Mithi desilting fraud:HC grants bail to Virgo CEO, citing lack of evidence

The court said the evidence on record does not appear to support the prosecution’s allegations against him and ordered him to be released on a bail bond of ₹30,000

MUMBAI: The Bombay High Court on Wednesday granted bail to Ketan Kadam, CEO of Virgo Specialties Pvt Ltd, arrested in connection with the alleged ₹65.54-crore fraud in the execution of contracts for desilting Mumbai’s Mithi River. The court said the evidence on record does not appear to support the prosecution’s allegations against him and ordered him to be released on a bail bond of ₹30,000.

Mithi desilting fraud:HC grants bail to Virgo CEO, citing lack of evidence

Kadam and his director Jay Joshi were among the 13 people booked by the Economic Offences Wing (EOW) of the Mumbai Police in May last year for their alleged role in the fraud. The accused include three civic officials, three intermediaries, five private contractors, and two company executives.

According to the police, the case involved inflated tenders and financial irregularities, among other corrupt practices linked to the desilting contracts awarded between 2019 and 2024. Police found that several contractors had submitted false memoranda of understanding (MoUs) and certain properties were shown as designated dumping sites.

The MOUs were found to be forged, which indicated that Kadam’s company claimed to have provided the contractors with two machines for the desilting work, but the machines had not even been procured, and the bill amounts were claimed without any work, police said.

Appearing for Kadam, senior advocate Sudeep Pasbola, and advocates Wesley Menezes and Waqar Pathan, submitted that since no contract for the desilting work was allotted to Kadam, no misdeeds could be attributed to him. Besides, they said, Joshi, who was said to have entered into the bogus MoUs, has already been enlarged on bail.

Additional public prosecutor AR Kapadnis opposed the bail plea, contending that Kadam worked with civic officials to frame tender conditions that compelled contractors to rent or purchase desilting machines only from Virgo Specialities. He clarified that Joshi was granted bail only on the ground that he was not a signatory to any of the documents.

A single-judge bench of Justice RM Joshi, however, noted that the material on record did not support the allegations against Kadam. The judge also noted that the accused and his company were only responsible for facilitating the contractors to obtain contracts from the municipal corporation, and for procuring two distilling machines. Documents on record indicated that it was the senior civic officials who permitted the contractors to engage in the services of others and certified the work.

The bench highlighted that since it is clear that the corporation permitted the contractors to engage services of others for providing machines to execute the work, “it cannot be said on the face of it that any illegality has been committed by the applicant (Kadam) and his company by providing such machines to the contractors”.

Additionally, the court said Kadam cannot be kept in custody by way of pre-trial imprisonment. “Applicant has no criminal history, he is not likely to flee from justice,” the bench concluded and ordered his release on bail on furnishing a personal bond of ₹30,000 and sureties of the same amount.