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Delhi High Court
Umesh Verma vs State on 14 July, 2025
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment reserved on: 09.07.2025
Judgment pronounced on: 14.07.2025
+ BAIL APPLN. 3788/2022 & CRL.M.A. 22040/2023
UMESH VERMA .....Petitioner
Through: Mr. Raj Shekhar Rao, Sr. Advocate
with Mr. Tarun Gaur, Ms. Vishakha
Gupta and Mr. Shubham Arora,
Advocates.
versus
STATE .....Respondent
Through: Mr. Ritesh Kumar Bahri, APP for
State with Ms. Divya Yadav,
Advocate with SI Pankaj, EOW.
Mr. Archit Kaushik, Advocate for
Complainant.
CORAM:
HON'BLE MR. JUSTICE GIRISH KATHPALIA
JUDGMENT
GIRISH KATHPALIA, J.:
1. The accused/applicant seeks regular bail in case FIR No. 132/2020 of
PS Economic Offences Wing (EOW) for offences under Section
406/409/420/467/120B IPC. Earlier, the accused/applicant had filed Bail
Application No.3500/2021 for grant of regular bail in the same case FIR, but
that application was dismissed by a coordinate bench of this court vide
judgment dated 26.10.2021.
Bail Application 3788/2022 Page 1 of 13 pages
GIRISH Digitally signed by GIRISH
KATHPALIA
Signature Not Verified KATHPALIA Date: 2025.07.14 14:48:10
+05'30'
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
1.1 The present bail application was filed way back in the year 2022 and
came up before this Bench for the first time on 17.04.2025 and on that day,
both sides were called upon on address arguments on merits, but they
requested and were allowed adjournment because till that day, before
different predecessor benches, the matter kept getting adjourned for
compromise and the counsel did not expect that they would be called upon
to address arguments. On the very next date 09.07.2025, final arguments
were advanced by learned Senior Counsel on behalf of the accused/applicant
and learned Additional Public Prosecutor on behalf of State, assisted by
learned counsel for the complainant de facto. During pendency of this bail
application, multiple status reports were filed on behalf of State dealing with
the progress related to the settlement efforts between the accused/applicant
and multiple victims of the offence.
2. Broadly speaking, the circumstances relevant for the present purposes
are that one Joginder Kumar lodged a complaint with the DCP, EOW against
a crypto currency company namely Pluto Exchange and its owners including
the present accused/applicant, alleging as follows. The accused/applicant
and the remaining accused persons were engaged in the business of gold and
diamond in Karol Bagh, and they told him about their Dubai Company
under the name Bharat Umesh General Trading LLC, Dubai, dealing in
crypto currency. The accused persons allured him to invest in crypto
currency, assuring returns up to 20% to 30% per month. The accused
persons also told him that they were giving high returns to their clients and
if he brought more clients, he would be paid commission as well. AfterBail Application 3788/2022 Page 2 of 13 pages
GIRISH Digitally signed by GIRISH
KATHPALIA
Signature Not Verified KATHPALIA Date: 2025.07.14 14:47:55 +05’30’Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
getting himself registered at the websites namely www.plutoexchange.com
and www.f2poolmining.com, the complainant de facto, invested a sum of
Rs.5,00,000/- in the company of the accused persons. On receiving no
returns after one month, the complainant de facto visited office of the
accused persons, but was told that due to fall in rates of bitcoin and seizure
of account they were unable to return the amount through bank, so he should
wait for a few months. On not receiving any money for long time, the
complainant de facto visited office of the accused persons, but found that the
accused persons had shifted their office to Dubai. Despite repeated efforts,
the complainant de facto could not contact the accused/applicant over phone,
nor did he receive his money. Later, the complainant de facto came to know
that a number of persons had invested in the company of the accused
persons, money to the tune of about Rs.50,00,00,000/- in the name of crypto
currency business. The said complaint of the complainant de facto was
registered by the EOW and investigation commenced.
3. The accused/applicant was arrested on 30.12.2020 and after dismissal
of his bail application from the Court of Sessions, he filed the present bail
application before this High Court on 16.12.2022.
3.1 Across the said period and even thereafter, the investigation
continued, unfolding the number of similarly defrauded investors.
