The Bombay High Court has granted bail to Hari Sankaran, former vice chairman and managing director (MD) of Infrastructure Leasing and Financial Services (IL&FS), almost five years after his arrest by the Serious Fraud Investigation Office (SFIO).

In the order, justice Prithviraj K Chavan noted that Mr Sankaran has been suffering from various severe ailments, including cardiovascular diseases, diabetes, and other comorbidities.

The bench also observed that continuing his detention would increase the risk of cardiac death and frustrate the very object of Article 21 of the Constitution, which guarantees the right to life and personal liberty.

“In view of such a fragile heart as well as the overall health condition of the applicant, no purpose would be served in continuing his detention, else, it would frustrate the very object of Article 21 of the Constitution. In case detention of the applicant is continued in judicial custody, perhaps it would increase a risk of cardiac death in view of the medical reports placed on record,” the HC says.

The bench noted that Mr Sankaran had already undergone half of the maximum sentence for the offences he was charged with, and given the complexity of the case and the large number of accused persons involved the trial was unlikely to commence anytime soon.

Hari Sankaran was arrested on the grounds of abusing his powers in IL&FS Financial Services Ltd (IFIN) through his fraudulent conduct and in granting loans to entities which were not creditworthy or have been declared non-performing assets and caused wrongful loss to the company and its creditors.

In April 2019, the SFIO arrested Hari Sankaran for abusing his powers in IFIN, through his fraudulent conduct and in granting loans to entities which were not creditworthy or have been declared non-performing assets and caused wrongful loss to the company and its creditors. (Read: IL&FS Scam: SFIO Arrests Ex-chairman Hari Sankaran)
 
On 28 May 2019, the SFIO submitted a report to the ministry of corporate affairs (MCA) against IFIN’s directors, including Mr Sankaran and auditors, running into more than 32,000 pages. The next day, the MCA issued a sanction letter asking SFIO to file a complaint before the special court against Mr Sankaran and others in this case.
 
However, aggrieved by the direction issued by the MCA to file a criminal complaint, Mr Sankaran filed a writ petition in the Bombay HC seeking quashing of the said direction, the complaint and consequently, the prosecution lodged by SFIO, on the premise that the MCA had not applied its mind whilst granting sanction.
 
Similar petitions were also filed by the other directors and auditors of IFIN.
 
During the hearing at that time, a division bench of chief justice BP Dharmadhikari and justice Nitin R Borkar observed that the SFIO had admitted that the court had not taken cognisance of the report and in these facts, if cognisance is not taken, the court may not have power to remand and, as such, the detention of the petitioner-director may not be legal.
 
The bench also observed that, however, since in that petition, they were not required to answer the question of detention of Mr Sankaran, the issue was kept open for consideration and liberty was granted to him to file appropriate proceedings for his release.
 
Mr Sankaran had filed an application before the sessions court, which, on 28 April 2020, granted interim bail to him.
 
SFIO, however, challenged the order passed by the sessions court granting interim bail to Mr Sankaran. The application was allowed by the Bombay HC. However, Mr Sankaran challenged it before the Supreme Court.
 
After hearing the counsel for Mr Sankaran, the apex court, on 16 June 2020, permitted him to withdraw his special leave petition (SLP) and allowed him to pursue appropriate remedies available in the law. Mr Sankaran then approached the Bombay HC seeking his release on the premise that his detention, post-filing of charge-sheet, was illegal as no cognisance of the complaint had been taken by the special judge.