A special CBI court on Monday ordered the issuance of a proclamation against billionaire jeweller Jatin Mehta, his wife Sonia Mehta and another accused in connection with an alleged Rs 146.35 crore fraud involving Canara Bank, after noting that they had remained untraceable despite the issuance of non-bailable warrants several years ago.
Special Judge Nitin V Jiwane allowed the Central Bureau of Investigation's application seeking proclamation proceedings under the relevant provisions of the Code of Criminal Procedure (CrPC) to secure the presence of the accused. However, the court rejected the agency's request for simultaneous attachment of their properties, observing that the apprehension of disposal of assets had not been supported by sufficient material.
The court noted that non-bailable warrants issued against the accused in June 2018 had remained unexecuted and that subsequent investigation indicated they were residing in the United Kingdom.
๐๐ผ๐๐ฟ๐ ๐ผ๐ฟ๐ฑ๐ฒ๐ฟ๐ ๐ฝ๐ฟ๐ผ๐ฐ๐น๐ฎ๐บ๐ฎ๐๐ถ๐ผ๐ป
The CBI had approached the special court seeking the issuance of a proclamation against Mehta and the other accused after repeated efforts to secure their presence failed.
Examining the material placed before it, the court observed that the accused had not been traced despite the issuance of non-bailable warrants and that there was sufficient prima facie material to initiate proclamation proceedings.
"The record shows that non-bailable warrants were issued against the accused and the same were not executed as the accused persons were not traced," the court noted.
It further observed that the circumstances indicated the accused were avoiding the execution of the warrants.
"Therefore, prima facie it is brought on record that, in spite of issuance of non-bailable warrants against the above named accused persons, they are concealing themselves for avoiding the execution of non-bailable warrants and have absconded. Therefore, the proclamation needs to be issued for securing presence of accused persons," the court said.
The proclamation proceedings are intended to compel the accused to appear before the court and participate in the criminal proceedings.
๐ฃ๐ฟ๐ผ๐ฝ๐ฒ๐ฟ๐๐ ๐ฎ๐๐๐ฎ๐ฐ๐ต๐บ๐ฒ๐ป๐ ๐ฝ๐น๐ฒ๐ฎ ๐ฟ๐ฒ๐ท๐ฒ๐ฐ๐๐ฒ๐ฑ
While allowing the request for proclamation, the court declined to simultaneously order attachment of properties belonging to the accused.
The CBI had sought attachment of assets belonging to Jatin Mehta, Sonia Mehta and two others, expressing concern that they might dispose of their properties to frustrate further legal proceedings.
However, the court held that the agency had merely expressed an apprehension without producing material to substantiate the claim.
It observed that an order for attachment under Section 83 of the CrPC required the court to reach the necessary satisfaction on the basis of material placed before it.
A general apprehension that the accused might dispose of their assets was insufficient to justify immediate attachment, the court indicated.
The judge nevertheless clarified that the CBI could submit a fresh application seeking attachment of properties at an appropriate stage of the proceedings, provided the request was supported by relevant material and complied with the law.
๐๐ผ๐น๐ฑ ๐ถ๐บ๐ฝ๐ผ๐ฟ๐๐ ๐ฎ๐ ๐ฐ๐ฒ๐ป๐๐ฟ๐ฒ ๐ผ๐ณ ๐ฐ๐ฎ๐๐ฒ
The case concerns alleged irregularities in transactions undertaken by Winsome Diamonds and Jewellery Ltd, a company associated with Jatin Mehta.
According to the CBI, the company purchased gold from three overseas bullion banks โ The Bank of Nova Scotia, Standard Bank and Standard Chartered Bank โ using guarantees provided by Canara Bank.
The imported gold was subsequently processed and exported to 13 buyers in the United Arab Emirates, the agency alleged.
However, the company allegedly failed to make payments for the gold imported against the bank guarantees.
The CBI stated that the failure to honour these obligations resulted in the overseas bullion banks invoking standby letters of credit (SBLCs) issued with the backing of Canara Bank.
The agency alleged that the transactions consequently caused a wrongful loss of Rs 146.35 crore to the Indian bank.
๐๐ผ๐บ๐ฝ๐ฎ๐ป๐ ๐ฐ๐ถ๐๐ฒ๐ ๐๐ป๐ฝ๐ฎ๐ถ๐ฑ ๐ฒ๐ ๐ฝ๐ผ๐ฟ๐๐
During the investigation, Winsome Diamonds maintained that it had not received export proceeds from its overseas buyers, which affected its ability to discharge the payment obligations arising from the gold imports.
According to the company's explanation cited in the proceedings, the non-receipt of payments from foreign buyers led to the invocation of the SBLCs by the bullion banks.
The CBI, however, has alleged that the transactions resulted in financial losses to Canara Bank and constitute the basis of the fraud case.
The allegations remain subject to adjudication, and the court's latest order concerns securing the presence of the accused rather than determining their guilt.
๐๐ฐ๐ฐ๐๐๐ฒ๐ฑ ๐ฟ๐ฒ๐ฝ๐ผ๐ฟ๐๐ฒ๐ฑ๐น๐ ๐ถ๐ป ๐จ๐
The court took note of the investigating agency's submission that the accused had remained untraceable despite attempts to execute the non-bailable warrants issued in June 2018.
The investigation subsequently indicated that the accused were residing in the United Kingdom.
On the basis of these circumstances, the court found sufficient grounds to issue a proclamation for securing their appearance.
The CBI may pursue property attachment through a separate application if it produces the material required under the CrPC.
The case will now proceed with the proclamation process, while the allegations concerning the gold transactions and the claimed Rs 146.35 crore loss to Canara Bank remain pending judicial determination.