Anticipatory Bail Is Barred under G.P.I.D. Act; Designated Court Has No Jurisdiction — Gujarat High Court Refuses Pre-Arrest Protection in ₹3.36 Crore Investment Scam

“In Economic Offences, Custodial Interrogation Is Not a Mere Form — It Is a Functional Necessity to Unravel Deep-Rooted Conspiracies” - In a significant ruling Gujarat High Court, through Justice Divyesh A. Joshi, refused to grant anticipatory bail to Archana Arvindbhai Patil, accused of participating in a massive ₹3.36 crore investment fraud. The applicant had approached the Court under Section 482 of the Bharatiya Nagarik Suraksha Sanhita, 2023, seeking pre-arrest protection. However, the Court not only found strong prima facie evidence against her but also held that anticipatory bail is barred under Section 17(2) of the Gujarat Protection of Interest of Depositors Act, 2003.

Rejecting the application, the Court declared: “The Court of original criminal jurisdiction under the G.P.I.D. Act is denuded of the power to grant anticipatory bail. The language of Section 17(2) is clear and categorical.”

The Court found that the applicant was not a passive or peripheral figure, but an active conspirator, involved in luring investors, receiving funds, organising meetings and foreign trips, and evading arrest. Her role, the Court held, was not incidental to her being the wife of a co-accused, but central to the fraudulent scheme.

“White-Collar Economic Offences Warrant a Distinct Judicial Approach” — Liberty Must Yield to Public Interest in Cases of Financial Crime

Dismissing the applicant’s argument that she was merely a homemaker and falsely implicated due to her husband’s involvement, the Court observed:

“The financial trail runs through her bank accounts, witness statements place her at the centre of investor meetings, and her evasive conduct speaks louder than her claim of innocence.”

The Court noted that multiple entries showed funds routed to her from both victims and co-accused. One of the witnesses, Pradip Jain, had transferred ₹6.5 lakhs to her account. Another accused, Mangesh Khunt, transferred ₹42 lakhs, and entries of over ₹18 lakhs from VIPS Group’s sister concerns also appeared. Additionally, WhatsApp chats retrieved during investigation established her active role.

The Court held that her continued absconding, despite issuance of warrant under Section 72 of the BNSS, revealed a deliberate attempt to frustrate the investigation.

“Economic offences, particularly those involving deep-rooted conspiracies and public funds, are crimes against the economic order of the society and must be treated as grave offences.”

“Designated Courts Are Not Magistrate or Sessions Courts for Bail Purposes under G.P.I.D. Act” — Court Reaffirms Legal Position

The Court reaffirmed the binding nature of Section 17(2) of the G.P.I.D. Act, which removes the power of granting anticipatory bail for offences under the Act, stating:

“A designated court under the G.P.I.D. Act functions as a court of original criminal jurisdiction. It is not bound by terminological status as a Magistrate or Sessions Court. It enjoys powers conferred upon it except those specifically denied — and anticipatory bail is expressly denied.”

Relying on its earlier ruling in Geetaben Manishkumar Shah v. State of Gujarat, the Court held that Section 438 CrPC and its BNSS equivalent Section 482 cannot be invoked when the special statute expressly denies the remedy.

“To put it plainly, the G.P.I.D. Court cannot entertain a request for anticipatory bail. The statutory framework excludes such jurisdiction.”

“Parity Is Not a Licence for Bail — Role-Based Scrutiny Is Essential”

A major contention raised was that her husband, accused no.1, had already been granted bail. The applicant argued for parity. The Court, however, clarified that bail by parity is not an absolute principle, and must be conditioned upon the comparative roles of the accused.

Citing the Supreme Court’s decision in Tarun Kumar v. Directorate of Enforcement, the High Court reiterated: “Parity is not the law. The Court must focus on the specific role of the applicant. Bail to one cannot be a carte blanche for another, especially when their involvement is dissimilar.”

The Court held that the applicant’s role was far more proactive than that of her husband. She was not only present at investor meetings but also involved in key financial decisions, had received funds directly, and was part of a structured scheme to deceive investors with fake promises of monthly returns.

“Anticipatory Bail Cannot Be Granted in a Casual or Mechanical Manner in Economic Offences”

The Court cited a long line of decisions that underscore the judicial caution required in pre-arrest bail pleas involving financial crimes:

In Y.S. Jagan Mohan Reddy v. CBI, the Supreme Court had observed that: “Economic offences constitute a class apart and need to be viewed with a different lens. Their ramifications on national interest, public confidence, and financial systems are profound.”

Similarly, in Mohammed Salim Abdul Rasid Shaikh v. State of Gujarat, the Gujarat High Court had held that: “Custodial interrogation may become unavoidable when the financial dimensions of a crime are complex and documentation-based.”

Justice Joshi applied these principles, stating: “Custodial interrogation is not a mere formality; it is a necessity to uncover multi-layered financial trails and recover funds, particularly where the accused is evasive.

“False Implication Argument Collapses Under the Weight of Evidence” — Court Finds Active Role, Not Innocent Association

Rejecting the defence’s claim that the applicant was being harassed merely because she was the spouse of the prime accused, the Court pointed to a trail of incriminating evidence.

Witness statements, account transactions, WhatsApp chats, and even her participation in marketing and promotion of the scheme were noted.

“She is not a passive spouse. Her role is not a function of association but of participation. She received funds, engaged with investors, and shared responsibility in the scheme’s execution.”

Anticipatory Bail Denied, Custodial Interrogation Deemed Essential in Interest of Justice and Financial Accountability

In concluding the order, Justice Divyesh Joshi made it unequivocally clear that the nature and magnitude of the fraud, coupled with the applicant's evasive conduct and her central role, justified the denial of anticipatory bail.

“When the allegations point to economic fraud of this magnitude, with a prima facie case supported by bank records and witness statements, the Court must lean in favour of investigation. Liberty cannot shield those who manipulate public trust for private gain.”

The Court held that granting bail at this stage would seriously compromise the investigation, especially in tracing the financial network and recovering misappropriated funds.

“The rule is discharged. The application is rejected. However, observations herein shall not prejudice the applicant’s rights during trial or while seeking regular bail.”

Date of Decision: 18 September 2025