Cannot dictate SFIO what to file on affidavit: Bombay High Court to daughter of Binani companies promoter

While hearing a plea challenging the summons issued by the Serious Fraud Investigation Office (SFIO) in relation to an investigation into the affairs of Binani Cement Limited (BCL), the Bombay High Court orally refused to direct the SFIO to place on record the details of the probe as mentioned in its affidavit..Shradha Binani, daughter of the promoter of the erstwhile BCL, had moved the plea in October 202. In December 2021, leave was granted to SFIO to file a reply. Certain statements in the reply were taken objection to by Binani, who sought for documents to substantiate the same.However, the High Court on Monday refused to intervene and instead granted time to Binani to file a rejoinder to the reply. .In her plea, Binani stated that the SFIO had summoned her to personally appear before it for examination on oath, and to provide certain documents in July 2021. She requested that the hearing be deferred in light of the COVID-19 situation in Maharashtra and Delhi. She also asked for details of the order directing the SFIO to conduct the investigation. The SFIO applied for the issuance of a Look-out Circular (LOC) against Binani, a resident of London, and issued another summons in September. Post this, Binani filed the present petition through Dhru & Co..Binani claimed in the plea that she had been a non-executive director of BCL for only a period of two years between 2012 to 2014. She claimed that after the initiation of the Corporate Insolvency Resolution Process (CIRP), the company, its promoters, shareholders, directors and all persons had no connection with the affairs of BCL. Hence, the summons issued to her did not serve any purpose whatsoever. BCL had immunity from prosecution of alleged offences committed even prior to the initiation of the CIRP, her plea stated.The plea stated that SFIO was only carrying out a fishing and roving enquiry by seeking personal details and information regarding her personal affairs, which was violative of her fundamental rights to privacy and to being compelled to be a witness against oneself. Binani sought for quashing or recall of the summons or an interim stay on the same, as well as an order against possible coercive action. .The SFIO, on the other hand, claimed that it had initiated an investigation based on an order of the Ministry of Corporate Affairs that stated that "the Resolution Professional had made a presentation on the avoidance transactions executed by the BCL including sales to potential related parties without adequate collection of receivables resulting in diversion of funds, loans, etc foregoing interest of ₹382 crores."It stated that Binani's conduct so far only showed that she had been deliberately trying to evade the process of the ongoing investigation. Rather than complying with the summons, under the pretext of trying to defer the hearings, Binani tried to leave India, the SFIO affidavit stated. It was claimed that her examination was crucial as the investigation had revealed transfer of huge funds since 2010 to her personal bank account from related BCL companies and certain other entities. .On Monday, Senior Advocate Harish Salve appearing for Binani sought for an order from the Court to the SFIO to produce details to back their 'brazenly false' claims about the alleged third party transactions. However, the Bench of Justices Gautam Patel and Madhav Jamdar refused to pass such orders remarking that “they could not dictate to any parties what to state in their affidavits”, and that the petitioner would know what goes in and out of her account.After granting time to Binani to respond to SFIO's affidavit, the Bench posted the matter for hearing on February 1, 2022. .After completing the CIRP as per provisions of the Insolvency and Bankruptcy Code, the National Company Law Tribunal, Kolkata, approved the Final Resolution Plan submitted by Ultratech Cements Limited.This order was upheld by the National Company Law Appellate Tribunal, as well as the Supreme Court.BCL was renamed to Ultratech Nathdwara Cement Limited in 2018. By 2019, after the procedure of acquiring Binani was completed by Ultratech, this was a rare case where all creditors of BCL received more than their debt amounts.