Magistrate Can Proceed Only for Offences Committed in India Until Sanction Is Obtained for Acts Outside India: Orissa High Court on International Financial Fraud

“Prior Sanction of Central Government Mandatory Under Section 208 BNSS for Prosecution of Offences Committed Abroad by Indian Citizens”, Orissa High Court granted bail to an Indian citizen accused of orchestrating a financial fraud involving USD 1,25,000 across India and Zambia. The Court examined critical questions surrounding cross-border offences, jurisdiction under Indian criminal law, and the necessity of prior Central Government sanction under Section 208 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS).

While allowing the bail, Justice G. Satapathy made it clear that “the petitioner cannot be prosecuted for the acts committed by him in Zambia without obtaining prior sanction from the Central Government under Section 208 of BNSS (corresponding to Section 188 of the CrPC)”. At the same time, the Court held that Indian authorities were well within their right to proceed against the petitioner for acts allegedly committed within India, especially since the transactions had a continuing nature and involved Indian bank accounts and assets.

The case stemmed from an FIR filed by Dharampal Singla, Director of FosGro Resources Pvt. Ltd., New Delhi, alleging that the petitioner, Soumya Ranjan Panda, committed a sophisticated financial fraud while serving as the Finance and Admin Manager of the company. Initially posted in Zambia with the company's partner entity, Igrow Resources Ltd., Panda was accused of setting up a parallel fraudulent company—FosGro Resources Ltd.—in Zambia, siphoning funds from the official company accounts into this sham entity, and further diverting them into Indian bank accounts.

The FIR recounted specific instances including fraudulent refunds, illegal sale of urea stock, and unauthorized fund transfers totaling over USD 1,25,000. The charge sheet detailed transactions involving remittances into Indian accounts, particularly ICICI Bank and SBI in Jajpur, Odisha, along with the theft of devices and company documents. The petitioner was arrested on 15 May 2025 and remained in custody while the trial, though commenced, stood stayed at the time of hearing.

A central legal controversy involved the applicability of Indian jurisdiction over offences committed abroad and the requirement of prior sanction under Section 208 of BNSS, which corresponds to Section 188 of the Criminal Procedure Code (CrPC).

Justice Satapathy observed: “It is no more res integra that when an offence is committed by an Indian citizen outside India, he may be dealt with in respect of such offence as if it had been committed at any place within India, provided no such offence shall be enquired into or tried in India except with previous sanction of Central Government.”

The petitioner’s counsel had argued that since the core offences occurred in Zambia, Indian courts lacked jurisdiction. This was countered by the informant’s counsel, who contended that the acts constituted continuing offences which had also taken place in India, particularly through the petitioner’s financial transactions and possession of misappropriated assets.

Justice Satapathy refrained from making a conclusive determination on jurisdiction at the bail stage, but emphasized: “This Court does not consider it proper to decide the jurisdictional issue, but finds the allegation by the informant against the petitioner prima facie constitute some offence in India.”

Importantly, the Court distinguished between acts committed solely abroad and those continuing into Indian territory, such as the deposit of misappropriated funds into Indian bank accounts and possession of stolen property in Odisha.

No Double Jeopardy at This Stage, Rules Court

Addressing concerns of potential double jeopardy due to parallel proceedings initiated in Zambia, including an arrest warrant issued by the Zambian court, the Orissa High Court invoked Section 337(6) of BNSS and Article 20(2) of the Constitution.

Justice Satapathy ruled: “The bar of double jeopardy would not be attracted in this case... the petitioner is yet to be prosecuted in any foreign country, although a criminal case has been registered against him in the country of Zambia.” The Court further noted that the same acts might constitute different offences under different legal regimes, which does not preclude Indian prosecution unless there has been a prior conviction or acquittal.

Reliance on Supreme Court Precedent

The Court heavily relied on the decision of the Supreme Court in Thota Venkateswarlu v. State of Andhra Pradesh (2011) 9 SCC 527, where it was held that Indian courts may proceed with trials concerning acts committed within India, but for acts abroad, prior Central Government sanction is essential. Citing the precedent, the Court reiterated:

“The learned Magistrate may proceed with the trial relating to the offences alleged to have been committed in India. However, in respect of the offences alleged to have been committed outside India, the learned Magistrate shall not proceed with the trial without the sanction of the Central Government.”

Reasoning Behind Grant of Bail

Taking into account the petitioner's custody since 15 May 2025, the recovery of allegedly stolen items such as laptop, iPhone, and ATM cards, and the fact that no further custodial interrogation was needed, the Court held that pre-trial incarceration was not justified.

Referring to established jurisprudence, the Court noted: “Following the well recognized principle ‘bail is the rule, but jail is the exception’, this Court without expressing any view on merit admits the petitioner to bail.”

It also observed that the offences were triable by a Magistrate and were not punishable with death or life imprisonment.

Stringent Bail Conditions Imposed

In view of the Zambian court's arrest warrant and the international nature of the case, Justice Satapathy imposed strict conditions:

“The petitioner shall surrender to the jurisdiction of the Court of Zambia, if he is acquitted of the charge in this case... the petitioner shall report attendance before the Jurisdictional Police Station once in a month preferably on a Sunday...”

Further, the Court directed the petitioner to provide complete contact information, not change his residence without intimation, and refrain from committing similar offences.

While granting bail, the Orissa High Court has made it unequivocally clear that Indian courts do possess jurisdiction to try Indian citizens for continuing offences that straddle international borders—provided acts are committed within India. However, for prosecuting offences occurring outside Indian territory, prior sanction of the Central Government under Section 208 of BNSS is not merely procedural, but mandatory.

The judgment delicately balances individual liberty with sovereign considerations in cross-border criminal enforcement, setting a vital precedent under the new criminal law regime brought in by BNSS and BNS, 2023.

Date of Decision: 10th December 2025