Bombay High Court
SURAJ MACCHINDRA MAHADIK AND ANOTHERversusTHE STATE OF MAHARASHTRA
- Disposal
- APPLICATION ALLOWED
Holding
The Court allowed the bail application, holding that the applicants' continued detention was unwarranted given the documentary nature of the evidence, the completed investigation, and the ability to secure their attendance through conditions.
Summary
Suraj and Kiran Mahadik, agricultural borrowers, were arrested for alleged diversion of a Rs 50 lakh loan sanctioned under a cooperative society, facing charges under IPC sections 409, 420 and 34, and Section 3 of the Maharashtra Protection of Interest of Depositors Act. The Special Court had denied their bail, but the High Court examined whether the seriousness of the offences, the applicants' role as borrowers rather than society directors, and the length of their pre‑trial detention warranted continued custody. The Court noted that the evidence was largely documentary, the investigation was complete, and no attempt to tamper with witnesses had been shown. It also considered that other co‑accused had been released on bail under similar circumstances. Concluding that their continued detention for seventeen months was unwarranted, the Court granted regular bail with strict conditions to safeguard the trial and evidence.
Issues considered
- Whether bail should be granted to the accused in offences punishable under IPC sections 409, 420, 34 and MPID Act section 3 despite the seriousness of the alleged fraud.
- Whether the applicants' status as borrowers, not directors, affects the bail decision.
- Whether prior bail orders to co‑accused create a binding precedent for the applicants.
- Whether the length of pre‑trial detention and the nature of the evidence justify continued custody.
Legislation cited
Subjects
- bail
- IPC 409
- IPC 420
- MPID Act
- financial fraud
- loan diversion
- pre‑trial detention
- criminal procedure
Judgment
1 BA1461.2026.odt
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
BAIL APPLICATION NO. 1461 OF 2026
1. Suraj Macchindra Mahadik,
Age : 34 years, Occu. Agriculture,
2. Kiran Macchindra Mahadik,
Age : 37 years, Occu. Agriculture,
Both R/o. Ukkadgaon, Tq. Shrigonda,
District Ahilyanagar (Ahmednagar),
(The applicants are in jail). ...Applicants
Versus
The State of Maharashtra ...Respondent
……..
Mr. V. D. Hon, Sr. Counsel a/w Mr. Shubham Kote, Advocate i/b Mr. A. V.
Hon – Advocate for the Applicants
Mr. S. V. Hange – APP for the State
……..
CORAM : HITEN S. VENEGAVKAR, J.
DATED : 21ST SEPTEMBER, 2026
ORDER : -
1. The Applicants, Suraj Macchindra Mahadik and Kiran
Macchindra Mahadik, seek regular bail in Crime No. 532 of 2024,
registered with Parner Police Station, District Ahilyanagar, for offences
punishable under Sections 409 and 420 read with Section 34 of the
Indian Penal Code [For short “IPC”], and Section 3 of the Maharashtra
Protection of Interest of Depositors (in Financial Establishments) Act,
2 BA1461.2026.odt
1999 [In short “MPID”]. Both Applicants were arrested on 5 th April
2025. Their bail application was rejected by the learned Special Court
on 24th June 2026.
2. The informant had deposited Rs. 9.00 lakh with Raje
Shivaji Gramin Bigarsheti Sahakari Patsanstha Maryadit. According to
the prosecution, the society failed to repay deposits on maturity. An
examination of its records disclosed irregular loan transactions and
alleged diversion of funds, causing an overall loss said to be Rs.
66,69,03,228/-. The Applicants were subsequently named in a
supplementary charge-sheet. The allegation specific to each of them is
that a loan of Rs. 50.00 lakh was sanctioned in his name for agricultural
improvement, but the amount was directed to the account of Raichand
Kisan Wakhare instead of being used for that purpose.
3. Learned Senior Counsel for the Applicants submits that they
are borrowers, and neither members of the Managing Committee nor
persons ARE conducting the society’s affairs. He relies on a registered
mortgage and a valuation report concerning their property. He submits
that the investigation is complete, the material is documentary, and the
applicants have remained in custody since 5th April 2025. Reliance is
also placed on the bail granted to co-accused Raju Baburao Katore by
this Court and to Popat Bolhaji Dhawle and another co-accused by the
Supreme Court. He further refers to the death of Kiran’s two children in
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an accident and submits that Kiran complied with the conditions of
temporary bail granted thereafter.
