THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATIONversusT. GANGI REDDY @ YERRA GANGI REDDY

                         [2023] 1 S.C.R. 741                            741


        THE STATE THROUGH CENTRAL BUREAU OF                             A
                    INVESTIGATION
                                 v.
         T. GANGI REDDY @ YERRA GANGI REDDY
                  (Criminal Appeal No. 37 of 2023)                      B
                        JANUARY 16, 2023
          [M. R. SHAH AND C.T. RAVIKUMAR, JJ.]
       Code of Criminal Procedure, 1973 : s. 167(2) – Default bail
– Cancellation of, on merits – On facts, accused-respondent arrested
                                                                        C
in connection with the murder of a former MLA, released on default
bail u/s 167(2) – CBI concluded the investigation, filed chargesheet
and then filed for cancellation of bail of the respondent – However,
the High Court rejected the said petition on the ground that default
bail granted u/s. 167(2) cannot be cancelled on merits – On appeal,
held: Order of release on bail under proviso to s. 167(2) cannot be     D
called as an order on merits – Purpose of proviso to s.167(2) is to
press expeditious investigation within the prescribed time limit –
Accused is released on bail under proviso to s.167(2) on the failure
of the prosecuting agency –Mere filing of the chargesheet
subsequent to a person is released on default bail u/s. 167(2) cannot
                                                                        E
be a ground to cancel the bail of a person, who is released on
default bail – No absolute bar that once a person is released on
default bail u/s.167(2), his bail cannot be cancelled on merits – On
filing of the chargesheet on conclusion of the investigation, if a
strong case is made out and on merits, it is found that he has
committed a non-bailable offence/crime, on the special reasons/         F
grounds and considering ss. 437(5) and 439(2), over and above
other grounds on which the bail to a person, who is released on
bail can be cancelled on merits – Therefore, the courts are not
precluded from considering the application for cancellation of the
bail on merits –Order of the High Court set aside – ss. 174, 437(5),
                                                                        G
439(2) – Penal Code, 1860 – ss. 120-B, 201, 302, 506.
      Allowing the appeal, the Court
      HELD: 1.1 When an accused is released on default bail
under proviso to sub- section (2) of Section 167 Cr.P.C., he is
released on furnishing the bail bond by him on the failure of the       H
                               741
742            SUPREME COURT REPORTS                      [2023] 1 S.C.R.


A     investigating agency to complete the investigation and file the
      chargesheet within the stipulated time mentioned therein. The
      proviso to sub-section (2) of Section 167 fixes the outer limit
      within which the investigation must be completed and if the same
      is not completed within the period prescribed therein, the accused
      has a right to be released on bail if he is prepared to and does
B
      furnish bail. Considering proviso to Section 167(2) Cr.P.C., it
      cannot be disputed that a person released on bail (default bail) is
      deemed to be released under provisions of Chapter XXXIII of
      the Cr.P.C., which includes Section 437 and 439 also. The object
      and purpose of proviso to Section 167(2) Cr.P.C. is to impress
C     upon the need for expeditious investigation within the prescribed
      time limit and to prevent laxity in that behalf. The object is to
      inculcate a sense of its urgency and on default the Magistrate
      shall release the accused if he is ready and does furnish bail.
      Thus, it cannot be said that order of release on bail under proviso
      to Section 167(2) Cr.P.C. is an order on merits. An accused is
D
      released on bail under proviso to Section 167(2) Cr.P.C. on the
      failure of the prosecuting agency. Therefore, the deeming fiction
      under Section 167(2) Cr.P.C. cannot be interpreted to the length
      of converting the order of bail not on merits as if passed on merits
      . [Para 8.1][750-H; 751-A-E]
E            1.2. When special reasons/grounds are being made out from
      the chargesheet and the chargesheet reveals the commission of
      a non- bailable crime, the bail in favour of a person, who has
      been released on default bail under Section 167(2) Cr.P.C. can
      be cancelled considering Section 437(5) and Section 439(2)
F     Cr.P.C. The law, which emerges is that mere filing of the
      chargesheet subsequent to a person is released on default bail
      under Section 167(2) Cr.P.C. cannot be a ground to cancel the
      bail of a person, who is released on default bail. However, on
      filing of the chargesheet on conclusion of the investigation, if a
      strong case is made out and on merits, it is found that he has
G     committed a non-bailable offence/crime, on the special reasons/
      grounds and considering Section 437(5) and Section 439(2)
      Cr.P.C, over and above other grounds on which the bail to a
      person, who is released on bail can be cancelled on merits.
      Therefore, there is no absolute bar as held by the High Court in
H
  THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.             743
              GANGI REDDY @ YERRA GANGI REDDY


