HC denies bail to Thane bizman in ₹377-crore investment fraud

The Bombay High Court denied bail to businessman Sandip Samant, accused of a ₹377.6 crore investment fraud affecting over 900 investors.

MUMBAI: The Bombay High Court on Monday refused bail to a Thane-based businessman accused of masterminding an investment fraud in which over 900 investors, many from Mumbai and Thane, were defrauded of nearly ₹377.6 crore.

HC denies bail to Thane bizman in ₹377-crore investment fraud

The court held that no case was made out for granting bail to the businessman, Sandip Samant, and justice Neela Gokhale explaining that the scale and seriousness of the allegations showed that vulnerable investors were misled with promises of unrealistic profits.

According to the police, the fraud began when a family from the city responded to an online advertisement by AS Agri and Aqua LLP, a company claiming to be involved in agricultural technology projects. Lured by promises of annual payouts of ₹1 crore and double returns within 16 months, the family invested heavily in the company.

The company representatives persuaded the family to buy farmland in Yenmadala village worth ₹1.1 crore, and then claiming that the land was unsuitable for agriculture, the family was made to spend another ₹60 lakh on leveling the land.

Once a complaint was filed, Samant, one of the directors of the company, was arrested on March 16, 2023 and has since been in custody. He was booked for cheating, criminal breach of trust, and conspiracy under the relevant sections of the Indian Penal Code (IPC), along with sections of the Maharashtra Protection of Interest of Depositors (MPID) Act, a law aimed at safeguarding investors from fraudulent schemes.

Samant argued that his arrest was illegal since the grounds of the arrest had not been furnished to him in writing. He added that this violated the constitutional safeguards and stressed that he had already spent over two years in jail without the possibility of a trial commencing in near future.

The prosecution opposed his bail plea, pointing out that Samant had been informed of the grounds of his arrest, his wife too had been notified, and he had acknowledged the remand report. The prosecution told the court that the company’s accounts showed large sums of money being siphoned off, and that Samant already had five criminal cases against him of a similar nature.

The court held that since Samant’s arrest took place in March 2023, before the Supreme Court’s October 2023 ruling requiring written arrest grounds, the procedure followed by the police was valid.

While looking through forensic audits and seized company documents which showed large-scale diversion of investor funds, justice Gokhale said, “The magnitude of the fraud, the manner in which gullible investors were duped, and the antecedents of the applicant show that no case is made out for grant of bail.”