4. Learned APP opposes the Application. The prosecution
alleges a wider arrangement in which loans were sanctioned in the
names of connected persons and society funds were diverted. It is
submitted that the existence of a mortgage does not explain the transfer
of the loan proceeds to a third party, and that the scale of the alleged
loss to depositors, the Applicants’ participation and the possibility of
interference with witnesses weigh against bail.
5. The accusation is serious. The Applicants cannot answer the
allegation of diversion merely by showing that property was mortgaged:
whether the security was adequate and genuine, whether the transfer
instructions were given by them, and whether they acted in concert with
those managing the society require examination at trial. Equally, the
material presently identified against these Applicants must be assessed
according to their own alleged acts. The charge-sheet passage
concerning them describes them as borrowers and identifies the alleged
transfer of ₹50 lakh in each case. The order under challenge repeatedly
proceeds on the footing that they were Directors of the Society, without
identifying material establishing that position. That distinction matters
when considering their role; it does not foreclose the prosecution from
proving common intention or participation in the alleged transactions.
4 BA1461.2026.odt
6. The applicability of Section 3 of the MPID Act to the
Applicants, and the ingredients of the IPC offences, must be decided on
the evidence. No final finding on those questions is necessary for bail.
Nor does bail granted to another accused create an automatic
entitlement: the respective roles and the circumstances of those orders
must be considered. The orders placed on record nevertheless show that
other accused in this crime have been released, including Popat Dhawle
by the Supreme Court on 30th April 2026, after consideration of his
incarceration and the bail granted to a similarly situated co-accused.
7. The investigation against these Applicants is complete and
the Charge-sheet has been filed. The Special Court’s order records 36
prosecution witnesses and none examined as of 24 th June 2026. The
Applicants have been in custody for approximately seventeen months.
The evidence concerning the loan sanctions, mortgage and transfers is
substantially documentary and has been collected. No specific instance
of an attempt by either applicants to influence a witness has been
brought to notice. In these circumstances, their continued detention
pending a trial, involving numerous witnesses is unwarranted. The
prosecution’s concerns can be addressed by conditions securing their
attendance and protecting the evidence. Kiran’s family circumstances are
noted, although the decision rests principally on the applicants’
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individual roles, the stage of the case and the length of custody. Hence, I
pass the following order: -
ORDER
(i) The Application is allowed.
(ii) Applicants, Suraj Macchindra Mahadik and Kiran
Macchindra Mahadik, shall each be released on bail in Crime No.
532 of 2024, registered with Parner Police Station, District
Ahilyanagar, for offences punishable under Sections 409 and 420
read with Section 34 of the Indian Penal Code, and Section 3 of
the Maharashtra Protection of Interest of Depositors (in Financial
Establishments) Act, 1999, on executing a personal bond of
Rs.50,000/- each with one or two sureties in the like amount, to
the satisfaction of the Special Court.
(iii) The Applicants shall attend every date of trial, unless
exempted by the Special Court.
(iv) The Applicants shall furnish their current residential
addresses and mobile numbers to the Investigating Officer and
the Special Court.
(v) The Applicants shall promptly report any change in their
residential address or mobile number to the Investigating Officer
and the Special Court.
(vi) The Applicants shall not, directly or indirectly, contact,
threaten or induce any prosecution witness.
(vii) The Applicants shall not tamper with the society's records
or any other evidence.
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(viii) The Applicants shall not leave India without the prior
permission of the Special Court.
(ix) The Applicants shall surrender their passports, if any, to the
Special Court.
8. Breach of any of the aforesaid conditions shall entitle the
prosecution to seek cancellation of bail.
9. Nothing observed in this order shall influence the trial,
which shall proceed independently on the basis of the evidence adduced
before the Trial Court.
[ HITEN S. VENEGAVKAR ]
JUDGE
SG Punde
Signed by: Sandeep Gulabrao Punde
Designation: PS To Honourable Judge
Date: 23/09/2026 16:02:48
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