Delhi High Court: Getting indulged in Virtual Currencies even after receiving public notices not to deal in the same and further duping several people, the accused applied for bail. Anu Malhotra, J., denied application of the accused concerned by expressing that,
“…alleged commission of economic offences corrode the fabric of democracy and were committed with total disregard to the rights and interest of the nation and were committed by breach of trust and faith and were against the national economy and national interest, whereby a large number of innocent investors had been duped of their hard-earned money…”
Bail was sought through the present application with respect to an FIR under Sections 420, 406, 120B of the Penal Code, 1860.
Applicant along with the co-accused Bharat Verma and other associates were running a Crypto Currency chit fund company and held various meetings to explain their cryptocurrency business and also the alleged high rate of return being given to clients whereby they allegedly induced the complainants to invest in the cryptocurrency in their firm on the assurance of high return up to 20-30% per month.
Adding to the above, it was also stated that complainants were further allured on the assurance of extra commission, if more clients were brought for the investment in the firm.
Complainants gave their hard-earned money but never received the return on their respective investments as assured by the allege persons and later it was learnt that the accused persons including the present applicant closed the office of their firm and fled to Dubai without returning the amount of the complainants.
EOW sought the dismissal of the bail application as the applicant had collected huge amounts from gullible investors.
Analysis, Law and Decision
High Court noted that the applicant had indulged in trade of cryptocurrency despite public notices issued by the RBI as also issued on cautioning users/holders and traders of virtual currency including bitcoins 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 3 months.
In view of the associated risks, it was decided by the RBI with immediate effect 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 accounts of exchanges dealing with them and transferring/receipt of money in 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 06.04.2018, the applicant continued to take investments even after the RBI’s circular dated 06.04.2018 as per the statement of amount invested by complainants along with receipts as submitted by the applicant.
Court expressed that,
“…taking into account the allegations levelled against the applicant of he with his associates having duped the complainants allegedly to the tune of Rs 2.5 Crores in the instant case which were related to an alleged commission of an economic offence, which offences corrode the fabric of democracy and were committed with total disregard to the rights and interest of the nation and were committed by breach of trust and faith and were against the national economy and national interest, whereby a large number of innocent investors had been duped of their hard-earned money, it is not considered appropriate to release the applicant on bail.”
In view of the above discussion, bail application was dismissed. [Umesh Verma v. State, 2021 SCC OnLine Del 4800, decided on 26-10-2021]
Advocates before the Court:
For the Petitioner:
Mr Raman Gandhi, Mr Anand Kumar Dubey, Advocates with applicant.
For the Respondent:
Ms Aashaa Tiwari, APP for State with SI Deepak Kumar.
Mr Archit Kaushik, Advocate for complainant