held that the power to grant bail

under Section 439 of Cr'.P.C. is of a wide amplitude. Though the

grant ofbail invrlves the exercise of discretionary power of the Coun,

it has to be exercised in a judicious manner and not as a matter of

course. In the said case, the guiding factors for exercise ol power to

grant bail as held in Ram Govintl []padhyay v. Sudurshan Singhe,

were referred, which are as follows:

"3. Grant of bail though being a discretionarl, order - but.

hor'vever. calls lor exercise ol such a discretion in a judicious

manner and not as a matter ol course. Order for bail bereft ol anl
cogent reason cannot be sustained. Needless to record, hou,ever.
that the grant ofbail is dependent upon the contextual lacts of the
matter being dealt rvith by the court and facts. however, do
always vary from case to case...The nature of the offence is one of
the basic conriiderations for the grant ofbail - more heinous is the
crime, the gr,:ater is the chance of rejection of the bail, though,
however, dep,:ndent on the factual matrix of the matter.

u.
lzozoy z scc r ts
 l4 KL,J
C .P. No.3980 of2020 & batch

4. Apart from the above, certain other which may be attributed

to be relevant considerations may also be noticed at this juncture,
though however, the same are only illustrative and not exhaustive,

neither there can be any. The considerations being:

(a) While granting bail the court has to keep in mind not only the
nature of the accusations, but the severity of the punishment, if
the accusation entails a conviction and the nature of evidence in
support of the accusations.
(b) Reasonable apprehensions of the witnesses being tampered
with or the apprehension of there being a threat for the
complainant should also weigh with the court in the matter of
grant of bail.

(c) While it is not expected to have the entire evidence

establishing the guilt of the Accused beyond reasonable doubt but
there ought always to be a prima facie satisfaction of the court in
support ol the charge.

(d) Frivolity in prosecution should always be considered and it is

only the element of genuineness that shall have to be (2002) 3
SCC 598 considered in the matter of grant of bail, and in the
event of there being some doubt as to the genuineness ol the
prosecution, in the normal course of events, the Accused is
entitled to an order of bail."

20. It was further held in the very same judgment that the

determination of whether a case is fit for the grant of bail involves the

balancing of numerous factors, arrong which the nature of the

offence, the severity of the punishment and a prima facie view of the

involvement of the Accused are important. No straight jacket formula

exists for courts to assess an application for the grant or rejection of

bail. At the stage of assessing whether a case is fit for the grant of

bail, the court is not required to enter into a detailed analysis of the

evidence on record to establish beyond reasonable doubt the

commission gf the crime by the Accused. That is a matter for trial.

However, the Court is required to examine whether there is a prirra

o. (zoozlsscc sqe
 15 KL,J
Crl.P. io.3980 of2020 & batch

facie or reasonable ground to believe that the Accused had comrnitted

the offence anct on a balance of the considerations involved, the

continued custody of the Accused sub-serves the purpose of the

criminal .justice r;1'stem. Where bail has been granted by a lower cor.rrt,

an appellate cout must be slow to interfere and ought to be guided by

the principles set out for the exercise of the power to set aside bail.

21. Tlie Flon'ble Apex Court referred to the factors to be borne

in mind rvhile considering an application for bail in Prasanta Kumar

Sarkar v Ashis ()hatterjeelq,, and the said factors are as follows:

"(i) u,hether t.rere is any prima facie or reasonable ground to believe

that the Accus:d had committed the offence;
(ii) nature and gravity of the accusation;
(iii) severity o;'the punishment in the event of conviction;
(iv) danger of .he Accused absconding or fleeing, ifreleased on bail;
(v) character, hehaviour, means, position and standing of the Accused;
(vi) likelihood ol the offence being repeated;
(r,ii) reasonabl,: apprehension ofthe witnesses being influenced; and
(viii) danger, ofcourse, ofjustice being thwarted by grant ofbail.

12. It is manifest that if the High Court does not adve( to these relevant
considerations and mechanically grants bail, the said order would
suffer fiom the vice ol non-application of mind, rendering it to be

illegal. . ."

22. The H,:n'ble Apex Court has also referred to the principles

laid down by it in Kalyan Chandra Sarkar v. Rajesh Ranjanll,

wherein it was h:ld that the Court granting bail should exercise its
discretion in a j udicious manner and not as a matter of course.

Though at the stage of granting bail, a detailed examination of

'0. lzoro; Il scc a96

 l6 KL,J
Crl.P. No.3980 of2020 & botch

evidence and elaborate documentation of the merit of the case need

not be undeftaken, there is a need to indicate in such orders reasons

for prima facie concluding why bail was being granted particularly

where the Accused is charged of having committed a serious offence.

Any order devoid of such reasons would suffer from non-application

of mind.

