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BEFORE THE DESIGNATED COURT UNDER M.P.I.D. ACT
AT BOMBAY CITY CIVIL & SESSION COURT, MUMBAI.
BAIL APPLICATION NO.66 OF 2015
IN
R.A. NO.29 OF 2015
IN
C.R.NO.89 OF 2013
Nimish Keshavlal Patel,
Age : 54 years, Indian Inhabitant,
Residing at : 41, Ashwamegh Bungalow,
Nr. Someshwar Complex, Satellite,
Ahmedabad – 380 015.

…. Applicant.

V/s.
The State of Maharashtra,
EOW Unit V, CB, CID,
C.R.No.89/13.
CORAM :
DATE
:
…. Respondents.

D.P. SURANA (C.R. NO.36)
17th NOVEMBER, 2015.

Appearance :
Adv. Girish Kulkarni for Applicant/Accused
SPP Adv. Avinash Avhad for State.
Adv. Sandip Karnik for Intervener/Informant.
ORAL ORDER
Applicant who was came to be arrested on 29.10.2015 in C.R.
No.89 of 2013 registered with EOW for the offence punishable under
sec.409, 465, 467, 468, 471, 474, 477(A), 120 B of the I.P. Code and
sec.3 of the Maharashtra Protection of Interest of Depositors (In
Financial Establishments) Act, 1999, by this application u/sec.439 of
the Cr.P.C. is seeking bail.
2.

It is the case of prosecution that, National Spot Exchange
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Ltd. (in short NSEL) provided electronic platform to the buyers and
sellers for entering into pair contract T+2 and T+25 wherein, T­2 is the
pay in date and T­25 is pay out date. That, on the NSEL platform the
buyers and sellers who resides far away from each other and don’t know
each other can trade in different commodities. That one who intend to
sell his commodity/s has to deposit his goods at warehouses operated
by NSEL, wherein quality, quantity etc., of goods were checked.
Electronic warehouse receipts were generated by NSEL. One who
intends to purchase the goods, so deposited in NSEL accredited
warehouses, is required to deposit margin money and on purchase, copy
of electricity warehouses receipt is issued to him.
It is alleged that the NSEL, which was supposed to trade in
sale and purchase of commodities, deviated from its business module.
That without there being actual physical stock of the commodities,
NSEL officials in collusion with there 25 borrowers and the brokers,
appointed by NSEL itself, generated false and bogus warehouse receipts,
without there being actual stock of the commodities. Whereas in all
around 13,000 investors were induced for higher returns by the NSEL
and were duped to the tune of Rs.3,500 Crores, and thereby undertaken
financial transaction, on the garb of sale and purchase. That these
13,000 investors were fraudulently defrauded and defaulted by the
NSEL in collusion with his member borrowers and brokers.
3.

It is alleged against the applicant accused that he is one of
the Promoter Director of M/s. N.K. Proteins Ltd. (in short NKPL) a
company having registered office at 7th Floor, Popular House, Ashram
Road, Ahmadabad. NKPL has the business of refining of edible oil and
its brand is Tirupati. NKPL started its trading on NSEL since September
2009 and became Trading Cum clearing Member of NSEL. NKPL used
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to trade in the Castor Seed, Castor Oil and Cotton Seed Wash Oil. The
applicant accused gave false storage receipts cum quality certificates,
issued fake sale invoices without having physical delivery and making
false statement about the stock of commodities and diverted funds
totally to the tune of Rs.969/­ Crores in connivance with NSEL officials.
It is further alleged against the applicant that, out of the 25 borrowing
companies M/s. N.K. Proteins is the biggest defaulter member. As per
declaration of NSEL on August 6, the company should have 7,553 tons
of Castor oil, 96,581 tons of Castor seed and 84,766 tons of Cotton
wash oil in the plans at Kadi and Thor, Dist. Mehsana, Gujarat.
However, police team did not find the stock at these places when visited
immediately after registration of this offence. The company of the
accused is first company to start trading in paired contracts without
stocks; other accused borrowers followed the suit.
4.

Adv. Girish Kulkarni for applicant submitted that the
applicant is sufficiently interrogated by the investigation agency. That
all the relevant documents are provided to the I.O. Nothing is left to be
interrogated from the applicant. That, all the offence leveled against the
applicant prescribes punishable for imprisonment upto 7 years only. He
further submitted that all other member borrowers of NSEL who were
arrested are granted bail. That the brother of applicant Nilesh Patel,
who was the chairmen of the NKPL was arrested, interrogated and
released on bail by Hon’ble High Court. The role of the co­accused
brother of the applicant Nilesh is similar to that of the present applicant,
as applicant is alleged to be MD of NKPL. That properties of the
applicant over and above the alleged default is already seized in the
said crime. Adv. Kulkarni contended that no purpose will be served in
keeping the applicant under further incarceration.

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5.

