Sandesara Settlement and Constitutional Perimeter Of Closure Of Criminal Cases

The Supreme Court's order dated 19 November 2025 in Hemant S. Hathi v. Central Bureau of Investigation [2025 Livelaw (SC) 1139] represents an extraordinary culmination of multiple criminal, regulatory and attachment proceedings arising from the affairs of the Sterling group. Acting on what it repeatedly describes as the “peculiar facts” of the case, the Court directed that all such proceedings be quashed upon deposit of a consolidated sum of ₹5100 crore.This belongs to a small category of cases that lie outside the ordinary grammar of criminal law. Its significance does not lie in findings on culpability, statutory thresholds or evidentiary standards. Instead, it lies in what it reveals about the Court's institutional role when confronted with overlapping statutes, multiple agencies and a factual matrix too densely interwoven to be untangled through conventional adjudication. It is an order that both uses and tests the boundaries of judicial power in the constitutional scheme.What transpired before the Court bore little resemblance to an adversarial criminal proceeding. The hearings functioned, in substance, as a settlement exercise. As the order itself reflects, the petitioners were not asserting legal rights so much as negotiating a financial quantum for a global discharge. The sealed-cover proposal placed by the Solicitor General became the State's preferred basis for a consolidated resolution, and the Court ultimately anchored its directions on that figure. In effect, the Court's task was to give legal effect to a negotiated financial closure.This piece is not a criticism of the Court. It is an acknowledgment that the order marks a threshold moment in our understanding of how constitutional courts respond when the architecture of statutory enforcement is confronted by interlocking proceedings, fragmented factual records, and the sheer scale of financial exposure.I. The statutory canvasThe petitioners sought relief across an exceptionally wide range of proceedings: CBI FIRs and charge-sheets; ECIRs and prosecution complaints under the PMLA; attachment and freezing actions; a fugitive-economic-offender application; prosecution under section 447 of the Companies Act; and complaints under the Black Money Act. Few matters combine this statutory breadth.The judgment notes that the amount alleged in the primary FIR was ₹5383 crore. Consolidated one-time settlement (OTS) figures across Indian and overseas entities stood at ₹6761 crore, of which ₹3507.63 crore had already been deposited. After accounting for recoveries under the Insolvency and Bankruptcy Code, the remaining unpaid amount was ₹2061.37 crore.On 18 November 2025, the Solicitor General submitted, in a sealed cover, a proposal that all proceedings be brought to an end on payment of ₹5100 crore. The petitioners expressed willingness to make this deposit. The judgment records the proposal and its acceptance, but does not disclose how this figure was derived, what it comprises, or whether it corresponds to principal, interest or any penal component. The calculation remains outside the public record.II. The Extraordinary Breadth of ProceedingsThe petitioners sought quashing of:· CBI FIRs and charge-sheets,· ECIRs, prosecution complaints and attachment proceedings under the PMLA,· an application under the FEOA,· prosecution under section 447 of the Companies Act, and· complaints under the Black Money Act.Few matters in recent memory have brought this breadth of regimes together. Parliament had designed each of these statutes as stringent, self-contained instruments meant to override general criminal procedure and ensure rigorous consequences for financial wrongdoing.III. A Settlement in the Supreme CourtThe petitioners were not defending the offences under the Prevention of Money Laundering Act, 2002 (PMLA), the Fugitive Economic Offenders Act, 2018 (FEOA), the Companies Act, 2013 or the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (Black Money Act). They were, instead, negotiating the financial quantum required to bring all proceedings to an end. The figure for this was eventually pegged at ₹5100 crore.The order notes that if the petitioners were prepared to deposit the amounts settled in OTS arrangements and thereby return public funds to the lender banks, “the continuation of the criminal proceedings would not serve any useful purpose.” The “peculiarity” lay in the scale of the exposure and the long history of repayments and recoveries.Notably, the Court did not engage with questions of fact, culpability or statutory thresholds. Nor did it interpret the PMLA, FEOA, Black Money Act or Companies Act. Its directions were confined to the factual consensus and the restitutionary objective that, in its view, justified closure.It is fair to say that the Solicitor General's sealed-cover proposal did not reflect a forensic assessment of...

Sandesara Settlement and Constitutional Perimeter Of Closure Of Criminal Cases

Rajasekhar V.K

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