Anticipatory Bail Denied to Primary Perpetrator of Multi-Crore Cyber Fraud Involving Crypto Currency Siphoning

In brief

The question

1. Whether a second FIR is maintainable when a larger conspiracy is unearthed subsequent to an initial complaint involving the same period.

The court held

The Court answered the issues in the negative, holding that the petitioner stood on a "distinct footing" from the beneficiaries granted bail

It also directed

The court emphasized that the humongous proportion of the fraud and the petitioner's role as a perpetrator disentitled him to discretionary relief

The application for anticipatory bail was dismissed, and the subsequent prayer for a stay on the order was rejected

01Facts

The petitioner sought anticipatory bail regarding a cyber fraud case involving approximately Rs. 315 crores

¶ 2

The prosecution alleged that the petitioner orchestrated a complex scheme using multiple "mule" accounts and Shell companies to defraud over 1,000 victims through fake investment schemes and "digital arrest" scams

¶ 2

Investigation revealed that funds were transferred to 11 bank accounts of Hughli Machineries Private Limited, which the petitioner accessed via his mobile and IP address

¶ 3

The proceeds were subsequently converted into cryptocurrency and moved to foreign jurisdictions like Saudi Arabia and Dubai

¶ 3

While co-accused members of the Ruia family (alleged beneficiaries) were granted anticipatory bail by a Co-ordinate Bench, the State argued the petitioner was the primary perpetrator

¶ 3, 5

The petitioner was already in custody for a related 2024 case when this second, more expansive FIR was registered

¶ 2, 12

02Issues

i.1. Whether a second FIR is maintainable when a larger conspiracy is unearthed subsequent to an initial complaint involving the same period.

¶ 2, 7

ii.2. Whether the petitioner is entitled to anticipatory bail on the grounds of parity with co-accused who were granted bail.

¶ 5, 6

iii.3. Whether the nature of the alleged economic offence warrants the exercise of discretionary relief under Section 438 of the CrPC/Section 482 of the BNSS.

¶ 3, 8

03Law Applied

The court applied the principle that a subsequent FIR is maintainable if it uncovers a larger conspiracy beyond a single instance of fraud, as held in State of Rajasthan v. Surendra Singh Rathore

¶ 7

Regarding economic offences, the court relied on P. Chidambaram v. Directorate of Enforcement, establishing that such crimes affect the economic fabric of society and form a class where anticipatory bail should be exercised sparingly

¶ 3, 8

The court also referenced Sushila Agarwal v. State (NCT of Delhi) and Pratibha Manchanda v. State of Haryana regarding the cautious exercise of discretionary powers in serious criminal matters

¶ 3

The court noted that applications for anticipatory bail should be heard by the regular Bench as per Shekhar Prasad Mahto v. High Court of Jharkhand

¶ 4

Provisions in the judgment · 12 · Linked ones open on LawLens

Bharatiya Nyaya Sanhita, 2023 9 provisions

Section 111 Section 317 Section 318 Section 319 Section 336 Section 338 Section 339 Section 340 Section 61

Indian Penal Code, 1860 Section 406 Section 419 Section 420

04Reasoning

The Court distinguished the petitioner’s role from the co-accused (the Ruia family) who received bail. While the Ruia family were alleged to be mere beneficiaries, the petitioner was identified as the "prime perpetrator" who actively executed the fraud, managed the technical IP addresses, and laundered money into cryptocurrency

¶ 6, 10

The Court reasoned that the humongous scale of the fraud—involving thousands of crores and international transfers—demonstrated a sophisticated criminal enterprise that necessitates custodial interrogation to "remove the layers"

¶ 6, 9

The Court found the prosecution's evidence regarding the petitioner's mobile phone and IP address usage to be incriminating

¶ 10

Additionally, the petitioner's criminal antecedents and the risk of him fleeing due to his technological "deftness" weighed against granting relief

¶ 11, 12