Supreme Court Cancels ₹ 3 Crore Deposit Requirement for Bail in Investor Fraud Case, Directs Not to Hinder Properties.
The Supreme Court has overturned a Madras High Court decision that required a bail applicant to pay ₹ 3 crore as a condition for bail. The Court instructed the accused not to create any third-party rights or encumbrances on properties owned by her husband. Justices BR Gavai and KV Viswanathan stated that such deposit conditions effectively deny justice and called for alternative ways to protect investors’ interests. During the hearing, Senior Advocate Manan Kumar Mishra represented the petitioner, while AAG V Krishnamurthy represented the respondent. The case began when Poornima, the appellant, contested the High Court’s refusal to change the bail condition set in its March 21, 2024 order, which required her to deposit ₹ 3 crore within eight weeks.
The petitioner’s lawyer argued that Poornima’s husband, who was involved in a financial fraud, had taken his own life due to his inability to repay depositors. Despite her attempts to sell property and gather funds, she could not fulfill the requirement. The Court remarked, “The Court should not impose such conditions which in effect amount to a denial of justice.” To protect investors, the Court prohibited Poornima from creating third-party rights or encumbrances on her late husband’s properties. It also highlighted that the Tamil Nadu Protection of Interests of Depositors (in Financial Establishments) Act, 1997, permits the State to attach and auction properties of financial defaulters to recover money owed to investors.
The Court accepted the appeal and removed the requirement to deposit Rs. 3 crore for bail. It ordered that bail be granted without this condition. Other pending applications were also resolved. “The appeals are accepted. The request made by the appellant to change the order from 21.03.2024 is approved. The requirement to deposit Rs. 3 crore for bail is canceled,” stated the Court.
Cause Title: Poornima v. State
