The Bombay High Court has granted bail to an accused in a Rs. 1.95 crore digital gold fraud case, emphasizing that pre-trial detention is not warranted once investigation concludes and the accused demonstrates cooperation. The order sets clear, enforceable conditions to balance liberty with public interest.
Background & Facts
The Dispute
A cyber-enabled fraud was perpetrated against Aditya Birla Capital Digital Limited (ABCD Ltd.), resulting in the unauthorized sale of customers’ digital gold worth Rs. 1,95,10,429.84. The crime was detected on 9th June 2025, leading to the registration of C.R. No. 107 of 2025 at the Cyber Police Station, Central Division, Worli, Mumbai. The prosecution alleged a coordinated scheme involving multiple accused, including the applicant, Sandeep Jagdishprasad Khandelwal.
Key Facts
- The fraud involved unauthorized access to ABCD Ltd.’s digital gold platform and subsequent sale of assets worth Rs. 1,95,10,429.84
- The applicant and co-accused Ganesh Singh allegedly forged a liquor license in Ganesh Singh’s name to open a bank account
- Rs. 51,00,000 of the proceeds were credited to this bank account
- The applicant is alleged to have received Rs. 16,00,000 as wrongful gain from the fraud
- The applicant is employed as a real estate broker; his family is financially dependent on him
- The applicant has no prior criminal antecedents
- Ten other accused remain absconding
Procedural History
- 09.06.2025: Fraud detected and complaint filed by Mr. Ravindra Choudhary of ABCD Ltd.
- 2025: C.R. No. 107 of 2025 registered at Cyber Police Station, Worli
- Prior to 2026: Investigation conducted; charge-sheet submitted
- 2026: Applicant arrested along with two others; 10 accused absconding
- Before 30.06.2026: Bail application rejected by Trial Court and Sessions Court
- 30.06.2026: Bail application heard before Bombay High Court
The Parties' Positions
Applicant’s Position: No direct evidence links him to the hacking or forgery. He is not the mastermind. He is a first-time offender with family dependents. He is willing to deposit Rs. 13,00,000 as a gesture of bona fides, without admitting guilt.
Respondent’s Position: The offence was highly organized. The applicant’s role in opening the bank account with a forged document establishes prima facie involvement. The scale of the fraud (nearly Rs. 2 crore) and the use of forged documents warrant continued custody.
Relief Sought
The applicant sought bail on reasonable conditions, including deposit of a portion of the alleged proceeds, submission of surety, and compliance with reporting obligations.
The Legal Issue
The central question was whether bail could be granted in a serious cyber fraud case under Sections 319(2), 318(4) of the Bharatiya Nyaya Sanhita, 2023 and Sections 43(A), 65, 66, 66(D) of the IT Act, 2000, where the investigation is complete, the accused has no antecedents, and is willing to deposit a substantial portion of the alleged proceeds without prejudice to his defence.
Arguments Presented
For the Appellant/Petitioner
Mr. Arun V. Lingalod argued that the prosecution had not adduced any material directly connecting the applicant to the hacking or forgery. The applicant’s alleged role was limited to receiving funds through a bank account opened using a forged document, but even that link was circumstantial. He emphasized the applicant’s steady employment, lack of criminal history, and willingness to deposit Rs. 13,00,000 as a voluntary gesture. He cited Arnesh Kumar v. State of Bihar to argue that gravity of offence alone cannot override the presumption of innocence and that bail should be the norm, not the exception.
For the Respondent/State
Mr. Mayur Sonavane, APP, contended that the offence was committed in a systematic manner involving forgery, digital intrusion, and money laundering. The diversion of Rs. 51,00,000 to a bank account opened with a forged liquor license demonstrated premeditation. The applicant’s receipt of Rs. 16,00,000 established him as a beneficiary. He argued that the scale of the fraud, the involvement of multiple absconding accused, and the potential for evidence tampering justified denial of bail.
The Court's Analysis
The Court acknowledged the seriousness of the offences under the Bharatiya Nyaya Sanhita, 2023 and the IT Act, 2000, particularly given the financial scale and the use of forged documents. However, it noted that the investigation was complete, the charge-sheet had been filed, and the applicant was not among the absconding accused. The Court observed that the applicant’s detention would not aid the investigation further.
"The Applicant is not likely to abscond and tamper with prosecution evidence. The Applicant has no antecedents. He is ready to deposit Rs.13,00,000/- in the trial towards return of the property allegedly received by the Applicant as the beneficiary of the crime."
The Court emphasized that the applicant’s willingness to deposit Rs. 13,00,000 - nearly 81% of the amount allegedly received by him - was a significant indicator of bona fides. The Investigating Officer confirmed the applicant’s share was limited to Rs. 16,00,000. The Court held that the conditions proposed were sufficient to ensure the applicant’s presence and prevent interference with the trial.
The Court further clarified that its observations were strictly confined to the bail stage and did not constitute any pre-judgment of guilt, directing the trial court not to be influenced by them.
The Verdict
The applicant succeeded. The Bombay High Court granted bail subject to the following conditions: (i) execution of a personal bond of Rs. 50,000 with one or two sureties of like amount; (ii) deposit of Rs. 13,00,000 in the trial court, without prejudice to his defence; (iii) monthly attendance at the Cyber Police Station, Worli, between 12:00 noon and 4:00 p.m. on the first day of each calendar month until trial concludes; (iv) regular attendance at all court proceedings unless exempted in writing; (v) no tampering with evidence or influence on witnesses; (vi) submission and updating of contact and residential details to the Investigating Officer; and (vii) a clear caveat that the order does not prejudge guilt. The applicant was released upon compliance.
What This Means For Similar Cases
Deposit of Proceeds Can Be a Decisive Factor in Bail
- Practitioners should advise clients in financial fraud cases to proactively offer deposit of alleged proceeds, even if partial, as a strong mitigating factor
- Courts are increasingly receptive to voluntary restitution as evidence of good faith, especially where the accused is not a flight risk
- The amount deposited need not be the full sum; proportionality matters
Monthly Reporting Is a Viable Alternative to Custody in Cyber Cases
- Courts are willing to impose structured reporting obligations in place of incarceration, particularly where digital trails are intact and evidence is secure
- Monthly police attendance conditions are now a recognized tool to ensure compliance without detention
- This model may be replicated in cases under Section 66(D) IT Act or Section 319(2) BNS involving digital asset theft
Pre-Trial Detention Is Not Automatic in Complex Cyber Crimes
- Once investigation concludes, the burden shifts to the prosecution to show why custody remains necessary
- Absence of antecedents and stable employment are critical factors in favour of bail
- The Court’s refusal to equate financial scale with flight risk sets a precedent for bail in white-collar cyber offences