As against this SPP Adv. Avhad, I.O. and Adv. Karnik for
informant intervener submitted that there is prima­facie case maid out
against the applicant. That the investigation shows a link established
between the NSEL, its officials and the applicant being M.D. of NKPL,
which shows that the crime was perpetrated in conspiracy. That
applicant has tie up between NSEL key Management persons and the
accused persons. That, the applicant accused in connivance with the
officials of the NSEL diverted huge amount of Rs.969/­ Crores and is
the biggest defaulter of the NSEL. This amount is yet to be recovered.
The brother of the co­accused Nilesh Keshavbhai Patel is son­in­law of .
Shankarlal Guru, the Chairman of NSEL, which proves their nexus with
the NSEL key management persons. Nilesh Patel was arrested on
22/10/2013 and was released on bail on 04/02/2014 as per the orders
of Hon’ble High Court whereas, investigation of this case is still in
progress. The applicant accused is an influential person who can
threaten the witnesses whose statement are yet to be recorded. He is
likely to tamper with the evidence and may abscond. The process of
identification and securing the assets of the accused is in progress which
will be attached under the provisions of MPID Act. The accused is
involved in day to day affairs of the borrower NKPL and is well aware of
the siphoned off money. The accused failed to cooperate in the
investigation and didn’t attend the office of EOW although summonses
were issued to him. The claim of the accused that he has deposited an
amount of Rs.52 Crores does not prove his bonafide because he has
paid only 5% of his liability. Investigation in respect of end use of
investors’ huge amount and other perpetrators of the crime who aided
and abetted him in the commission of this offence is in progress. The
applicant accused has created hurdles in the investigation by way of
filing frivolous litigations and has scant respect for the law. The accused
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is likely to abscond and tamper with the evidence. That, the co­accused
members/borrowers, who are released on bail where after filing of
charge­sheet against them, whereas charge­sheet is not yet filed against
the applicant, as such, the law of parity is not applicable to the
applicant. As such, they prayed that applicant may not be granted bail
at the most till the filing of charge­sheet.
6.

After going through the rival contentions, I have perused
the documents relied by parties and the police case papers.
7.

At the out set I would like to mention here that it is not
disputed by the applicant that he is M.D. of NKPL who was the member
of NSEL. It is also not disputed that there was trading of huge amount
between him and NSEL. It is pertinent to note here that applicant and
his brother Nilesh are sufficiently interrogate by the I.O. The grounds
put­forth by the I.O. for rejection of the bail are not sufficient to
continue the applicant behind the bars, as no specific instance is shown
as to what part of investigation, as against the applicant, is pending for
which his custody is necessary or required and on what aspect there
was non cooperation by the applicant during the interrogation.
8.

It seems that applicant is disputing the quantum of his
liability as against the NSEL. The properties of the applicant over and
above the claim of the NSEL is already attached in the crime. The
brother of applicant, who is co­accused in the crime and who is a
chairmen of the NKPL, namely Nilesh Patel is already released on bail
by the order of Hon’ble High Court. When it is not satisfactory shown as
to why the applicant’s custody is necessary for the further investigation,
irrespective of the fact that charge­sheet is not filed as against the
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applicant or further investigation as against him is pending, I do not
find that he is required to be continued behind the bars. Only because
the applicant has not come with a suitable proposal in respect of the
repayment of the amount alleged to be due as against NKPL or has not
consented for the sale of the property/ies, when he is disputing the
amount due as against him, he cannot be detained behind the bars.
9.

The accused applicant is in custody since 29.10.2015.

There is no material to show that only if the applicant is kept behind the
bars the further investigation will be facilitated and other wise not. As
such, the grounds put­forth by the prosecution opposing the application
of bail of the applicant are not sufficient enough to refuse bail to the
applicant.
10.

More over, all the arrested officer bearers of the NSEL and
arrested borrowers/member of NSEL, including Jignesh Shah of NSEL
and Nilesh Patel of NKPL are already granted bail. The directors of
other similarly situated companies i.e., Lotus Refineries Pvt. Ltd., P.D.
Agro Processors Pvt. Ltd., ARK Imports Pvt. Ltd., Yathuri Associates,
etc., whose outstanding amount as against the NSEL is also in corers,
are also released on bail. There may be difference that they might have
released on bail after filing of charge­sheet, but as discussed above,
there is no insistences pointed out by the prosecution as to what part of
investigation as against the applicant is pending for which his custody is
necessary. As such, I am of the view that the applicant is entitle for bail
on the law of parity too.
11.

The allegation of the I.O. of tampering or absconding are
general in nature. The co­accused brother of applicant Nilesh Patel,
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who was released on bail is not alleged to be absconding or has
tampered with any withess or the evidence. The applicant’s address is
also not disputed by the I.O.
12.

Most of the investigation is based on documentary
evidence, which are already in the possession of I.O. The documents
relating to NKPL are also seized in the crime. To have an opportunity to
the I.O. to further interrogate the applicant, pending investigation,
conditions can be imposed on him, so as to have an opportunity to I.O.
to complete investigation smoothly. In the result, I am of the view that,
applicant is entitle to be released on bail with strict conditions to be
imposed. As such, I proceed to pass following order.
ORDER
Criminal bail application no.66/2015 is hereby allowed.
Applicant Nimish Keshavlal Patel is ordered to be released on
bail in EOW Crime No.89/2013 for the offence u/sec.409, 465, 467,
468, 471, 474, 477­A r/w sec.120­B of the I.P. Code and sec.3 of the
MPID Act, on his executing PR bond of Rs.20 Lakhs with one or more
sureties to make up the like amount with following conditions ­
1. that applicant shall mark his presence at concern police station
with investigating officer on coming 10 alternate Wednesday
between 10 am to 1 pm. and as and when called by I.O.
2. that applicant shall not leave India without the permission of
this court.
3. that applicant shall not directly or indirectly make any
inducement, threat or promise to any person acquainted with the
facts of the case so as to dissuade him from disclosing any facts to
any police officer or court.

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4. that applicant shall not alienate or disposed off, in any manner,
any of his immovable properties without the permission of court.
Date : 17.11.2015
( D.P. Surana )
Special Judge, M.P.I.D. Act.
City Civil & Sessions Court, Gr. Bombay.