REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO.2415/2009

(Arising out of S.L.P.(Crl.)No.4190 of 2006)

HDFC Bank Ltd. ..Petitioner

Vs.

J.J. Mannan @ J.M. John Paul & Anr. ..Respondents

J U D G M E N T

ALTAMAS KABIR, J.

1. Leave granted.

2. This appeal has been filed by the H.D.F.C. Bank Ltd.

(hereinafter referred to as “the Bank”) against the judgment

and order dated 3

rd

July, 2006, passed by the Madras High

Court in Crl.M.P.No.3784 of 2006 and Crl.O.P.No.15217 of

2006, allowing the application filed by the Respondent No.1

under Section 438 of the Code of Criminal Procedure (Cr.P.C.)

for grant of anticipatory bail to him.

3. According to the Bank, the Respondent No.1 in his

capacity as the Managing Director of the Mannan Construction

Corporation Private Limited, a company engaged in the

execution of Highway Contracts and contracts of the Public

Works Department (hereinafter referred to as “the Company”),

along with one M/s. Immanuel Projects Private Ltd., applied

for a loan of Rs.2,03,40,000/- (Rupees Two Crores, three

lakhs and forty thousand) only, for purchase of 6 Krishna

Electronic Sensor Paver Finishers from one M/s. Krishna

Engineering Works in Ahmedabad. The said loan was duly

sanctioned and after signing of necessary Agreements and

other documents, six cheques for the loan amount of

Rs.2,03,40,000/-, drawn in the name of M/s. Krishna

Engineering Works, were handed over to the Respondent No.1 on

9

th

March, 2006. Subsequently, by a letter dated 24

th

May,

2006, the Bank informed M/s. Krishna Engineering Works in

Ahmedabad that a sum of Rs.2,03,40,000/- had been disbursed

to them on account of the Respondent No.1 and requested them

to confirm receipt of the same. M/s. Krishna Engineering

Works wrote back to the Bank stating that it had not received

any payment on account of Mr. J.M. John Paul.

4. The Bank thereupon caused enquiries to be made and

came to learn that no machineries had, in fact, been

purchased by the Respondent No.1, and that the Respondent

No.1 had colluded with M/s. Immanuel Projects Private Limited

and their Directors and one Mr. R.I. Jambert Mathuram with

the intention of cheating the Bank and in the process had

committed offences punishable under Sections 420, 467, 468,

471 and 120-B Indian Penal Code.

5. The Bank filed a complaint with the Commissioner of

Police, Egmore, Chennai-600008 on 27

th

May, 2006, setting out

the facts relating to sanction of the loan and the handing

over of the six Banker’s cheques in the name of M/s. Krishna

Engineering Works. The complaint also contained the manner

in which the Respondent No.1 had opened a fictitious account

with I.C.I.C.I. Bank, Tuticorin Branch, in the name of M/s.

Krishna Engineering Works and deposited the cheques meant for

supply of road construction equipment by Krishna Engineering

Works of Ahmedabad. Thereafter, the said amount was encashed

and transferred to M/s. Matrix Enterprises having its office

at No.41, C.G.E. Colony, 5

th

Street, Tuticorin-628 003, which

was holding an account in the Tuticorin Branch of I.C.I.C.I.

Bank. The said amounts were again transferred to the account

of M/s. Delta Enterprises, also having its office at No.41,

C.G.E. Colony, 5

th

Street, Tuticorin, with the Tuticorin

Branch of the I.C.I.C.I. Bank.

6. After the aforesaid transactions, the moneys were

finally credited to the account of the Respondent No.1 in the

same Branch of the I.C.I.C.I. Bank. It was also found on

enquiry that the addresses of all the above-mentioned

companies were that of the residence of the Respondent No.1,

Mr. J.M. John Paul.

7. F.I.R. No.157 of 2006 dated 12

th

June, 2006, was drawn

up on the basis of the aforesaid complaint against the

Respondent No.1 and others by the Central Crime Branch,

Chennai, under Sections 419, 420, 468, 473 read with Section

120B Indian Penal Code.

8. The Respondent No.1 thereupon filed an application in

the Madras High Court under Section 438 Cr.P.C. for grant of

Anticipatory Bail and the learned Single Judge of the said

High Court, by his order dated 3

rd

July, 2006, allowed the

same upon holding that since the investigating agency had

already seized all relevant and vital documents and had

recorded the statements of all the important witnesses, the

custodial interrogation of the Respondent No.1 was not

required.

9. The present appeal has been filed by the Bank for

cancellation of the Anticipatory Bail granted to the

Respondent No.1.

10. On behalf of the Union of India it was contended that

in the facts of the case, the High Court had erred in

allowing the Respondent No.1’s application under Section 438

Cr.P.C. since he had allegedly master-minded the fraud and

having regard to the gravity of the offence alleged, the

Anticipatory Bail granted to him was liable to be cancelled.

Mr. Lalit submitted that the Respondent No.1 had

misappropriated what was meant to be paid to the supplier of

the road construction equipment, in a planned manner and the

whereabouts of the moneys was yet to be ascertained.

11. Mr. Lalit submitted that the provisions of Section 438

Cr.P.C. had been misapplied by the High Court in this case,

since there was sufficient material on record to prima facie

indicate that the Respondent was a direct player in the

fraudulent episode, and, in any event, the High Court could

not have granted a blanket order of Anticipatory Bail upto

the end of the trial. Mr. Lalit submitted that in view of

the impugned order, the Respondent No.1 had never appeared in

Court even once, at any stage of the case, and had not even

surrendered and obtained regular bail. Mr. Lalit referred to

the decision of this Court in Adri Dharan Das vs. State of

West Bengal [(2005) 4 SCC 303], wherein it was categorically

indicated that Anticipatory Bail had to be given for a

limited duration so as to enable the accused to move for

regular bail under Section 437 Cr.P.C. Reference was also

made to the decision of this Court in Salauddin Abdulsamad

Shaikh vs. State of Maharashtra [(1996) 1 SCC 667] where the

same essentials have been reiterated.