3.2 On 05.04.2023, before the predecessor bench, the number of such
defrauded investors was disclosed to be 48, and it was informed that 22
investors had settled the matters before the Mediation Centre, Delhi High
Court. Going by the assurance of the accused/applicant to settle accounts ofBail Application 3788/2022 Page 3 of 13 pages
Digitally signed by GIRISH
GIRISH KATHPALIA KATHPALIA
Date: 2025.07.14 14:47:40 +05’30’
Signature Not Verified
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
all such investors, the predecessor bench vide order dated 05.04.2023
directed release of the accused/applicant on interim bail till next date subject
to certain conditions. That interim protection from arrest continued on date
to date basis before different predecessor benches and the matter kept
getting adjourned across piecemeal settlements of the accounts of those
victims before the Mediation Centre, Delhi High Court. Towards settlement,
the accused/applicant continued to pay dues of the victims by way of post-
dated cheques and/or cash.
3.3 On 20.05.2024, three of the victims informed the predecessor bench
that without any settlement with them, an amount of Rs.1,00,000/- had been
deposited in their account without their knowledge.
3.4 On 07.10.2024, the status presented before the predecessor bench was
that out of 48 victims, only 07 confirmed the settlement, while 33 denied
and 08 were waiting.
3.5 Simultaneously, the matter remained in process before the Mediation
Centre, Delhi High Court and on multiple directions of the predecessor
benches, multiple status reports were filed by the State.
3.6 On 29.01.2025, the prosecution informed the predecessor bench that
in addition to 48 known victims, 11 more victims had filed their complaints,
so the predecessor bench directed the IO to supply details of those 11
additional victims.
3.7 On 06.03.2025, the predecessor bench named an arbitrator and even
prepared elaborate plan of settlement between the parties after minutely
examining the settlement reports.
Bail Application 3788/2022 Page 4 of 13 pages Digitally signed by GIRISH GIRISH KATHPALIA KATHPALIA Date: 2025.07.14 14:47:25 +05'30' Signature Not Verified Digitally Signed By:NEETU N NAIR Signing Date:14.07.2025 15:57:08 3.8 It is thereafter that on 17.04.2025, the matter came to this bench for
the first time. Order dated 17.04.2025 is extracted below:
“1. The petitioner has sought quashing of FIR in one of these petitions
and grant of regular bail in the other petition. The FIR pertains to
offences under Section 420/406/409 IPC.
2. The matters have come up before me for the first time.
3. It appears that before the predecessor benches, the matters were
repeatedly being listed for piecemeal settlements with the allegedly
defrauded victims in groups. The alleged victim groups were being
referred to mediation centre also, followed by fresh referrals of the
disputes to the mediator.
4. In my considered view, the courts dealing with bail applications and
petitions for quashing the FIR are not forums of money recovery,
that too in piecemeal settlements with different groups of the alleged
victims.
5. Therefore, both sides are directed to address arguments on merits.
Learned counsel for petitioner seeks adjournment on the ground that
the learned Senior Counsel is not available. Keeping in mind the
above circumstances where the matter was being listed repeatedly
for settlement efforts, fairness expects grant of the adjournment
request.
6. List for arguments on 09.07.2025.
7. Interim orders to continue till next date of hearing.”
Ultimately, on 09.07.2025 final arguments on merits were concluded.
4. During arguments, learned senior counsel for the accused/applicant
took me through previous record and contended that there is no mens rea,
insofar as when the accused/applicant started the business in crypto
currency, there was nothing in law to prohibit the same and it is only later on
that the government suddenly derecognized crypto currency, because of
which the accused/applicant fell in financial problems; and despite that, the
accused/applicant settled claims of almost all investors, which shows his
bona fide and entitles him the relief of regular bail. It was argued that the
Bail Application 3788/2022 Page 5 of 13 pages
Digitally signed by GIRISH
GIRISH KATHPALIA KATHPALIA
Date: 2025.07.14 14:47:09 +05’30’
Signature Not Verified
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
accused/applicant is not a flight risk and never misused the liberty of interim
bail granted by the predecessor benches. Learned senior counsel for accused/
applicant submitted that the accused/applicant genuinely intends to clear all
claims of all the investors.
5. On the other hand, learned prosecutor strongly opposed the bail
application, contending that the accused/applicant has deep pockets and if
granted bail, he would influence the witnesses and tamper with the evidence.
Learned prosecutor also argued that mediation proceedings were exploited
by the accused/applicant as a tool to stay on interim bail endlessly, without
any serious intentions to resolve claims of the defrauded investors. Learned
prosecutor also took me through record in support of his contentions that the
accused/applicant is certainly a flight risk and if granted bail, would flee the
country. As regards the settlements in question, learned prosecutor placed
on record statements of 38 victims alleging that they had not received any
amount or the complete amount invested by them.