23. By referring to the above said judgments, the Hon'ble

Apex Court held that it is a fundamental premise of open justice, to

which our judicial system is committed, that factors which have

weighed in the mind of the judge in the rejection or the grant of bail

are recorded in the order passed. Open justice is premised on the

notion that justice should not only be done, but should manifestly and

undoubtedly be seen to be done. The duty of the Judges to give

reasoned decisions lies at the heart of this commitment. Questions of

the grant of bail concem both liberty of individuals undergoir.rg

crirninal prosecution as well as the interest of criminal justice systeur

in ensuring that those who commit crimes are not afforded the

opportunity to obstruct justice. Judges are duty bound to explain the

basis on which they have arrived at a conclusion.

24. ln view of the above said settled legal principle on grant or

reject the bail in exercise of its powers under Section 439 of Cr.P.C.,

coming to the case on hand, it is the frrst contention of the ACB that

the present petitions filed seeking regular bail straightway in High

". lzooa; I scc szs

 17 KL,J
Crl.P. No.3980 o12020 & batch

Court without approaching the Court below is not maintainable.

Though the learned Special Counsel for ACB raised a ground with

regard to maintainability of present petitions, he has not stressed the

same seriously. The jurisdiction ttnder Section 439 of Cr.P.C. is

concurrent jurisciction. The Accused may either approach the Coun

below or may approach High CouIt seeking regular bail under Section

439 of Cr.P.C., the said principle is also held by the High Court ol

Judicature at Hyderabad for the State of Telangana and the State o1'

Andhra Pradesh in Kaladindi Sanyasi Raju v. State of Andhra

Pradeshl2. r,,'her,:in the High Court relied on the principle laid down

in Sundeep Kumar Bafna v. State of Maharashtrar3. In view of the

said principle and also the fact that there is concurrent jurisdiction, the

contention ol the ACB that the present applications filed by the

Accused seel<ing. regular bail straightway in High Court rvithout

approaching the Court below cannot be accepted. Thus, the bail

applications filed by the petitioners are maintainable.

REGISTRATION OF EARLIER CRIMES AGAINST THE

PETITIONERS - ACCUSED Nos.1,2,3 AND 6:

25. The ACB Officials have registered varies crimes, the

details of which are as under:

sl Crime Number & Name ofAccused &
Offences allegcd
No I Date of re Accused Number
Secs.l3 (l) (c) (d).7 (a), l3 (l) (a) r/$
0t 8/RCO.CIU.ACB/I9 & Mr.K. Srihari Babu (A-l), whereas in sec.13 (2) ol P.C Act and Sec.47?A, 465
2s.09.20t9 Cr.No.4/2020 as Accused No.1 468,471,420 r/!v Secs 120-B and 31 IPC.
to/Rco-ctt.r-ACB/19,t Secs.l3 (l) (c) (d), 7 (a), l3 (l) (a) r/$
02
25. r0.2019
Mr. K Sriha-ri Babu, Accused No.8, sec.13 (2) of P.C Act aDd Sec.477A,465
uhereas in Cr.No.4/2020 as Accused 4?1,420 r/w Secs 120-B and 34 IPC
Nol
0l I3/RCO.CIU.ACB/ I9 II Mr K.Srihari Babu (Accused No.I) Secs ll (l) (c) (d), 7 (a), 13 (l) (a) r/\\
:t0 l2 20lg Mr K Krupasagar Reddy (A-4) sec.l3 (2) of P.C Act and Sec .120 r1$
Mrs K Sujarha(Accused No.7) Secs- 120-B and 34 IPC
Mrs. B Venkalcshwarlu A-3

''. 20 ts 1ty et-D (crt.) !,3.1

'r. 2ora 12; eLo 1crl.) t6 (sc)
 l8 KL,J
Crl.P. No.3980 of2020 & barch

26. The comparative statement of allegations in present Crime

No.4 of 2020 and Crime Nos.8/2019, 1012019 and 13i2019 is

mentioned below:

