Bail Application Rejection in Bharat Bhushan Bansal v. State (NCT of Delhi)

Introduction:

The Delhi High Court, in its judgment dated March 3, 2025, in Bharat Bhushan Bansal v. State (NCT of Delhi) (Bail Application No. 124/2025), dismissed the bail application of the petitioner, citing serious allegations of financial fraud and misappropriation of funds by the accused in his capacity as the President of Vasundhaya Kalyanam Urban Cooperative Thrift and Credit Society Ltd. The judgment underscores key legal principles concerning bail in economic offenses and corporate fraud cases.

Case Background:

The petitioner, Bharat Bhushan Bansal, was arrested on October 5, 2023, under Sections 406 and 420 of the Indian Penal Code (IPC) following an FIR registered at Police Station Keshav Puram, Delhi. The prosecution alleged that the petitioner, as the founder and president of the cooperative society, induced innocent investors to deposit funds under fixed deposit (FD) and recurring deposit (RD) schemes, promising attractive returns. However, upon maturity, these deposits were not repaid, and the funds were allegedly diverted for personal and related-party benefits.

Arguments by the Petitioner

1. Unjustified Incarceration: The petitioner argued that he had been in judicial custody since October 2023, and continued detention was causing undue hardship.
2. Civil Nature of Dispute: The petitioner contended that the allegations arose from a contractual obligation between the society and its members, making it a civil dispute rather than a criminal offense.
3. Lack of Direct Involvement: It was argued that the petitioner was merely the President of the Society and was not personally liable for financial transactions undertaken by the Society.
4. Delay in Trial: The defense cited precedents where prolonged incarceration without trial was considered a ground for bail (e.g., Arvind Kejriwal v. CBI, Manish Sisodia v. ED).
5. Cooperation with Investigation: The petitioner maintained that he had complied with investigation requirements under Section 41A of Cr.P.C., and his arrest was unnecessary.

Prosecution’s Contentions

1. Financial Fraud and Misappropriation: The prosecution highlighted that approximately 29 victims had come forward, alleging financial fraud amounting to significant sums.
2. Intent to Cheat: Evidence suggested that the petitioner deliberately siphoned off investors’ funds to his relatives and defaulting borrowers, demonstrating an intention to cheat.
3. Non-cooperation and Destruction of Evidence: The prosecution asserted that the petitioner did not hand over crucial financial records to the administrator and attempted to manipulate evidence.
4. Seriousness of Economic Offense: Relying on Supreme Court judgments, the prosecution emphasized that economic offenses undermine public trust and warrant stringent bail considerations.

Court’s Observations and Decision:

The Delhi High Court rejected the bail application based on the following considerations:

• Magnitude of the Offense: The court noted that the fraud involved multiple victims and substantial financial misappropriation, making it a serious offense.
• Role of the Petitioner: The court found prima facie evidence indicating that the petitioner played a central role in orchestrating the financial misdeeds.
• Possibility of Tampering with Evidence: The court reasoned that releasing the petitioner on bail could impede the investigation, given his past non-cooperation.
• Judicial Precedents: The court distinguished the case from precedents cited by the defense, asserting that bail orders depend on the unique facts of each case.
• Public Interest Considerations: Given the nature of the offense, the court held that granting bail could erode investor confidence and undermine faith in cooperative societies.

Conclusion:

The ruling in Bharat Bhushan Bansal v. State (NCT of Delhi) reinforces the principle that bail in economic offenses is not a matter of right, particularly when there is prima facie evidence of financial misconduct. The judgment highlights judicial reluctance to grant bail in cases where public funds are misappropriated, emphasizing the need to balance individual liberty with larger public interest.

References:

1. Arvind Kejriwal v. CBI, Criminal Appeal No. 3816/2024
2. Manish Sisodia v. ED, SLP Criminal 8781/2024
3. Paras Ram Vishnoi v. The Director, CBI, Criminal Appeal 693/2021
4. Dalip Kaur v. Jagnar Singh, (2009) 14 SCC 696
5. Sarabjit Kaur v. State of Punjab, (2023) 5 SCC 360
6. Mariam Fasihuddin v. State, 2024 SCC OnLine SC 58
7. Syed Yaseer Ibrahim v. State of U.P., 2022 SCC OnLine SC 271
8. Pankaj Soni v. State of NCT of Delhi, Bail APPL. No. 3247/2024