REPORTABLE IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION CRIMINAL APPEAL NO.2415/2009

(Arising out of S.L.P.(Crl.)No.4190 of 2006)  

HDFC Bank Ltd.     ..Petitioner Vs.

J.J. Mannan @ J.M. John Paul & Anr.   ..Respondents

J U D G M E N T

ALTAMAS KABIR, J.

1. Leave granted.

2. This appeal has been filed by the H.D.F.C. Bank Ltd.  

(hereinafter referred to as “the Bank”) against the judgment  

and order dated 3rd July, 2006, passed by the Madras High  

Court  in  Crl.M.P.No.3784  of  2006  and  Crl.O.P.No.15217  of  

2006, allowing the application filed by the Respondent No.1  

under Section 438 of the Code of Criminal Procedure (Cr.P.C.)  

for grant of anticipatory bail to him.

3. According  to  the  Bank,  the  Respondent  No.1  in  his  

capacity as the Managing Director of the Mannan Construction

Corporation  Private  Limited,  a  company  engaged  in  the  

execution of Highway Contracts and contracts of the Public  

Works Department (hereinafter referred to as “the Company”),  

along with one M/s. Immanuel Projects Private Ltd., applied  

for  a  loan  of  Rs.2,03,40,000/-  (Rupees  Two  Crores,  three  

lakhs and forty thousand) only, for purchase of 6 Krishna  

Electronic  Sensor  Paver  Finishers  from  one  M/s.  Krishna  

Engineering  Works  in  Ahmedabad.   The  said  loan  was  duly  

sanctioned  and  after  signing  of  necessary  Agreements  and  

other  documents,  six  cheques  for  the  loan  amount  of  

Rs.2,03,40,000/-,  drawn  in  the  name  of  M/s.  Krishna  

Engineering Works, were handed over to the Respondent No.1 on  

9th March, 2006.  Subsequently, by a letter dated 24th May,  

2006, the Bank informed M/s. Krishna Engineering Works in  

Ahmedabad that a sum of Rs.2,03,40,000/- had been disbursed  

to them on account of the Respondent No.1 and requested them  

to confirm receipt of the same.  M/s. Krishna Engineering  

Works wrote back to the Bank stating that it had not received  

any payment on account of Mr. J.M. John Paul.   

4. The Bank thereupon caused enquiries to be made and  

came  to  learn  that  no  machineries  had,  in  fact,  been  

purchased by the Respondent No.1, and that the Respondent  

No.1 had colluded with M/s. Immanuel Projects Private Limited  

and their Directors and one Mr. R.I. Jambert Mathuram with

the intention of cheating the Bank and in the process had  

committed offences punishable under Sections 420, 467, 468,  

471 and 120-B Indian Penal Code.

5. The Bank filed a complaint with the Commissioner of  

Police, Egmore, Chennai-600008 on 27th May, 2006, setting out  

the facts relating to sanction of the loan and the handing  

over of the six Banker’s cheques in the name of M/s. Krishna  

Engineering Works.  The complaint also contained the manner  

in which the Respondent No.1 had opened a fictitious account  

with I.C.I.C.I. Bank, Tuticorin Branch, in the name of M/s.  

Krishna Engineering Works and deposited the cheques meant for  

supply of road construction equipment by Krishna Engineering  

Works of Ahmedabad.  Thereafter, the said amount was encashed  

and transferred to M/s. Matrix Enterprises having its office  

at No.41, C.G.E. Colony, 5th Street, Tuticorin-628 003, which  

was holding an account in the Tuticorin Branch of I.C.I.C.I.  

Bank.  The said amounts were again transferred to the account  

of M/s. Delta Enterprises, also having its office at No.41,  

C.G.E.  Colony,  5th Street,  Tuticorin,  with  the  Tuticorin  

Branch of the I.C.I.C.I. Bank.   

6. After  the  aforesaid  transactions,  the  moneys  were  

finally credited to the account of the Respondent No.1 in the  

same Branch of the I.C.I.C.I. Bank.  It was also found on  

enquiry  that  the  addresses  of  all  the  above-mentioned

companies were that of the residence of the Respondent No.1,  

Mr. J.M. John Paul.   