Sl No Cr.No.4/20 Cr.No.8/19 Cr r,vo l0/19 Cr No.lll19

OI Violation of The allegations &e A-1, Mr. K. Srihari Babu,
A-l Mr. K. Srihari Babu conditions laid only against obtained illegal mcans lhrough
obtained purchase orders of dorvn in Accused No.l his employees/associalcs and
I lemocue I lB Cuvetles G.O.Ms.No.5l for hercin and Accused oblained purchasc ordcrs lbr
manufaclured b) M/s purchase of No 8 in the said Mls Lagend Enterplses ar
Hetrocue Sweden through his medicines crime
betnm fot M/s Lcgend
Enrerprises during the year A-7 is A-l in Supply of HIV Tfl M/s. l,egend Enlcrprises. shell
2017- 18. lnvolved in lhe presenl crime, Dot Krls without compant-. fake busrness
Circular Trading rhrough the proprietor oIOmni aulhorizatron c!c concern, cxisted onl) on
firms floated by him, his wife, Medi in collusion records for oblaining purchase
Mr. KrupBsagar Reddy (A-l) wilh officials of orders fron Direclor, IMS.
and Mr. Venkateshwarlu (,4-6). IMS, got prepared
ante-datcd Not gilen Aulhorization by
purchase order, M/s Hemocuc to l\rs. Le8end
insened wirh mala Enterprises to supply producG
lde inlention for manufactured by it lo DIMS.
pecuniary advaflce For the year 2017-18. Mrs
for himself and Devika Rani, Director, IMS has
others. issued purchase order to M/s
Legend Enterprises for supply
of lab kits nanufactured by
Hemocue.

She has sanctioned invoices in

crores of rupegs
Did nol autho.ize M/s. Legend
Enterprises to supply.
M/s. Omni Medi, lt47s Omni
Helath Car€ and M/s Omni
Enterprises are s(an€d by A'l
and his wife A-2.

Address of all the concems rs I

one and the same. I

Exorbitanl rates charged on

Hemocue WBC alld Clucose
Cuvcttes by M/s. Legend
Enterprises.

Wrongful loss of
Rs 12,84,96,600 ]
Violatron of G.O.Ms.No.5l. I
I

Role ofA-3
Close associate artd benani ot

Transfcraed an amount of
Rs.54,87,75,919r.

Director in Trined Solutions

lndia Pvt. Ltd. along with A-l

Proprietor of M/s. Legend

Enterprises, shell company,
submitted fake authorization
letter, to make Direclor, IMS lo
believe that it is an authorized
distributor of lab
kits/reagents/special rapid
cards, stripes etc.
02 M/s. Legend Enlerprises, a
shell company, incorporaled
only for the purpose of supply
oflab kirs to Director, IMS.

lws. Legend Enterprises I

misrepresentedto Di.ector,
IMS that it is authorized
Dislributor of Hemocue I

Products which was denied by

M/s Hemocue
 19 KL,J
Crl.P. lto 3980 of 202A & batch

M/s Hemocue di,i not give

any authorization ro N?rs.
Legend Enterprises.

During the yea, 2017-18, Ms.

Dcvika Rani. Director, IMS,
issued purchase o(ler to liYs.
Legend Enterprises for supply
of kils manufadured by
Hemocue. she has sanctioned
rnvoices of M/s. Legend
Enterprises in Crores of rupees
throuSh cheques in its accounl
in SBI

Hemocue did not authorize

M/s. Legend Ent(:.prises io
supply rts p.oducts rnd did nol
supply its products to
M/s.Legend Enterprises.A-l
used to collect purcrase ordcrs
lhrough his emplcyees from
bills and deliver dre material
manufac(ured bv Nrs.
Hemocuc showing nraterial is
being supplied elc.
Charging of exorbit.nt rates:
Wrcngful loss of
Rs.6.48.99,900.

Violation of Buidel nes issued

under C.O.Ms.No 51. dared
09.04.2012

Hc rs close ass(,ciale and

berramr of A-1, transferred
Rs.51,87.75,919 Tiom th€
account of Nl/s Legend
Enterprises to t!l/s Omni
Enlerpnses. Direcl('r in Ws.
Trimed Solutions India Pvl.
Lld.. in which A.l is also
Director. Proprietor of lws
I-egend Enterprises, shell
conrpa.ny floated by A.l,
subDifted fake authcrizld le(er
to Director. lMs.

27. Thus, the above stated facts would reveal that the ACB

Officials conduct()d regular inquiry for the period from 2017-18. The

allegations levelkrd in Crime No.4 of 2020 and Crime No.13 of 2019

appear to be mo:e or less similar in nature except tlie period and

product. Nature of offence appears to be same. Like-wise, the

allegations in Crirne Nos.4 of 2020, 8 of 2019 and 10 o1'2019 against

Accr,rsed Nos.1, 2. 3 and 6 respectively appear to be similar in nature.

except the period and product.

 20 KL,J
Crl.P. No.3980 of2020 & batch

PROTECTION GRANT E D BY THIS COURT TO THE

I'ETITIONERS - AC USED N I 2 and 6.

28. Accused No.1 herein filed Crl.P. No.7101 of 2019 to grant

regular bail in Crime No.8 of 2019, and this Court vide order dated

25.11.2019 granted regular bail to hirn on execution ofpersonal bond

fbr an amount of Rs.2.00 lakhs with two sureties for a like sum each,

and not to interfere with the investigation, shall not misuse the liberty

granted to hirn, appear before the Investigating Officer on every

alternative day till completion of investigation, surrender passport,

deposit an mount of Rs.10.00 lakhs by way of FDR.

