Bombay High Court
VINAYAK DNYANESHWAR MARATHEversusSTATE OF MAHARASHTRA
- Decided
- Disposal
- Allowed
Holding
The court held that bail should be granted to the applicant, subject to strict conditions.
Summary
The applicant, Vinayak Dnyaneshwar Marathe, was arrested in connection with a large‑scale investment fraud alleged under the MPID Act, the Banning of Unregulated Deposit Schemes Act and several provisions of the Bharatiya Nyaya Sanhita (BNS). The complainant claimed that Marathe, as a director and marketing agent of Infinite Beacon Pvt. Ltd., induced investors to deposit money in schemes promising high returns and subsequently diverted funds to his personal bank accounts. The prosecution sought to deny bail, arguing that the offences amounted to cheating under Section 318(4) BNS and that the applicant might abscond. The defence contended that Marathe was falsely implicated, had resigned from the company, and that there was no direct evidence of his participation in the fraud. The court examined the distinction between cheating and criminal breach of trust, concluding that the case, if any, would fall under cheating, and noted the lengthy trial and lack of immediate risk of absconding. Accordingly, the court granted bail with stringent conditions.
Issues considered
- Whether the applicant is entitled to bail under Section 483 of the Bharatiya Magarik Suraksha Sanhita, 2023 in view of the alleged cheating offences.
- Whether the alleged conduct constitutes cheating under Section 318(4) BNS or criminal breach of trust under Section 316(5) BNS.
- Whether the applicant poses a risk of absconding or tampering with evidence.
Legislation cited
- Banning of Unregulated Deposit Schemes Act, 2019 — s. 21, 23
- Bharatiya Nyaya Sanhita, 2023 — s. 111, 229, 316(5), 318(4), 3(5), 61(2)
- Indian Penal Code, 1860 — s. 406, 415, 420
- Maharashtra Protection of Interest of Depositors Act, 1999 — s. 3, 4
Subjects
- bail
- economic offence
- cheating
- criminal breach of trust
- investment fraud
- Section 483 BNSS
- high court
- bail conditions
- financial scam
Judgment
BA.2949.2026.doc
Ajay
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CRIMINAL APPELLATE JURISDICTION
BAIL APPLICATION NO. 2949 OF 2026
Mr. Vinayak Dnyaneshwar Marathe .. Applicant
Versus
State of Maharashtra .. Respondent
....................
Mr. Niranjan Mundargi a/w. Mr. Namit Khandage, Ms. Keral Mehta
i/b. Jinal Garasia, Advocates for Applicant.
Mr. Amit A. Palkat, APP for Respondent – State.
Mr. Chetan More, API - EOW, Pune.
......…...........
CORAM : MILIND N. JADHAV, J.
DATE : SEPTEMBER 09, 2026.
P.C.:
1. Heard Mr. Mundargi, learned Advocate for Applicant and
Mr. Palkar, learned APP for Respondent – State.
2. Present Application is filed under Section 483 of Bharatiya
Magarik Suraksha Sanhita, 2023 (BNSS) seeking enlargement on bail
in respect of FIR being CR No.118 of 2025 registered at Shivajinagar
Police Station, Pune for the offences punishable under Sections 3 and 4
of the Maharashtra Protection of Interest of Depositors Act, 1999
(MPID Act) and Sections 21 and 23 of the Banning of Unregulated
Deposit Schemes Act, 2019 along with Sections 111, 3(5), 61(2), 229,
316(5) and 318(4) of the Bharatiya Nyaya Sanhita, 2023 (BNS)
against Applicant and other accused persons.
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3. Briefly stated, Complainant is one Amit Chandrashekar
Borase. One Anand Ramrao Raut informed Complainant that his
acquaintance one Navnath Awtade was a stock broker and invested
monies of numerous investors in the share market and delivered high
returns. In September 2023, Complainant along with Anand Raut went
to the office of Navnath Awtade and he informed Complainant that he
along with 7 other persons were directors in a stock broking firm
namely Infinite Beacon India Pvt. Ltd. bearing SEBI Registration
No.00003119383 and Bombay Stock Exchange Registration No.6818
which was an expert in share trading and investments earning returns
upto 6% to 8% per month. Navnath Awtade informed Complainant
that he could check details of his investment on Tredz Investment Pvt.
