Shrikant Pandurang Palande vs State Of Maharashtra on 13 August, 2025

Bombay High Court

Shrikant Pandurang Palande vs State Of Maharashtra on 13 August, 2025

Author: Amit Borkar

Bench: Amit Borkar

2025:BHC-AS:35015
                                                                                              25-ba705-2025.doc


                              AGK
                                         IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                               CRIMINAL APPELLATE JURISDICTION

                                                    BAIL APPLICATION NO.705 OF 2025


                              Shrikant Pandurang Palande                     ... Applicant
                                         V/s.
                              The State of Maharashtra                       ... Respondent



       ATUL                   Mr. Sainath Gawli for the applicant.
       GANESH
       KULKARNI
       Digitally signed by
       ATUL GANESH
                              Mrs. Megha S. Bajoria, APP for the respondent-State.
       KULKARNI
       Date: 2025.08.13
       17:35:13 +0530
                              Mr. Ravindra B. Mandlik, PI, EOW, Thane, is present.


                                                             CORAM     : AMIT BORKAR, J.

                                                             DATED     : AUGUST 13, 2025
                              P.C.:

1. By this application under Section 439 of the Criminal
Procedure Code, 1973 (“Cr.P.C.” for short), the applicant seeks his
release on regular bail in connection with Special Case No. 928 of
2022 arising from Crime Register No. I-274 of 2021 registered
with Kasarvadavali Police Station. The case is for offences
punishable under Sections 420, 406, 409 read with Section 34 of
the Indian Penal Code, 1860 (“IPC” for short) and Section 3 of the
Maharashtra Protection of Interest of Depositors (in Financial
Establishment) Act, 1999 (“MPID Act“).

2. The prosecution case, in brief, is that accused No. 2, Shrikant
Palande, visited the informant’s house and introduced himself as
the proprietor of a company named Anuja Consultancy, engaged in

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forex trading. He assured the informant that an investment of ₹1
lakh would yield a return of ₹5,000 per month. He also promised
security for the investment by issuing post-dated cheques and
executing a promissory note. Believing his words, the informant
invested in phases an amount of ₹47 lakhs. Against this, Shrikant
issued post-dated cheques and a promissory note. An amount of
₹12,45,000/- was repaid to the informant.

3. Thereafter, in October 2019, the accused stopped making
further payments. On inquiry, both accused – Shrikant and his wife
Shraddha (accused No. 1), expressed inability to pay but
persuaded the informant to invest another ₹30 lakhs, assuring
repayment. A Memorandum of Understanding (MoU) dated 28
July 2020 was executed between the informant and the accused.
Acting on this, the informant invested ₹15 lakhs more.
Subsequently, the informant discovered that both accused had
vacated their residence. Consequently, the FIR came to be lodged.
The applicant was arrested on 6 June 2022.

4. Learned Advocate for the applicant submits that the
applicant has been in custody since 6 June 2022 and there is no
likelihood of the trial concluding in the near future, given the
number of witnesses and the nature of the case. It is contended
that the allegations do not disclose the essential ingredients of the
offence under Section 409 IPC. Further, for the offences under
Section 420 IPC and Section 3 of the MPID Act, the maximum
sentence prescribed is seven years. The applicant has already
undergone incarceration of over three years, and therefore
deserves to be enlarged on bail, more so when continued detention

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would amount to pre-trial punishment.

5. Per contra, the learned APP has opposed the application. It is
submitted that the applicant, along with the co-accused, was
running Anuja Consultancy without registration or permission
from the Reserve Bank of India to accept deposits. They lured
investors with an unrealistic promise of 5% monthly returns. In
total, the accused collected about ₹2,83,76,000/- from more than
48 investors, and cheques for returns were signed by the applicant
himself. The money was received through bank transfers, cheques,
and cash. The modus operandi included executing MoUs with
investors to gain their trust.

6. The investigation reveals that ₹24,22,987/- was transferred
to the applicant’s personal account, and the preliminary forensic
audit indicates cash withdrawals of ₹1,20,74,845/-. According to
the prosecution, this is a case of systematic siphoning of hard-
earned money of innocent investors. Given the scale of the fraud
and its impact on multiple victims, the learned APP urges that the
bail be rejected.

7. I have heard the learned Advocate for the applicant and the
learned APP. I have perused the FIR, the charge-sheet papers, bank
statements, the preliminary forensic audit note, the Memoranda of
Understanding (MoUs), and the documents showing
cheques/promissory notes issued to investors.

8. The record shows that a legal entity in the name of Anuja
Consultancy was projected as doing forex trading. Investors were
induced to deposit money on the promise of 5% return per month,

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supported by MoUs, promissory notes and post-dated cheques. The
prosecution material presently indicates that about ₹2,83,76,000/-
was collected from 48 plus investors; approximately ₹24,22,987/-
moved into the applicant’s personal account; and cash withdrawals
of about ₹1,20,74,845/- were made. The RBI communication on
record shows no registration/permission for accepting deposits.
The case papers also reflect that the accused stopped payments
from October 2019 and thereafter left their residence.