7. F.I.R. No.157 of 2006 dated 12th June, 2006, was drawn  

up  on  the  basis  of  the  aforesaid  complaint  against  the  

Respondent  No.1  and  others  by  the  Central  Crime  Branch,  

Chennai, under Sections 419, 420, 468, 473 read with Section  

120B Indian Penal Code.   

8. The Respondent No.1 thereupon filed an application in  

the Madras High Court under Section 438 Cr.P.C. for grant of  

Anticipatory Bail and the learned Single Judge of the said  

High Court, by his order dated 3rd July, 2006, allowed the  

same upon holding that since the investigating agency had  

already  seized  all  relevant  and  vital  documents  and  had  

recorded the statements of all the important witnesses, the  

custodial  interrogation  of  the  Respondent  No.1  was  not  

required.

9. The  present  appeal  has  been  filed  by  the  Bank  for  

cancellation  of  the  Anticipatory  Bail  granted  to  the  

Respondent No.1.

10. On behalf of the Union of India it was contended that  

in  the  facts  of  the  case,  the  High  Court  had  erred  in  

allowing the Respondent No.1’s application under Section 438

Cr.P.C. since he had allegedly master-minded the fraud and  

having regard to the gravity of the offence alleged, the  

Anticipatory Bail granted to him was liable to be cancelled.  

Mr.  Lalit  submitted  that  the  Respondent  No.1  had  

misappropriated what was meant to be paid to the supplier of  

the road construction equipment, in a planned manner and the  

whereabouts of the moneys was yet to be ascertained.   

11. Mr. Lalit submitted that the provisions of Section 438  

Cr.P.C. had been misapplied by the High Court in this case,  

since there was sufficient material on record to prima facie  

indicate  that  the  Respondent  was  a  direct  player  in  the  

fraudulent episode, and, in any event, the High Court could  

not have granted a blanket order of Anticipatory Bail upto  

the end of the trial.  Mr. Lalit submitted that in view of  

the impugned order, the Respondent No.1 had never appeared in  

Court even once, at any stage of the case, and had not even  

surrendered and obtained regular bail.  Mr. Lalit referred to  

the decision of this Court in Adri Dharan Das vs. State of  

West Bengal [(2005) 4 SCC 303], wherein it was categorically  

indicated  that  Anticipatory  Bail  had  to  be  given  for  a  

limited duration so as to enable the accused to move for  

regular bail under Section 437 Cr.P.C.  Reference was also  

made to the decision of this Court in  Salauddin Abdulsamad  

Shaikh vs. State of Maharashtra [(1996) 1 SCC 667] where the

same essentials have been reiterated.   

12. Appearing for the Respondent No.1, Mr. Rajiv Dutta,  

learned  Senior  Advocate,  submitted  that  except  for  wild  

allegations  made  against  the  Respondent  No.1,  nothing  

incriminating had been found against him.  Mr. Dutta urged  

that the Respondent No.1 had been granted Anticipatory Bail  

as far back as on 3rd July, 2006, and he had never misused  

the  privilege  and  had  co-operated  with  the  investigating  

agencies all through.  Furthermore, the trial had already  

commenced and several witnesses had been examined and there  

could,  therefore,  be  no  justification  for  cancelling  the  

Anticipatory Bail granted to him by the High Court more than  

three  years  ago.   Referring  to  the  decision  of  the  

Constitution Bench in the case of Gurbaksh Singh Sibbia Vs.  

State of Punjab [(1980) 2 SCC 565], wherein the application  

of Section 438 Cr.P.C. had been considered in detail, Mr.  

Dutta submitted that the said provision had been interpreted  

to be a beneficent provision relating to personal liberty  

guaranteed under Section 21 of the Constitution.  Mr. Dutta  

submitted that the Constitution Bench had observed that since  

denial of bail amounts to deprivation of personal liberty,  

the court should lean against the imposition of unnecessary  

restrictions on the scope of Section 438 Cr.P.C.

13. Reference was also made to the decision of this Court  

in  the  case  of  Savitri  Agarwal  &  Ors. Vs.  State  of  

Maharashtra & Anr. [JT 2009 (9) SC 460 = (2009) 8 SCC 325],  

where  the  various  decisions  in  this  regard,  with  special  

emphasis on Sibbia’s case (supra) as also Adri Dharan Das’s  

case (supra), were referred to. Their Lordships took note of  

the fact that the provisions of Section 438, as amended, had  

not yet been notified and that as a result the old provision  

continued to be in force.  Hence, the earlier decisions would  

continue to be relevant to the facts of this case.  Mr. Dutta  

submitted that having regard to the views expressed by this  

Court in no uncertain terms, prayer for Anticipatory Bail  

should  not  be  refused  and,  in  any  event,  in  this  case  

Anticipatory Bail had already been granted more than three  

years ago and hence the submissions now being made as to when  

Anticipatory Bail should be granted have become irrelevant.  

