PRASANTA KUMAR DASH Vs. STATE OF ORISSA

JUDGEMENT

(1.) Heard learned counsel for the parties. This is an application under Section 438 Cr.P.C. for grant of anticipatory bail.

(2.) The case of the prosecution, as detailed in the First Information Report ('F.I.R.' for short) is that the petitioner and other Directors of M/s. Seashore Group of Companies are collecting deposits to the tune of crores of rupees from the members of general public by alluring them with high interest rate and promising to pay them heavy return. It is alleged in the said F.I.R. that though interest was shown in the account of the company as dividend and paid to the depositors, inquiry reveals that the amount paid to the depositors was part of the deposits made by them and that the company had no commensurate business to make payment of huge interest and therefore the company was running a money circulation scheme, which is prohibited under the Prize Chits and Money Circulation Schemes (Banning) Act, 1978.

(3.) In the said F.I.R. it is further alleged that the company has defaulted in making payment to the depositors and has thus cheated many members of the general public. It is also alleged that the company, i.e. M/s. Seashore Securities Ltd. was accepting deposits and issuing preferential shares with guaranteed monthly dividend of 2% for a period of 6 years along with one life insurance policy from Tata AIG Life and one accidental insurance policy from Oriental Insurance Company, though the said company is not registered with the Reserve Bank of India as a Non-Banking Financial Company (NBFC) and the shares of the company are also not listed on the National Stock Exchange of India. Accordingly, it is alleged that the activities of the petitioner and other Directors of Seashore Group of Companies constitute offences under Sections 420/120-B IPC read with Sections 4, 5, and 6 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978: