UNION OF INDIA versus PRATEEK SHUKLA
[2021] 2 S.C.R. 570, Supreme Court of India, 2021
Outcome: Appeal(s) allowed (Granted)
Segment: Arguments
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[2021] 2 S.C.R.
UNION OF INDIA
v.
PRATEEK SHUKLA
(Criminal Appeal No. 284 of 2021)
MARCH 08, 2021
[DR DHANANJAYA Y CHANDRACHUD AND
M. R. SHAH, JJ.]
Narcotic Drugs and Psychotropic Substances Act, 1985:
s. 37 – Complaint u/s.8,9A,25A,23 and 29 of the Act – Alleging
that the respondent was part of an international drug syndicate
involved in diversion of a controlled substance – Bail granted by
High Court – Appeal to Supreme Court – Held: The bail was granted
without applying legal norms provided u/s. 37 – The reasons for
granting bail do not reflect application of mind to the seriousness
of the offence involved – Bail liable to be cancelled.
Allowing the appeal, the Court
HELD: 1. Ex facie, there has been no application of mind
by the High Court to the rival submissions and, particularly, to
the seriousness of the allegations involving an offence punishable
under the provisions of the NDPS Act. Merely recording the
submissions of the parties does not amount to an indication of a
judicial or, for that matter, a judicious application of mind by the
Single Judge of the High Court to the basic question as to whether
bail should be granted. [Para 11][575-D-E]
2.1 The provisions of Section 37 of the NDPS Act provide
the legal norms which have to be applied in determining whether
a case for grant of bail has been made out. There has been a
serious infraction by the High Court of its duty to apply the law.
The order granting bail is innocent
of an awareness of the legal
principles involved in determining whether bail should be granted
to a person accused of an offence under the NDPS Act.
[Para 11][575-E-F]
2.2  The High Court was clearly not justified in granting
bail and the reasons provided by the High Court, do not reflect
application of mind to the seriousness of the offence which is
[2021] 2 S.C.R. 570
570
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involved. The allegations against the respondent indicate that
he was a member of an international drug syndicate involved in
the diversion of a controlled substance; therefore, merely stating
that the respondent as an educated person with a Bachelor of
Technology “may not commit any offence” is an extraneous
circumstance that the High Court should not have considered
when granting bail for an offence under the NDPS Act.  While
determining that the respondent should be granted bail, the High
Court has erroneously applied the law to the circumstances.
[Paras 12 and 13][576-D-E]
CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
284 of 2021
From the Judgment and Order dated 07.05.2019 of the High Court
of Judicature at Allahabad in Misc. Bail Application No. 9873 of 2019.
Praveen Agrawal, Gautam Kumar Laha, Advs. for the Appellants.
K. M. Nataraj, ASG., Ms. Binu Tamta, Vatsal Joshi, Sharath N.
Nambiar, B. V. Balaram Das, Advs. for the Appellant.
P. R. Rajhans, Jyoti Kumar Singh, Mrs. Paroma Sengupta, Vishal
Arun, Advs. for the Respondents
The Judgment of the Court was delivered by
DR. DHANANJAYA Y CHANDRACHUD, J.
1. Delay condoned.
2. Leave granted.
3. This appeal arises from a judgment and order of a Single Judge
of the High Court of Judicature at Allahabad dated 7 May 2019, by
which bail was granted to the respondent, who is alleged to be involved
in the commission of offences punishable under the provisions of the
Narcotic Drugs and Psychotropic
Substances Act 19851.