6. Learned counsel for complainant de facto while assisting the learned
prosecutor took me through record to show that even subsequent to the
derecognition of crypto currency, the accused/applicant continued to accept
investments in the same, and that, according to learned counsel for
complainant de facto, reflects dishonest intention on the part of the
accused/applicant. Learned counsel for complainant de facto also pointed
out that the accused/applicant is involved in 13 more cases of similar nature.
Bail Application 3788/2022 Page 6 of 13 pages
GIRISH Digitally signed by GIRISH
KATHPALIA
Signature Not Verified KATHPALIA Date: 2025.07.14 14:46:49 +05'30'
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
7. To begin with, my decision to switch over from the said piecemeal
settlement proceedings to adjudication of this bail application on merits is
fortified by plethora of judicial pronouncements to the effect that the bail
courts are not forum for recovery of money; and that the economic offences
constitute a class apart, so need to be visited with a different approach in
matters of bail.
7.1 In the case of Apruva Kirti Mehta vs State of Maharashtra, 2025
SCC OnLine SC 336, the Supreme Court held thus:
“8. That apart, the direction for payment was in the teeth of a plethora of
decisions of this Court. We can profitably refer to a few of them, viz.
Ramesh Kumar vs. State (NCT of Delhi); St. George Dsouza vs. State
(NCT of Delhi) and Dilip Singh vs. State of M.P. & Anr. Having regard to
the principles of law laid down in the said decisions, inter alia, to the
effect that the courts, exercising jurisdiction to grant bail/pre-arrest bail,
are not expected to act as recovery agents for realization of dues of the
complainant from the accused, the High Court should have independently
applied its mind and arrived at a conclusion as to whether a case for
grant of bail, on settled parameters, had been made out or not
irrespective of whatever statement was made on behalf of the appellant
before the Sessions Judge.”
7.2 While elaborately examining the legality of the conditions that can be
imposed for granting bail, the Supreme Court in the case of Ramesh Kumar
vs State of NCT of Delhi, 2023 SCC OnLine SC 766, held thus:
“1. A disquieting trend emerging over the years which has gained pace
in recent times necessitates this opinion. It has been found by us in
multiple cases in the past several months that upon First Information
Reports being lodged inter alia under section 420 of the Indian Penal
Code, 1860 (“the IPC“, hereafter), judicial proceedings initiated by
persons, accused of cheating, to obtain orders under Section 438 of the
Code of Criminal Procedure, 1973 (“the CrPC“, hereafter) are
unwittingly being transformed into processes for recovery of the quantum
of money allegedly cheated and the courts driven to impose conditions
for deposit/payment as pre-requisite for grant of pre-arrest bail. The
present case is no different from the others and it is consideredBail Application 3788/2022 Page 7 of 13 pages
Digitally signed by GIRISH
GIRISH KATHPALIA KATHPALIA
Date: 2025.07.14 14:46:32 +05’30’
Signature Not Verified
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
appropriate to remind the high courts and the sessions courts not to be
unduly swayed by submissions advanced by counsel on behalf of the
accused in the nature of undertakings to keep in deposit/repay any
amount while seeking bail under section 438 of the CrPC and
incorporating a condition in that behalf for deposit/payment as a pre-
requisite for grant of bail.
….
….
26. We may, however, not be understood to have laid down the law that
in no case should willingness to make payment/deposit by the accused be
considered before grant of an order for bail. In exceptional cases such
as where an allegation of misappropriation of public money by the
accused is levelled and the accused while seeking indulgence of the
court to have his liberty secured/restored volunteers to account for the
whole or any part of the public money allegedly misappropriated by
him, it would be open to the concerned court to consider whether in the
larger public interest the money misappropriated should be allowed to
be deposited before the application for anticipatory bail/bail is taken up
for final consideration. After all, no court should be averse to putting
public money back in the system if the situation is conducive therefor. We
are minded to think that this approach would be in the larger interest of
the community. However, such an approach would not be warranted in
cases of private disputes where private parties complain of their money
being involved in the offence of cheating.”
(emphasis supplied)
7.3 In the case of Bimla Tiwari vs State of Bihar, 2023 SCC OnLine SC
51, the Supreme Court held thus:
“9. We have indicated on more than one occasion that the process of
criminal law, particularly in matters of grant of bail, is not akin to money
recovery proceedings but what has been noticed in the present case
carries the peculiarities of its own.
