Delhi High Court schools SFIO on arrest of Neeraj Singal

The Delhi High Court yesterday pulled up the Serious Fraud Investigation Office (SFIO) on the arrest of former promoter, Bhushan Steel Ltd, Neeraj Singal, saying that its Officers must be sent to Scotland Yard for an orientation on maintenance of records..A Division Bench of the Delhi High Court comprising Justices S Muralidhar and Vinod Goel was hearing Singal’s bail plea filed by Singal’s mother..Singal, who was the first person ever to be arrested by the SFIO, has been in judicial custody since his arrest on August 8, for an alleged Rs. 2500 crore loan fraud..The Court questioned the way the files and notes were being maintained by the SFIO, which subsequently led to Singal’s arrest..“There is a pattern. Officers are given power to arrest. Especially in PMLA cases, there is no case diary. Who is supervising it? What forms the decision to arrest?”, Justice Muralidhar asked Additional Solicitor General Tushar Mehta..After looking at a file and a note supplied by the SFIO, Justice Muralidhar further questioned,.“Are these documents case diaries at all? Where is the file number? There is a character to a government file. Your officers should know how to maintain and record documents in such cases. It is a vast responsibility. Police powers are given to Officers.”.He further said,.“Look at the first page, do you see any chronology? What did you do from August 8 (when Singal was arrested) till today? Where is that? When did you start the investigation? When did you find out about the (alleged) fraud?”.Stating that there was a serious problem with the note supplied to him, Justice Muralidhar remarked,.“We are in the realm of criminal jurisdiction. These questions are relevant.”.Justice Muralidhar also expressed his dissent with the SFIO’s stand on maintaining confidentiality with respect to all its findings during the investigation, saying,.“What is so confidential about this? They are all facts. All these facts concern him and he has to know these facts to meet his case. This is extremely unknown to our criminal law. It is fundamentally flawed in law to keep a person in jail without telling him what the case is. There is only a sketchy remand application (that is available to him).”.“During the investigation, the accused cannot have access to investigation material.”, ASG Mehta replied..To which the Court said,.“We are not asking you to. We are asking you to inform him about the facts that have emerged, especially when there is no FIR.”.The Court further raised doubts on the nature of the offence for which Singal was arrested and thus, the procedure that should have been followed to make an arrest..ASG Mehta informed the Court that although the offence was a cognizable offence, Chapter XII of the Code of Criminal Procedure on “Information To The Police And Their Powers To Investigate” would not be applicable to it..“Whether FIR as per Section 154 of CrPC is required is pending consideration.”, ASG Mehta said..To which Justice Muralidhar replied,.“How do you justify his detention in jail when CrPC does not apply? What is the offence? Which proposition of law allows his continued detention and grants confidentiality of certain facts? I think he has a prima facie case against the Constitutional validity of the impugned provision of law.”.The petition, filed through advocates PK Dubey and Arshdeep Singh, has challenged Section 212(6)(ii) of the Companies Act, 2013. The petition contends that this provision imposes unreasonable restrictions for grant of bail to persons arrested under the Act, thereby being violative of fundamental rights..“We are not sitting in appeal. We only want to know if a system known to law, including the system on maintenance of record, is being followed. Same standard that applies to police officers should apply to SFIO officers as well when it comes to arrest.”, he further said..Counsel appearing for Singal, Kapil Sibal argued that the SFIO has sought to follow the procedure that was unknown to law by adopting a hybrid approach which was a mix of two separate procedures for cognizable and non-cognizable offences..“If you say its a cognizable offence, register an FIR and produce a case dairy..if you say its non-cognizable, you could not have arrested me.”, he said..In an attempt to “satisfy the judicial consciousness of the Court”, ASG Mehta said that keeping in mind the magnitude of the offence and the extent of his involvement, bail should not be granted to Neeraj Singal..He further stated that the acts for which Singal has been arrested were always an offence and only the power to arrest was granted later in August 2017, hence the argument of retrospective application, as argued by the Singal earlier, did not find merit..The hearing will continue on August 23.