Ltd. app and on the 30th of every month he could withdraw his
investment which would then be credited to his account before the
10th day of the following month.
3.1. Complaint registered himself on Tredz Investment Pvt. Ltd.
app and invested Rs.1,00,000/- on 03.10.2023 and Rs.11,00,000/-
24.11.2026. On 02.07.2024, Complainant subsequently withdrew
amounts of Rs.11,98,266 and Rs.18,50,000/-. Thereafter, Complainant
invested Rs.2,75,50,000/- between 21.02.2024 and 30.07.2024. In
April 2025, Complainant was in need of funds and attempted to
withdraw his investment with interest however the same was not
credited within the promised period. Complainant attempted to
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contact Navnath Awtade and other directors however he could not do
so. Complainant conducted inquiries into Navnath Awtade and Infinte
Beacon Pvt. Ltd. and realised that they had duped him alongwith other
investors by luring them to invest sums of money and receive high
returns. Therefore, Complainant filed present complaint against
Applicant and 7 other persons. Applicant filed Bail Application No.706
of 2026 before the Additional Sessions Judge, Pune which came to be
rejected by Order dated 08.06.2026. Hence present Application.
4. Mr. Mundargi, learned Advocate for Applicant would submit
that Applicant is falsely implicated in the present case, that there are
no allegations against Complainant, that there is no involvement of
Applicant in the present crime, that he is not concerned with the
functioning of Tredz Investment Pvt. Ltd., that he did not receive any
amount in his bank account and that there is a delay of more than 4
months in filing the FIR.
4.1. He would submit that Applicant was one of the Directors of
Infinite Beacon Pvt. Ltd. which was incorporated on 20.07.2023. He
would submit that Applicant resigned as Director from Infinite Beacon
Pvt. Ltd. on 22.02.2025. He would submit that Infinite Beacon Pvt. Ltd.
has not conducted any transaction since it was incorporated which is
manifest from perusal of the Registrar of Companies records. He would
submit that Complainant failed to mention name of Applicant in the
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FIR and that all investments were made at the behest of Navnath
Awtade only.
4.2. He would submit that Applicant along with his family has
invested a sum of Rs.83,06,905/- in Infinite Beacon Pvt. Ltd. which
was not returned to them and his wife filed a complaint with Pimpri
Chinchwad Police Station on 20.07.2025. He would submit that
chargesheet is filed and investigation is over hence there can be no
opportunity for Applicant to tamper with evidence and further
detention of Application is unwarranted. He would submit that
Applicant was not acting as an agent of the Company or any investor
and therefore Section 316(4) of BNS is not applicable. He would
submit that Police authorities have seized immovable property worth
Rs.3.5 crores owned by Applicant hence there is no chance of
Applicant absconding as he has deep roots in Society.
4.3. He would submit that there are more that 500 witnesses to
be examined as per the chargesheet and hence there is no possibility of
early conclusion of trial and further detention of Application will
amount to pre-trial detention. He would submit that Application is
ready and willing to deposit 50% of amount alleged to have received
by him in this Court. He would urge me to enlarge Applicant on bail on
any condition that this Court deems necessary to impose.
5. Mr. Palkar, learned APP for Respondent State would submit
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that Applicant and other accused persons played a large scale fraud on
investors by opening multiple companies and luring unsuspecting
investors with high returns. He would submit that Applicant along with
other accused persons appointed 514 franchisees and 13577 agents to
collect monies from various investors and that large sums of money
transfers are transferred between various accounts. He would submit
that nearly 520 investors were duped amounting to Rs.294.34 crores.
He would submit that Applicant was director of Infinite Beacon Pvt.
