Orissa High Court
Case Details
Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 IN THE HIGH COURT OF ORISSA AT CUTTACK BLAPL No.2947 of 2025 Along with BLAPL Nos.3916 and 4127 of 2025 …. Petitioner (s) Manas Ranjan Barik & Anr. (In BLAPL No.2947 of 2025) Soumyasankar Chakra @ Raja (In BLAPL No.3916 of 2025) Susanta Kumar Samal (In BLAPL No.4127 of 2025) Mr. Dharanidhar Nayak, Sr. Adv. along with his associates (in BLAPL No.2947/2025) Mr. Ashok Kumar Mohanty, Sr. Adv. along with associates (in BLAPL No.3916/2025) Mr. Ashok Parija, Sr. Adv. along with associates (in BLAPL No.4127/2025) -versus- Opposite Party(s) …. Mr. Partha Sarathi Nayak, AGA State of Odisha CORAM: DR. JUSTICE S.K. PANIGRAHI Order No. 02. F.I.R. No. EOW No. 03 ORDER 16.05.2025 Dated Police Station Case No. and Sections 07.02.2025 Bhubaneswar EOW P.S Courts’ Name Bhubaneswar EOW P.S Case No.03/2025, corresponding to CT Case No. 4(C)/2025 Sections 409, 406, 467, 420, 468, 471, and 120-B of the IPC Page 1 of 10 Signature Not Verified
Legal Reasoning
Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 in of the the pending court learned Additional District cum- Officer, Designated Court (under OPID Act), Balasore Judge- Presiding 1. These matters are taken up through hybrid arrangement. 2. Heard learned counsel for the parties. 3. Since the cases arise from the same transaction, relate to the same set of facts, and involve identical questions of law, all the BLAPLs are being
Decision
heard and disposed of together. 4. The petitioners were arrested on different dates in connection with Bhubaneswar EOW P.S Case No.03/2025, corresponding to CT Case No. 4(C)/2025, registered for the alleged offences under Sections 406, 409, 420, 467, 468, 471, and 120-B of the IPC, which is presently pending in the court of the learned Additional District Judge- cum- Presiding Officer, Designated Court (under OPID Act), Balasore. 5. The present case arises from an FIR lodged by one Mr. Biswanath Roul, alleging large-scale financial misappropriation to the tune of approximately Rs. 40–50 crores by the Ex-President, Mr. Manas Ranjan Barik, Secretary Mr. Utkal Das, and their associates of the Gandhamardhan Loading Agency & Transporting Cooperative Society Ltd., Keonjhar. The allegations pertain to the period from FY 2017–18 to Page 2 of 10 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 2023–24 and include accusations of cheating, criminal breach of trust, and forgery. It is alleged that society funds were siphoned off under various fictitious heads such as periphery development, village payments, fake bills, EPF deductions, and fuel charges, supported by forged documents and without proper entries in mandatory financial records like cash books, ledgers, and vouchers. A special audit initiated in 2022 in response to local complaints substantiated many of these irregularities, revealing payments made in cash or by self-cheques without proper documentation or acknowledgment. 6. The Society in question is engaged in iron ore loading operations at the Gandhamardhan Mines for the Odisha Mining Corporation (OMC). The leadership of the Society transitioned over the years, with Babaji Charan Barik and Anjan Kumar Bej serving as President and Secretary, respectively, from 14.01.2015 to 13.01.2020, followed by Administrator Basanta Kumar Nayak until 23.06.2022. Since 24.06.2022, the petitioners, Manas Ranjan Barik and Utkal Das, have been serving as President and Secretary, respectively. Other petitioners, such as Soumya Sankar Chakra and Susanta Kumar Samal, are third-party contractors or C- Class members who claim no decision-making authority within the Society. 7. Petitioners Manas Ranjan Barik and Utkal Das submit that all financial transactions during their tenure were conducted in accordance with the resolutions passed by the General Body of the Society. They claim that the advance of Rs. 7.36 crores disbursed for civil works and other Page 3 of 10 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 payments were duly authorized and documented. They deny any individual role in the alleged misappropriation and argue that no specific acts of financial misconduct have been attributed to them in the audit report or FIR 8. They further assert that the entire investigation is vitiated by political motivation and selective targeting. It is contended that despite the audit covering previous administrations, former President Babaji Charan Barik, former Secretary Anjan Kumar Bej, and Administrator Basanta Kumar Nayak have not been interrogated. The petitioners highlight that their arrest and continued detention are attempts to harass them under the influence of political opponents. 9. Petitioners Soumya Sankar Chakra and Susanta Kumar Samal claim that their firms provided loading/transport services to the Society during 2017–2020 under valid work orders. They assert that all transactions, amounting to Rs. 1.6 crore and Rs. 1.75 crore respectively, were conducted through banks and duly supported by invoices and resolutions. They maintain that their business was purely commercial in nature, without any access to or involvement in the Society’s financial decisions. It is contended that he FIR was politically motivated due to rivalry between political factions, particularly BJP and BJD. They further argue that prior office bearers and politically influential individuals who exercised authority during much of the audit period have not been interrogated or named as accused. Page 4 of 10 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 10. It is also contended that the investigation has been selective and flawed. Despite seizures of documents, including invoices, payment records, and resolutions, the Investigating Officer has failed to consider these materials. In addition, key orders from the Court requiring the production of the updated case diary and seizure memorandum have not been complied with. They assert that no specific overt act has been attributed to them in the FIR or the audit report. They argue that the prosecution is attempting to falsely implicate third-party vendors and current office bearers merely on the basis of transactions, without establishing mens rea or complicity. They invoke the principle that bail is the rule and jail is the exception, and argue that their continued custody amounts to pre-trial punishment. 