10. We would reiterate that the process of criminal law cannot be utilised
for arm-twisting and money recovery, particularly while opposing the
prayer for bail. The question as to whether pre-arrest bail, or for that
matter regular bail, in a given case is to be granted or not is required to
be examined and the discretion is required to be exercised by the Court
with reference to the material on record and the parameters governing
bail considerations. Putting it in other words, in a given case, the
concession of pre-arrest bail or regular bail could be declined even if the
accused has made payment of the money involved or offers to make any
payment; conversely, in a given case, the concession of pre-arrest bail orBail Application 3788/2022 Page 8 of 13 pages
Digitally signed by GIRISH
GIRISH KATHPALIA KATHPALIA
Date: 2025.07.14 14:46:15 +05’30’
Signature Not Verified
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
regular bail could be granted irrespective of any payment or any offer of
payment.
11. We would further emphasize that, ordinarily, there is no justification
in adopting such a course that for the purpose of being given the
concession of pre-arrest bail, the person apprehending arrest ought to
make payment. Recovery of money is essentially within the realm of civil
proceedings.”
7.4 Recently, even this bench in the case of Mohit Singh Raghav vs
Government of NCT at New Delhi {Bail Application No. 662/2024, decided
on 05.05.2025}, reiterated that the bail court is not a forum for recovery of
money. It is in view of above legal position that when this bail application
came up before me for the first time on 17.04.2025 that both sides were
directed to address on merits instead of getting the matter endlessly
adjourned in the name of settling the monetary claims of the defrauded
investors.
8. As regards the settlement of claims before the predecessor benches
across the period of more than two years, contention of learned senior
counsel for accused/applicant that the same reflects bona fide of the
accused/applicant has been examined by me.
8.1 It appears from record that in the name of settlement of claims of the
victims, the accused/applicant executed settlement agreements with some of
them before the Mediation Centre, but did not fully comply with the same.
As mentioned above, out of 61, as many as 38 defrauded investors (from
various States across the country) have given their signed statements or
electronic messages to the IO that they either did not receive any money or
received only a small part thereof.
Bail Application 3788/2022 Page 9 of 13 pages
GIRISH Digitally signed by GIRISH
KATHPALIA
Signature Not Verified KATHPALIA Date: 2025.07.14 14:45:59
+05'30'
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
8.2 It seems that the mediator(s) also simply recorded the Mediation
Settlements and concluded the mediations without ensuring that the money
was actually returned to the victims. I find substance in the argument of
learned prosecutor that the accused/applicant used the mediation process as a
tool to create artefact of bona fide, which led to his interim bail and
thereafter he continued to ensure that the settlement process goes endlessly
and he evergreens the interim protection.
9. Then comes the next argument of bona fide that when the
accused/applicant started business of crypto currency there was no illegality
therein, so no dishonest intention can be attributed to him. In the judgment
dated 26.10.2021 of the coordinate bench {Bail Application No.3500/2021},
this argument was examined, but discarded thus:
“25. Without any observations on the merits or demerits of the trial that
would take place, in as much as, the charge sheet has already been filed,
the factum that the applicant indulged in the trade of crypto currency
despite public notices dated 24.12.2013, 01.02.2017, 05.12.2017 issued by
the RBI as also issued on 06.04.2018 cautioning users/holders and traders
of virtual currency including bit coins regarding various risks associated
in dealing with such virtual currencies with regulated entities already
providing such services having been called upon to exit the relationship
within three months from the date of the circular dated 06.04.2018
bearing DBR.No.BP.BC.104/08.13.102/2017-18, copy of which is annexed
as Annexure-F to the present application, coupled also with the aspect that
in view of the associated risks, it was decided by the RBI with immediate
effect vide circular dated 06.04.2018 that the entities regulated by the RBI
would not deal in VCs or provide services for facilitating any person or
entity in dealing with or settling VCs and that such services included
maintaining accounts, registering, trading, settling, clearing, giving loans
against virtual tokens, accepting them as collateral, opening accountsof
exchanges dealing with them and transferring/receipt of money inBail Application 3788/2022 Page 10 of 13 pages
GIRISH Digitally signed by GIRISH
KATHPALIA
Signature Not Verified KATHPALIA Date: 2025.07.14 14:45:45 +05’30’Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
accounts relating to purchase/ sale of VCs with the transactions entered
into by the applicant, coupled with the aspect that apart from the
investments received by the applicant prior to the circular dated
O6.O4.2018, the applicant continued to take investments even after the
RBl’s circular dated 06.04.2018 as per the statement of amount invested
by complainants along with receipts as submitted by the applicant vide
documents dated 27.09.2021 filed vide diary No.797160…”
(bold emphasis is as in the quoted extract)
After the above extracted portion, in the judgment dated 26.10.2021 the
learned coordinate bench of this court enlisted as many as 15 investors with
further details from whom money was collected by the accused/applicant
even after the RBI circular dated 06.04.2018. This act of the
accused/applicant collecting money even after derecognition of crypto
currency in itself shows mala fide.