the impugned judgment and order that once a person is released        A
on default bail under Section 167(2) Cr.P.C., his bail cannot be
cancelled on merits and his bail can be cancelled on other general
grounds like tampering with the evidence/witnesses; not
cooperating with the investigating agency and/or not cooperating
with the concerned trial court etc. [Para 9.7, 10, 11][761-F; 762-
                                                                      B
G-H; 763-A-B]
      1.3 The impugned judgment and order passed by the High
Court dismissing the application for cancellation of the bail filed
by the C.B.I. under Section 439(2) Cr.P.C. is quashed and set
aside. [Para 13][763-H; 764-A]
                                                                      C
      1.4 As the High Court has not at all considered on merits
the application for cancellation of the bail, the matter is to be
remitted to the High Court for considering the said application
afresh in accordance with law and on merits and in light of the
observations made. As pursuant to the earlier judgment and order
passed by this Court dated 29.11.2022 in Writ Petition (Criminal)     D
No. 169 of 2022, the trial of the F.I.R. in the present case has
been ordered to be transferred to the C.B.I. Special Court,
Hyderabad, the proceedings of the cancellation of the bail
application, which was earlier filed before the High Court of
Andhra Pradesh are ordered to be transferred to the High Court        E
of Telangana at Hyderabad and now the High Court of Telangana
to consider, decide and dispose of the application for cancellation
of the bail on merits and in light of the observations made. [Para
14][764-D-F]
      Aslam Babalal Desai Vs. State of Maharashtra (1992)             F
      4 SCC 272 : [1992] 1 Suppl. SCR 545; Abdul Basit
      Alias Raju and Ors. Vs. Mohd. Abdul Kadir Chaudhary
      and Anr (2014) 10 SCC 754 : [2014] 10 SCR 571;
      Raghubir Singh and Ors. Vs. State of Bihar (1986) 4
      SCC 481 : [1986] 3 SCR 802 – relied on.
                                                                      G
      Mohamed Iqbal Madar Sheikh and Ors. Vs. State of
      Maharashtra (1996) 1 SCC 722 : [1996] 1 SCR 183,
      Rajnikant Jivanlal and Anr. Vs. Intelligence Officer,
      NCB, New Delhi, (1989) 3 SCC 532 : [1989] 3 SCR
      377, Rakesh Kumar Paul v. State of Assam, (2017) 15
      SCC 67 : [2017] 8 SCR 785 – referred to.                        H
744             SUPREME COURT REPORTS                            [2023] 1 S.C.R.


A                              Case Law Reference
      [1992] 1 Suppl. SCR 545            relied on         Para 5.4
      [2014] 10 SCR 571                  relied on         Para 5.7
      [1996] 1 SCR 183                   referred to       Para 6.3
B     [2017] 8 SCR 785                   referred to       Para 7
      [1986] 3 SCR 802                   relied on         Para 9.8
      [1989] 3 SCR 377                   referred to       Para 9.9
           CRIMINAL APPELLATE JURISDICTION : Criminal Appeal
C     No.37 of 2023.
            From the Judgment and Order dated 16.03.2022 of the High Court
      of Andhra Pradesh at Amaravati in Criminal Petition No.788 of 2022.
           K.M. Nataraj, ASG, Ms. Jyoti Zongluju, Sharath Nambiar, Vinayak
      Sharma, Praneet Pranav, T.S. Sabarish, Nakul Chengappa K. K., Arvind
D     Kumar Sharma, Advs. for the Appellant.
           B. Adinarayana Rao, Siddhartha Dave, Sr. Advs., Sumanth
      Nookala, Ms. Jesal Wahi, Ms. Vidhi Thaker, Advs. for the Respondent.
            The Judgment of the Court was delivered by
E           M. R. SHAH, J.
             1. Feeling aggrieved and dissatisfied with the impugned judgment
      and order dated 16.03.2022 passed by the High Court of Andhra Pradesh
      at Amravati in Criminal Petition No. 788 of 2022 by which the High
      Court has dismissed the said petition preferred by the appellant – Central
F     Bureau of Investigation (C.B.I.) filed under Section 439(2) of the Code
      of Criminal Procedure (Cr.P.C.), to cancel the bail that was granted to
      the respondent herein – original Accused No. 1 and wherein the High
      Court has held that once the respondent No. 1 – Accused No. 1 was
      released on default bail under Section 167(2) Cr.P.C., thereafter it is not
      permissible to consider the case for cancellation of bail on merits, the
G     Investigating Agency – C.B.I. has preferred the present appeal.
             2. While considering the issue involved in the present appeal,
      namely, whether in a case where the accused is released on default bail
      thereafter, cancellation of the bail application can be considered on merits,
      the chronological dates and events are required to be referred to, which
H     are as under:-
  THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                     745
       GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


