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Condition precedent for Bail should be reasoned and cannot be out of the Financial Capacity of the Applicant: Bombay High Court

When the applicant is being given bail on condition precedent, the order shall discuss and provide reasons for the same. It should also be within the financial capacity of the applicant. This judgment was passed in the case of Mohammadale Jamaluddin Saiyyad @ Raunak Suresh Madhiwal vs. The State of Maharashtra [BA/168/2021] by a Single Bench consisting of Hon’ble Shri Justice S. V. Kotwal.

The applicant was arrested for the offenses under section 420, 120-B read with section 34 of the Indian Penal Code. The FIR was lodged by Prashant Katkade who was in the construction and development business. He wanted a project loan during which he came in contact with one of the accused. The accused represented himself as representative of M/s. Cobra Financial Solution, Gujarat. He stated that a loan of Rs. 5 crores could be taken @ 6% per annum which had to be repaid within 5 years. Rs. 22 lakhs was paid to obtain Rs. 5 crores, but no loan was sanctioned and loss of the Rs. 22 Lakhs occurred for which the FIR was lodged. Since the charge sheet was not filed, the judicial magistrate first Cass under section 167(2) of Cr.P.C. granted bail in the sum of Rs. 50,000 and a notice was issued to the investigating order as to why the charge sheet was not filed. However, since the charge sheet was filed within four days of the order, the applicant was not released on bail and filed for the same under section 439 of Cr.P.C.

The Additional Sessions Judge granted bail provided Rs. 22 lakhs was deposited before the Magistrate. When the applicant failed to do the same, they applied for relaxation of the above condition and condition of reporting to the police station. The same was rejected.

After hearing the counsels, the Hon’ble High Court of Bombay opined that under section 167(2) of Cr.P.C. the applicant was not given the opportunity to furnish the sureties and cannot be held that the Applicant failed to comply with the directions. At the same time, the Applicant did not approach any higher authority in this regard but preferred a bail under section 439 of the code. Further, since the co-accused was released on bail, on parity the applicant deserved to be released on bail with conditions to ensure he is present during the trial.

The Bombay High Court went on to understand the imposition of Rs. 22 Lakhs; on doing so it came to light that there was no reasons or discussion in the order with regards to the reasons for such a heavy imposition. It held that the condition was an onerous on and based on the presumption that FIR is a complete truth which is not permissible. Relying on Supreme court judgments the court held that the condition for bail cannot be sustained since it is out of the financial capacity of the applicant and thereby making the bail illusory.

The Hon’ble Bombay High Court ordered that “The Applicant is directed to be released on bail in connection with C.R.No.I-101/2018 registered with Manmad City Police Station, District-Nashik on his furnishing a PR bond in the sum of Rs. 50,000/- (Rupees Fifty Thousand Only) with one or two local solvent sureties in the like amount.”

Click here for the Judgment.

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