Bail – A Company ‘ANL’ was issued a Letter of Intent for Construction and development of Vessels Traffic and Port Management System (VTPMS) in the Gulf of Khambhat, on Build Own Operate and Transfer basis – It was followed by a Concession Agreement, entered into between the Gujarat Maritime Board, ANL and the Government of Gujarat – Dispute arose regarding the Capital Cost incurred by ANL – On basis of a preliminary inspection report, the Gujarat Maritime Board claimed that ANL made an extra income of Rs. 134.38 crores – ANL moved the Commercial Court u/s.9 of the Arbitration and Conciliation Act, 1996 as there was threat of termination of the Concession Agreement and thereafter matter was referred to Arbitration – The Gujarat Maritime Board lodged a complaint and on basis of the said complaint FIR was registered against 8 accused, including A-1, A-2 and A-3 u/ss. 406, 409, 420, 465, 468, 471 and 120 B IPC and s. 13(1)(d) of the Prevention of Corruption Act – A-1(Appellant) and A-2 his son were arrested – Ever since then, the appellant is in judicial custody – His bail application was rejected several times – However, the High Court gave liberty to the appellant to file a fresh application before the trial Court if the trial could not commence within a period of six months – Incidentally, this period of six months has expired and trial has not commenced yet – Also, the Arbitral Tribunal passed interim measures and financial interests of the Maritime Board were protected – In the background of the above facts, the appellant sought bail – Per contra, the respondent-State contended that the matter involved national security, which stands threatened by the activities of the appellant – Held: The potential threat to national security, cannot be sustained, for two reasons – The first reason is that the project became operational in August 2010 and the disputes started between the parties in 2018 that too with regard to financial matters – The second reason, by virtue of interim measures of protection granted by the Arbitral Tribunal u/s. 17, the termination of Concession Agreement stands stayed – Therefore, the Company of which the appellant is the head, continues to operate the VTPMS Project – The Arbitral Tribunal has also permitted the State Police to be there at the Project and allowed Maritime Board to depute a competent person, familiar with the project in question, to supervise and monitor the functioning of the Project – Also, the period of six months within which the High Court hoped the trial to commence, has expired as on date – Therefore, appellant is entitled to bail and is directed to be released on bail.
Allowing the appeal, the Court
HELD: 1. The period of six months within which the High Court hoped the trial to commence, has expired as on date. The appellant, who is admittedly 62 years of age has already spent nearly a year in judicial custody. A period of nine months has passed from the date of filing of the charge sheet. Though the Solicitor General contended that the sanction to prosecute has already been issued as against Government Officials, the fact remains that charges have not been framed and the trial has not commenced as yet. [Para 20][389-F]
2. The arguments revolving around the potential threat to national security, cannot be sustained, for two reasons. The first reason is that the project became operational in August-2010 and the disputes between the parties started only in 2018 and that too with regard to financial matters. The second reason is that by virtue of the interim measures of protection granted by the Arbitral Tribunal (comprising of a former Judge of this court, a former Judge of the High court and a Senior Advocate) in terms of section 17 of the Arbitration and Conciliation Act, 1996, the termination of the Concession Agreement stands stayed. Therefore, the Company of which the appellant is the head, continues to operate the VTPMS Project. In any case, the Arbitral Tribunal has not merely protected the economic interests of the State, but also permitted the State Police to be there at the project site. The Tribunal has also allowed the Maritime Board to depute a competent person, familiar with the project in question, to supervise and monitor the functioning of the project. Therefore, this contention cannot be accepted blind fold. [Para 21] [389-G-H; 390-A-B]
3. Though much is said about the tempering of witnesses, it is seen from the material on record that the prosecution rests mainly on documents. In any case, the prosecution is not remedyless, if a person enlarged on bail, indulges in certain activities. [Para 22][390-C]
4. Therefore, this Court is of the view that the appellant is entitled to bail. Hence, the appeal is allowed and the appellant is directed to be released on bail, subject to such terms and conditions as the Sessions Court may deem fit and appropriate in the facts and circumstances of the case, including a condition for the surrender of the passport, which shall be subject to orders passed by the Trial Court from time to time. [Para 23][390-D]
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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