The arrest of
ICICI Bank's former Managing Director and Chief Executive Officer (CEO) Chanda
Kochhar and her husband Deepak Kochhar by the Central Bureau of Investigation
(CBI) in a loan fraud case was "without application of mind and due regard
to the law", amounting to an "abuse of power", the Bombay High
Court has said.
A division bench
of Justices Anuja Prabhudessai and N R Borkar had on February 6 held the
Kochhars' arrest as illegal and confirmed a January 2023 interim order passed
by another bench granting them bail.
In the order made
available on Monday, the court said the CBI has been unable to demonstrate the
existence of circumstances or supportive material based on which the decision
to arrest was taken.
The absence of
such circumstances renders the arrest illegal, it said.
"Such
routine arrest without application of mind and due regard to the law amounts to
an abuse of power," the court said.
The court also
refused to accept the probe agency's contention that the arrest was made as the
Kochhars were not cooperating with the probe and said the accused had a right
to remain silent during interrogation.
"The right
to silence emanates from Article 20(3) of the Indian Constitution, which gives
an accused the right against self-incrimination. Suffice it to say that
exercise of the right to remain silent cannot be equated with
non-cooperation," it said in the order.
The CBI arrested
the couple on December 23, 2022, in the Videocon-ICICI Bank loan case.
They immediately
moved the high court challenging the arrest and sought for the same to be
declared illegal, and by way of interim order, sought to be released on bail.
On January 9,
2023, the court, in an interim order, granted the Kochhars bail, noting that
the CBI had made the arrest casually and mechanically and without application
of mind.
In the February 6
order, the bench noted that section 41A of the Criminal Procedure Code (CrPC)
was introduced to avoid routine arrests.
It cited that
this provision restricts the power to arrest when an accused person complies
with the notice issued by the police to appear for questioning and mandates
that an arrest shall be made only when the police are of the opinion that it is
necessary.
The court held
that while it was within the domain of the investigating agency to interrogate
an accused and to arrive at a subjective satisfaction on the issue, the same
was not "wholly immune from judicial reviewability".
"The court
can consider whether the reasons for deprivation of liberty are rational,
reasonable or fanciful," it said.
The bench further
said that the first information report (FIR) against the Kochhars was
registered in 2019, and they were summoned for questioning only in 2022.
"Despite the
gravity of the offence, the petitioners (Kochhars) were not interrogated or
summoned for a period of over three years from the date of registration of the
crime," it said.
From June 2022,
the Kochhars have been appearing before the CBI as and when notices under
section 41A were issued to them, the bench said.
The CBI had
claimed that the Kochhars were arrested as they were not cooperating with the
probe and that their custodial interrogation was required to unearth the entire
gamut of conspiracy.
Apart from the
Kochhars, the CBI had also arrested Videocon group founder Venugopal Dhoot in
the case. The high court granted him bail in January 2023 in its interim order.
The probe agency
has alleged that private sector lender ICICI Bank had sanctioned credit
facilities to the tune of Rs 3,250 crore to the companies of Videocon Group promoted
by Dhoot in violation of the Banking Regulation Act, Reserve Bank of India's
guidelines, and credit policy of the bank.
The CBI had named
the Kochhars, Dhoot along with Nupower Renewables (NRL) managed by Deepak
Kochhar, Supreme Energy, Videocon International Electronics Ltd and Videocon
Industries Ltd as accused in the FIR registered in 2019 under the Indian Penal
Code sections related to criminal conspiracy and provisions of the Prevention
of Corruption Act.
The agency has
alleged that the ICICI Bank sanctioned credit facilities to the tune of Rs
3,250 crore to these companies in violation of norms.
It further
claimed that as a part of quid pro quo, Dhoot made an investment of Rs 64 crore
in Nupower Renewables through Supreme Energy Pvt Ltd (SEPL) and transferred
SEPL to Pinnacle Energy Trust managed by Deepak Kochhar through a circuitous
route between 2010 and 2012.