Anticipatory Bail Not a Shield Where Custodial Interrogation is Essential to Recover Crores in Fraud Case: Andhra Pradesh High Court

Despite Withdrawals of Rs.1.5 Crore, Petitioner Offers No Explanation or Return—Custodial Interrogation Is Justified - Andhra Pradesh High Court refusing anticipatory bail to the petitioner accused of involvement in a massive ICICI Bank fraud case involving Rs.28.34 Crores. Justice T. Mallikarjuna Rao held that the power of anticipatory bail under Section 438 Cr.P.C. (now under Section 482 of the Bharatiya Nagarik Suraksha Sanhita, 2023) is “extraordinary and must be exercised sparingly,” especially in cases involving serious financial fraud and unaccounted cash withdrawals. 
 
The criminal case originated from Crime No. 23/2024 registered by CID Police Station, Mangalagiri, following a complaint by the Zonal 
Head of ICICI Bank, Vijayawada, on October 9, 2024. The complaint alleged a sophisticated fraud by bank staff—including the Branch Manager, Regional Sales Head, and Gold Loan Counsellors—who manipulated overdrafts on fixed deposits, issued fake FD receipts, diverted customer funds, and misused gold loans, culminating in a scam amounting to approximately Rs.28.34 Crores. 
 
The petitioner, Chimakurthi Naga Venkata Sai Kiran, was arrayed as Accused No. 20 (A.20) based on the statement of A.1. It was alleged that Rs.1.5 Crores was deposited into his bank account and subsequently withdrawn in cash. The petitioner approached the Court seeking anticipatory bail. 
  

The petitioner claimed innocence, arguing he was merely a customer who had been deceived, and that he had no intent or knowledge of the fraud. He relied on Section 35(3) of the BNSS, 2023, to claim that the offences alleged attracted less than seven years’ imprisonment and thus merited a notice instead of arrest. 
 
However, the Court sharply rejected these arguments. 
Prior to withdrawing this substantial sum, the Petitioner must have had knowledge that the amount in question did not belong to him... the Petitioner did not take any steps to inform the bank about this discrepancy, nor did he raise any concerns.

 The Court further noted: “Even after registration of the crime, the Petitioner has not provided any explanation regarding the whereabouts of the withdrawn amount... nor offered any account of what happened to it... this omission raises serious concerns.” 
 
Rejecting the defense under Section 35(3) BNSS, the Court held:  “The discretion to arrest or not to arrest and therefore to follow under section 35(3) of BNSS is solely vested in the investigating officer.” 
 
  The Court also addressed the relevance of custodial interrogation: “Custodial interrogation can be one of the relevant aspects... success in such interrogation will elude if the suspected person knows he is protected and insulated by a pre-arrest bail order.” 
  
 It was observed that investigation was still at an initial stage, the sum of Rs.1.5 crore remained unrecovered, and no explanation had been provided by the petitioner. Therefore, it was not a fit case for pre-arrest bail. 
 
The Court concluded: “Considering all the attending facts and circumstances of the case as well as the gravity of the offence... no such extraordinary circumstance has been made out. This Court does not find it a proper case for granting the relief of anticipatory bail.” 
 
 Accordingly, the criminal petition was dismissed, and the request for anticipatory bail was denied. 
 
 Date of Decision: 27 March 2025