Bombay HC rejects Hari Sankaran’s quashing plea in IL&FS case – Times of India

MUMBAI: In a setback to former Infrastructure Leasing & Financial Services (IL&FS) vice chairman Hari Sankaran, Bombay high court on Tuesday dismissed a quashing petition he had filed in the case of an alleged fraud and evergreening of the company.
The Serious Fraud Investigation Office (SFIO) at the Ministry of Corporate Affairs was investigating the alleged scam. Sankaran through his senior counsel Aabad Ponda sought quashing of the criminal prosecution and setting aside of his remand orders on the premise that the Special trial Court in Mumbai had not taken cognizance of the 2019 complaint filed by the SFIO yet.
Sankaran sought his release for “illegal custody.” He was arrested on April 1, 2019 for an offence under the Companies Act.
The HC bench of Justices Revati Mohite Dere held that “prima facie accused (not Sankaran), have been protracting the proceedings” and that it “is always open to an accused to challenge the cognizance taken by the court,” once it is taken.
Noting, the “disturbing” aspect of delay and that the case is at a pre-cognizance stage from May 2019, the HC directed the trial court to expedite the issue of taking cognizance (legal notice by trial court, after application of mind, of charges mentioned in a charegsheet against an accused).
SFIO counsel Hiten Venegaokar explained the delay in court citing several transfers of judges and the restrictions on hearings limited to urgent matters during the Covid-19 lockdown.
Ponda had submitted that once charge-sheet is filed, it is incumbent on the court to take cognizance and that no gap is envisaged in the CrPC between filing of charge-sheet and taking of cognizance. This, according to him, is in consonance with the constitutional mandate of protecting the personal liberty of an accused. Citing several judgments Ponda said a “remand under Section 309 of Criminal Procedure Code (CrPC) is possible only after court takes cognizance of the offence and as such, all the remand orders passed by the learned Judge being illegal, the same be set-aside and the applicant be released from the alleged illegal detention/custody.”
Ponda also argued that taking cognizance of an offence is not an elaborate procedure and that it ought not to take so long, as has happened in the present case. He submitted that once charge-sheet was filed, it was open for the learned Judge to take cognizance, as the Magistrate is not required to record any reasons for taking cognizance. He submitted that the delay by the court in taking cognizance, as pointed out by Venegavkar, prosecutor, cannot be accepted.
The HC judgment said, “The court can remand an accused person to custody, under sub-section (2) of Section 309, pre and post filing of charge-sheet/complaint. On a plain reading of Section 309, it is evident that the provision applies to an ‘inquiry’ or ‘trial’.”
The question is, when does an inquiry commence under Section 309(2).
According to Ponda, it would commence only post taking of cognizance, on filing of chargesheet said the HC but citing an apex court ruling in Rahul Modi’s case the HC said the controversy in question was laid to rest.
The SC, noted the HC, said, “Acknowledging the fact that an accused has to remain in custody of some court, this Court concluded that on filing of the charge-sheet within the stipulated period, the accused continues to remain in the custody of the Magistrate till such time as cognizance is taken by the court trying the offence, when the said court assumes custody of the accused for purposes of remand during the trial in terms of section 309 CrPC.”
The HC said thus the submissions of Ponda are rejected as being sans merit.
On cognizance of chargesheet, the HC said , “In a nutshell, the expression ‘taking cognizance’ means ‘application of mind’. Though the expression `cognizance’ has not been defined in the CrPC, … taking cognizance does not involve any formal action … but occurs as soon as the Magistrate applies his mind to the suspected commission of an offence..”