No Bail U/S 479(1) BNSS On Completing Half Or 1/3rd Sentence If Accused Booked In Multiple Cases: Karnataka High Court

The Karnataka High Court has rejected the bail plea of 73-year-old K Ramakrishna, former Chairman of Guru Raghavendra Sahakara Bank Niyamitha and Sri Guru Sarvabhauma Souhanda Credit Co-operative Ltd, booked under Prevention of Money Laundering Act, for allegedly de-frauding the bank to the tune of Rs.1,553 Crores by creating fictitious documents and granting loan in favour of fictitious persons.

Ramakrishna–the petitioner, had approached the Trial Court seeking the relief of bail invoking Section 479(1) of BNSS, 2023, and also on the ground that there is a delay in trial and trial has not yet commenced and he has been in custody from two years seven months. He subsequently approached the high court in a third bail plea. 

The high court said that petitioner cannot invoke the proviso to Section 479 BNSS on the ground of one-third punishment period undergone, adding that it was not applicable on the facts of the case since several cases were registered against him. 

For context, Section 479 (1) of BNSS states that where a person has, during the period of investigation, inquiry or trial under the Sanhita of an offence under any law (not being an offence for which the punishment of death or life imprisonment has been specified as one of the punishments under that law) undergone detention for a period extending up to one-half of the maximum period of imprisonment specified for that offence under that law, he shall be released by the Court on bail. 

Justice HP Sandesh in its order observed that Section 479 of BNSS makes it clear that the benefit of first proviso to Section 479 is subject to Section 479(2) of BNSS and the Court has to take note of the third proviso, thereof, wherein investigation, inquiry or trial in more than one offence are in multiple cases are pending against a person, he shall not be released on bail by the Court. The second proviso to Section 479(1) of BNSS empowers the Court to order the continued detention of a person for a period longer than one half of the period.

It then said, “All the provisions have to be read conjointly, including Sections 479(1) and 479(2). The trial Court has also taken note of the said fact into consideration since there is more than one offence against the petitioner and IPC offences are invoked and a separate case is also invoked by invoking PML offence”. 

It said that the Court has to take note of the fact that the petitioner is the founder of the said Bank and the allegation against him is that Rs.1,544 Crores are misused by creating bogus and fake deposits. 

"Particularly taken note of out of that Rs.882.85 Crores has been sanctioned only to 24 major beneficiaries and specific allegation is made that this petitioner is the architect of the fraud and this fact has been considered by this Court twice and the Apex Court also dismissed SLP (Crl.) No.8032/2022 vide order dated 16.09.2022," the court observed.

It also noted that the other case registered against the petitioner is for offences punishable under Sections 406, 420, 409, 120B read with 34 of IPC and Section 9 of the Karnataka Protection of Interest of Depositors in Financial Establishment Act. 

The court held “When the offences are different as well as when more number of cases are registered against the petitioner, he cannot invoke the proviso under Section 479 of BNSS seeking the relief on the ground of one third punishment even if it is considered, maximum punishment he has already underwent and the said proviso is not applicable to the facts of the case on hand, since the Court has to take note of the gravity of the offence and multiple cases against the petitioner and more than Rs.1,544 Crores fraud has been committed that too this petitioner being a founder Chairman of the said bank". 

Background

The petitioner's counsel the maximum punishment is up to seven years and minimum sentence is three years under Section 5 of the PMLA. It was contended that the trial court's observation was that that another case is filed and it is not a case of multiple case. It was contended that the reasons of the Trial Court are not correct.

Reliance was placed on order of the Apex Court in Writ petition (Civil) No.406/2013, in Re-inhuman conditions in 1382 prisons, wherein it was directed immediate implementation of Section 479 of the BNSS by calling upon the Superintendents of Jails across the country wherever accused persons are detained as undertrials, to process their applications to the concerned Courts upon their completion of one-half/one-third, as the case may be, of the period mentioned in sub-section (1) of the said provision, for their release on bail.

However, the prosecution opposed the plea alleging that this court twice rejected the bail petition having taken note of the fact that allegation of fraud invoking PMLA  offence is to the tune of Rs.1,544 Crores and the same is money invested by the general public and this petitioner being the Chairman of the said Bank indulged in committing such breach of trust.

Moreover, there are two cases, one under PML Act and the other case is by ED and both the trials are different. Hence the Trial Court rightly came to the conclusion that Section 479(1) of BNSS is not applicable to the case on hand, the prosecution said. Further, it was contended, that the court has to take note of the gravity of the offence and the very proviso to Section 479(1) of BNSS is not applicable to the case on hand.

Findings

The court also observed that under Section 531 of BNSS, there is a saving clause while repealing Cr.P.C. regarding applicability of the old Act also. It said that when there is a saving clause, the question of invoking the provision of new enactment is not applicable and while rejecting the bail application, the Trial Court taken note of the same and in detail discussed the same.

The high court said that it does not find any ground grant bail to the petitioner on the ground that no trial has been commenced.

Noting that trial court commenced in the other case the bench said, “Merely because he is in custody from past two years seven months cannot be a ground to enlarge the petitioner on bail when PML offence is invoked and the charges levelled against him is committing fraud to the tune of Rs.1,553 Crores by creating fictitious documents and granting loan in favour of fictitious persons, particularly 24 persons and Rs.928 Crores was misappropriated.”

Thus it rejected the petition.

Case Title: K Ramakrishna AND Assistant Director

Counsel for Petitioner:  Advocate Balkrishna M.R 

Counsel for Respondent: CGC Unnikrishnan M 

Citation No: 2024 LiveLaw (Kar) 483

Case No: CRIMINAL PETITION NO.9930/2024

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