29. Accused No.1 has also filed Crl.P. No.7108 of 2019 for

regular bail in Crime No.10 of 20\9, and this Court vide order dated

25.11.2019 granted regular bail to the petitioner on the very same

conditions which were imposed in the order dated 25.11.2019 in

Crl.P. No.7109 of 2019 in respect of Crime No.8 of 2019.

30. Accused No.1 has also filed Crt.P.No.73 of 2020 seeking

regular bail in Cr.No. l3 of 2019, and this Couft has granted regular

bail to hirn on the very same conditions, and also that he shall deposit

a sun.r of Rs.30.00 lakhs.

31. It is apt to mention that the ACB has filed SLP (Crl.)

Nos.l069 - 1070 of 2020, challenging the said orders, and the

Hon'ble Supreme Court vide order dated 14'02.2020 dismissed

the said SLPs.

 2t KI,.,I
Crl.P .Yo 3980 of2020 & batch

tr
32. It is also apt to mention that there is no allegation by the

ACB Officials .hat Accused No.1 has not complied u'ith the above

conditions sxs6,pt 4 baid allegation of non-cooperation with the

Investigating C,fficer. The ACB Officials have not filed any

document to substantiate the said contention. They have issued notice

under Section 9l of Cr.P.C. summoning to produce cefiain documents

and the same \\ere furnished by the Accused. There is no further

communication ;iom the ACB Officials.

33. Accused No.2 has filed Crl.P. No.102 of 2020 to quasl.r the

proceedings in C rime No. I 3 of 2019, and this Court vide order dated

07.01.2020 post,:d the matter to 12.02.2020, till the next date ol

listing, no coerr:ive steps shail be taken against the petitioner -

Accused No.2. However, investigation shall go on. The said order

was extended from time to time.

34. Accused No.3 has filed Crl.P. No.118 of 2020 seeking

anticipatory bail in Crime No.13 of 2019, and this Court vide order

dated 10.01.2020 directed him to appear before the ACB Officials on

every alternative ,lay, surender passport, cooperate with Investigating

Officer b1' furnishing necessary information and docutnents. The

same was extendr:d frorn time to time, and the condition of reporting

every alternative clay is modified to every Thursday.

35. Accused No.6 has filed Crl.P. No.293 of 2020 under

Section 482 of Cr.P.C. to quash the proceedings in Crime No.i3 of
 22 KL,J
Crl.P. No.39E0 0f2020 & botch

2019, and this Court vide order dated 26.02.2020, directed him to

appear before the ACB Authorities on every alternative day, surrender

passport, cooperate with the Investigating Officer by furnishing

information/documents.

Thus, this Court has granted protection to the petitioners - Accused

Nos.l, 2, 3 and 6 in the manner stated above. It is relevant to note that

there is no stay of investigation in any of the Crimes registered by the

ACB Officials. It is also relevant to note that Accused No. I was in

Jail from 27.09.2019, and was enlarged on bail vide order dated

14.02.2020. Thus, Accused No. I was in judicial custody for about

five months in all the above said three crimes. He is in Jail from

judicial custody from 04.09.2020 in the present Crime No.4 of 2020.

36. The above stated facts would also reveal that the ACB

Officials have registered the first case i.e., Crime No.8 of 2019 on

25.09.2019, the premises of Accused No.1 was searched on

26.09.2019, and he was arrested on27.09.2019. They have registered

the second case i.e., Crime No.10 of 2019 on 25.10.2019 i.e., exactly

after one month. Like-wise, the ACB Officials have registered the

third case i.e., Crime No. 13 of 2019 on 30.12.2019 i.e., after one

month five days of registration of second Crime. They have

registered the fourth crime i.e., Crime No.4 of 2020 on 04.09.2020

37. As stated above, there is no complaint against the

petitioners herein by the ACB that the petitioners have violated the
 23 KL,J
Crl.P. No.3980 of2020 & botch

conditions imp csed by this Court in the above said orders except a

bald allegation )f non-cooperating with the Investigating Officer. The

ACB Officials lailed to substantiate the said allegation by producing

any evider.rce, r:iuch less documentary evidence. They have not filed

any application for cancellation of bails/anticipatory bails, vacate stay

petitions ir.r the,above said matters. The said fact would reveal that the

petitioners have not violated any order ofthis Court.

38. It is also relevant to note that in Crime No.8 of 2019, the

ACB officials irave mentioned the date of occurrence as prior to

25.09.2019, in (lrime No.10 of 2019 as prior to 25.10.2019. in Crime

No.13 of 2019 as prior to 30.12.2019, and in Crime No.4 of 2020 as

prior to 03.09.2020. The above stated facts would reveal that the

ACB Officials are not sure of date of commission o1' offence.

