Sanchayita Lahkar

The High Court of Kerala Single Bench of Justice A. Badharudeen refused anticipatory bail to a government officer accused of misappropriating ₹1.14 crore under a self-employment subsidy scheme. While directing the petitioner to surrender and cooperate with the probe, the Court clarified that when an arrest is declared illegal, the accused is restored to the pre-arrest stage, and any interim bail made absolute in such circumstances effectively amounts to releasing the person. Justice Badharudeen held that such orders are legally unsustainable, as they bar lawful re-arrest, and therefore carry no legal effect.

The petitioner, Praveen Raj, a government officer serving as an Industries Extension Officer, approached the High Court seeking anticipatory bail in connection with a case investigated by the Vigilance and Anti-Corruption Bureau (VACB), Thiruvananthapuram. The case concerned alleged misappropriation of funds under a self-employment beneficiary group scheme implemented by the Thiruvananthapuram Corporation during the financial year 2021–2022.

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According to the prosecution, the petitioner, along with another officer, conspired with others to manipulate the list of beneficiaries, prepare forged documents, generate false bills, and disburse subsidies to ineligible persons. It was alleged that these actions caused a wrongful loss of approximately ₹1.14 crore to the government. The offences invoked included Sections 409, 420, 468, 471, 120B, and 34 of the Indian Penal Code, along with Section 13(2) read with Section 13(1)(a) of the Prevention of Corruption Act, 2018.

In seeking bail, the petitioner contended that no loans were authorized by him during the relevant period as funds were unavailable, and that he acted only in accordance with the beneficiary list approved by the Corporation. He argued that there was no evidence in the remand report linking him to the alleged offences, asserted his innocence, and maintained that custodial interrogation was unnecessary. He also pointed out that he had appeared before the investigating officer upon notice, demonstrating his willingness to cooperate, and expressed readiness to comply with any bail conditions.

The Special Public Prosecutor opposed the application, citing investigation findings that the petitioner had selected ineligible groups without proper verification, in collusion with others, thereby diverting government funds. It was also submitted that he was involved in other similar cases and vigilance enquiries, and that custodial interrogation was necessary for a fair investigation.

Justice A. Badharudeen recorded that the prosecution materials indicated prima facie involvement of the petitioner in the misappropriation of Rs.1.14 crore. The Court observed: “Going by the prosecution allegation as could be gathered from the records, including the report of the investigating officer, the petitioner has involvement in the misappropriation of Rs.1.14 crores, which he alleged to have allotted illegally to the group ventures without interviewing the beneficiaries, without verifying the authenticity of the documents by physically verifying the same and without verifying whether they had availed any loan for starting the ventures from any bank.”

Justice Badharudeen stated: “That apart, the records would show that the petitioner has involvement in this crime, where 1.14 Crores alleged to be misappropriated. In addition to that, as per the report of the investigating officer, the petitioner, though a public officer, has involvement in multiple crimes.”

The Court referred to the Supreme Court judgment in Devinder Kumar Bansal v. State of Punjab [2025 KHC 6219] and observed: “Anticipatory bail can be granted only in exceptional circumstances where the Court is, prima facie, of the view that the applicant has been falsely enroped in the crime or the allegations are politically motivated or are frivolous. So far as the case at hand is concerned, it cannot be said that any exceptional circumstances have been made out by the petitioner accused for grant of anticipatory bail and there is no frivolity in the prosecution, this is not a fit case to grant anticipatory bail.”

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Justice Badharudeen noted: “When it is found that the arrest was illegal, the accused is free from custody of the police as well as the Court, and the question of execution of bail bond doesn’t arise. In such a case, there is no necessity for the Special Judge to make the interim bail absolute. By making the interim bail absolute, the learned Special Judge held that the accused were set at free. It is noticed that the Special Judge went wrong in making the interim bail absolute instead of holding that the accused were set free to the stage before their arrest.”

Justice Badharudeen directed: “In the result, this petition is found to be meritless and is accordingly dismissed. The petitioner is directed to surrender before the investigating officer forthwith and to co-operate with the investigation, failing which the Investigating Officer is at liberty to proceed as per law, without fail.”

Advocates Representing the Parties

For the Petitioner: Shri. Sreejith S. Nair, Shri. Sasthamangal S. Ajithkumar (Senior Advocate), Sri. Satheesh Mohanan, Smt. Mahima

For the Respondents: Sasthamangal S. Ajith Kumar (Senior Advocate), Special Public Prosecutor, Adv. Rajesh A., Senior Public Prosecutor, Adv. Rekha S.

Case Title: Praveen Raj v. State of Kerala

Neutral Citation: 2025: KER:65904

Case Number: B.A. No.9746 of 2025

Bench: Justice A. Badharudeen