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MSCB ‘fraud’: One agency intervening in another’s probe ‘foreign to criminal law’, says court

The EOW had in October submitted a closure report in the case, stating that no criminal case was made against the accused, including Deputy Chief Minister Ajit Pawar and other political leaders of the state.

Written by Sadaf Modak | Mumbai | Updated: December 3, 2020 9:37:39 am
MSCB fraud case, Mumbai Police, ED, Economic Offences Wing, Maharashtra State Cooperative Bank, Maharashtra State Cooperative Bank fraud, Maharashtra State Cooperative Bank EDThe court also held that the ED was not an aggrieved party and therefore was not entitled for a hearing in the proceedings associated with the closure report.

In its detailed order rejecting the Enforcement Directorate’s (ED) intervention application opposing the clean chit given by the Mumbai Police Economic Offences Wing (EOW) to 74 accused in the Maharashtra State Cooperative Bank (MSCB) alleged fraud case, the special court has said that the investigation of both agencies is “totally different”. It also observed that an investigation agency intervening in another’s probe was “foreign to criminal law”.

The EOW had in October submitted a closure report in the case, stating that no criminal case was made against the accused, including Deputy Chief Minister Ajit Pawar and other political leaders of the state. The ED, which has filed a separate complaint to probe allegations of money laundering in the case, had opposed the closure report stating that it may impact its case.

“It is important to note that the investigation of ED is totally different from that of the EOW… In the rejoinder filed by the ED, there is a specific pleading whereby it has said that in case the closure report is accepted, it may influence its case. This pleading itself goes to show that ED is not sure about the consequences of the order on the closure report,” the special court said in its order last week.

The court also held that the ED was not an aggrieved party and therefore was not entitled for a hearing in the proceedings associated with the closure report.

“In this matter, it is important to note that it is a case where one investigation agency is not happy with work of another investigation agency and therefore wants to intervene. This itself is foreign to criminal law,” the court said.

Additional Solicitor General S V Raju, appearing for the ED, had argued that the agency is not a third party and is “directly aggrieved” by the EOW’s closure report hence, should be allowed to intervene. He added that in case such offences are “hushed up” because of improper investigation, the ED has the right to object.

The court also clarified that it was only deciding on whether the ED can intervene in the proceedings on the closure report and a separate order will be passed if it accepts the report or asks the EOW to continue its probe.

An FIR was filed by the EOW on directions of the Bombay High Court based on a public interest litigation claiming that there were irregularities in the loan transactions of sugar cooperative banks from 2002 till 2017 and a probe should be initiated against their directors and members. The directors and members included political leaders of the state.

The ED had also contended that the HC had given directions to file an FIR in the case and hence, the EOW is expected to file a chargesheet against the accused. The special court, however, said that it did not agree with this contention.

“As such it was not expected that investigation officer is required to be influenced by the findings given by the Hon’ble High Court and was expected to carry out an investigation in a fair manner in accordance with the law. Accordingly, it was open for the investigation officer to submit report under Section 173 of the Criminal Procedure Code – same can be a chargesheet or closure reports…,” the court said.

A protest petition filed by the complainant in the case opposing the EOW’s report will be heard this month.

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