Deals & Matter

Alok Kumar vs State of Bihar

Supreme Court

Medical Negligence

Alok Kumar vs State of Bihar
  • O.M.P. (I) (COMM.) 349/2022
  • 29 November 2022
  • Delhi High Court

Issue

The case concerned the refusal by the Patna High Court to club together multiple FIRs lodged against Alok Kumar, Director of Agrani Homes, a real estate development company accused of defrauding home buyers. The petitioner sought (i) clubbing of 81 FIRs related to similar allegations of cheating and breach of trust in housing projects, and (ii) grant of bail after nearly two years in custody. The matter also involved the settlement of claims amounting to approximately ₹13.94 crore, alleged to have been collected from home buyers without delivering promised flats.

Petitioner’s Claim

Represented by Senior Advocate Vikas Singh, the petitioner submitted:

1. Nature of Allegations

The FIRs arose from multiple home buyers alleging payment for residential units that were never delivered. Many cases were registered under Section 420 IPC and Section 138 NI Act.

2. Clubbing Request

Since all FIRs arose from the same real estate scheme and similar facts, they should be clubbed under one main FIR, with others treated as statements under Section 161 CrPC.

3. Custody Duration

The petitioner had been in custody since 14 October 2022, and bail had been granted only in 10 out of the 81 cases.

4. Partial Payments Made

He had already repaid ₹3.17 crore to various home buyers and was willing to deposit more funds towards settlement.

5. Offer to Secure Payment

Initially offered property worth ₹4 crore as security, later agreed to deposit the same in cash with the Supreme Court Registry.

6. Settlement Commitment

Gave an undertaking to settle the balance liability (₹9.94 crore) within six months of release, supported by a personal guarantee from his son.

7. Harsh & Unreasonable Action:

Cancelling their selection was termed excessively harsh, especially when vacancies still existed and their performance in exams was superior.

Respondent’s Argument

The State of Bihar, RERA authorities, and other respondents opposed unconditional relief, arguing:

1. Scale of Fraud

The petitioner and Agrani Homes had allegedly duped numerous home buyers, collecting crores without delivering projects.

2. Multiple Victims, Multiple FIRs

Each FIR represented a distinct victim or set of victims, making clubbing inappropriate unless directed by law.

3. Outstanding Liability

Disputed the petitioner’s ₹13.94 crore liability estimate, suggesting the actual amount could be higher.

4. Risk of Asset Dissipation

Concern that granting bail might enable disposal of properties or funds before full settlement.

5. Need for Accountability

Emphasised the importance of protecting victims’ interests and ensuring funds deposited were properly distributed.

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Court's Observations

The Supreme Court (Justices J.B. Pardiwala and R. Mahadevan) made the following key observations:

  • Practical Approach in Home Buyer Cases

Recognised the gravity of the allegations but noted that prolonged incarceration would not necessarily help recover funds or protect victims.

  • Interest of Victims Paramount

The Court’s priority was enabling settlement and recovery for home buyers rather than indefinite detention.

  • Precedent for Clubbing FIRs

Relied on Satinder Singh Bhasin v. State of U.P. (2023) to justify treating the first FIR as the main one and subsequent FIRs as Section 161 CrPC statements, since allegations were part of a common transaction.

  • Conditions for Bail

Temporary bail could be considered if accompanied by substantial deposits to secure claims, preventing misuse of liberty.

  • Asset Disclosure

Directed full disclosure of petitioner’s and company’s properties to ensure transparency and facilitate recovery.

Court's Decision

The Supreme Court allowed the petition in part, granting temporary bail for six months and ordering clubbing of FIRs under strict conditions:

  • Clubbing of FIRs
  1. The first FIR dated 11 January 2018 at Shastri Nagar Police Station, Patna, to be treated as the main FIR.
  2. All other FIRs (including future ones related to the same project) to be treated as Section 161 CrPC statements.
  • Deposit Requirements
  1. Petitioner had already deposited ₹4 crore with the Supreme Court Registry.
  2. Must deposit the remaining ₹9.94 crore within six months from release.
  3. Deposited funds to be kept in a short-term fixed deposit with auto-renewal.
  4. Deposit not to be treated as full settlement; distribution to be determined later for all home buyers.
  • Property Conditions
  1. Petitioner disclosed ownership of one personal flat, seven company-owned properties, and 62 development agreement properties.
  2. Cannot transfer or create third-party rights in any property without Court permission.
  • Bail Conditions
  1. Furnish bail bond of ₹5 lakh with one solvent surety.
  2. Surrender passport to the Supreme Court Registry (to be obtained from RERA if held there).
  3. Mark presence at Shastri Nagar Police Station, Patna, once every fortnight on Sundays.
  • Consequences of Default
  1. If the ₹9.94 crore deposit is not made within six months, bail may be cancelled.
  2. Rights of RERA to execute decrees remain unaffected.
  • Enforcement Directorate Proceedings
  1. ED investigations to continue independently, unaffected by this order.
  • Next Hearing
  1. Matter listed for 24 February 2026 for further review and to consider intervention applications.

Key Takeaways

Supreme Court Balances Bail and Victim Compensation

This order reflects a shift towards using bail conditions to secure financial restitution in large-scale economic offences.

Precedent for Clubbing FIRs in Financial Fraud

The Court reaffirmed that where allegations form part of the same transaction, multiple FIRs can be consolidated to streamline investigation and trial.

Strong Asset Safeguards

Restrictions on property transfers and mandatory disclosure aim to prevent dissipation of assets pending resolution.

Temporary, Conditional Liberty

Bail here is not an exoneration but a tool to facilitate settlements, with the liberty contingent on compliance with financial commitments.

Deals and Matter

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