Mumbai: Terming it a case of ‘sheer abuse’ of arrest powers, the Bombay High Court on Tuesday pulled up the Economic Offences Wing (EOW) for taking Mamta Digvijay Singh into custody without following due process of law.
Accused Seeks Quashing Of FIR
Singh, one of the accused in the alleged Rs 1,000-crore corporate fraud case involving forged share certificates and illegal transfer of company assets, had sought quashing of the magistrate’s order directing registration of the FIR and the FIR itself.
Court Notes Investigation Lapses
A bench of Chief Justice Shree Chandrashekhar and Justice Gautam Ankhad noted glaring lapses in the investigation. “The power of arrest vested in the investigating officer comes with a corresponding duty to apply his mind. Power of arrest is not unbridled and it must be prima facie shown that police officers had followed mandate under the Code of Criminal Procedure (CrPC),” the court observed. It ordered Singh’s immediate release on interim bail upon furnishing two sureties of Rs 50,000 each.
Arrest Without Fresh Notice
The court pointed out that although Singh’s statement was recorded on June 22, she was arrested nearly three months later, on September 10, without any fresh notice.
“It is quite amazing that after recording her statement in June, she has been arrested in September,” the bench remarked, adding that no explanation was offered as to why Singh was not given the same opportunity as other accused who were served notices as late as Auust.
HC Warns Investigating Officer
Initially, the bench even said it would issue notice to the investigating officer (IO) on why departmental proceedings should not be initiated against him.
“Do you want to be suspended or dismissed?” the court asked the officer who was present in the court. However, it refrained from passing directions on suspension at this stage and instead ordered that its order be transmitted to the Joint Commissioner and the Director General of Police.
Petition Maintainable, Says Court
The court rejected the arguments by the complainant, businessman Rajat Jhunjhunwala, that Singh’s petition was not maintainable, and that she had the option of filling a revision plea before the lower court.
Supreme Court Precedents Cited
Citing Supreme Court rulings, the bench stressed that “a person must not be punished solely on the basis of allegations and that too without fair trial.”
Case Background
The matter will now be heard further after responses from the state and the complainant company. Jhunjhunwala had alleged that his stake in Shajas Developers Pvt Ltd and its subsidiary JLS Realty Pvt Ltd was fraudulently wiped out by the accused.
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Fraud Allegations Detailed
EOW alleged that nearly 3.9 million shares were illegally dematerialised and transferred through shell firms using fabricated signatures. Forged documents were also submitted to the Registrar of Companies. Witnesses have alleged that fake pledges of shares were created in favour of IDBI Trusteeship Services, raising questions over the involvement of other entities.
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