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Can SFIO take signed statement from accused in custody to use against him; SC to decide


Press Trust of India New Delhi
The Supreme Court today said it will pass order on a plea of the SFIO seeking stay on a Delhi High Court order restraining the corporate fraud investigating agency from taking a signed statement of an accused in custody which may be used against him in a case.
While releasing Bhushan Steel's erstwhile promoter Neeraj Singal on bail yesterday, the high court had restrained the SFIO from taking a signed statement from him.
A bench of Justices A M Khanwilkar and D Y Chandrachud said it was reserving verdict on the appeal of the Serious Fraud Investigating Office (SFIO) against the high court order.
During the hearing, Additional Solicitor General Maninder Singh, representing SFIO, said though the apex court had yesterday not issued any stay on the release of Singal from the custody, the expectation was that he will not be released till the top court decided the appeal.
He said that after the apex court's hearing yesterday, Singal was released from jail pursuant to the high court order.
Singh said that Singal was granted bail by the high court on a habeas corpus petition filed by him, which is a process unknown to law.
"The High Court virtually stayed the investigation by a probe agency by restraining it not to take signed written statement from a person to be examined under the Companies Act, a power given under section 217(7)," he said, adding the high court cannot direct an investigating agency to probe in a particular way.
Section 217(7) of the Companies Act states that the notes on examination of an arrested person "shall be taken down in writing and shall be read over to or signed by the person examined and may thereafter be used in evidence against him".
The bench then said "there is one option. We can hear all the similar petitions pending, stay the judgement of the high court saying it would not be cited in any other case and thirdly, we will not interfere with the bail of accused".
The ASG said the operative directions had to be stayed even if the court decides not to interfere with the release of the accused as it would have impact in further investigations by the probe agency.
He said this was a serious matter as Rs 2,368 crore of public loan have now "disappeared" through 146 shell companies and Rs 100 crore in cash was deposited in his bank accounts. All the shell companies can only be found if Singal was arrested, he said.
Singh said he should also be granted liberty to file a proper application for imposing of other conditions on Singal, to which bench nodded in affirmative.
Senior advocates Kapil Sibal, A M Singhvi and Siddharth Luthra and advocate P K Dubey, appearing for Singal, opposed staying of the judgement saying these were serious issues and the verdict cannot be stayed in a simple manner.
"The inspector under the Companies Act cannot go and record a statement on oath from a person who is in custody. The statement may be used against him. This is against Article 20(3) of the Constitution which says that no person accused of an offence shall be compelled to be a witness against himself," Sibal said.
He argued that this provision of the Companies Act was even against the Evidence Act and said "under which law in this country is it allowed to take a signed statement which can be used against you. These are very serious issues and the verdict cannot be stayed like this". Staying of the high court order will seriously prejudice his client, he asserted.
Sibal said the power of arrest to SFIO was given in August 2017 and the agency has been investigating Bhushan Steel Ltd (BSL) and Bhushan Steel and Power Ltd (BSPL) since May 2016. "They cannot arrest me for an offence allegedly committed prior to the power of arrest given to them."

The bench after hearing the arguments said it will pass order on the petition of SFIO.
The apex court had yesterday refused to grant an interim stay on the high court's order to grant bail to Singal but agreed to hear the SFIO's plea today.
Singal was released from custody on bail after the top court refused to stay relief granted to him and pursuant to the high court order.
Singal was the first person ever to be arrested by SFIO on August 8 for allegedly siphoning off over Rs 23 billion.

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First Published: Aug 30 2018 | 7:30 PM IST

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