₹284 crore bank fraud: HC grants bail to Cox & Kings CFO Anil Khandelwal

Bombay HC granted bail to Cox & Kings CFO Anil Khandelwal in a ₹284 crore IndusInd Bank fraud case due to long pre-trial incarceration of 4 years, 8 months.

MUMBAI: The Bombay high court (HC) on Tuesday granted bail to Anil Khandelwal, the chief finance officer (CFO) of fraud-hit Cox & Kings Ltd, in connection with an alleged fraud of ₹284 crore at IndusInd Bank.

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A single-judge bench of justice Manish Pitale granted bail to Khandelwal, who was arrested by the Economic Offences Wing of the Mumbai police on December 9, 2020, primarily in view of his long pre-trial incarceration.

The FIR was first registered at the Andheri police station on October 23, 2020, and transferred to the Economic Offences Wing for investigation. It was registered following a complaint lodged by a vice president of IndusInd Bank, claiming that the senior executives at Cox & Kings had defrauded the bank by defaulting payments pertaining to commercial credit card facility.

The complainant said the facility was first provided to the tours and travels company in February 2015 and in March 2018 enhanced to ₹370 crore. Khandelwal, the CFO of CKL, was accused of being an active part of the scam along with others and had allegedly misused the facility by illegally diverting huge amounts to companies owned or controlled by him or his family members.

It was also alleged that huge amounts were paid to him and his family members as “consultancy charges” and under his directions and supervision funds were diverted to 15 bogus companies and several fake entities.

Khandelwal had approached the high court for bail, primarily contending that two serious charges levelled against under sections 409 (criminal breach of trust by a banker, merchant, factor, broker, attorney or agent) and 467 (forgery of valuable security, will or other document) of the Indian Penal Code were not made out and since other charges levelled in the case prescribed maximum punishment of up to 7 years imprisonment, he was entitled to bail having served more than half of the punishment.

Justice Pitale accepted his argument and held that prima facie the two offences were not made out. “Consequently, the period of incarceration undergone as an under-trial by the applicant ought to be taken into consideration with reference to the other offences, which carry a maximum sentence of imprisonment for a term of up to seven years,” the court said referring to Khandelwal’s incarceration for 4 years and 8 months and granted Khandelwal bail on furnishing a personal bond of ₹50,000.

The court said there was no doubt that financial frauds and scams adversely impact the economic health of the nation, and such offences are extremely serious. “The applicant, being the CFO of CKL, was certainly a key player in the entire chronology of events. It is evident from the documents on record, including statements of accounts, which were signed by the applicant as CFO that he cannot claim ignorance about the manner in which the fraud was committed upon the complainant bank and other banks,’ said Justice Pitale. “The extent of financial misappropriation in the present case itself is to the extent of about ₹284 crores. Thus, the seriousness of the case cannot also be doubted,” the judge added.