'Successive Commission Of Economic Offences Prejudicial To Maintenance Of Public Order': Telangana HC Upholds Preventive Detention For White Collar Crimes

"Unfortunately, in the last few years, the country has been witnessing an alarming rise in white-collar crimes, which has affected the very fibre of the country's economic structure. Notwithstanding stringent legislations made to curb this evil, it has not been possible to eradicate the same. Therefore, any leniency in economic offence will send a wrong signal to the society at large. On the contrary, a message must reach to such offenders that there shall not be any leniency shown with respect to such activities/offences and the same shall be dealt with Iron hand," a Division Bench of Justices A. Rajasheker Reddy and Dr. Justice Shameem Akther observed.

The Bench further made it clear that economic offences, when committed in quick succession, are prejudicial to the maintenance of 'public order'. This position is different from merely disturbing 'law and order' and therefore, an order of preventive detention may be passed against the alleged offender.

Background

The observation was made while dismissing a Habeas Corpus petition, filed against preventive detention of the Petitioner's husband on an order passed by the Commissioner of Police, Cyberabad Police Commissionerate, under Section 3(2) of the Telangana Prevention of Dangerous Activities Act, 1986.

The impugned order was passed after relying on five criminal cases registered against the detenu, an alleged 'White Collar Offender'.

The State had contended that the detenu has been habitually and continuously engaging himself in series of unlawful activities by committing criminal breach of trust and cheating the innocent public by collecting huge money under the guise of investing the same in stock market and promising good profit, in an organized way, and thereby creating large scale fear and insecurity among the gullible public, which are prejudicial to the maintenance of public order.

The Petitioner on the other hand submitted that her husband is an innocent Stock Market Trader. She submitted that collecting money from public for investing in same in stock market by promising good returns, in any event, would not satisfy the word 'White Collar Offender'.

She submitted that all the criminal cases relied upon by the detaining authority for preventively detaining the detenu are at preliminary stage and charge-sheet is not filed in any case. Further, in all the five cases relied by the detaining authority for preventively detaining the detenu, the detenu was granted bail by the Courts concerned.

Further, the cases alleged against the detenu do not add up to "disturbing the public order". They are confined within the ambit and scope of the word "law and order". Since the detenu is alleged to be a 'White Collar Offender', the detenu can certainly be tried and convicted under the Penal Code. Thus, there was no need for the detaining authority to invoke the draconian preventive detention laws.

Findings

On a perusal of the record and material presented against the detenu, the Bench observed that he committed the alleged offences in quick succession. It further observed that since the detenu got bail in all the five cases relied upon by the detaining authority, there is nothing wrong in raising an apprehension that there is every possibility of the detenu committing similar offences, which would again certainly affect the public order.

"In the instant case, a perusal of the material placed on record reveals that the detenu was granted bail by the Courts concerned in all the five cases relied upon by the detaining authority for preventively detaining him. Under these circumstances, the contention of the respondents that the illegal activities of the detenu would disturb the even tempo of life of the community which makes it prejudicial to the maintenance of the public order and there is imminent possibility of the detenu again indulging in similar prejudicial activities, cannot be brushed aside," it said.

The Bench observed that it is settled law that an order or detention is not a curative or reformative or punitive action, but a preventive action, the avowed object of which is to prevent the anti-social and subversive elements from imperilling the welfare of the people or the security of the nation or from disturbing the public tranquillity or from indulging in white collar offences.

In the instant case, it observed, the modus operandi of the detenu in the alleged offences which were committed in quick succession would certainly disturb the public peace and tranquillity.

"So it is imperative upon the officers concerned to pass the order of detention, since the acts of the detenu are prejudicial to the maintenance of public order," it held.

The order further stated,

"The illegal activities of the detenu were of such a reach and extent, that they would certainly affect the even tempo of life and were prejudicial to the public order. The detaining authority had sufficient material to record subjective satisfaction that the detention of the detenu was necessary to maintain public order and even tempo of life of the community. The order of detention does not suffer from any illegality.

Here, it is apt to state that the economic offences, having deep rooted conspiracies and involving huge loss of public funds, needs to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country.

Similarly, white collar offence can have a large impact on the society. It is also called as a socio-economic crime, because it has a direct impact on the society, which is far more costly than the ordinary crime. These white collar crimes, by nature, are such that the injury or the damage caused as a consequence of it is so widely diffused in the large body of citizens, that their enormity as regards personage victim is almost trifling."

Case Title: Banka Sneha Sheela v. State of Telangana & Ors.

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