Bail Plea Dismissed
A special CBI court in Mohali on Friday dismissed the bail plea of Kanhaiya Lal, accused of allegedly providing a bank account used by cyber fraudsters to layer and withdraw part of the ₹2 crore defrauded from a retired Punjab State Power Corporation Limited (PSPCL) chief engineer.
CBI special judge Baljinder Singh Sra dismissed the bail application, observing that the investigation was still underway, the chargesheet had not been filed and the defrauded money had not been recovered yet. The court, however, allowed Kanhaiya Lal to approach it again for bail after the filing of the chargesheet.
The CBI registered the case under Section 318(4) (cheating) of the Bharatiya Nyaya Sanhita and Section 66D of the Information Technology Act. The agency took over the investigation after the Punjab and Haryana high court, on March 17, directed the CBI to investigate an FIR originally registered at the Cyber Crime police station in Jalandhar.
Fraudsters posed as govt officials
According to the CBI, complainant Sukhmander Singh, who retired as PSPCL chief engineer on April 30, 2025, lost ₹2 crore to fraudsters who impersonated as government and law-enforcement officials.
The fraudsters allegedly called Singh on May 9, 2025, claiming that a SIM card issued in his name was being used for illegal activities in Mumbai and that a bank account in his name was linked to a money-laundering case. They allegedly threatened him with legal consequences and kept him under continuous phone and video calls, in a modus operandicommonly known as ‘digital arrest’.
{{/usCountry}}The fraudsters allegedly called Singh on May 9, 2025, claiming that a SIM card issued in his name was being used for illegal activities in Mumbai and that a bank account in his name was linked to a money-laundering case. They allegedly threatened him with legal consequences and kept him under continuous phone and video calls, in a modus operandicommonly known as ‘digital arrest’.
{{/usCountry}}The accused allegedly sent bank-account details to Singh through WhatsApp and directed him to transfer money through RTGS. Acting under fear and coercion, he transferred ₹2 crore in 10 transactions to nine bank accounts between May 13 and June 11, 2025. He realised he had been cheated on June 12 and approached the authorities.
During the investigation, the CBI traced the money through first, second and third layer beneficiary accounts. The agency said substantial portions were withdrawn through ATMs, cash withdrawals and cheque transactions or transferred further, often on the same day the money was credited.
The CBI identified Kanhaiya Lal, a resident of Nagaur, Rajasthan, as one of the persons linked to the money trail. According to the prosecution, ₹1.5 lakh was credited to his Punjab National Bank account on May 23, 2025, from an account belonging to Saismruti Charitable Trust, identified as the first beneficiary account under investigation.
The CBI alleged that Kanhaiya Lal subsequently withdrew ₹45,000 through an ATM, transferred ₹20,000 through UPI to Sher Mohammad, paid ₹1,000 to Bharat Garva and transferred another ₹90,500 through immediate payment service (IMPS).
The agency arrested Kanhaiya Lal from his Nagaur residence on June 30. After obtaining transit remand from a Nagaur court, it produced him before the special CBI magistrate in Mohali on July 1, following which he was sent to judicial custody.
Accused seeks bail
Seeking bail, Kanhaiya Lal claimed that he was innocent and had been falsely implicated. He told the court that a CBI search of his residence on June 30, conducted pursuant to a search warrant issued on June 23, did not yield any incriminating material.
He further claimed that during the search, he disclosed that he had sold his PNB account for ₹5,000 to a person named Gajendra of Nagaur and handed over the SIM card linked to the account. His counsel argued that the disclosure was inadmissible and that no incriminating material had been recovered from his possession.
Public prosecutor Anmol Narang, appearing for the CBI, opposed the bail plea, arguing that Kanhaiya Lal had provided a mule account used by cyber criminals to layer and withdraw part of the fraud proceeds.
The court referred to a recent Delhi high court judgment in Ashok Kumar vs State of NCT of Delhi, in which the court observed that providers of mule accounts can play an important role in a criminal conspiracy and their role cannot automatically be treated as peripheral.
The Mohali court held that the case remained under investigation, the chargesheet was yet to be filed and the defrauded money was yet to be recovered. It therefore found no ground to grant bail at this stage and dismissed the application.
The order clarified that its observations would not affect the merits of the main case.