10. Next comes the question as to whether the accused/applicant is a flight
risk. Merely because the accused/applicant did not flee the clutches of law
despite being released on interim bail, the issue of flight risk cannot be
decided in his favour. For, as mentioned above, the accused/applicant was
evergreening his liberty by making piecemeal mediation settlements with the
victims, without paying them their due amounts and the matter was being
adjourned across past more than two years, as he was successfully conveying
impression of his bona fide. On the issue of flight risk, as reflected from
chargesheet, during investigations, efforts were made to locate the
accused/applicant and interrogate him, but it came out that he had fled to
Dubai, so in order to secure his presence, Lookout Circular was issued
against him, and on 30.12.2020 he was apprehended at the airport and
Bail Application 3788/2022 Page 11 of 13 pages
GIRISH Digitally signed by GIRISH
KATHPALIA
Signature Not Verified KATHPALIA Date: 2025.07.14 14:45:30 +05’30’
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
arrested. The deep pockets of the accused/applicant, coupled with the nature
and expanse of offence in the present case and 13 more cases with
consequential possibility of long incarceration lends credence to the
apprehension of prosecution that the accused/applicant is a flight risk.
11. As held in catena of judicial pronouncements by the Supreme Court
and all High Courts, economic offences constitute a class apart and need to
be visited with a different approach in the matter of bail. For, economic
offences, unlike most conventional bodily offences, are committed with
elaborate planning and expertise. Especially, dealing in crypto currency has
profound implications on economy of our country by way of dissolution of
recognised money into the dark unknown and untraceable money. The
allegations against the accused/applicant in this multi-victim scam are quite
serious, more so in the light of his antecedents of involvement in as many as
13 more cases of similar nature, list whereof is on record and not challenged
by the accused/applicant. The accused/applicant prima facie seems to have
duped 61 investors after painting a rosy picture of getting them returns of
20% to 30% on their investments in crypto currency, which process he
continued against the gullible persons even after derecognition of crypto
currency. And there can be revelation of more such defrauded persons, as the
ongoing investigation is unfolding, having reached the number of defrauded
investors from 48 to 61.
12. To summarise, there are multiple factors that convince this court to
deny bail to the accused/applicant, and the same are: complexity and
Bail Application 3788/2022 Page 12 of 13 pages
GIRISH Digitally signed by GIRISH
KATHPALIA
Signature Not Verified KATHPALIA Date: 2025.07.14 14:45:17 +05’30’
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
expanse of the economic crime alleged against the accused/applicant;
continuance of collection of investments in the business of crypto currency
by the accused/applicant from credulous investors, swayed by the mirage of
20% to 30% profit assured by the accused/applicant, despite derecognition
of crypto currency; blatant misuse of the mediation system by the
accused/applicant by alluring execution of mediation settlements and not
complying with the same despite adjournments across more than two years
before the predecessor benches; the accused being a serious flight risk;
continuance of investigation, unfolding more and more victims of the fraud;
and the antecedents of the accused/applicant.
13. Therefore, this Bail Application is dismissed. The pending application
stands disposed of
14. However, nothing observed herein shall be read by the learned trial
court while final deciding the trial.
15. The accused/applicant, who is on interim bail granted by the
predecessor bench, shall surrender before the IO or the trial court forthwith.
Digitally signed by
GIRISH GIRISH KATHPALIA
KATHPALIA Date: 2025.07.14
14:44:56 +05'30'
GIRISH KATHPALIA
(JUDGE)
JULY 14, 2025/as
Bail Application 3788/2022 Page 13 of 13 pages
Signature Not Verified
Digitally Signed
By:NEETU N NAIR
Signing Date:14.07.2025
15:57:08
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