Published On : Mon, Oct 24th, 2016

Dabba case meets dead-end as police, EOW acted without authority

nagpur high court

Nagpur: The Nagpur Bench of Bombay High Court on Monday granted pre-arrest bail to Kanhaiyya Thawrani in the much-hyped Dabba trading scam, where he was dubbed as having a staggering Rs 1 lakh crore plus turnover in the Dabba trading scam. The said claim of figures was curiously made by the Crime Branch and Economic Offences Wing of city police. The investigating agency attempted to create much clout by quoting such astronomical and unprecedented figures of the trade. However all such claims fell flat on face after nearly five months of investigations.

In a curious strategy, the legal team of the applicant chose to pose a pure question of Law & Interpretation before the High Court for consideration. Considering the said arguments, the High Court held that the Police & EOW inherently did not have any powers to initiate action and register FIR against them for alleged violations under the Securities Contract Act 1956 and the class of entities under Section 26, who can initiate such action is Central Government or State Government or the Securities & Exchange Board of India (SEBI) or the recognized Stock Exchange, alone can initiate action by filing a complaint before the Special Court. Thus, the role of police before filing any such complaint is totally illegal and void.

It may be recalled that the premises of various persons including the L7 group were raided on 12.5.2016 on the basis of some suspicion and discreet information gathered by Crime Branch & EOW. On said day, the police agency conducted marathon search for over 12 hours at various places. Nagpur Today reported in June 2016 that Dabba case lost much of the steam when Neeraj Agrawal was released on regular bail.

The High Court on Monday, while holding that police had no authority as per the Securities Contract Act to initiate FIR and carry on investigation, granted Thawrani a pre-arrest bail.

The entire effort of the prosecution was perhaps only to create a huge clout against the persons arrayed as accused in the matter without any substantial and reliable material against them. The grounds raised regarding colossal losses caused to government exchequer also were left unsupported.

Earlier while granting regular bail to Neeraj Agrawal & Ravi Agrawal, the High Court had observed that the prosecution could not even establish a prima facie case against the said accused.

The entire top brass of police machinery and EOW were left embarrassed when the arguments of the applicant were accepted by the Court holding that action of police was illegal. It may be noted that several top IPS officers were closely following the matter and even attending the court proceedings especially since the validity of police action was questioned. Even in June, 2016 , the Court had observed that Senior Advocate Gupta had made arguments touching the validity of the proceedings, however at that time, looking at other material at hand, the High Court had reserved its opinion on the said topic.

The State at the last minute also roped in the Government Pleader Bharti Dangre to argue the matter on its behalf.
Senior Advocate Avinash Gupta along with Adv Aakash Gupta instructed by Srinidhi Associates Law firm appeared for the accused.