Greater Bombay, July 30, 2024 – The Designated Court under the Maharashtra Protection of Interest of Depositors (in Financial Establishments) Act, 1999 (MPID Act), at the City Civil & Sessions Court, Greater Bombay, presided over by HHJ Shri N.G. Shukla (Court No. 20), has rejected the bail application of Piyush Rajesh Mehta, a 36-year-old businessman. Mehta was arrested in connection with M.E.C.R.No.08 of 2016, pertaining to offences punishable under Section 420 of the Indian Penal Code (IPC) and Sections 3, 4, and 5 of the MPID Act. The order denying bail was pronounced in open court on July 25, 2024, and the signed order was uploaded on July 30, 2024.
The bail application, No. 545 of 2024, was filed in Remand Application No. 722 of 2024. The prosecution, represented by Ld. APP. Mrs. Chaitrali Panshikar, strongly opposed the application by filing a reply (Exh.2). Ld. Adv. Mr. Bharat Mane appeared for the Applicant/Accused.
Prosecution’s Case:
The prosecution’s case, in brief, alleges that the applicant, Piyush Rajesh Mehta, who was dealing in the export of spectacles, approached the informant in May 2014. Mehta allegedly represented that the spectacles export business was highly profitable and induced the informant to invest money, promising a 3% profit on the investment.
Initially, the informant invested ₹10,000 and received the promised 3% profit. Subsequently, the informant invested further amounts of ₹20,000 and ₹30,000, eventually investing a total of ₹1,00,000. The informant continued to receive the 3% profit from the applicant until 2015.
It is further alleged that the applicant then persuaded the informant to invest a larger sum. Consequently, between January 2015 and May 2015, the informant collected ₹1,52,00,000 from his friends and relatives and handed it over to the applicant and his wife for investment in the spectacles export business. However, the applicant allegedly failed to provide the promised profit and did not return the principal amount invested.
On June 30, 2015, the applicant allegedly issued a post-dated cheque of ₹1,85,00,000 to the informant, which included a profit of ₹33,00,000. Upon depositing the cheque on its maturity at Punjab National Bank, the bank informed the informant of discrepancies in the applicant’s signatures. Having not received the invested amount, the informant lodged a complaint in the Special Designated Court. Following the court’s direction, an FIR was registered against the applicant.
The prosecution highlighted that the applicant had been absconding, leading the police to file an “A” summary report initially. However, after tracing and arresting the applicant, the case was reopened.
Applicant’s Arguments:
Ld. Advocate for the applicant argued that the allegations were primarily focused on deceiving and inducing the informant, who initially invested ₹1,00,000 and received the agreed-upon 3% profit until March 2015. He contended that while there were seven depositors, the total investment was only ₹57,00,000, disputing the police’s claim of ₹1,52,00,000.
The applicant’s counsel further pointed out that the applicant had issued a cheque to return the amount to the informant. He also argued that the other depositors did not directly give money to the applicant but to the informant, suggesting that the applicant could not be held directly responsible for defrauding them.
The defense emphasized that the applicant was arrested on May 12, 2024, and claimed that there had been no significant progress in the investigation during his police custody. It was also stated that the statements of witnesses were already recorded in 2016, and there were no funds in the applicant’s bank account. The applicant’s counsel argued that the police’s opposition to bail lacked substantial reasons and assured the court that the applicant was ready to abide by any conditions imposed if granted bail.
Prosecution’s Opposition:
Ld. APP strongly opposed the bail, emphasizing that the offence was registered in 2016, and the applicant was arrested only in May 2024, indicating that he had been absconding for eight years. The prosecution argued that there was a high likelihood of the applicant absconding again if released on bail.
The prosecution referred to the informant’s statement dated April 6, 2016, which allegedly showed that the informant collected money from friends and relatives and gave it to the applicant for investment. It was also pointed out that the applicant had issued a fake cheque to return the investors’ money to the informant. The Ld. APP asserted that the investigation was still in progress and urged the court to reject the bail application.
Court’s Observations and Order:
After considering the submissions and perusing the records, HHJ Shri N.G. Shukla made the following observations:
The court noted the informant’s statement indicating an initial investment of ₹1,00,000 in installments with the applicant, on which the applicant paid a 3% profit until March 2015. However, the principal amount was not returned.
The statements of the informant and other investors revealed that they had given various amounts to the informant for investing with the applicant, and the informant, in turn, had handed over these amounts to the applicant. This suggested that the applicant had accepted deposits for investment in the spectacles business with the assurance of a 3% profit.
While the applicant disputed the ₹1,52,00,000 figure, the court noted that details provided in the bail application itself revealed a primary investment of ₹57,00,000 from the informant’s friends and relatives, which was given to the applicant through the informant.
The court acknowledged the prosecution’s contention that neither the invested amounts nor the promised profits were returned by the applicant, prima facie indicating his involvement in the alleged crime.
Crucially, the court highlighted that the offence was registered in 2016, and the applicant was absconding for eight years, only being arrested in May 2024. The court found no satisfactory reason or explanation from the applicant for this prolonged period of absconding.
Considering the ongoing investigation and the applicant’s conduct of absconding for a significant period, the court concluded that it was not a fit case for the grant of bail.
Consequently, the court passed the following order:
ORDER
- Bail Application No. 545 of 2024 is rejected and stands disposed of.
The order, dictated on July 25, 2024, transcribed on July 26, 2024, and signed on July 30, 2024, signifies a setback for Piyush Rajesh Mehta, who will remain in custody pending further legal proceedings in the MPID Act case. The court’s decision underscores the seriousness with which it views economic offenses and the act of absconding from the law for an extended period.