IMA Scam: Karnataka High Court grants bail to prime accused Mansoor Khan on account of deteriorating health

The Karnataka High Court recently granted bail to IMA Jewels Founder and Managing Director Mansoor Khan, the prime accused in the IMA ponzi scheme, owing to his deteriorating health. .Khan had been in jail since September 2019, when he was first arrested by officials of the Enforcement Directorate (ED)..The bail order was passed by Justice Sreenivas Harish Kumar, who imposed the following conditions:.To obtain a bond for Rs.5,00,000/- and two sureties for the like sum to the satisfaction of the trial court.Shall regularly appear before the trial court till the conclusion of trial and shall not tamper with the evidence or threaten the witnesses.Shall not alienate any of his properties till conclusion of trial without the prior permission of the trial court. Shall mark his attendance regularly and shall not leave the jurisdiction of the trial court without prior permission..Factual Background.Khan, the head of a company called ‘I Monetary Advisory’ (IMA), claims to be having vast experience in the finance sector as a portfolio manager. He garnered many clients to invest in this scheme, which reaped profits till March 2019. When a few investors requested Khan to return their deposits, he failed to do so. .The state government later constituted a Special Investigation Team (SIT), and thereafter, the investigation was transferred to the Central Bureau of Investigation (CBI). It was found out that Khan had collected Rs. 4,000 crore from more than 50,000 people by painting a false picture about the profits being made by the IMA group of companies..After the ED took over the investigation, Khan and other accused were charged under Sections 406 (Punishment for criminal breach of trust), 409 (Criminal breach of trust by public servant, or by banker, merchant or agent), 420 (Cheating and dishonestly inducing delivery of property), 120B (Punishment of criminal conspiracy) of the Indian Penal Code, Section 9 of The Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2006 and Section 3 of the Prevention of Money Laundering Act (PMLA). .After the trial court rejected Khan's application for bail, he moved the High Court..Arguments raised .Appearing for the petitioner, Advocate GK Nandakumar argued that Khan had returned to India himself after gaining information about a criminal case being registered against him. It was submitted that Khan fully cooperated with the police during the investigation and surrendered his passport when he was taken into custody on September 1, 2019..Khan's counsel further submitted that he has been suffering from diabetes and hypertension for a while now, and that he had been diagnosed with unstable angina coronary artery disease. .Reliance was placed on a number of judgments in support of the argument that in extreme medical conditions, the courts have always taken a lenient view in granting bail..A letter written by the Chief Medical Officer of the Central Prison at Bengaluru to the Chief Superintendent of the Central Prison, which highlighted Khan's health issues, was also relied on..Vehemently opposing his bail application, Public Prosecutor Madhukar Deshpande contended that Khan had been implicated of committing serious offences including the offences punishable under the PML Act..The investigating officer had collected ample evidence against the petitioner. Under the circumstances, if the petitioner is released on bail, he is likely to alienate the properties which he might have purchased from the proceeds of crime, the prosecutor argued..What the Court held.The Bench firstly accepted that in cases pertaining to allegations of laundering huge amounts of money, bail should not be granted. Considering the prima facie materials against Khan, there was no scope for granting him bail. .Referring to the Supreme Court decision in Sanjay Chandra v. CBI, the Court opined that poor health condition can be considered as a reason for granting bail..Thus, the Single Judge proceeded to allow Khan's bail application, noting,."The Chief Medical Officer might have stated that petitioner’s health condition is stable, but it does not mean that the petitioner can continue to manage those ailments being inside the jail. Certainly the ailments that he has requires constant monitoring; the treatment that he may take outside the jail may be of different standard. It is pertinent to note that the Chief Medical Officer has clearly made an observation about the chronic disease conditions of the petitioner. Therefore, certainly this aspect can be considered for granting bail."Karnataka High Court.[Read the judgment]