Ltd. and he received Rs.4.59 crores into his HDFC and ICICI Bank
accounts from Infinite Beacon Pvt. Ltd. which are investments
deposited by investors being diverted to Applicant’s bank account. He
would submit that all co-accused persons are absconding and hence
there is all likelihood that Applicant may jump bail. He would urge this
Court to deny grant of bail to Applicant on the basis of these
submissions.
6. I have heard the learned Advocates appearing for the parties
and with their able assistance, perused the record of the case.
Submissions made by learned Advocates at the bar have received due
consideration of the Court.
7. Perusal of the material on record would show that
Complainant alongwith other investors invested in Infinite Beacon Pvt.
Ltd. since 2023 and were getting the benefits therefrom regularly.
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Prosecution case is that the investors were lured and induced by the
Applicant and other accused persons to invest into the schemes floated
by their Companies by promising high rates of interest. Hence it can be
deduced that the case of prosecution at the highest can be for cheating
under Section 318(4) of BNS.
8. It is trite law that offence of cheating and criminal breach of
trust cannot co-exist simultaneously. In this context reference is made
to a decision of the Supreme Court in the case of Delhi Race Club
(1940) Ltd. and Ors. Vs. State of Uttar Pradesh and Anr. 1 wherein in
paragraph Nos.24 to 30 the Court has laid down the distinction
between offence of cheating and criminal breach of trust. Paragraph
Nos. 24 to 30 read thus:-
"DIFFERENCE BETWEEN CRIMINAL BREACH OF TRUST AND
CHEATING
24. This Court in its decision in S.W. Palanitkar & Ors. v. State
of Bihar & Anr. reported in (2002) 1 SCC 241 expounded the
difference in the ingredients required for constituting an of
offence of criminal breach of trust (Section 406 IPC) viz-a-viz
the offence of cheating (Section 420). The relevant observations
read as under: -
“9. The ingredients in order to constitute a criminal breach
of trust are: (i) entrusting a person with property or with
any dominion over property,(ii) that person entrusted (a)
dishonestly misappropriating or converting that property
to his own use; or (b) dishonestly using or disposing of
that property or wilfully suffering any other person so to
do in violation (i) of any direction of law prescribing the
mode in which such trust is to be discharged, (ii) of any
legal contract made, touching the discharge of such trust.
10. The ingredients of an offence of cheating are: (i) there
should be fraudulent or dishonest inducement of a person
by deceiving him, (ii)(a) the person so deceived should be
1 Criminal Appeal No. 3114 of 2024 decided on 23.08.2024
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induced to deliver any property to any person, or to
consent that any person shall retain any property; or (b)
the person so deceived should be intentionally induced to
do or omit to do anything which he would not do or omit
if he were not so deceived; and (iii) in cases covered by
(ii)(b), the act of omission should be one which causes or
is likely to cause damage or harm to the person induced in
body, mind, reputation or property.”
25. What can be discerned from the above is that the offences
of criminal breach of trust (Section 406 IPC) and cheating
(Section 420 IPC) have specific ingredients.
In order to constitute a criminal breach of trust (Section 406
IPC): -
1) There must be entrustment with person for property or
dominion over the property, and
2) The person entrusted: -
a) dishonestly misappropriated or converted property to
his own use, or
b) dishonestly used or disposed of the property or willfully
suffers any other person so to do in violation of:
i. any direction of law prescribing the method in which the
trust is discharged; or
ii. legal contract touching the discharge of trust (see:
S.W.P. Palanitkar (supra).
Similarly, in respect of an offence under Section 420 IPC, the
essential ingredients are: -
1) deception of any person, either by making a false or
misleading representation or by other action or by omission;
2) fraudulently or dishonestly inducing any person to deliver
any property, or
3) the consent that any persons shall retain any property and
finally intentionally inducing that person to do or omit to do
anything which he would not do or omit (see: Harmanpreet
Singh Ahluwalia v. State of Punjab, (2009) 7 SCC 712 : (2009)
Cr.L.J. 3462 (SC))
26. Further, in both the aforesaid sections, mens rea i.e.
intention to defraud or the dishonest intention must be present,
and in the case of cheating it must be there from the very
beginning or inception.
