Section 309 CrPC- Is Remand After Chargesheet But Before Cognizance Legal? Bombay High Court To Decide

Justice Revati Mohite Dere on Wednesday was hearing a petition seeking to quash remand extension which raises the above question of law in the IL & FS fraud case investigated by the Serious Fraud Investigation Office (SFIO).

Petitioner Hari Sankaran, who is the prime accused in the case has filed the plea under section 482 of the CrPC alleging that his continued detention is illegal as the Special Court has not taken cognisance of the chargesheet filed in the case despite two years having elapsed. He has sought his release forthwith.

On Tuesday, Justice Dere asked,

"The charge sheet is filed and cognisance is not taken, do the remand orders become illegal? What if the judge is on leave…what happens when the accused files application after application."

The court concluded hearing on the plea yesterday and had permitted the accused to tender written submissions by Monday.

Facts of the Case

Sankaran was arrested in the case on April 1, 2019 and a charge sheet was filed by the Serious Fraud Investigation Office (SFIO) before the Special court on May 29, 2019 – before the expiry of the 60 day period.

The case pertains to alleged wrongdoings in the affairs of Infrastructure Leasing & Financial Services (IL&FS) and its subsidiaries under various sections of the Companies Act. The allegation is that the accused abused their positions, flouted regulatory stipulations for Non-Banking Finance Companies in its lending operations to the detriment of the company and its creditors.

The special trial court is yet to take cognisance of the charge sheet based on an application filed by a proposed accused seeking that cognisance should not be taken. He alleged that the sanction granted by the Ministry of Corporate Affairs (MCA) for prosecution was not proper.

During a previous hearing earlier this month, Justice Dere, calling it a very serious matter, called for the records of the case from the Special Court. The court was of the view that cognisance of a charge sheet was an issue between the concerned court and the investigating agency. Apart from the application filed by a proposed accused, another reason cited before Justice Dere was transfer of five judges from that assignment.

The court observed that on one hand there was an accused seeking that cognisance should not be taken, and on the other there was an accused before that court seeking release citing the same reason. "A matter pending with no cognisance is a matter of concern for this court. The reasons for such delay have to be dealt with," Justice Dere had observed.

Section 309(2) CrPC

The prime challenge in the plea is the proper interpretation of section 309(2) of the CrPC. According to section, if the court, after taking cognizance of an offence, or commencement of trial, finds it necessary to adjourn the inquiry or trial it may do so and may by a warrant remand the accused if in custody.

According to Special Public Prosecutor Hiten Venegavkar for SFIO the period between filing of charge sheet and taking cognisance is in the form of an inquiry and therefore fit perfectly within 309(2). Therefore, all the court's orders directing further detention of the accused were legal even if cognisance was delayed. "Filing of the chargesheet is good enough."

He relied on the judgements of Hardeep Singh vs State Of Punjab & Ors on 10 January, 1947.

Conversely, Senior Advocate Aabad Ponda, along with Advocate Vikrant Negi of DSK Legal submitted that even if it is assumed that the process of taking cognisance is an inquiry, the power to postpone any inquiry is only after cognizance.

Responding to the court's query of a scenario where the judge is on leave, Ponda said that in such cases remand is extended by an in-charge court, so why should cognisance not be taken. Ponda relied on law commission reports relating to the amendment of section 309.

He said that the power to remand an accused under section 167(2) of the CrPC ends with the 60 day custody period and the accused cannot be detained further without cognisance.

He urged the court to set aside all the remand orders passed by the Special Court after filing of the prosecution Complaint (equivalent of chargesheet), pursuant to which the Sankaran is in illegal custody.