14. Having  carefully  considered  the  submissions  made  on  

behalf of the respective parties and the decisions referred  

to in support of their respective cases, we are of the view  

that the role of the Respondent No.1 in the entire episode  

did not entitle him to the relief of Anticipatory Bail, much  

less a blanket order of bail.  However, that is now a closed  

chapter.  But what is of relevance is whether the High Court  

should have worded its order in such a way that it could be

interpreted to mean, as has been done by all concerned, that  

the  Respondent  No.1  was  not  required  to  even  appear  and  

surrender before the Court during the entire investigation  

stage and the trial.  Taking advantage of the same, the  

Respondent No.1 has successfully avoided the Court from the  

very initial stage of investigation and even the trial.  Such  

kind  of  an  order  is  not  contemplated  under  Section  438  

Cr.P.C. as has been repeatedly explained by this Court.   The  

said  position  has  been  clearly  enunciated  in  Adri  Dharan  

Das’s  case  (supra).   Furthermore,  it  has  also  been  

consistently indicated that no blanket order could be passed  

under Section 438 Cr.P.C. to prevent the accused from being  

arrested at all in connection with the case.  To avoid such  

an eventuality it was observed in  Adri Dharan Das’s case  

(supra)  that  Anticipatory  Bail  is  given  for  a  limited  

duration to enable the accused to surrender and to obtain  

regular bail.  The same view was reiterated in  Salauddin’s  

case  (supra)  wherein  it  was,  inter  alia,  observed  that  

Anticipatory  Bail  should  be  of  limited  duration  only  and  

primarily  on  the  expiry  of  that  duration  or  extended  

duration, the Court granting Anticipatory Bail should leave  

it  to  the  regular  court  to  deal  with  the  matter  on  an  

appreciation  of  evidence  placed  before  it  after  the  

investigation  has  made  progress  or  the  charge-sheet  is

submitted.   

15. The object of Section 438 Cr.P.C. has been repeatedly  

explained by this Court and the High Courts to mean that a  

person  should  not  be  harassed  or  humiliated  in  order  to  

satisfy the grudge or personal vendetta of the complainant.  

But at the same time the provisions of Section 438 Cr.P.C.  

cannot  also  be  invoked  to  exempt  the  accused  from  

surrendering to the Court after the investigation is complete  

and  if  charge-sheet  is  filed  against  him.   Such  an  

interpretation would amount to violence to the provisions of  

Section 438 Cr.P.C., since even though a charge-sheet may be  

filed against an accused and charge is framed against him, he  

may still not appear before the Court at all even during the  

trial. Section 438 Cr.P.C. contemplates arrest at the stage  

of investigation and provides a mechanism for an accused to  

be released on bail should he be arrested during the period  

of investigation.  Once the investigation makes out a case  

against him and he is included as an accused in the charge-

sheet, the accused has to surrender to the custody of the  

Court and pray for regular bail.  On the strength of an order  

granting Anticipatory Bail, an accused against whom charge  

has  been  framed,  cannot  avoid  appearing  before  the  trial  

court.  If what has been submitted on behalf of the appellant  

that the Respondent No.1 has never appeared before the trial

court is to be accepted, it will lead to the absurd situation  

that charge was framed against the accused in his absence,  

which would defeat the very purpose of Sub-Section (2) of  

Section 240 Cr.P.C.

16. Having  regard  to  the  above,  the  order  of  the  High  

Court dated 3rd July, 2006, is modified to the extent that  

the Respondent No.1 shall surrender before the Trial Court  

forthwith and pray for regular bail and the Trial Court shall  

dispose of the same on merits, in accordance with law, before  

proceeding further with the trial.

17. The appeal is allowed to the above extent.

…………………………………………J. (ALTAMAS KABIR)

                                      …………………………………………J. (DEEPAK VERMA)  

New Delhi Dated: 16.12.2009