JSL Realty fraud: Bombay HC orders fresh probe, senior cop under inquiry

The Bombay High Court has transferred the JSL Realty fraud investigation from the Economic Offence Wing (EOW) to the Mumbai Crime Branch, following concerns over an officer’s abuse of power. The order was issued by the Director General of Maharashtra Police.

Court observations

The bench, led by Chief Justice Shree Chandrashekhar and Justice Gautam A Ankhad, noted that the officer handling the case had previously faced strictures for wrongful arrest but continued to supervise the investigation.

The court highlighted irregularities in the arrest of accused Mamta Singh, who was taken into custody on September 10 despite her statement being recorded on June 18. The bench questioned the delay in arresting Singh, who was hosting a birthday party for her specially-abled child, and noted that unlike other accused, she was not given additional notices.

“The failure to provide reasons for the delayed arrest raises serious questions about the investigation’s conduct,” the court said, adding that the officer’s actions appeared biased and lacked transparency, with no records of searches conducted at the petitioner’s premises.

The court emphasized that the power of arrest is not absolute and must follow procedures under Section 41(1)(b)(ii) of the Code of Criminal Procedure, ensuring arrests prevent further offenses, tampering with evidence, or influencing witnesses.

Police response

During hearings, the bench had hinted at suspending the officer, yet he continued issuing summons in the case. Frustrated, the court warned of action against police leadership for non-compliance.

Subsequently, Additional Public Prosecutor Mankuwar Deshmukh confirmed that the Maharashtra DGP had transferred the investigation to the Crime Branch and initiated an inquiry against the officer by a senior police official of Additional Commissioner rank.

Case background

The case involves a complaint by businessman Rajat Jhunjhunwala, alleging fraudulent transfer of ownership in Shajas Developers Pvt Ltd and its subsidiary JSL Realty. According to the complaint, the accused used forged documents and fake shareholding certificates to remove Jhunjhunwala’s stake in the companies.