A special court has temporarily stayed proceedings in a case involving Mehul Choksi’s firm Gitanjali Gems and Choksi himself with regard to its former executive Vipul Chitalia in a government financial institution cheating case of over Rs22 crore.
The court has held that the order of a city magistrate court, in which it took cognisance of offence, is not reasoned and has a “prima facie error”. The order came on a plea by Chitalia challenging the magistrate’s order. He was facing proceedings in the case along with Choksi and others.
The case was on the basis of the general manager of IFCI, a development financial institution of the government. The complaint had alleged that Choksi and others conspired to cheat it and got Rs25 crore sanctioned in March 2016. The jewellery company that disbursed the loan started defaulting on the loan and caused a loss to the institution.
In a plea before the special court, Chitalia through his advocate Rahul Agarwal had alleged that the magistrate court had passed a cryptic order without applying its mind while taking cognisance.
Special Judge VS Gaike pointed out that it is of immense importance that there be sufficient grounds for proceeding (against the accused persons) and that an opinion has to be formed only on due application of mind. Judge Gaike stated, “Prima facie it does not appear that any opinion was formed by the trial court on the basis of material content in the chargesheet,” and went on to stay proceedings with regard to Chitalia till July 7.
