Mumbai, April 24, 2024 (Gr. Bombay Special Court): In a significant development in the ₹767 crore online investment fraud case involving the financial institution ‘DIFM’, the Designated Court under the Maharashtra Protection of Interest of Depositors (MPID) Act, situated at the City Civil & Sessions Court in Mumbai, has granted regular bail to Shivangi Mehta, the wife of the prime accused Ashesh Mehta.
The order, passed on April 24, 2024, by Her Honour Judge Aditee Uday Kadam in Court Room No. 7, addressed Bail Application No. 287 of 2024, filed by Shivangi Mehta, a 34-year-old housewife residing in Goregaon, Mumbai. She was implicated as an accused in C.R. No. 34 of 2023, registered with the Economic Offences Wing (EOW), Unit-7, Mumbai, which cross-references to C.R. No. 387 of 2023 at the Amboli Police Station.
Shivangi Mehta faced charges under Sections 409 (criminal breach of trust), 420 (cheating) read with Section 34 (acts done by several persons in furtherance of common intention) of the Indian Penal Code, 1860, as well as Sections 3 and 4 of the MPID Act, 1999.
The prosecution strongly opposed the bail application, filing their response at Exhibit No. 02.
Details of the Alleged Fraud:
According to the prosecution’s case, Ashesh Shailesh Mehta and Shivangi Ashesh Mehta operated a financial institution and online platform named ‘DIFM’. This platform allegedly showcased approximately 3500 investors and investments exceeding ₹767 Crores. The accused purportedly claimed expertise in Financial Management and invested funds in ‘NIFTY50’ options for short-term gains or losses. Investors were allegedly promised 70% of the profits after deducting various charges, along with an assurance of principal amount refund within 48 hours of demand.
The online application developed by the accused was described as sophisticated and professional, and agreements were generated bearing the accused’s signatures. The complainant reportedly invested ₹25,00,000, and a friend invested ₹30,00,000. The prosecution alleged that thousands of individuals invested varying amounts based on the assurances of profit and quick principal return. However, when the complainant demanded his principal on June 20, 2023, it was not returned, leading him to discover that the accused had allegedly defrauded numerous other investors of over ₹300 Crores.
The FIR was initially lodged at Amboli Police Station on June 26, 2023, and subsequently transferred to EOW, Zone-VIII.
Applicant’s Arguments for Bail:
Advocate Vinay Bhanushali, representing Shivangi Mehta, argued that this was a successive bail application filed after the charge sheet was submitted. He pointed out that the charge sheet revealed M/s. Bliss Consultants (FE) was the proprietary concern of Shivangi Mehta’s husband. Being the wife of the proprietor, her involvement was limited to administrative tasks, and she had no ownership stake in the business.
The defense highlighted that the primary evidence against Shivangi Mehta in the charge sheet consisted of website printouts and emails sent to only one or two investors. Advocate Bhanushali argued that in a proprietary concern, only the proprietor is liable under the MPID Act. He further stated that the charge sheet listed 581 investors with dues amounting to ₹110,93,59,446, while the total property seized, including cash and assets, was valued at ₹171,47,10,396, exceeding the investment amount.
The defense also claimed that Shivangi Mehta had received ₹68 Lakhs from the FE’s bank account against her own investment of ₹14 Lakhs, indicating she was also an investor and not solely a beneficiary of the alleged fraud. It was asserted that she was never an employee or director, did not handle day-to-day affairs, and played no role in securities trading. Advocate Bhanushali emphasized that in a proprietary concern, liability rests with the proprietor, and Shivangi Mehta did not unlawfully gain from the transactions beyond her own investment returns.
Prosecution’s Strong Opposition:
Ld. SPP Seema Deshpande opposed the bail application, citing the serious nature of the alleged offense and the prima facie evidence against Shivangi Mehta, which led to the filing of the charge sheet on March 21, 2024. The prosecution argued that the previous bail application was rejected on merit, and there was no significant change in circumstances to warrant reconsidering bail. They alleged that Shivangi Mehta was actively involved in the business as a director and in the administrative department, communicating with investors via email. The prosecution also mentioned that assets worth ₹171.41 Crores had been secured, with further property investigations ongoing, and that other co-ordinators/co-accused were yet to be apprehended. Additionally, they pointed to other cases lodged against Shivangi Mehta in different states.
Court’s Observations and Decision:
Her Honour Judge Aditee Uday Kadam noted that the earlier bail application was rejected based on the prima facie involvement of the applicant. However, with the filing of the charge sheet, the court observed that Shivangi Mehta was apparently not the primary beneficiary of the investors’ funds. While she played an active role in business administration, suggesting inducement, she did not appear to have secured personal unlawful gain beyond her own investment returns.
Regarding the previous criminal case under the NDPS Act in Madhya Pradesh, the Investigating Officer informed the court that the charge sheet in that case only named the prime accused who implicated Shivangi Mehta and her husband. Thus, the court found the criminal antecedents against Shivangi Mehta to be unclear.
The court acknowledged the admission that Shivangi Mehta’s husband was accepting liability towards the investors and that the assets of both accused, amounting to over ₹171 Crores, had been frozen and secured, exceeding the total investment amount. The court emphasized that the primary objective of the MPID Act is to protect the interests of the investors, and the money trail was a crucial aspect.
Noting that Shivangi Mehta was arrested on December 29, 2023, and the investigation was now complete, the court found that her continued physical custody for custodial interrogation was no longer necessary. The court also considered that her husband, who claimed sole proprietorship, bore the primary liability. This filing of the charge sheet was deemed a change in circumstances.
Considering that Shivangi Mehta is a young woman with no clear criminal antecedents, a local resident unlikely to flee, and willing to cooperate with the investigation, the court found merit in granting bail with certain conditions.
The Bail Order:
Her Honour Judge Aditee Uday Kadam passed the following order:
- Bail Application No. 287 of 2024 is hereby allowed and disposed of.
- Applicant Shivangi Mehta w/o Ashesh Mehta is hereby released on bail in connection with C.R. No. 34 of 2023 registered with EOW, Unit-7, Mumbai, upon furnishing a PR bond of ₹1,00,000/- (Rupees One Lakh only) with one or more sureties in the like amount.
- The Applicant is permitted to furnish provisional cash bail of ₹1,00,000/- (Rupees One Lakh only) for a period of three months.
- The Applicant shall make surety compliance before the concerned Court.
- The applicant shall surrender her passport before the investigating officer within one week of her release.
- The applicant shall make herself available for interrogation by the Investigating Officer as and when required, under written intimation.
- The applicant shall not leave India without prior permission of this Court.
- The applicant shall not alienate any movable and immovable property in her name or in the name of her relatives, if any, without permission of this Court.
- The applicant shall not tamper with the prosecution evidence or pressurize the prosecution witnesses in any manner until the conclusion of the trial.
- The applicant shall furnish her contact number and residential address to the Investigating Officer and shall keep him updated in case of any change.
- The applicant shall attend the dates of trial regularly.
The order, dictated and pronounced in open court on April 24, 2024, grants conditional bail to Shivangi Mehta, emphasizing her cooperation with the ongoing legal proceedings and adherence to the stringent conditions laid down by the court. The focus now shifts to the further legal processes and the efforts to safeguard the interests of the numerous investors allegedly defrauded in this substantial financial scam.