Section 438 CrPC: Deposit of money before grant of anticipatory bail in offence of cheating will not be warranted in case of private disputes.

 

 
            A Bench of Justices of the Supreme Court of India S. Ravindra Bhat and Dipankar Datta while deciding a case under section 420 IPC reminded  High courts and the Sessions courts not to be unduly swayed by submissions advanced by counsel on behalf of the accused in the nature of undertakings to keep in deposit/repay any amount while seeking bail under section 438 of the CrPC and  incorporating a condition in that behalf fir deposit/payment as a pre-requisite for grant of bail.

            The fact in the instant case is that  – the appellant who owned a property had given to a builder (developer) on agreement that to construct a multi-storied building in which the appellant would have ownership rights in respect of 3^rd and 4^th floor. The builder would have rights to deal with the  1^st and 2^nd floor.

            The builder then entered into an agreement with Vinay Kumar and Sandeep Kumar (complainant) in respect of 2^nd floor. The complainant alleged to have paid 35 lakh to builder as well as appellant in cash as well as cheques.    

            The complainants were not handed over the possession of the floor which they intended to purchase. Therefore they lodged complaint and an FIR was registered under section 420/406/34 IPC against the appellant, the builder and a broker.           

            After which the appellant approached  a criminal Court for seeking order under section 438 of CrPC. However the application was dismissed. Then appellant approached the High Court. The High Court granted bail to the appellant and the builder on condition that builder shall deposit a sum of Rs thirteen lakh and appellant/owner shall deposit twenty lakh to the complainant with the learned trial Court. due to unable to arrange funds to deposit, the appellant approached the High Court for extension of time. The Court allowed the application which means appellant shall deposit within three days, failing which the anticipatory bail granted would be revoked.

            That is why the appellant, being aggrieved approached the Supreme Court.

            Before the Supreme Court, the appellant contended that the imposition of condition to deposit rupees twenty two lakh is bad in law and liable to be set aside.

On the other hand, the State counsel opposed the appeal stating the condition imposed was volunteered through his advocate without prejudice to his rights and contentions and that the Supreme Court should not interfere with the order of the High Court.
 
Legality of the impugned condition.

The Hon’ble Supreme Court took note of precedents governing the discretion  of the courts to  grant anticipatory bail.

            The Court took reference of landmark case of Gurbaksh Singh Sibbia and others vs State of Punjab (1980) 2 SCC 565, where it was held –

“......... that since denial of bail amounts to deprivation of personal liberty, the Court should lean against the imposition of unnecessary restrictions on the scope of section 438, especially when no such restrictions have been imposes by the legislature in the terms of that section. Section 438 is a procedural provision which is concerned with the personal liberty of the individual, who is entitled to the benefit of the presumption of innocence since he is not, on the date of his application for anticipatory bail, convicted of the offence in respect of which he seeks bail.”

            Also the Hon’ble Court referred to a case, Munish Bhasin vs.  State (NCT of Delhi) (2009) 4 SCC 45 where it was observed as follows –
“10. It is well settled that while exercising discretion to release an accused under Section 438 of the Code neither the High Court nor the Sessions Court would be justified in imposing freakish conditions. There is no manner of doubt that the court having regard to the facts and circumstances of the case can impose necessary, just and efficacious conditions while enlarging an accused on bail under Section 438 of the Code. However, the accused cannot be subjected to any irrelevant condition at all.”

            The Court also took note of recent decision such as Dilip Singh vs State of Madhya Pradesh (2021) 2 SCC 779 and Bimla Tiwari vs. State of Bihar (2023)

Dilip Singh’s case   

            The criminal proceedings are not for realisation of disputed dues. The criminal Court, exercising jurisdiction to grant bail/ anticipatory bail is not expected to act as a recovery agent to realise the dues of the complainant, and that too, without any trial.

            It is again held in Bimla Tiwari  case that the process of criminal law particularly in matters of grant of bail, is not akin to money recovery proceedings and the criminal law cannot be utilised  for arm-twisting and money recovery.

            Disapproving the imposition of a condition laid by High Court, the Hon’ble Apex Court said that the conditions to imposed must not be onerous or unreasonable or excessive.
“In the context of grant of bail, all such conditions that would facilitate the appearance of the accused before the investigating officer/court, unhindered completion of investigation/trial and safety of the community assume relevance. However, inclusion of a condition for payment of money by the applicant for bail tends to create an impression that bail could be secured by depositing money alleged to have been cheated. That is really not the purpose and intent of the provisions for grant of bail. We may, however, not be understood to have laid down the law that in no case should willingness to make payment/deposit by the accused be considered before grant of an order for bail”.

            Deposit of money before grant of bail will not be warranted in cases of private disputes where private parties complain of their money being involved in the offence of cheating unlike in exceptional cases like allegation of misappropriation of public money for the large interest of the community – the Court said.         

            The high Court fell in grave error in proceeding on the basis of the undertaking of the appellant and imposing payment of Rs. 22,00,000/- as a condition precedent for grant of bail – Court accorded.

            The High Court  ought to have realised that having regard to the nature of dispute between the parties which is predominantly civil in nature, the process of criminal law cannot be pressed into service for settling a civil dispute.          

            The Supreme Court remitted the matter to the High Court for re-consideration keeping in view of the decision of Mahesh Chandra vs. State of U.P (2006) 6 SCC 196 wherein the case was remitted to consider the bail application afresh on merit without imposing any condition of the nature imposed by the impugned order.                                                                                                                                                                                                                                                                        Ramesh Kumar Vs. The State Of Nct Of Delhi  [Slp(Crl.) No.2358 Of 2023.
Date of Judgment: July 4^th 2023

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