       2.1 The deceased Shri Y.S. Vivekananda Reddy, a former M.L.A.;         A
former Member of Lok Sabha; former Member of A.P. Legislative
Council; and holding other posts was found dead in his house on
15.03.2019. Initially a case under Section 174 Cr.P.C. was registered by
the local police, i.e., Police Station, Pulivendula in Crime No.84 of 2019.
Subsequently, a case under Section 302 read with Section 120-B of the
                                                                              B
Indian Penal Code (I.P.C.) was registered. Special Investigation Team
(S.I.T.) was constituted by the State. The S.I.T. took over the
investigation. During the course of investigation, the concerned State
Police Agency arrested the respondent herein – original Accused No. 1
(A-1) on 28.03.2019 and he was remanded to judicial custody. The
statutory period of 90 days lapsed on 26.06.2019. On the very next day        C
of lapsing of 90 days, respondent herein – original Accused No. 1 filed a
bail application for default bail under Section 167(2) of the Cr.P.C. The
respondent herein was allowed the default bail by the learned JMFC,
Pulivendula on 27.06.2019. The respondent herein – original accused
No. 1 was released on bail as per the said order.
                                                                              D
        2.2 That subsequently and pursuant to the order passed by the
High Court dated 11.03.2020 passed in Writ Petition No. 3144 of 2019
and Writ Petition No. 1639 of 2020, investigation in the above crime was
entrusted to the appellant – C.B.I. The C.B.I. then took up the
investigation in the said case. The C.B.I. filed the F.I.R. No. RC-04(S)/
2020/SC-II/ND on 09.07.2020. The investigation revealed that a                E
conspiracy was hatched up by A-1 to A-4 along with some other persons
to kill the deceased and there were some influenced persons behind the
said conspiracy.
       2.3 The C.B.I. filed the initial / first chargesheet on 26.10.2021
and named A1 to A4. That thereafter the CBI filed an application before       F
the Special Court under Section 439(2) Cr.P.C. for cancelation of the
bail granted to the respondents, which came to be dismissed by the learned
Trial Court vide order dated 30.11.2021.
       2.4 That thereafter the C.B.I. filed a supplementary chargesheet
against the accused D. Siva Shankar Reddy (A-5) under Sections 201            G
and 120-B read with 302 & 201 I.P.C. and also against the respondent
herein – original Accused No. 1 under Sections 201, 506 and 120-B read
with 201 I.P.C. That thereafter the C.B.I. conducted the further
investigation and continued the investigation and recorded the statement
of approver A-4. That thereafter the C.B.I. filed the Criminal Petition       H
746             SUPREME COURT REPORTS                            [2023] 1 S.C.R.


