SC dismisses ED’s appeal against bail to DHFL’s Wadhawan in Yes Bank case

The apex court ruled on Monday that the 60/90-day period for granting default bail in a criminal case would include the time spent in remand. Justices KM Joseph, Hrishikesh Roy, and BV Nagarathna were part of the bench that made the decision.

“The remand period will be calculated from the date, the magistrate remanded the accused. An accused becomes entitled to default bail if the charge sheet is not filed by the 61st or 91st day of the remand period”, the bench said.

The three-judge bench answered the larger issue referred to it by a two-judge bench in 2021. It directed the pending petitions pertaining to the case to be placed before a two-judge bench.

The top court had on February 9, reserved its verdict on the appeal of ED.

In February 2021, the Supreme Court referred a legal question to a larger bench, asking whether the day an accused is remanded to custody should be counted when calculating the 60-day period for the grant of default bail.

The legal issue had arisen during the hearing of an ED’s appeal against a Bombay High Court order granting bail to the former promoters of the Dewan Housing Finance Limited (DHFL).

In September 2020, the top court had stayed a Bombay High Court order granting bail to the promoters.

The Supreme Court had issued a notice to the accused in response to the Enforcement Directorate’s plea against the Bombay High Court’s decision to grant bail to the Wadhawan brothers in a Yes Bank money laundering case. 

On August 20, 2020, the High Court had granted the bail on the basis that the Enforcement Directorate had not filed the charge sheet within the 60-day period, making the mandatory default bail applicable. 

The central probe agency had then filed a special leave petition before the apex court.

The federal probe agency had said that it was not in violation of the procedure and had filed a part of the charge sheet through e-mail, a day before the 60-day period ended.

The charge sheet was filed in physical form by the ED on July 13, 2020.

As per Section 167(2) of the Code of Criminal Procedure, an accused can be detained for a maximum of 90 days for a crime punishable with death, life imprisonment or a sentence of over 10 years. If the investigation relates to any other offence, the accused can be detained for 60 days.

If the investigative agencies do not complete their investigation within these time limits, the arrested person is entitled to ‘default bail’.

The Wadhawans, however, were not released on bail as they are in CBI custody at present.

They were arrested by the ED on May 14, 2020, under the provisions of the Prevention of Money Laundering Act (PMLA).

The ED had filed PMLA charges against Kapil and Dheeraj Wadhawan in connection with alleged suspicious loans granted by Yes Bank and the “quid pro quo” between its co-promoter Rana Kapoor and the Wadhawans, based on a CBI FIR filed in March.

According to the CBI and ED, Yes Bank invested about ₹3,700 crore in short-term non-convertible debentures of DHFL between April and June 2018.