Bank Fraud Case: Kochhars’ arrest in loan case not as per provisions of law, rules HC; grants bail

Background of Chanda Kochhar: The banking sector titan who fell off

Kochhars’ arrest in loan case not as per provisions of law, rules HC; grants them interim bail


Mumbai : The Bombay High Court on Monday pulled up the Central Bureau of Investigation (CBI) for arresting former ICICI Bank CEO-cum-MD Chanda Kochhar and her businessman-husband Deepak Kochhar in a “casual and mechanical” manner and “clearly without application of mind” in an alleged loan fraud case as it granted them interim bail. The CBI arrested the Kochhars on December 23, 2022, in connection with the Videocon-ICICI Bank loan fraud case and they are currently in jail under judicial custody. The couple had filed petitions in the HC challenging their arrest, terming it as “illegal and arbitrary”. The duo had sought to be released from jails on bail by way of an interim order. A division bench of Justices Revati Mohite Dere and P K Chavan, in its 49-page judgment, said the Kochhars’ arrest was not in accordance with the provisions of law. The petitioners are entitled to be released on bail, pending the hearing and final disposal of the petitions, the HC said and listed the pleas for hearing on February 6. It directed the duo to deposit a cash bail amount of Rs one lakh each, surrender their passports to the CBI, cooperate with the probe and attend the central agency’s office as and when summoned. The HC court noted that in the present case, the grounds of arrest are merely stated as non-co-operation and not giving full and correct disclosure. “The reason given in the arrest memos to arrest the petitioners, having regard to the facts as stated aforesaid, appears to us, to be casual, mechanical and perfunctory, clearly without application of mind,” the court observed. The bench held the arrest of the Kochhars was in violation of Section 41A of the Code of Criminal Procedure (CrPC), which mandates sending notice for appearance before the police officer concerned. “According to the facts, the petitioners’ (Kochhars) arrest was not done in accordance with the provisions of law. There has been non-compliance of section 41(A) thus warranting their release. The arrest has not been in conformity with the provisions of law,” the HC added. After the HC ruling, a special CBI court issued the release order of the couple, but they could not walk out of prisons during the day as their bail papers did not reach jail authorities on time. As per a prison official, they didn’t receive the release order by 5:30 pm, the deadline set by jail authorities, hence the couple was not freed on Monday. Earlier, their lawyer said the Kochhars were unlikely to walk out of the prison during the day. Deepak Kochhar (61) is lodged in Arthur Road Jail in central Mumbai, while Chanda Kochhar (61) is housed in the nearby Byculla women’s prison. The HC order said the arrest in a case may be authorised only if the investigating officer has a reason to believe the action is necessary and person has committed the crime. “Belief must be in good faith and not casual or on mere suspicion. The same must be made on credible material and no decision to arrest can be made on fancy or whimsical grounds,” the bench observed. The grounds for arresting the petitioners as stated in the arrest memos are unacceptable and contrary to the reason(s)/ ground(s) on which a person can be arrested, it said. “Courts have time and again re-iterated the role of courts in protecting personal liberty and ensuring that investigations are not used as a tool of harassment,” the HC bench noted. “Needless to state, that personal liberty of an individual is an important aspect of our constitutional mandate. Merely because an arrest can be made because it is lawful, does not mandate that arrest must be made,” the judges maintained. After registration of the case by the CBI in December 2017, the Kochhars have not only appeared before the agency but also submitted all relevant documents and details, the bench said. “Admittedly, during the period 2019 till June 2022, for around four years, neither any summonses were issued to the petitioners nor any communication was established by the respondent No.1– CBI with the petitioners,” it said. “What was the reason to arrest the petitioners after four years is not spelt out in the arrest memos,” the judgment said.

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