27. In our view, the plain reading of the complaint fails to
spell out any of the aforesaid ingredients noted above. We may
only say, with a view to clear a serious misconception of law in
the mind of the police as well as the courts below, that if it is a
case of the complainant that offence of criminal breach of trust
as defined under Section 405 of IPC, punishable under Section
406 of IPC, is committed by the accused, then in the same
breath it cannot be said that the accused has also committed the
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offence of cheating as defined and explained in Section 415 of
the IPC, punishable under Section 420 of the IPC.
28. Every act of breach of trust may not result in a penal
offence of criminal breach of trust unless there is evidence of
manipulating act of fraudulent misappropriation. An act of
breach of trust involves a civil wrong in respect of which the
person may seek his remedy for damages in civil courts but, any
breach of trust with a mens rea, gives rise to a criminal
prosecution as well. It has been held in Hari Prasad Chamaria v.
Bishun Kumar Surekha & Ors., reported in (1973) 2 SCC 823 as
under:
“4. We have heard Mr. Maheshwari on behalf of the
appellant and are of the opinion that no case has been
made out against the respondents under Section 420
Penal Code, 1860. For the purpose of the present appeal,
we would assume that the various allegations of fact
which have been made in the complaint by the appellant
are correct. Even after making that allowance, we find
that the complaint does not disclose the commission of
any offence on the part of the respondents under Section
420 Penal Code, 1860. There is nothing in the complaint
to show that the respondents had dishonest or fraudulent
intention at the time the appellant parted with Rs.
35.000/- There is also nothing to indicate that the
respondents induced the appellant to pay them Rs.
35,000/- by deceiving him. It is further not the case of the
appellant that a representation was made, the respondents
knew the same to be false. The fact that the respondents
subsequently did not abide by their commitment that they
would show the appellant to be the proprietor of Drang
Transport Corporation and would also render accounts to
him in the month of December might create civil liability
on the respondents for the offence of cheating.”
29. To put it in other words, the case of cheating and
dishonest intention starts with the very inception of the
transaction. But in the case of criminal breach of trust, a person
who comes into possession of the movable property and receives
it legally, but illegally retains it or converts it to his own use
against the terms of the contract, then the question is, in a case
like this, whether the retention is with dishonest intention or
not, whether the retention involves criminal breach of trust or
only a civil liability would depend upon the facts of each case.
30. The distinction between mere breach of contract and the
offence of criminal breach of trust and cheating is a fine one. In
case of cheating, the intention of the accused at the time of
inducement should be looked into which may be judged by a
subsequent conduct, but for this, the subsequent conduct is not
the sole test. Mere breach of contract cannot give rise to a
criminal prosecution for cheating unless fraudulent or dishonest
intention is shown right from the beginning of the transaction
i.e. the time when the offence is said to have been committed.
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Therefore, it is this intention, which is the gist of the offence.
Whereas, for the criminal breach of trust, the property must
have been entrusted to the accused or he must have dominion
over it. The property in respect of which the offence of breach of
trust has been committed must be either the property of some
person other than the accused or the beneficial interest in or
ownership’ of it must be of some other person. The accused
must hold that property on trust of such other person. Although
the offence, i.e. the offence of breach of trust and cheating
involve dishonest intention, yet they are mutually exclusive and
different in basic concept. There is a distinction between
criminal breach of trust and cheating. For cheating, criminal
intention is necessary at the time of making a false or
misleading representation i.e., since inception. In criminal
breach of trust, mere proof of entrustment is sufficient. Thus, in
case of criminal breach of trust, the offender is lawfully
entrusted with the property, and he dishonestly misappropriated
the same. Whereas, in case of cheating, the offender
fraudulently or dishonestly induces a person by deceiving him to
deliver any property. In such a situation, both the offences
cannot co-exist simultaneously.”