According to the ACB Officials, they have conducted regular inquiry,

and the regular inquiry would reveal the commission of offence by the

petitioners - Acc,rsed. The matter requires investigation.

39. The above stated facts also would reveal that the

investigation is 5roing on from registration of first Crime i.e., Crime

No.8 of 2019 dated 25.09.2019 i.e., from almost one year. They have

not completed in.,estigation in any one of the cases. On perusal of the

record, the investigation is pending in all the matters and the ACB has

not filed final reoor/charge sheet in any one of the cases. During

pendency of the investigation, the ACB Officials have legistered one

 24 KL,J
Ctl.P. No.3980 of2020 & batch

G
case after the other on the ground that the cause of action, transaction,

product and indent are different

40. Both the leamed Senior Counsel has contended that the

ACB Officials cannot register a fresh crime for the very same

offences during pendency of investigation in the crimes already

registered earlier. The leamed Special Counsel for ACB would

contend that the transactions are different, product is different etc.,

and therefore, there is no prohibition for the ACB Officials to register

fresh cases. He has placed principle held by the Hon'ble Supreme

Court in M. Krishna v. State of Karnatakara and Babubhai v.

State of Gujaratls. In both the said cases, it was held by the Hon'ble

Apex Court that second FIR is maintainable where there are two

different versions, new discovery is made on factual foundation which

are distinct and separate from one which the FIR had already been

lodged. Whereas, in the present case, except stating that the period is

different, product is different, the ACB Officials have not produced

any evidence to show that there is new discovery of fact or evidence

with regard to commission of present offence by the petitioners -

Accused. As stated above, the allegations in all the crimes are also

similar in nature. The basis for registration of crimes against the

petitioners - Accused are regular inquiry conducted by the ACB

Officials. As stated above, the ACB Officials have registered the

cases one after the other within a period of one month.

'0. lrooo; : scc zau

 l5 KL..I
Crl.P. No 3980 of2020 & botch

41. It is relevant to note that the ACB Officials have sought

custodial interrogation of Accused No.l and the Courl below has

granted the sarne. Thus, the ACB Officials have intenogated Accused

No.1 and other Accused for two- three days. Having conducted the

custodial interrcgation in the earlier crimes, the ACB Officials cannot

now allege that the Accused are not co-operating with the

Investigating 01ficer. They cannot also claim that the investigation is

pending. At the cost of repetition, it is trite to mention that there is no

allegation again:,t the petitioners herein with regard to violation ofany

condition imposed by this Court while granting bail/anticipatory

bail/protection c,rder in quash petition. The ACB has not filed any

petition for can,:ellation of bailianticipatory bail and to vacate stav

petition in quasb petition. Therefore, the ACB Officials cannot claiu'r

that the investierltion is pending and the petitioners - Accused are not

cooperating with the Investigating Officer.

42. It is also relevant to mention that the Hon'ble Supreme

Court has disrnissed the SLP (Crl.) flled by the ACB Officials

challenging the crders passed by this Court granting tiberties.

43. Coming to the allegations levelled against the petitioners -

Accused Nos.1. 11, 3 and 6 in the present crime, the allegation againsl

Accused No.1 are almost similar to the allegations mentioned in the

earlier crime i.e., Crime No.13 of 2019. The basis for registration of

''. (20I o) l2 scc 254

 26 KL,J
CrLP No 3980 of2a20 & barch

the present crime is also regular inquiry conducted by the ACB

Officials. The period also appears to be similar. The comparative

statement of allegations levelled against the petitioners in Crime No.4

of 2020 and Crime Nos.8 of 2019. 10 of 2019 and 13 of 2019 are

almost same. The allegations levelled against the petitioners herein

are that Accused No.1 has obtained purchase orders in HemoCue HB

Cuvettes manufactures by HemoCue Sweden through his be nami

N,I/s. Legend Enterprises. The same allegation is there in Crime No.13

of 20i9. The other allegation in the present Crime is that Accused

No.1 has floated Shell Company i.e., M/s. Legend Enterprises and the

said allegation is also there in Crime No.13 of 2019. The other

allegation in the present crime is that Accused No.l has

misrepresented to the Director, IMS that I\4/s. Legend Enterplises is

authorized Distributor of HemoCue and the said allegation is also

there in Crime No.13 of 2019. The allegation with regard to collection

of purchase order, collection of money, quoting of exorbitant rates and

violation of guidelines for purchase of medical equiplrent issued by

the Govemment under G.O.Ms.No.51, dated 09.04.20i2 etc. are there

in both the crime Nos.13 of 2019 and 4 of 2020 and also in other

cflmes.

44. The allegation against Accused No.2 is that she is

proprietor of M/s. Omni Health Care, wife of Accused No.1, and in

connivance df her husband, she has committed the offence. The said

allegation is also there in Crime No.13 of 2019, in which she is shown

 27 KL.J
Crl.P. No.3980 of2020 & batch

as Accused No.7. The allegations appear to be sirnilar. She was J

granted protecti()n by this Court in Crime No.13 of 2019. There is no

complaint of violation of any condition imposed by this Couft.

