On ED’s plea, Bombay High Court sets aside magistrate’s order accepting EOW’s closure report in Topsgrup case

Ramesh Iyer, a former employee of Topsgrup and the original complainant, had informed the magistrate that he had no objection to the closure report, claiming that his complaint was filed “due to a misunderstanding.” The court had then accepted the report, prompting the ED to challenge the decision before the high court.

The ED’s case was based on an FIR registered on October 28, 2020, based on Iyer’s complaint. He had alleged that Topsgrup defrauded the Mumbai Metropolitan Region Development Authority (MMRDA) of Rs 175 crore. As per the ED, the MMRDA contract awarded to Topsgrup was facilitated by Sarnaik, who allegedly received kickbacks of at least Rs 7 crore.

On Wednesday, a single-judge bench of Justice Madhav Jamdar – while allowing the ED’s plea – noted that the magistrate “didn’t apply mind” to the ‘C’ summary report (closure report) and it was accepted solely on the ground that the complainant had given no objection.

The EOW had filed the C-summary report in January 2022. The order of the Chief Metropolitan Magistrate court, dated September 14, 2022, noted the EOW’s submission that after reviewing witness statements and relevant documents, it concluded that no cognizable offence could be made out.

The high court bench has now sent the matter back to the magistrate court, directing it to reconsider the C-summary report filed by the EOW expeditiously. The high court clarified that it had not examined the merits of the closure report and that all contentions of the parties remained “expressly kept open.”

Justice Jamdar noted that the magistrate was duty bound to apply his/her mind to the facts of the case, the closure report and accompanying material before passing an order, either accepting the report, rejecting it and taking cognisance of the offence and initiating proceedings, or ordering further investigation.

“A bare perusal of said Order dated September 14, 2022 shows that the ‘C’ Summary Report is accepted without application of mind and only on the ground that the First Informant has given no objection,” the high observed.

The bench further noted that the question of whether the case needs to be committed to the special court under the Prevention of Money Laundering Act (PMLA) would arise only if the magistrate rejects the closure report and initiates proceedings.

Accordingly, the high court sent the case back to the magistrate for reconsideration and disposed of the ED’s plea.