12. Appearing for the Respondent No.1, Mr. Rajiv Dutta,

learned Senior Advocate, submitted that except for wild

allegations made against the Respondent No.1, nothing

incriminating had been found against him. Mr. Dutta urged

that the Respondent No.1 had been granted Anticipatory Bail

as far back as on 3

rd

July, 2006, and he had never misused

the privilege and had co-operated with the investigating

agencies all through. Furthermore, the trial had already

commenced and several witnesses had been examined and there

could, therefore, be no justification for cancelling the

Anticipatory Bail granted to him by the High Court more than

three years ago. Referring to the decision of the

Constitution Bench in the case of Gurbaksh Singh Sibbia Vs.

State of Punjab [(1980) 2 SCC 565], wherein the application

of Section 438 Cr.P.C. had been considered in detail, Mr.

Dutta submitted that the said provision had been interpreted

to be a beneficent provision relating to personal liberty

guaranteed under Section 21 of the Constitution. Mr. Dutta

submitted that the Constitution Bench had observed that since

denial of bail amounts to deprivation of personal liberty,

the court should lean against the imposition of unnecessary

restrictions on the scope of Section 438 Cr.P.C.

13. Reference was also made to the decision of this Court

in the case of Savitri Agarwal & Ors. Vs. State of

Maharashtra & Anr. [JT 2009 (9) SC 460 = (2009) 8 SCC 325],

where the various decisions in this regard, with special

emphasis on Sibbia’s case (supra) as also Adri Dharan Das’s

case (supra), were referred to. Their Lordships took note of

the fact that the provisions of Section 438, as amended, had

not yet been notified and that as a result the old provision

continued to be in force. Hence, the earlier decisions would

continue to be relevant to the facts of this case. Mr. Dutta

submitted that having regard to the views expressed by this

Court in no uncertain terms, prayer for Anticipatory Bail

should not be refused and, in any event, in this case

Anticipatory Bail had already been granted more than three

years ago and hence the submissions now being made as to when

Anticipatory Bail should be granted have become irrelevant.

14. Having carefully considered the submissions made on

behalf of the respective parties and the decisions referred

to in support of their respective cases, we are of the view

that the role of the Respondent No.1 in the entire episode

did not entitle him to the relief of Anticipatory Bail, much

less a blanket order of bail. However, that is now a closed

chapter. But what is of relevance is whether the High Court

should have worded its order in such a way that it could be

interpreted to mean, as has been done by all concerned, that

the Respondent No.1 was not required to even appear and

surrender before the Court during the entire investigation

stage and the trial. Taking advantage of the same, the

Respondent No.1 has successfully avoided the Court from the

very initial stage of investigation and even the trial. Such

kind of an order is not contemplated under Section 438

Cr.P.C. as has been repeatedly explained by this Court. The

said position has been clearly enunciated in Adri Dharan

Das’s case (supra). Furthermore, it has also been

consistently indicated that no blanket order could be passed

under Section 438 Cr.P.C. to prevent the accused from being

arrested at all in connection with the case. To avoid such

an eventuality it was observed in Adri Dharan Das’s case

(supra) that Anticipatory Bail is given for a limited

duration to enable the accused to surrender and to obtain

regular bail. The same view was reiterated in Salauddin’s

case (supra) wherein it was, inter alia, observed that

Anticipatory Bail should be of limited duration only and

primarily on the expiry of that duration or extended

duration, the Court granting Anticipatory Bail should leave

it to the regular court to deal with the matter on an

appreciation of evidence placed before it after the

investigation has made progress or the charge-sheet is

submitted.

15. The object of Section 438 Cr.P.C. has been repeatedly

explained by this Court and the High Courts to mean that a

person should not be harassed or humiliated in order to

satisfy the grudge or personal vendetta of the complainant.

But at the same time the provisions of Section 438 Cr.P.C.

cannot also be invoked to exempt the accused from

surrendering to the Court after the investigation is complete

and if charge-sheet is filed against him. Such an

interpretation would amount to violence to the provisions of

Section 438 Cr.P.C., since even though a charge-sheet may be

filed against an accused and charge is framed against him, he

may still not appear before the Court at all even during the

trial. Section 438 Cr.P.C. contemplates arrest at the stage

of investigation and provides a mechanism for an accused to

be released on bail should he be arrested during the period

of investigation. Once the investigation makes out a case

against him and he is included as an accused in the charge-

sheet, the accused has to surrender to the custody of the

Court and pray for regular bail. On the strength of an order

granting Anticipatory Bail, an accused against whom charge

has been framed, cannot avoid appearing before the trial

court. If what has been submitted on behalf of the appellant

that the Respondent No.1 has never appeared before the trial

court is to be accepted, it will lead to the absurd situation

that charge was framed against the accused in his absence,

which would defeat the very purpose of Sub-Section (2) of

Section 240 Cr.P.C.

16. Having regard to the above, the order of the High

Court dated 3

rd

July, 2006, is modified to the extent that

the Respondent No.1 shall surrender before the Trial Court

forthwith and pray for regular bail and the Trial Court shall

dispose of the same on merits, in accordance with law, before

proceeding further with the trial.

17. The appeal is allowed to the above extent.

…………………………………………J.

(ALTAMAS KABIR)

…………………………………………J.

(DEEPAK VERMA)

New Delhi

Dated: 16.12.2009