4. The allegation is that, on 18 October 2018, secret information
was received by an intelligence officer in the Delhi Zone of the Narcotics
Control Bureau2 that a huge quantity of acetic anhydride had been
purchased by a company by the name of Altruist Chemicals Private
Limited3; and that the Company had not submitted its quarterly returns
for April – June 2018 and July – September 2018, as required under the
1 “NDPS Act”
2 “NCB”
3 “Company”
UNION OF INDIA v. PRATEEK SHUKLA
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Narcotic Drugs and Psychotropic Substances (Regulation of Control
Substances) Order 2013. It has been alleged that based on a suspicion
of diversion, a team of the NCB proceeded to the Company’s registered
office situated at 001, AG Block, Sector 45, Noida. On the premises
being found locked, the owner was called to the spot. The owner allegedly
informed the NCB team that the premises had been let out to a person
by the name of Himanshu Rana, who is a co-accused in the complaint
which has been lodged against the respondent. The lock was broken,
upon which a quantity of 896 gms of acetic anhydride and 1.885 kg of
amphetamine is alleged to have been found in the premises. During the
course of the search, documents relating to a company by the name of
M/s Griffin International were found and it was revealed that the
respondent and an Afghan national by the name of Bismillah Khan
Ahmadzai were the Directors of the Company. Notices were issued to
the respondent and to Himanshu Rana, following which the statement of
the respondent was recorded under Section 67 of the NDPS Act. It has
been alleged that the disclosure revealed that a huge quantity of the
controlled substance, acetic anhydride, was purchased and diverted to a
godown situated at Village Karheda, Ghaziabad. During the search and
seizure of the premises, a quantity of 9650 kgs of acetic anhydride was
alleged to have been recovered and empty drums of acetic
anhydride
were also found. Notices under Section 67 of the NDPS Act were also
issued to one Shamsuddin and Bismillah Khan Ahmadzai. It has been
alleged that the respondent, the co-accused Himanshu Rana and
Shamsuddin disclosed that Bismillah Khan Ahmadzai is a Director of
the Company involved in its day to day affairs. Bismillah Khan Ahmadzai
was apparently residing in the US and was arrested on his return to
India. The residential premises of Shamsuddin Qarizada were searched
and 500 gms of acetic anhydride was allegedly recovered. It has been
alleged that on 21 October 2018, a search was conducted at the residential
premises of the respondent which yielded, inter alia, a recovery of:
(i)
An arms license issued in the name of one Mohit Kaushik,
which had the photograph of the co-accused Himanshu Rana;
(ii)
A Cheque Book of the respondent and an entity called Skyline
Company bearing the name and address of the respondent;
(iii)
The rubber stamps of Griffin International, Shiv Shakti Trading
Company and the Company (Altruist Chemicals Private
Limited);
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(iv)
A rent agreement executed between one Dharmendra
Pandey and Mohit Kaushik, proprietor of Skyline
International;
(v)
A letter head and import-export certificate of a company
named White World Multi Cane (I) Private Limited, which
mentioned the name of the co-accused, Pawan Kumar
Sharma, as Director, but had the photograph of the
respondent; and
(vi)
Certain bank documents – letters addressed to the NCB and
an agreement between the co-accused Himanshu Rana and
Bismillah Khan Ahmadzai.
5. The respondent was arrested during the course of the
investigation on 22 October 2018. The lab report dated 27 October 2018
allegedly confirmed the presence of acetic anhydride and hydrochloric
acid, though the presence of amphetamine has not been specifically
recorded and has been sent for further verification. Based on this
evidence, a complaint was lodged on 21 December 2018 for offences
under Sections 8, 9A, 25A, 23 and 29 of the NDPS Act. It was alleged
that all the accused were members of an international drug syndicate
and had entered into a conspiracy for diversion, illegal storage, sale,
purchase and export of the controlled substance.
6. The respondent filed a bail application which was initially
rejected by the Additional Sessions Judge III, Gautam Budh Nagar on 6
February 2019. Thereafter, a bail application was moved before the High
Court, which resulted in the impugned order dated 7 May 2019.
7. Mr K M Nataraj, learned Additional Solicitor General
appearing
on behalf of the appellant, submits that:
(i)
The respondent is alleged to be a part of an international
syndicate involved in a diversion of a controlled substance;
(ii)
The respondent is a Director of Altruist Chemicals Private
Limited;
(iii)
Having regard to the incriminating material which has been
recovered during the course of the investigation, as set out
in the complaint, the involvement of the respondent prima
facie has been shown to exist;
UNION OF INDIA v. PRATEEK SHUKLA
[DR. DHANANJAYA Y CHANDRACHUD, J.]
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(iv)
In a matter involving serious violations of the NDPS Act, the
Single Judge of the High Court was not justified in granting
bail;
(v)
Under the NDPS Act, the burden of proof lies on the accused
and not the prosecution and the High Court has wrongly
reversed the burden of proof; and
(vi)
Absolutely no valid reasons have been indicated in the
judgment of the Single Judge for the grant of bail.
8. Pursuant to the notice that was issued by this Court on 16
December 2020, the respondent has been served. On 15 February 2021,
the hearing of the proceedings was posted on 8 March 2021 on the
request of the learned counsel appearing on behalf of the respondent,
who had recently entered appearance, for filing a counter affidavit. A
counter affidavit has been filed.