Accused No.2 being women, entitled for protection under Section 437

of Cr.P.C.

45. The allegations levelled against Accused No.3 are almost

similar in Crime No.4 of 2020 and Crime No.13 of 20 19. The

comparison stat('n1ent mentioned supra would disclose the said fact.

Except the same. there is no other specific overl act against Accusecl

No.3. This Court granted protection to Accused No.3. There is no

serious allegatio.r of non-co-operating with the Investigating Officer

and violation of my condition imposed by this Court against Accused

No.3. He was taken into custody on 03.09.2020 (Thursday) when he

went to ACB C)ffice to report before the Investigating Officer as

contended by the leamed counsel for the petitioner. There is no

explanation, much less plausible explanation by the ACB Offlcials for

the same. Admittedly, he is in judicial custody from 04.09.2020.

46. There i; no specific allegation against Accused No.6. The

only allegation against him is that N4/s. HemoCure AB Sweden has

appointed NtVs. Cmni Health Care as its Distributor, an agreernent \4,as

executed to the said effect, the said agreement was signed by Accused

No.6 in the capat:ity of Manager of NtUs. Omni Health Care, but he is

no way connecte,l with the said concern. He is an employee of M/s

Omni Medi, to uhich Accused No.1 is the proprietor. The said

 28 KL,J
Crl.P. No.3980 of2020 & batch

allegation is there in Crime No. 1 3 of 2019. This Courl granted

protection to Accused No.6. It is trite to note that Accused No.6 is

shown as LW.5 in Crime No.8 of 2019 by the very same ACB

Officials. The ACB Officials have arrested Accused No.6 on

04.09.2020 as per the remand repon. According to the learned

counsel for Accused No.6, the ACB Officials have arrested Accused

No.6 on 03.09.2020 when he went to the ACB Olfice to report before

the Investigating Officer in compliance of the order granted by this

Court. It is relevant to note that 03.09.2020 is Thursday. This Court

directed the Accused No.6 to report before the Investigating Officer

on every Thursday. There is no explanation by the ACB, much less

plausible explanation for the said allegation made by Accused No.6.

The same was happened in respect of other Accused. Thus, all the

Accused are in Jail f-rorn 04.09.2020.

47. The ACB Officials have shown six reasons for judicial

custody of the petitioners - Accused in the remand report. The said

reasons are that i) in order to prevent the Accused from causing the

evidence of offence to disappear or tamper; ii) to prevent from making

any inducement etc; iii) to ensure that they shall not commit similar

offence; iv) not to interfere with the process of investigation; v) likely

to leave Country, thus jeopardizing the legal process; and vi) other

witnesses are to be examined and other documents are to be collected.

48. It is relevant to note that the ACB Officials have been

conducting investigation from 25.09.2019 i.e., date ofregistration of

 29 KL.J
Crl.P. No.3980 of2020 & batch

first crime. They have taken Accused No.1 for custodial interrogation

and thus, they have intenogated Accused No.l in all the crimes for

two-three days. As stated above, there is no serious complaint t>f

interference with the investigation by the Accused and their nott-

cooperation u,i:h Investigating Officer. Passports were seized and,

therefore, thele is no question leaving the Country by them. The

statements can be recorded under Section 164 of Cr.P.C. by following

procedure. Thus, the l'easons mentioned by the ACB Officials in the

remand leport fol arrest of the petitioners are not satisfactory to take

them into judic:al custody, more particularly when they went to the

ACB Officials to appear before the Investigating Officer in

compliance of ttre order passed by this Court.

