CENTRAL BUREAU OF INVESTIGATION VS KAPIL WADHAWAN

INTRODUCTION

This case challenged the impugned order dated 30/05/2023 by the High Court of New Delhi. The case was filed by the Central Bureau against Kapil Wadhawan who is a noted businessman in India for financial misconduct and fraud. CB which is India’s premier investigative agency undertook this investigation with their main focus on the activities of Kapil Wadhawan and his associated companies. The allegation against Mr. Wadhawan includes misappropriation of funds, corruption and other financial irregularities.

FACTS OF THE CASE

1. The FIR is being registered by the DGM of Union Bank of India in CBI for the offence punishable under section 409,420 and section 477 of IPC and also section 13(1) and 13(2) of PC act against Dewan Housing Finance Corporation Ltd and 12 other accused. 
2. It is clearly said by the FIR that the accused Mr. Wadhawan along with 12 other accused people cheated the consortium of 17 banks led by Union of India.
3. They took a loan of 42,000 crores approx. and thereafter misappropriated the funds in falsifying acts and at the time of repayment they caused a wrongful loss of Rs. 34,000 crores to the consortium lenders during the period of January,2010 to December,2019.
4. The respondents Mr. Kapil Wadhawan and Mr. Dheeraj Wadhawan were arrested by the CBI on 19^th July 2022.

              But they seek for their release from judicial custody because the court had no jurisdiction to arrest them under section 17A (on which the court ordered their arrest).

5. The special court took cognizance on 26^th November 2022 of the offences against all the accused and issued warrants against MR. Wadhawan.

ISSUES RAISED

1. The Special court granted default bail to the accused Mr. Kapil and Dheeraj Wadhawan under Section 167(2) Cr.P.C is valid or invalid?
2. Whether he has been released on any bond and if so whether or with or without any securities.

CONTENTIONS OF APPELLANT

1. The respondent Mr. Kapil & Dhreej Wadhawan was arrested by the CBI after an FIR filed against them.
2. They carried out the investigation and filed a chargesheet for offences under section 206,409,411,424,465,458 and 457 of IPC against the respondent and other accused. (before special judge, lower court)

CONTENTIONS OF RESPONDENT

1. Respondent’s advocate Mr. Mukul Rohatgi argued that the issue of cognizance had not any connection with the default bail.
2. The chargesheet filed by the CBI is not filed within the prescribed time limit and when it is filed it is not complete so the below court considered that is an incomplete chargesheet, which entitled the respondents the benefit of default bail under section 167(2) of Cr.P.C
3. They also argued that the incomplete chargesheet which is filed by the CBI isa subterfuge to defeat the indefeasible right of the respondents under section 167(2) of Cr.P.C

JUDGEMENT

The Apex Court set aside the order given by the Special Court or the High Court and held both had committed a serious error of law while giving their judgements. The court said that for however reasons if all the documents are not filed by the chargesheet this doesn’t mean that the chargesheet is invalid. And this doesn’t entitle the accused to claim right to get default bail on the mere ground of chargesheet incompletion.

Thus, the court directed the accused person to be taken in custody if they are still on default bail.

CONCLUSION

The investigative agency CBI fails to file the chargesheet within the given time period due to somewhat reason, the accused is entitled to be released on statutory bail. This cognizance has been taken by the Special court and supported by the High Court further. But this can’t be a valid ground for statutory bail so the apex court set aside the rulings of both the special and the High Court and ordered to take into custody the accused if he is on default bail still.

Written by Shreya Raj an intern under legal vidhiya.

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