Anticipatory bail granted to CMRL officials accused in alleged ₹18-crore land compensation fraud

The de facto complainant, Phoenix Asset Reconstruction Company Ltd., alleged that properties originally owned by P.K.S. Prashath and P.J.K. Sriram had been mortgaged with Andhra Bank and that, after default and assignment of the debt to Phoenix ARC, Accused Nos. 1 to 5 fraudulently transferred the properties to Samarpana Charitable Trust by suppressing the subsisting mortgage.

The Trust allegedly relied on the documents to obtain compensation from Chennai Metro Rail Limited (CMRL) for acquisition of the properties, causing an alleged loss of approximately Rs.18 crores.

The petitioners were CMRL officials: N. Sathiyanarayanan served as District Revenue Officer (Land Acquisition) until 30.06.2022; R. Ramesh succeeded him on 01.07.2022; and P. Gopalsamy served as Deputy Collector (Land Acquisition).

The petitioners claimed that they acted pursuant to the prescribed acquisition procedure, obtained a legal opinion from CMRL’s Panel Counsel, and relied on the permission granted by this Court under Section 92 CPC to alienate the Trust property.

The petitioners apprehended arrest in Crime No.31 of 2026, registered for offences under Sections 420, 418, 424, 467, 468, 120B and 471 IPC, and sought anticipatory bail under Section 482 of the Bharatiya Nagarik Suraksha Sanhita, 2023.

Whether the petitioners, who were CMRL Government officers implicated in an alleged fraudulent payment of compensation, were entitled to anticipatory bail under Section 482 BNSS.

Whether custodial interrogation of the petitioners was necessary, having regard to the nature of the allegations, the documentary nature of the evidence, their official status, service records and the observations made in the earlier civil proceedings.

Whether the possibility of the petitioners tampering with evidence or absconding justified denial of anticipatory bail.

The Court applied Section 482 of the Bharatiya Nagarik Suraksha Sanhita, 2023, governing anticipatory bail, in the context of the alleged offences under Sections 420, 418, 424, 467, 468, 120B and 471 IPC.

The governing consideration was whether arrest and custodial interrogation were necessary, particularly where the investigation substantially rested on documentary evidence already available with the police and the accused had strong societal roots, no criminal antecedents and a demonstrated likelihood of cooperating with the investigation.

The Court also applied the principle in P.K. Shaji v. State of Kerala, [(2005) AIR SCW 5560], that breach of anticipatory-bail conditions may be dealt with by the Magistrate or Trial Court as if the conditions had been imposed and the accused released by that court itself.

Section 269 of the Bharatiya Nyaya Sanhita was referred to in relation to the registration of a fresh FIR if the petitioners subsequently absconded.

The Court acknowledged the seriousness of the alleged loss of Rs.18 crores and the Division Bench’s findings that CMRL had acted negligently and casually, and that its role in the transaction required scrutiny.

However, those observations were not directed conclusively against any particular individual officer, and the Government had earlier defended the conduct of the concerned CMRL officials before the Division Bench.

The record indicated that the petitioners had followed the prescribed procedure by issuing a publication identifying the original owners, referring the Trust’s competing claim to the Panel Counsel, and acting on the resulting legal opinion and court permission.

The Court further found that the petitioners were Group-I Government officers with long, unblemished service records, no criminal antecedents and strong roots in society.

Since the relevant evidence consisted principally of official and documentary records already in police custody, the risk of tampering was remote and custodial interrogation was not required for effective investigation.

These factors outweighed the prosecution’s contention that custody was necessary to uncover the larger conspiracy or ascertain any pecuniary benefit received by the petitioners.

They were directed to surrender or appear before the Judicial Magistrate, CCB & CBCID Special Court, Egmore, Chennai, within fifteen days from the date on which the order copy became ready, and to execute a bond for Rs.25,000 each with two sureties for the like sum.

The conditions included daily reporting to the respondent police at 10:30 a.m. for two weeks and thereafter as required for interrogation; execution and verification of surety documents; automatic cancellation upon failure to surrender within the stipulated period; and consequences for breach of conditions in accordance with law.

The Court further directed that, if the petitioners absconded, a fresh FIR could be registered under Section 269 of the Bharatiya Nyaya Sanhita.