49. The leamed Special Counsel for ACB would contend that

the offences conrmitted by the petitioners are economic offences. All

the petitioners h,:rein were arrested on04.09.2020 and they have filed

bail applications on 05.09.2020. They have caused loss of crores ol

rupees to the (lovernment Exchequer and they have gained for

themselves wrongfully. There is every possibility of interference ol

investigation by them. Therefore, on the said grounds, he sought to

dismiss the present bail appiications. He has also placed reliance on

the principle laid down in Nimmagadda Prasad v. C.B.I.r6and

Shivani Rajiv Sarxena v. Director,ate of EnforcementrT. The learned

'u. 1zo t3yz scc a5o

r?.2017
Lawsuit (Del) 4222
 30 KL.J
Crl.P. No.3980 of2020 & batch

counsel for the ACB has also relied upon the principle held by the

Hon'ble Apex Court in State of Bihar v. Amit Kumar @ Bacha

rair8, Mallampati Gandhi v. State of Telanganate, State of

Jharkhand v. Lalu Prasad Yadav2o, and would contend that bails

cannot be granted to the Accused involved in economic offences. In

the said case, it was held that economic offences constitute a class

apaft and need to be registered with a different approach in the matter

of bail. The economic offence having deep rooted conspiracies and

involving huge loss of public funds needs to be viewed seriously and

considered as a grave offence affecting the economy of Country as a

whole and thereby posing serious threat to the financial health ofthe

Country. It is relevant to note that economic offences include

counterfeiting of currency, financial scams, fraud, money laundering

etc. Whereas, in the present case, the allegations against the

petitioners are at the investigation stage and admittedly the

investigation is pending against the petitioners herein in all the four

crirnes. As held by the Hon'ble Apex Court in Kolyan Chandra

Sarkortt, at the stage of granting bail, a detailed exan.rination of

evidence and elaborate documentation of the merit of the case need

not be undertaken. Indicating reasons for prima facie conclusion for

granting bail is sufficient. As stated supra, the facts of the present case

are different. The ACB Officials have registered four cases one after

the other within a span of one month and nien months respectively.

'', (zorz) 2 elo (crl.) 227 (sc)

'e. zo t 8 (2) alt (crt.) I (AP)
'0. 20ru 6).sc:5a
 31 KL,J
Crl.P..Yo 3980 of2a20 & batch

The allegations appear to be similar. Accused No. I is in jail for about

five months. Protection was given to the other Accused in other

cfllnes. All tfLe petitioners herein have been reporting before the

Investigating Ctfficer every Thursday in compliance of the orders

passed by this (lourt. Accused No. t has already deposited an alnourtt

of Rs.50.00 lakhs in other crimes. All the Accused have produced

their passports. The present applications are for grant of regular bail.

The prosecutiorr can prove the guilt against the petitioners and seek

maximum punir;hment from the trial Court. At the stage of grant of

bail, ACB cannot make allegation of loss of crores of rupees to the

Govemment Exchequer. They can complete the investigation, file

charge sheet and get the Accused tried and seek fbr maximur-r

punishurent.

Applicabrlitv of Scction 4 l.{ of Cr.P.C.

50. The leamed Senior Counsel appearing on behalf of the

petitioners woull submit that the punishment for the offences alleged

against the petitroners therein is seven years and below seven years

and, therefore, the ACB Officials have to follow the procedure laid

down under Seclion 41A of Cr.P.C. and also the guidelines issued b1'

the Hon'ble Supreme Court in Arnesh Kumarr. Whereas, the

leamed Special Counsel for ACB would submit that the offence

alleged against the petitioners herein is under Section 13 of the P.C.

Act, where punishment is more than seven years and, therefore, there

is no need to tht: ACB Officials to follow the procedure laid dorvn

 32 KL,J
Ct l.P. No.3980 of202A & batch

L
under 41A of Cr.P.C. and also the guidelines issued by the Hon'ble

Apex Court in Arnesh Kumarr.

51. It is relevant to note that Section 13 of P.C. Act deals with

climinal misconduct by a public servant, and section l2 ol the P.C.

Act deals with punishment of abetment of offences dellned in

Sections 7 or I 1. According to the leamed counsel for the

petitioners, the ingredients of Section 13 of the P.C. Act are lacking in

the present case since the petitioners are not public servants. Section

2 (c) of P.C. Act defines 'public servant', as per which, any person in

the service or pay of the Government or remunerated by the

Government of by fees or commission for performance of any public

duties etc. The petitioners herein are not falling in any of the

categories of the above said definition. Therefore, the contention of

the learned Special Counsel for ACB that the charge levelled against

the petitioners is under Section 13 of P.C. Act and, therefore, Section

4l A of Cr.P.C. is not applicable is not sustainable. However, the

petitioners herein were arrested by the ACB Officials on 04.09.2020

itselL

52. The allegation against Accused No. I is that he has resorted

to Circular Trading by opening several proprietary cornpanies

including shell firms and caused loss of the Public Exchequer

Circular Trading is a type of securities fraud that can take place in

stock markets, causing price manipulation and often related to pump

and r{ump schemes. Circular Trading occurs when identical sell

 Crl P. tic, 3980 of )020 & batch

orders entered at ,he sarre time with the same number shares and the

same price. Whether Accused No.l has resorted to Circular Trading

or not. q,hether the contents of FIR would constitute to Circular

Trading or not is a matter of investigation and trial. As held by the

Hon'ble Supreme Court while considering the bail application, the

said issue which is serious in nature cannot be considered examined

and considered.

