Karnataka High Court grants bail to accused in alleged ₹899-crore bank fraud, citing the completed probe and unlikely near-term trial start

The petitioner, Accused No. 2 in an Enforcement Case Information Report (ECIR) under Sections 3 and 4 of the Prevention of Money Laundering Act, 2002 (PMLA), sought regular bail under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023.

The ECIR arose from allegations that Deepak Cables (India) Ltd. and its directors obtained bank loans through forged or manipulated documents and diverted loan funds.

The petitioner was arrested on 2 June 2026; the investigation was subsequently completed and the prosecution complaint filed.

His bail application before the Special Court was rejected on 28 August 2026.

He argued that he had cooperated with the investigation, had not been arrested in the predicate-offence cases, and that the PMLA case was at the pre-cognizance stage, with a lengthy trial unlikely to conclude soon.

The prosecution opposed bail, relying on the alleged prima facie case, the Section 45 PMLA conditions, and the risk of evidence tampering.

1. Whether the petitioner should be granted regular bail under Section 483 of the BNSS in the PMLA proceedings, having regard to the statutory bail restrictions under Section 45 of the PMLA and the circumstances of the case.

2. Whether the expected delay in trial, the nature and volume of the evidence, and the petitioner’s period of custody warranted release on bail in light of the right to a speedy trial under Article 21 of the Constitution.

Section 483 of the BNSS empowers the High Court to grant regular bail; Sections 3 and 4 of the PMLA define and punish money-laundering offences, while Section 45 imposes twin conditions for bail.

The Court relied on the principle that Section 45’s restrictions cannot justify unreasonable pre-trial incarceration that undermines Article 21; the need for expeditious trials must be read alongside stringent bail conditions.

It applied the Supreme Court’s reasoning in *P. Chidambaram v. Directorate of Enforcement*, *Manish Sisodia v. Directorate of Enforcement*, *V. Senthil Balaji v. Deputy Director, Directorate of Enforcement*, *Padam Chand Jain v. Enforcement Directorate*, and *Arvind Dham v. Directorate of Enforcement*, concerning custody, trial delay, documentary evidence, and constitutional safeguards.

The Court also considered *Tarun Kumar v. Assistant Director, Directorate of Enforcement*, cited by the prosecution in support of the Section 45 restrictions.

The Court considered that the petitioner had cooperated with the investigation, which was complete, and that the prosecution complaint had been filed; the case remained at the pre-cognizance stage.

The complaint involved 32 witnesses and 154 documents in six volumes, making disposal in the near future unlikely.

The alleged maximum punishment was seven years, the relevant properties had been attached, and the evidence was substantially documentary.

The Court also noted that the petitioner had not been arrested in the predicate cases and had been enlarged on bail there.

Applying the cited authorities, it concluded that the prospect of a lengthy trial, considered alongside the circumstances of the case and Article 21 concerns, supported release on bail notwithstanding the statutory restrictions.

He was required to execute a personal bond of Rs. 1,00,000 with two sureties for the like sum, attend the trial unless exempted, refrain from threatening or tampering with prosecution witnesses or engaging in similar offences, and not leave the trial court’s jurisdiction without permission until the case is disposed of.