11. The State opposes the bail application, contending that serious allegations of financial misappropriation involving approximately Rs. 40–50 crores have been leveled against the petitioners during their tenure as President and Secretary of the Society. It is submitted that the audit findings and seized documents prima facie indicate their involvement in authorising or facilitating irregular payments under various fictitious heads. The State further argues that the investigation is at a crucial stage and that release of the petitioners at this juncture may prejudice the probe, especially given their influential positions and access to key records and witnesses. 12. In cases involving large scale financial fraud, particularly those affecting public or cooperative institutions, courts have consistently emphasized Page 5 of 10 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 the need for a cautious and guarded approach to bail. The allegations in the present case concern the misappropriation of substantial sums, approximately Rs. 40 to 50 crores, over an extended period, allegedly facilitated through systematic manipulation of records, forged documents, and unauthorised cash withdrawals. While the petitioners assert their innocence and limited role, the nature and scale of the economic offences alleged cannot be overlooked. Economic crimes corrode public trust and have far reaching ramifications beyond immediate monetary loss, impacting communities and governance structures alike. 13. Highlighting the gravity of economic offences, the Supreme Court remarked in the case of State of Gujarat v. Mohanlal Jitmalji Porwal and Anr1 as follows: “5...The entire community is aggrieved if the economic offenders who ruin the economy of the State are not brought to book. A murder may be committed in the heat of moment upon passions being aroused. An economic offence is committed with cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the community. A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the community in the system to administer justice in an even- handed manner without fear of criticism from the quarters which view white collar crimes with a permissive eye unmindful of the damage done to the national economy and national interest.” 14. In view of these compelling observations, it is abundantly clear that a different approach must be adopted in addressing offences of this 1 1987 AIR 1321. Page 6 of 10 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 nature. Hence, in this regard, it would be prudent to also refer to the judgment of the Supreme Court in the case of Y.S. Jagan Mohan Reddy v. CBI2: “34. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offence having deep rooted conspiracies and involving huge loss of public funds needs to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country. 35. While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations.” 15. Given the petitioners’ leadership roles during the period of alleged misappropriation and their presumed access to financial mechanisms and documentation, there exists a reasonable apprehension that their release may influence the ongoing investigation or result in tampering with evidence. Courts have repeatedly held that in serious economic offences, particularly where the investigation is ongoing and voluminous documentary evidence is involved, the custodial interrogation of the accused may be necessary to trace the financial trail, identify beneficiaries, and ensure accountability. In this context, the 2 AIR 2013 SUPREME COURT 1933. Page 7 of 10 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 seriousness of the offence, the magnitude of the alleged loss, and the necessity to secure the integrity of the investigative process outweigh considerations of individual liberty at this stage. 16. Considering the gravity of the allegations, the magnitude of the alleged financial misappropriation, and the petitioners’ positions of authority during the relevant period, this Court is of the view that the case warrants a thorough and unhindered investigation. While the petitioners have contended that they acted under General Body resolutions and have disclaimed any personal role in the financial transactions, the audit findings and the nature of the documentation seized raise serious questions requiring detailed scrutiny. The argument that previous office bearers have not been examined, though noted, does not by itself dilute the allegations currently under investigation against the petitioners. 17. Even in respect of petitioners who did not hold any official position within the Society, the reasoning adopted by the Court continues to apply, given the nature and magnitude of the financial irregularities alleged. As the case primarily hinges on voluminous documentary evidence and complex financial transactions spread across several years, the investigative process requires thorough scrutiny of all beneficiaries, facilitators, and associated entities. 18. In particular, petitioners Soumya Sankar Chakra and Susanta Kumar Samal, though not office bearers, are alleged to have received sizeable sums under the guise of service contracts. Their defense hinges on Page 8 of 10 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 documented work orders and bank transfers; however, the integrity of such records must be rigorously tested against audit irregularities, ledger entries, and testimonies. The sheer quantum of payments, coupled with the opaque operational environment, raises a plausible inference of either conscious facilitation or willful blindness. In economic offences, where the money trail often tells the truest story, even those at the periphery may leave footprints too substantial to ignore. 19. The petitioners’ assertions of legitimate commercial transactions and political motivation require factual verification by the investigating agency, which may necessitate custodial interrogation. Therefore, the seriousness of the alleged offence, coupled with the investigative needs and potential risk of evidence tampering, justifies a cautious approach to bail, even for those not formally in positions of authority within the Society. 20. At this stage, the material on record prima facie suggests active involvement or knowledge of the financial irregularities during the petitioners’ tenure. Given the early stage of investigation and the seriousness of the offence, the Court is not inclined to grant bail at this juncture. 21. All these BLAPLs are, accordingly, dismissed. Judge Page 9 of 10 ( Dr. S.K. Panigrahi ) Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 17-May-2025 18:34:56 Page 10 of 10