A     No. 788 of 2022 before the High Court under Section 439(2) Cr.P.C. for
      cancellation of bail granted to the respondent herein – Accused No. 1.
             2.5 By the impugned judgment and order, the High Court has
      rejected the said petition mainly on the ground that once the respondent
      No. 1 – original Accused No. 1 was released on default bail under Section
B     167(2) Cr.P.C., thereafter, the bail cannot be cancelled on merits.
            2.6 Feeling aggrieved and dissatisfied with the impugned judgment
      and order passed by the High Court refusing to cancel the bail under
      Section 439(2) Cr.P.C., the C.B.I. has preferred the present appeal.
             3. At this stage, it is required to be noted that in the meantime, the
C     daughter and wife of the deceased filed a writ petition under Article 32
      of the Constitution of India before this Court seeking transfer of the trial
      arising out of the present F.I.R. from C.B.I. Special Court, Kadapa,
      Andhra Pradesh to C.B.I. Special Court, Hyderabad or C.B.I. Special
      Court, New Delhi and also to direct the C.B.I. for duly completing the
D     investigation in the aforesaid F.I.R. in the time bound manner. By a
      detailed judgment and order dated 29.11.2022, this Court has allowed
      the said writ petition on the allegations of tampering with the evidence
      and the witnesses and even pressurizing the C.B.I. Officers by filing
      false complaints against them.

E           4. Therefore, the short question which is posed for the
      consideration of this Court is:-
                   Whether after an accused is released on default bail under
            Section 167(2) Cr.P.C., under which circumstances, his bail can
            be cancelled and whether bail can be cancelled on merits having
F           found committed non-bailable crime on conclusion of the
            investigation and filing the chargesheet?
             5. Shri K.M. Nataraj, learned ASG appearing on behalf of the
      C.B.I. has vehemently submitted that as such release of an accused on
      default bail under Section 167(2) Cr.P.C., cannot be said to be releasing
      the accused on merits. It is submitted that an accused is released on
G
      default bail under Section 167(2) Cr.P.C. on failure of the investigating
      agency to conclude the investigation within the time stipulated under the
      Cr.P.C. It is submitted that therefore, on filing of the chargesheet and
      curing the defects, it is always open for the Court to consider the
      application for cancellation of bail on merits on that basis and to consider
H     the seriousness of the offence.
   THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                       747
        GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


        5.1 It is vehemently submitted that Section 167(2) Cr.P.C. fixes         A
the outer limit within which the investigation has to be completed and if
the same is not completed within the period prescribed, the accused has
a right to be released on bail, if he is prepared to and does furnish bail. It
is submitted that as per clause (a)(ii) of sub-section (2) of Section 167,
he is deemed to be released under the provisions of Chapter XXXIII of
                                                                                 B
the Cr.P.C. It is submitted that Chapter XXXIII of the Cr.P.C. includes
Sections 437 and 439 whereunder the Court is empowered to cancel the
bail granted to an accused in terms of Section 437(5) and Section 439(2).
It is submitted that therefore, though the bail is granted under proviso to
sub-section (2) of Section 167 Cr.P.C., by virtue of deeming fiction, the
same can be cancelled by the Court in terms of Section 437(5) and                C
Section 439(2) Cr.P.C.
       5.2 It is submitted that the purpose of the proviso to Section 167(2)
is to impress upon the need for expeditious investigation within the
prescribed time limit and to prevent laxity in that behalf. The object is to
inculcate a sense of its urgency and on default the Magistrate shall release     D
the accused if he is ready and does furnish bail. It is submitted that
therefore, an order for release on bail under proviso to Section 167(2)
Cr.P.C. is not an order on merits but an order on default of the prosecuting
agency. It is submitted that the deeming fiction under the proviso to
Section 167(2) cannot be interpreted to go to the length of converting an
order of bail not on merit as if passed on merit. It is submitted that           E
therefore, such an order could be nullified for special reasons after the
defect/default has been cured, i.e., after filing of the chargesheet. It is
submitted that therefore, since the bail was granted due to default of the
investigating agency and without the Court adverting to the merits of the
case, the merits brought about in the chargesheet and attending                  F
circumstance would be relevant.
       5.3 It is further submitted that in the present case the bail was
granted to the respondent herein under proviso to Section 167(2) on the
default of the State Police in completing the investigation within the
prescribed limit and the lackadaisical approach of the State Police was          G
also the reason for transfer of the investigation to the appellant – C.B.I.
      5.4 Shri K.M. Nataraj, learned ASG appearing on behalf of the
appellant – C.B.I. has vehemently relied upon the Three Judge Bench
decision of this Court in the case of Aslam Babalal Desai Vs. State of
Maharashtra, (1992) 4 SCC 272 in support of his submission that as               H
748            SUPREME COURT REPORTS                           [2023] 1 S.C.R.