9. Learned counsel appearing on behalf of the respondent has
adverted to the counter affidavit, which has been filed on behalf of the
respondent. The contention of the respondent, as set out before this
Court, by Mr Vishal Arun, learned counsel, is that:
(i)
The respondent had resigned as a Director of the Company
on 4 May 2018 having joined the Company earlier in the
month of January 2018;
(ii)
The quarterly returns in respect of acetic anhydride for the
period January 2018 to March 2018 had been submitted to
the concerned office of the NCB;
(iii)
After his resignation on 4 May 2018, the respondent has had
no relationship with the Company and may not be held
responsible for the non-filing of the quarterly returns;
(iv)
The documents which have been filed before the trial Court
would indicate that the alleged purchase orders for the
controlled substance as well as the delivery at the premises
of the Company took place after the resignation of the
respondent;
(v)
After the respondent had resigned from the position of a
Director in the Company, intimation was furnished to the
NCB on 22 May 2018; and
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UNION OF INDIA v. PRATEEK SHUKLA
[DR. DHANANJAYA Y CHANDRACHUD, J.]
(vi)
The purchase orders are from the month of June 2018, by
which date the respondent had no connection with the
Company.
10. While evaluating the merits of the rival submissions in the
context of the correctness of the order passed by the High Court granting
bail, it would be necessary, at the outset, to note the reasons which
weighed with the High Court in doing so. The High Court having recorded
the submissions of the respondent and of the learned counsel for the
NCB has indicated the following reasons for grant of bail:
“Having considered the submissions and having perused the
material on record, without commenting on the merits of the matter,
prima facie, it appears that the applicant may not be guilty of any
offence and considering his clean past and being an educated
person as submitted that, he has a degree in Bachelor of
Technology (B.Tech.) may not commit any offence in future, I
am of the view that the applicant has made out a case for bail.”
11. Ex facie, there has been no application of mind by the High
Court to the rival submissions and, particularly, to the seriousness of the
allegations involving an offence punishable under the provisions of the
NDPS Act. Merely recording the submissions of the parties does not
amount to an indication of a judicial or, for that matter, a judicious
application of mind by the Single Judge of the High Court to the basic
question as to
whether bail should be granted. The provisions of Section
37 of the NDPS Act provide the legal norms which have to be applied in
determining whether a case for grant of bail has been made out. There
has been a serious infraction by the High Court of its duty to apply the
law. The order granting bail is innocent of an awareness of the legal
principles involved in determining whether bail should be granted to a
person accused of an offence under the NDPS Act. The contention of
the respondent that he had resigned from the Company, Altruist Chemicals
Private Limited, must be assessed with reference to the allegations in
the criminal complaint which has been filed in the Court of the District
and Sessions Judge. Gautam Budh Nagar (Annexure P-6). The relevant
part of the complaint reads as follows:
“18. That during investigation of the case, letter dated 27.11.2018
was sent to the Registrar of Companies for providing details of
the Directors etc of the company in question i.e. U/s Altruist
Chemicals Pvt Ltd and vide its report dated 03.12.2018 Registrar
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SUPREME COURT REPORTS
[2021] 2 S.C.R.
Kalpana K. Tripathy
   Appeal allowed.
of Companies provided the said information and from the perusal
of said information/documents, it reveals that accused Prateek
Shukla and Bismillah Khan are the Directors. Accused Himanshu
Rana was also Director but he has resigned from the directorship.
From the perusal of the documents, it also reveals that they had
registered the company, i.e., Altruist Chemical Pvt. Ltd. At 001,
Block Ab-Sector-45, Noida, which is a residential area and accused
persons also obtained Unique Registration No. from the NCB on
the above said premises.”
12. We may also note at this stage the contention of the respondent
in the application for bail which was filed before the High Court
(Annexure P-8) that he had transferred 99% of his shareholding in the
Company to Bismilla Khan Ahmadzai. Bismilla Khan Ahmadzai, as the
prosecution alleges at this stage, is an Afghan national. The application
for bail which had been filed before the High Court as well as the counter
affidavit which has been filed in the present proceedings suppress more
than what they disclose. Be that as it may, we are of the view that the
High Court was clearly not justified in granting bail and the reasons
provided by the High Court, as we have already indicated above, do not
reflect application of mind to the seriousness of the offence which is
involved. Indicating that the respondent as an educated person with a
Bachelor of
Technology “may not commit any offence” is an extraneous
circumstance which ought not to have weighed with the High Court in
the grant of bail for an offence under the NDPS Act.
13. For the above reasons, we are of the view that the High Court
has mis-applied the law to the facts in arriving at a decision for the grant
of bail to the respondent. We accordingly allow the appeal and set aside
the impugned judgment and order of the High Court dated 7 May 2019.
As a consequence, the bail which has been granted by the High Court to
the respondent shall stand cancelled. The respondent shall surrender
forthwith as a result of the cancellation of bail by the present order of
this Court.
14. Pending application, if any, stands disposed of.