53. It is {urther alleged by the leamed Special Counsel for

ACB that the petitioners - Accused are not cooperating with the

Investigating Otflcer and not producing the infbrmatior/documents

sought by them. They are taking shelter under the order passed by this

Court including a direction to the ACB Officiats not to take coercive

steps and, thus, the ACB Officials are not in a position to complete the

investigation in vi,:w of the silence maintained by the petitioners. The

Iearned counsel fcrr the petitioners would submit that right to remain

silence is also a fundamental right guaranteed under Article - 20 of the

Constitution of InCia. It is settled principle of law that the Accused

has a right to remain silence and it is a fundamental right. The said

principles also herld by the Hon'ble Supreme Court in catena of

decisions. The Hon'ble Apex Court in Selvi and Others v. State of

Karnataka2r held that the right to remain silence is available even at

the stage of investigation in a criminal case. The said principle w'as

reiterated in Crl.Rr:.No.3208 of 20 l6 dated 20.02.2017. As discussed

r' ro; z scc

120 u o3
 34 KL,J
Crl.P No.3980 of2020 & barch

supra, having intenogated Accused No.1 after obtaining his custody

frorn the Courl below, the ACB Offrcials now cannot claim that they

are not in a position to complete the investigation in view of non-

cooperative of petitioners.

54. As stated above, the petitioners have already furnished their

passports, they have been reporting before the Investigating Officer on

every Thursday. There is no allegation against the petitioners of

interfering with the investigation and that they are trying to abscond

or there is danger of fleeing away, if released on bail. There are no

previous criminal antecedents to the petitioners. Therefore, according

to this Cou(, the petitioners are made out several grounds for grant of

regular bail to them.

55. As discussed supra, Accused No.1 was in jail lbr about five

months. Accused No.2 being woman is entitled for protection under

Section 437 of Cr.P.C. There are no specific overt acts against

Accused No.3 and 6. It is relevant to note that the only allegation

against Accused No.6 is that he has signed on the agreenrent. All the

Accused got protection from this Court either by way of grant of

regular bail or anticipatory bail with certain conditions. They have

been cornplying with the same. Accused No.1 has already deposited

an amount of Rs.50.00 lakhs. Accused Nos.l and 3 have furnished

sureties for substantial amount in compliance of the orders passed by

this Court. They are in jail from 04.09.2020 i.e., since 14 days.
 35 KL,./
Crl.P. ,\'o j980 of2020 <( barch

56. For the reasons and discussion supra, according to thjs

Cour1, the petiti()ners are entitled for regular bail.

57. Accordingly, the present Criminal Petitions are allowe(I,

and the petition3rs - Accused Nos.1, 2, 3 and 6 shall be released on

bail on the follo'ving conditions:

i) The petitioners - Accused Nos.l, 2 and 3 shall execute

personal bonds for Rs.1,00,000/- (Rupees one lakh only)

each with two (02) sureties for a like sum each to the
satirifaction of the Principal Special Judge for SPE &
ACB Cases, City Civil Court, Hyderabad, while
peti .ioner - Accused No.6 shall execute a personal bonrl

lor '1s.20,000/- (Rupees twenty thousand only) with tr,,,o

sureties for a like sum each to the satisfaction of the said

Court;

ii) 'fhe'.' shall reporl before the Investigating Officer on

every Thulsday between 10.00 A.M. and 5.00 P.M. till

com rletion of investigation;

iii) Thel shall co-operate with the Investigating Officer;

iu) 1'hey shall not interfere with the investigation; and

v) 'lhe,, shall sunender their Passporls, if not surrendered.

As a seqLri:I, miscellaneous petitions, if any, pending in the

above criminal petitions shall stand closed.

SI)/. .K.SHYLESHI
ASSIST-q N'I' IIE(; I SI-RAI

,TRUE COPY//
One Fair Copy to, SIiCTtON OT'FICER
The Hon'ble Sri Justice Sri K. Lakshman,
(For l-lis Lordships kind perusal)
To,
l. The Principal Special Judge for SPE & ACB Cases, Hyderabad
2. 'Ihe Inspector of Police, Central Investigation Unit, Anti Com-rption Bureau, Hyderabad
3. The Superintendent, Central Jail, Chanchalguda, Hyderabad
4. l0 L.R. Copies
5. The Under Secretary, Union of India, Ministry of Law Justice and Company Affiars,
New Delhi
6. The Secretary, Telangana Advocates Association Library, High Court, Hyderabad
7. One CC to Sri T Nagarjuna Reddy Advocate [OPUC]
8. One CC to Sri D. Lakshmikanth Reddy, Advocate (OPUC)
o One CC to Ms. Sri Ranga Pujitha, Advocate (OPUC)
10. One CC to Sri V. Ravi Kiran Rao, Special Counsel for ACB Cases, High Court,
Hyderabad(OUT)
ll. One spare copy
HIGH COURT

KLJ

DA'tED: l8/09/2020

OITDER

CRLP.Nos.3980 ,3916' 39''1 and 3990 of 2020

C'RLP. ALLO\\ EI)