SC grants bail to director of Aatash Norcontrol Limited in alleged fraud of 100 Crores INR upon Gujarat Maritime Board

The SC on June 19, 2020 {Jinofer Kawasji Bhujwala vs State of Gujarat} held that the appellant, who is admittedly 62 years of age has already spent nearly a year in judicial custody. It was held that a period of nine months has passed from the date of filing of the charge sheet. It was held that though the learned Solicitor General contended that the sanction to prosecute has already been issued as against Government Officials, the fact remains that charges have not been framed and the trial has not commenced as yet. 

It was observed by the Bench, comprising of Justice Ashok Bhushan, Justice M.R. Shah & Justice V. Ramasubramanian, that the arguments revolving around the potential threat to national security, cannot be sustained, for two reasons. It was held that the first reason is that the project became operational in August 10, 2010 and the disputes between the parties started only in 2018 and that too with regard to financial matters. It was held that the second reason is that by virtue of the interim measures of protection granted by the Arbitral Tribunal (comprising of a former Judge of this court, a former Judge of the High court and a Senior Advocate) in terms of section 17 of the Arbitration and Conciliation Act, 1996, the termination of the Concession Agreement stands stayed. Therefore, it was held that the Company of which the appellant is the head, continues to operate the VTPMS Project.

On 01.05.2019, the Gujarat Maritime Board lodged a complaint with the CID Crime, Gandhi Nagar Zone, alleging that Aatash Norcontrol Limited and its directors were guilty of (1) inflation of cost (2) non execution of certain works (3) creation of shell companies and carrying out work through them (4) siphoning and round tripping of funds through those companies (5) not carrying out construction on the lands allotted for Master Control Room (6) raising of false bills and forged invoices (7) managing the issue of completion certificate through the then Superintending Engineer and Chief Nautical Officer of the board and (8) entering into a conspiracy with each other to exceed the expenditure of the project upto Rs. 100 crores and committing criminal breach of trust. On 27.6.2019, the appellant and his son were arrested. The appellant is in custody since then.

In the present appeal, aggrieved by the dismissal of bail application by the High Court of Gujarat at Ahmedabad, the appellant, a person who was cited as A-1 in the First Information Report dated 26.06.2019 for alleged offences under Sections 406, 409, 420, 465, 468, 471 and 120B of the Indian Penal Code and Section 2 13(1)(d) of the Prevention of Corruption Act, 1988, had filed appeal before the SC.

The SC held that though much is said about the tempering of witnesses, it is seen from the material on record that the prosecution rests mainly on documents. It was held that in any case, the prosecution is not remedyless, if a person enlarged on bail, indulges in certain activities.

The Court held that the appellant is entitled to bail. Hence, the appeal was allowed by the SC and the appellant was directed to be released on bail, subject to such terms and conditions as the Sessions Court may deem fit and appropriate in the facts and circumstances of the case, including a condition for the surrender of the passport, which shall be subject to orders passed by the Trial Court from time to time.