Gaurav Garg vs. C.B.I

Held

The Court rejected the anticipatory bail application of Gaurav Garg. The Court found that the applicant was involved in diverting a large share of the loan amount granted to co-accused Harmesh Kumar. The applicant, as the perpetrator of M/s Krishna Jute Bag Company, received a significant portion of the diverted loan amount. The Court noted that the applicant could not provide any invoices or supporting documents for the business of construction materials, and the remaining amount of Rs. 19,39,900/- could not be accounted for by the applicant. The Court concluded that the applicant was fully involved in siphoning off the loan amount of over Rs. 20 crores. Considering the allegations of criminal conspiracy with other accused and bank officials in siphoning off the loan amount by submitting forged papers and misleading the bank, and the fact that the loan was siphoned off within six months of its sanction, the Court held that the applicant is not entitled to anticipatory bail. The Court also referred to the dismissal of anticipatory bail applications of co-accused in similar circumstances.

Facts

This case involves an anticipatory bail application filed by Gaurav Garg, proprietor of M/s Krishna Jute Bag Co. The applicant is accused of being involved in a criminal conspiracy to defraud the Union Bank of India. M/s H.K. Enterprises, a partnership firm, obtained a Cash Credit Limit of Rs. 20 Crores on October 24, 2017, based on false/forged documents. The loan was allegedly siphoned off within a month through associated concerns, leading to a wrongful loss of Rs. 20.60 Crores to the bank, and the account was declared a fraud. A sum of Rs. 7,87,97,100/- was diverted into the applicant's firm's account. The CBI investigation report indicates that the applicant could not explain the remaining Rs. 19,39,900/- and failed to provide supporting documents for business purposes, suggesting involvement in siphoning off loan amounts. The applicant also allegedly filed GST returns to justify these transactions.

Key Issues

1. Whether the applicant, Gaurav Garg, is entitled to anticipatory bail under Section 438 Cr.P.C. in Special Case No. 07 of 2022, RC No. 219 of 2019 E004, registered under Sections 120B read with 420, 468, 471 IPC and Section 13(2) read with Section 13(1)(d) of the PC Act, 1988? Petitioner's Contention: The applicant seeks anticipatory bail to avoid arrest during the pendency of the investigation. Revenue's Contention (CBI): The CBI contends that the applicant was involved in a criminal conspiracy to divert and siphon off a substantial loan amount of Rs. 7,87,97,100/-. They argue that the applicant could not provide invoices or supporting documents for business purposes and that the transactions were not utilized for the intended business, indicating involvement in siphoning off the loan amount. The CBI also points out that the applicant dishonestly attempted to justify the transactions by filing GST Returns. The anticipatory bail applications of co-accused have already been dismissed by this Court.