9. The applicant argues long incarceration (since 06.06.2022),
low maximum sentence for Section 420 IPC and Section 3 of the
MPID Act (seven years), and contends that Section 409 IPC is not
made out. The State points to the scale, modus, money trail,
unauthorised deposit-taking, and the applicant’s active role
(signatory to cheques/MoUs) to oppose bail.

10. Section 409 IPC applies when a person, in the way of his
business as a banker, merchant, factor, broker, attorney or agent, or
a public servant, is entrusted with property or has dominion over
property, and commits criminal breach of trust (Section 405 IPC).
The essential parts are: (a) Entrustment of property or dominion
over it; (b) Such entrustment in capacity as
“banker/merchant/agent etc.”; and (c) Dishonest
misappropriation/ conversion/ use or dealing with the property
contrary to law or the contract.

11. The MoUs and the accompanying cheques/promissory notes
show that investors handed over money for a specific purpose, to
be invested in forex trading and to earn monthly returns. This is

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not a simple friendly loan or a mere sale transaction. The money
was entrusted to the applicant and co-accused to hold and deploy
on the investors’ behalf. Bank credits into the consultancy’s
accounts, the applicant’s role as signatory, and the trail into his
personal account establish dominion over investors’ funds.

12. Even if Anuja Consultancy was only registered under the
Shops and Establishments Act and not with RBI, the functional
capacity in which the applicant received and dealt with investors’
money was that of an “agent”, i.e., one who undertook to invest
and manage funds for the principals (investors) and to generate
returns for them. The definition of “agent” in the Contract Act (a
person employed to do any act for another or represent him in
dealings) fits squarely. The consultancy’s promises, MoUs, and
routine of monthly payouts place the applicant within the
expression “agent” (and at least a “merchant” in the business
sense) carrying on such dealings as a business. Section 409 IPC
therefore stands engaged.

13. Dishonest use/misappropriation contrary to law/contract:

(i) The MoUs/assurances required the funds to be invested
for the investors’ benefit and returns paid monthly. Instead,
the preliminary audit shows large cash withdrawals (₹1.20
crore approx.) and transfers to the applicant’s personal
account (₹24.22 lakh approx.), which is contrary to the
agreed purpose and indicates conversion to own use.

(ii) The RBI communication shows that Anuja Consultancy
was not authorised to accept deposits. Using investors’

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money in violation of the legal framework amounts to
dealing with property “in violation of any direction of law”

within Section 405 IPC.

(iii) The abrupt stoppage of returns from October 2019,
shifting residence, and failure to refund despite assurances
reinforce a prima facie dishonest intention and breach of the
trust reposed by the investors.

14. The number of investors (48+), the amount mobilised
(₹2.83 crore approx.), the repeated use of MoUs/cheques to gain
confidence, and the unrealistic 5% monthly return promise
together disclose a systemic scheme. Such material, at this stage,
supports an inference of deep-rooted conspiracy and criminal
breach of trust in a business/agency capacity, fulfilling the
ingredients of Section 409 IPC.

15. The contention that only Sections 420/MPID apply, and
therefore the maximum punishment is seven years, is
misconceived at the present stage. Once Section 409 IPC is prima
facie attracted, the offence carries punishment up to life
imprisonment (or up to ten years and fine). Thus, the applicant’s
argument based on the seven-year cap fails. The presence of MPID
charges does not exclude Section 409 when the facts disclose
entrustment in agency capacity and dishonest breach.

16. Economic offences involving public investment are treated as
a class apart due to their far-reaching impact on the financial
health of numerous victims and on public confidence in financial
dealings. The magnitude of funds, multiplicity of victims, and the

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organised modus weigh strongly against grant of bail at this stage.

17. The papers show the applicant as an active signatory to
cheques issued towards “returns,” a recipient of investor money
(including credits to his personal account) and a participant in
large cash withdrawals. This is not a peripheral or clerical role; it
is a central, operational role.

18. There are over 48 investors and several banking/forensic
witnesses. Many investors are small savers. The nature of the
alleged scheme, the prior conduct of leaving the residence, and the
ongoing tracing of funds create a reasonable apprehension that, if
released, the applicant may influence witnesses, hamper recovery,
or interfere with the financial trail.

19. Though the applicant has been in custody since 06.06.2022,
the case involves voluminous financial records, multiple accounts,
digital evidence, and co-accused. Several material witnesses are
yet to be examined. In such complex economic offences, mere
passage of time cannot, by itself, override the compelling triable
material and risks identified above, particularly where Section 409
IPC is in play with its higher sentencing range.

20. No case for parity is made out on facts. The applicant’s
signatory status, personal account credits, and the cash-withdrawal
pattern distinguish his role.

21. Considering the continuing need to trace and attach
properties, and the breadth of the investor-witness pool, standard
conditions (like sureties, marking attendance, deposit of passport)
are insufficient at this stage to neutralise the risks.

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22. On a prima facie assessment, (i) the ingredients of Section
409 IPC are made out, entrustment/dominion of investors’ money,
agency/business capacity, and dishonest misappropriation/ use
contrary to law and the MoUs; (ii) the gravity, scale, and societal
impact are substantial; (iii) there exists a real possibility of
tampering with evidence/influencing witnesses/impeding recovery
if released. The applicant has not made out a case for bail at this
stage.

23. Accordingly, the bail application stands rejected.

(AMIT BORKAR, J.)

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