In a significant legal development involving corporate misappropriation and digital data theft, the LXII Additional City Civil and Sessions Judge of Bengaluru has granted anticipatory bail to Krishnamurthy K.V. The petitioner was accused of siphoning off over Rs 5 lakh from a logistics company and stealing sensitive digital data from the organization’s proprietary application. The court’s decision, delivered on June 28, 2022, emphasizes the protection of personal liberty in cases where the alleged offences are triable by a Magistrate and do not carry the penalty of life imprisonment or death.

The case was presided over by Sri A. Earanna, LXII Additional City Civil and Sessions Judge, Bengaluru City (CCH-63), in the matter of Crl.Misc.No. 6032/2022.

Background of the Alleged Corporate Fraud

The Whitefield CEN (Cyber, Economic, and Narcotic) Crimes Police Station had registered a case against Krishnamurthy K.V. under Crime No. 233/2021. The charges included Sections 419 (Cheating by personation) and 420 (Cheating and dishonestly inducing delivery of property) of the Indian Penal Code (IPC), along with Sections 66(c) (Identity theft) and 66(d) (Cheating by personation by using computer resource) of the Information Technology Act.

According to the prosecution, the complainant, a diversified logistics delivery firm identified as Shadowfax Technologies Private Limited, discovered significant financial discrepancies within its finance department. The accused, who was an on-role employee of the company, allegedly manipulated the company’s payment system. The company claimed that Krishnamurthy diverted payments made by customers via UPI to his personal bank accounts instead of the company’s account, resulting in a shortage of Rs 5,11,742.

Furthermore, the company alleged that 246 data points were stolen from the company’s application hub, worth an estimated Rs 1,63,854. When the company confronted the employee and requested a refund of the misappropriated funds, he reportedly failed to comply, prompting the logistics firm to seek police intervention.

Arguments for Anticipatory Bail

The petitioner, Krishnamurthy K.V., a 35-year-old resident of Devasandra, Krishnarajpuram, approached the court seeking protection from arrest. His legal counsel, A.P. Umesha, argued that the petitioner was innocent and had been falsely implicated in a case of corporate dispute. The defense emphasized that Krishnamurthy is a permanent resident of Bengaluru with deep roots in the society, making him unlikely to abscond.

The defense also pointed out that the offences alleged—while serious in nature—are not punishable by death or life imprisonment and are triable by a Magistrate. The petitioner expressed his readiness to cooperate with the Investigating Officer (I.O.) and abide by any conditions imposed by the court to prove his innocence.

Prosecution’s Opposition

The Public Prosecutor strongly opposed the bail petition, presenting the Case Diary and the counter-statement from the Investigating Officer. The prosecution argued that the preliminary investigation revealed significant evidence of the petitioner’s involvement in the fraud. The state expressed concerns that if granted anticipatory bail, the accused might destroy digital evidence, threaten prosecution witnesses, or flee from justice. The prosecution maintained that custodial interrogation might be necessary to recover the diverted funds and the stolen data.

Court’s Observations and Ruling

After hearing both sides, Judge A. Earanna evaluated the balance between the needs of the investigation and the personal liberty of the accused. The court noted that while there were allegations of misappropriation of funds and data theft, the nature of the crime fell under the category of cases triable by a Magistrate.

The court observed that since the petitioner had undertaken to cooperate with the investigation, the police could still perform their duties without requiring him to be in judicial custody. The judge remarked that the apprehension of the prosecution regarding the tampering of evidence or witnesses could be effectively managed through stringent bail conditions.

The court found that the petitioner’s status as a permanent resident reduced the risk of him fleeing. Consequently, the court ruled in favor of the petitioner, granting him the shield of anticipatory bail.

Terms and Conditions of Release

The court allowed the petition under Section 438 of the Cr.P.C., directing the Whitefield CEN Police to release the petitioner on bail in the event of his arrest, subject to the following conditions:

1. The petitioner must execute a personal bond of Rs 1,00,000 with one surety for the like sum.
2. He must appear before the Investigating Officer within 30 days and cooperate fully with the probe.
3. He must mark his attendance at the jurisdictional police station once every 30 days, preferably on the second Saturday, until the final report is filed.
4. He is strictly prohibited from threatening the complainant or tampering with any prosecution witnesses or evidence.
5. He must not leave the jurisdiction of the court without prior permission.
6. He must provide proof of his residential address and that of his surety.
7. He is warned not to indulge in similar offences in the future.

The order concluded that any failure to obey these conditions would lead to the automatic cancellation of the bail order. This ruling underscores the judicial principle that pre-trial detention should not be used as a form of punishment, especially in white-collar crimes where the legal process can be sustained through cooperation.