Chhattisgarh High Court Denies Bail To Key Accused In ₹540 Crore Illegal Coal Levy Scam Involving Pradesh Congress Bhavan
The High Court held that in cases involving economic offences of serious magnitude and deep-rooted conspiracy, where prima facie material indicates active involvement of the accused in the collection and distribution of illegally obtained funds, the grant of bail would be against the larger interests of justice.
The High Court of Chhattisgarh has rejected a bail application in an illegal coal levy syndicate involving the collection of approximately ₹540 crores, which, as per the prosecution case, was deposited at the State Congress Bhavan, holding that prima facie material indicates the applicant’s involvement and that economic offences of such magnitude must be viewed seriously.
The Court was hearing a bail application under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023 filed by the applicant, who was arrested in connection with Crime No. 03/2024 registered by the Anti-Corruption Bureau/Economic Offences Wing, Raipur, for offences under Sections 384, 420, 120-B, 467, 468 and 471 IPC and Sections 7, 7-A, 12 of the Prevention of Corruption Act, 1988.
A Bench of Justice Narendra Kumar Vyas observed: “… the applicant has nowhere stated in the bail petition regarding the source of income which has been shown in the final report and distributed the same by him, which clearly shows that the ACB/EOW has collected certain material against the applicant, which cannot rule out prima facie involvement of the applicant. As such, from perusal of FIR and the material available in the case diary, involvement of the applicant in the commission of offence under Sections 420, 120-B, 384 of IPC read with Sections 7, 7A & 12 of the PC Act in economic offence, is prima facie reflected”.
Advocate Amrito Das represented the applicant, while Dr Sourbh Kumar Pande, Deputy Advocate General, represented the respondents.
Background
The prosecution case arose from a complaint received from the Directorate of Enforcement, leading to registration of an FIR against multiple accused persons in connection with an alleged illegal coal levy racket operating in the State.
It was alleged that a syndicate comprising private individuals, senior bureaucrats, and political functionaries orchestrated policy changes to convert an online system of issuance of transport permits into a manual system, thereby facilitating illegal collection of ₹25 per tonne of coal transported.
The investigation revealed that between July 2020 and June 2022, an amount of approximately ₹540 crores was collected through this extortion mechanism.
As per the prosecution, the applicant, who had served as an accountant and later as a personal assistant to a senior political functionary, was entrusted with the responsibility of collecting and managing funds generated through the illegal levy. It was alleged that the applicant received the extorted money from associates of the syndicate and facilitated its distribution for political purposes.
The case diary further indicated that handwritten diaries seized during searches contained entries corroborating the deposit of large sums at “Congress Bhawan”, and witness statements supported the allegation that the applicant was actively involved in the collection and distribution of such funds.
Court’s Observation
The Court, upon examining the material on record, noted that the evidence collected during the investigation, including seized diaries and witness statements, prima facie indicated that the applicant played an active role in handling illegally collected funds. It was observed that the quantum involved was substantial and that the offence formed part of an organised conspiracy.
The Court rejected the contention that the case was based solely on the statements of the co-accused, observing that the material collected by the investigating agency could not be disregarded at the stage of considering bail. It held that the question of the admissibility of such evidence is a matter for trial.
On the plea of delay in trial, the Court observed that no material had been placed to show that the delay was attributable solely to the prosecution. Therefore, such ground could not justify the grant of bail.
Addressing the argument of parity with the co-accused who had been granted bail, the Court held that the applicant could not claim parity as he had been arrested recently and the circumstances were distinguishable.
The Court emphasised that economic offences constitute a class apart and must be dealt with differently, observing that such offences are committed with “cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the community.” It further noted that such offences have a serious impact on public confidence and the financial health of the State.
Relying on precedents including P. Chidambaram v. Directorate of Enforcement (2019) and Ramesh Bhavan Rathod v. Vishanbhai Hirabhai Makwana (2021), the Court reiterated that in cases involving economic offences and deep-rooted conspiracies, bail must be considered with greater caution, keeping in view the larger interests of the public and the State.
The Court held that, considering the nature and gravity of the allegations, the prima facie material on record, and the requirement of further investigation, the applicant was not entitled to bail.
Conclusion
The High Court held that the case involved serious economic offences with prima facie evidence of the applicant’s involvement in a large-scale illegal coal levy racket, and that it was not a fit case for the grant of bail.
Accordingly, the bail application was rejected.
Cause Title: Devendra Dadsena v. State of Chhattisgarh (Neutral Citation: 2026:CGHC:14779)
