Adarsh Cooperative Society 'Scam': Rajasthan High Court Revokes Default Bail Granted To Co-Accused On Ground Of Incomplete Charge Sheet
Rajasthan High Court cancelled the default bail granted under Section 167 (2) CrPC, to one of the co-accused, Rajeev Kumar Rana, under IPC, Prize Chits and Money Circulation Scheme (Banning) Act, and IT Act (2000), in an alleged Rs. 9238 Crores Loan scam case.
The accused has been asked to surrender within 4 weeks. The State moved the high court seeking cancellation of bail granted by the trial court after considering the charge sheet submitted by the police as incomplete, and thus invoking Section 167(2) of CrPC.
As per Section 167(2) CrPC, the police is required to complete the investigation within the prescribed timelines, after which the accused is entitled to be released on “default bail” if no charge sheet is filed.
The bench of Justice Ashok Kumar Jain observed that merely recording the fact that the investigation was incomplete was not sufficient to grant bail. Instead, the trial court was required to apply its mind on what are the counts on which the investigation was pending, and whether the charger sheet/documents submitted by the police were sufficient to proceed.
The accused Rajeev Kumar Rana was arrested on 13th April 2022 in a case popularly known as "Adarsh Credit Cooperative Society case". The allegation in FIR is primarily upon Mukesh Modi and his associates who distributed a loan of ₹ 9238 Crores to 125 shell companies. The facts further indicate that SOG has filed a charge sheet against 15 persons including Rohit Modi, Rahul Modi and Kamlesh Choudhary on 22 July 2019. Admittedly, the SOG has filed a charge sheet (third) on 8 July 2022, but also kept pending investigation under section 173(8) of CrPC.
The Court was hearing a bail cancellation application filed by the State against Trial Court's order that granted default bail to the accused, on the ground that the charge sheet filed by the police was incomplete, since the investigation was pending.
After hearing the contentions, the Court referred to the Supreme Court case of CBI v Kapil Wadhawan & Anr. in which it was held that,
“…mere pendency of investigation would not impugn the charge sheet filed or be a ground for granting a default bail, as long as the condition of Section 173(2) of CrPC were met and the charge sheet was filed in time. The intent behind default bail under Section 167(2) of CrPC is to give impetus to speedy investigation and protection of the rights of the accused.”
The Court highlighted that the investigation was kept pending only on 4 points, but the trial court did not apply its mind to the counts on which the investigation was incomplete, and whether the charge sheet was sufficient to proceed further.
The Court further stated that in today's world, there was an increase in white-collar crimes and usually the money siphoned off to shell companies was untraceable and unreachable. Hence, the investigation was not only challenging but also required time and cooperation from other agencies.
In this background, it was held that a holistic approach was required from the court while intending to protect Article 21 of the accused.
“once a charge sheet is filed…the Court granting a default bail considering the charge sheet papers filed as incomplete, is required to adjudicate the issue whether the documents submitted by police are sufficient to proceed or just an attempt to frustrate right of accused to seek bail under Section 167(2) of CrPC. In the instant case, there is no such observation by the trial court, rather considering the report of police to keep pending investigation on four count, as incomplete charge sheet, the trial Court has judged the charge sheet without examination.”
Accordingly, it was held that the trial court's invocation of Section 167(2) CrPC was seriously erroneous, and thus the bail was cancelled.
Accused has been directed to surrender within 4 weeks.
Title: State of Rajasthan v Rajeev Kumar Rana
Citation: 2026 LiveLaw (Raj) 212