9. From the above it can be deduced that the grievance of
Complainant in the present case would at the most lie for offence of
cheating under Section 318(4) BNS and not criminal breach of trust
under Section 316(5) of BNS because of the alleged dishonest
intention of Applicant and other accused persons to lure investors and
dupe them with investment schemes promising high returns. It is
prosecution’s case that Applicant has alleged diverted funds into
certain his bank account and thereby allegedly received undue benefit
from the investments made by the investors.
10. It is seen that the role attributed to Applicant is that he was
employed as marketing agent in Infinite Beacon Pvt. Ltd. where he
introduced schemes for investment to potential investors and earned
commission from those who invested their monies into Infinite Beacon
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Pvt. Ltd.. However prima facie there is no material on record to show
his direct complicity in the crime. It is further seen that the
Investigating Officer attached assets valued at Rs.3.72 crores belonging
to Applicant. Chargesheet is filed before the Trial Court and it lays out
more than 500 witnesses to be examined. Trial has commenced and is
at the stage of framing of charge therefore there is no possibility of the
Trial concluding the near future. In this regard, support is drawn from
the decision of the Supreme Court in the case of Sanjay Chandra Vs.
Central Bureau of Investigation2 wherein the Court has held that in
economic offences while considering an application for bail, the nature
of charge may be relevant but at the same the punishment to which the
party may be liable, if convicted is also a significant aspect and
therefore both, the seriousness of the charge and the severity of the
punishment should be taken into consideration for arriving at decision
of grant of bail. It further observed that deprivation of liberty must be
considered a punishment unless it is absolutely necessary in the
interest of justice and that object of bail is merely to secure appearance
of accused at the trial.
11. In view of the above prima facie observations and facts
delineated herein above, Applicant before me is entitled for bail. Bail
Application is allowed on the following terms and conditions:-
(i) Applicant - Vinayak Dnyaneshwar Marathe is directed
2 (2012) 1 SCC 40
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to be released on bail on furnishing P.R. Bond in the
sum of Rs.50,000/- with one or two sureties in the like
amount;
(ii) Applicant is permitted to furnish provisional cash bail of
Rs.50,000/- for his release immediately and file
undertaking that he will provide one or two sureties in
the like amount of Rs.50,000/- within a period of four
weeks after his release which shall be accepted by the
Trial Court. Applicant shall provide sureties as directed;
(iii) Applicant shall report to the Investigating Officer of the
concerned Police Station once every month on the third
Sunday between 10:00 a.m. to 12:00 p.m. for the first
one year and thereafter as and when called;
(iv) Applicant shall co-operate with the conduct of trial and
attend the Trial Court on all dates unless specifically
exempted and will not take any unnecessary
adjournments, if he does so, it will entitle the
prosecution to apply for cancellation of this order;
(v) Applicant shall not leave the Country without prior
permission of the Trial Court;
(vi) Applicant shall not influence any of the witnesses or
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tamper with the evidence in any manner;
(vii) Applicant shall keep the Investigating Officer informed
of his current address and mobile contact number and /
or change of residence or mobile details, if any, from
time to time; and
(viii) Any infraction of the above conditions shall entail the
prosecution to seek cancellation of this order.
12. It is clarified that the above observations in this order are
limited for the purpose of granting bail only and I have not made any
observations on the merits of the case and the trial shall be adjudicated
on the basis of the evidence uninfluenced by the present order and
strictly in accordance with law. It is also clarified that the common
order is for the sake of convenience and Applicant shall not be
adversely impacted by the conduct of the other Applicant including but
not limited to infringement of bail conditions.
13. Bail Application is allowed and disposed.
[ MILIND N. JADHAV, J. ]
Ajay
Digitally signed
by AJAY
AJAY TRAMBAK
TRAMBAK UGALMUGALE
UGALMUGALE Date: 2026.09.12
14:36:34 +0530
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