Bombay HC denies pre-arrest bail to 1992 batch civil services officer in duping case

MUMBAI: Denying pre-arrest bail to Ashutosh Kumar, a 1992 batch IAS officer and a co-accused, Sanjay Pandey accused of several investors of over Rs 5 crore, the Bombay high court observed that the duo along with another accused “were present and they collected and counted the cash amount’’.
The duo are accused of inducing five persons to part with Rs 5.5 crore under the guise of investing in various SRA/Mahada and other development projects, assuring them of a good return on profit.
“Custodial interrogation of the applicants Ashutosh Kumar and Sanjay Pandey appears to be indispensable for a fair and effective investigation,’’ said Justice N J Jamadar in a December 18 order.
Last month, dismissing Kumar’s his wife Monica Kumar’s quashing petition against a July FIR registered with the Versova police in Mumbai, a division bench of Justices Ajay Gadkari and Sharmila Deshmukh, had said the material unearthed against Kumar “reveals startling state of affairs.’’
The division bench had said, “We find it to be of utmost importance that the investigation is not stifled but is necessarily required to be continued.’’ The HC had directed that the investigation be conducted by a deputy police commissioner and supervised by a joint CP.
Kumar,52, stated that he is currently posted as a regional director of the Plastics Export Promotion Council in northern India.
Sanjay Pandey is a director of the LFS group of companies. The FIR by one Rajkumar Dadhich alleged that Kumar represented himself as a senior IAS officer and his wife, a director along with him in LFS Global Pvt Ltd -- a Company that was handling the development projects as well as financing film projects.
All three had petitioned the HC to protect them against arrest in a case of cheating and also under Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999. The HC granted pre-arrest bail to Monica, observing that she had no role in inducing investors or when money was delivered.
Kumar’s counsel Ashok Bhatia argued that allegations that crores of rupees were paid in cash are "inherently improbable" and deserve no credence.
Besides the amounts were allegedly paid in 2017-2018 and yet the FIR was inordinately delayed and filed in 2023, making it a case for pre-arrest bail. Bhatia also said the complaints against Kumar were a “counterblast’’ to falsely rope him since he had on April 6, 2023, filed a complaint of alleged extortion against the first informant and others.
Bhatia also argued that the filing of the FIR is also not free from infirmities and that the police summoned his clients before registering the FIR, which shows how the probe was “partisan’’.
But opposing their plea, the State argued that the accused made a false representation to show that Kumar was entitled to land in Mumbai, which belonged to the State.
Kumar is in a position to influence witnesses, said a prosecutor adding “as many as six crimes have been registered against Ashutosh Kumar and two crimes each against Monica and Sanjay Pandey,’’ apart from the present crime.
APP Ajay Patil said the accused induced five persons to part with over Rs 5 crore.
Uday Warunjikar, counsel for the first informant also opposed the grant of relief to the trio that the explanation sought to be offered by Kumar’s counsel is in the nature of a defence, which is required to be tested at the trial.
Justice Jamadar said he found substance in Warunjikar’s submissions.
"At this stage, to unearth the fraud in all its facets, ascertain the identity of the persons privy to the fraud and also have a money trail, custodial interrogation of the applicant Ashutosh Kumar and Sanjay Pandey seems to be warranted," said the HC.
However, Justice Jamadar said the only allegation against Monica was that in July 2017 when her husband was making an effort to induce the first informant and his associates to invest by showing, but not furnishing documents and when they demanded copies she had tried to assert that they believe a person "holding such a high position".
On November 2, the division bench in the quashing plea after hearing Kumar’s counsel Anil Lala, additional public prosecutor Ajay Patil and Warunjikar had said, "We are also shocked to note that, the investigation discloses that, as per the ROC details, (Kumar) is shown to be the director in various companies…We have our own doubts as regards the permissibility of an Government Officer to occupy the post of Managing Director/Director in private limited companies, considering that the Central Services (Conduct) Rules, 1964 prohibit a Government Servant from engaging directly or indirectly in any trade or business except with the previous sanction of the Government."
Bhatia in the pre-arrest bail plea argued before Justice Jamadar that Kumar was a karta in the M/s Kumar Hindu Undivided Family (HUF) and in that capacity, a director in the companies, namely, LFS Global Pvt. Ltd and Shringar Realties Pvt. Ltd.
“There is nothing illegal in accused No.1 becoming a Director in those companies in the capacity of Karta of HUF while holding a Civil Post in the Government, as service rules permit,’’ he submitted.