A     observed and held by this Court on the special grounds being made out
      that the accused has committed very serious offences; committed non-
      bailable crimes and he deserves to be in custody, even in a case where
      the accused is released on default bail under Section 167(2) Cr.P.C., his
      bail can be cancelled. Heavy reliance is placed on the observations made
      by Justice A.M. Ahmadi (as he then was) in paragraph 14. He has also
B
      taken us to the observations made by Justice M.M. Punchhi (as he then
      was) in paragraphs 23 and 28 (though dissenting view but concurring
      with the observations with respect to Section 167(2) Cr.P.C.). He has
      also taken us to the observations made by the then Justice K. Ramaswamy
      (concurring view made in paragraphs 39 and 40). Relying upon the above
C     observations made in the aforesaid paragraphs by the respective Hon’ble
      Judges, it is submitted that as observed and held by this Court, grant of
      default bail under the proviso to sub-section (2) of Section 167 Cr.P.C. is
      deemed to be released in terms of Chapter XXXIII of the Cr.P.C. and,
      therefore, the default bail, once granted, can be cancelled by the Court
      for the reasons germane to the cancellation of bail under Section 437(5)
D
      or Section 439(2) of the Cr.P.C.
             5.5 Relying upon the above decision and the observations made
      therein, it is submitted that since the bail was granted due to default of
      the investigating agency and without the Court adverting to the merits of
      the case, the merits brought about in the chargesheet and attending
E     circumstance would be relevant.
              5.6 Shri K.M. Nataraj, learned ASG has further submitted that in
      the present case, even the case is made out under Section 439(2) Cr.P.C.
      to cancel the bail in view of the changed circumstances and the
      observations made by this Court in the subsequent order passed in the
F     Writ Petition (Criminal) No. 169 of 2022) by which this Court transferred
      the trial from the C.B.I. Special Court, Kadapa, Andhra Pradesh to the
      C.B.I. Special Court, Hyderabad. It is submitted that this Hon’ble Court
      has transferred the trial on the ground that the witnesses are being
      threatened and/or influenced and there is no possibility of having fair
G     trial if the same is conducted in the State of Andhra Pradesh. However,
      as the High Court has not at all considered anything on merits, we do not
      propose to go into the said aspect at this stage and opine anything on the
      aforesaid.
            5.7 Shri Nataraj, learned ASG has also heavily relied upon the
H     subsequent decision of this Court in the case of Abdul Basit Alias
  THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                     749
       GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


Raju and Ors. Vs. Mohd. Abdul Kadir Chaudhary and Anr., (2014)                A
10 SCC 754 (paragraphs 13 and 14) in support of his submission that
the bail granted under Section 167(2) Cr.P.C. can be cancelled on an
application by the prosecuting agency.
      5.8 Making above submissions, it is prayed to allow the present
appeal and cancel the bail granted in favour of the respondent herein –       B
original Accused No. 1 on merits considering the chargesheet and
considering the seriousness of the offences alleged to have been
committed by the accused and considering the gravity of the offences.
      5.9 Learned ASG appearing on behalf of the C.B.I. has also tried
to submit on merits as well as on the post-bail conduct of the respondent     C
herein – Accused No. 1. However, as the High Court has not at all
considered the aforesaid aspects, we do not propose to enter into the
merits and/or post-bail conduct of the respondent /accused at this stage.
      6. Present appeal is vehemently opposed by Shri B. Adinarayana
Rao, learned Senior Advocate appearing on behalf of the respondent.           D
       6.1 It is vehemently submitted by the learned senior counsel
appearing on behalf of the respondent – original Accused No. 1 that as
per the settled position of law, mere subsequent filing of the chargesheet
cannot be a ground to cancel the bail granted to the respondent under
Section 167(2) Cr.P.C. It is submitted that therefore in the present case,    E
the High Court has rightly refused to cancel the default bail/bail on
subsequent filing of the chargesheet by the C.B.I. It is further submitted
that as such in the present case the respondent – original Accused No.
1 was chargesheeted by the State Police Agency / S.I.T. much prior to
the C.B.I. was entrusted with the investigation.
                                                                              F
       6.2 It is submitted that even thereafter and after the C.B.I. took
over the investigation and filed the chargesheet, the C.B.I. then filed the
application before the learned Trial Court for cancellation of the bail
under Section 439(2), which came to be dismissed by the Trial Court. It
is submitted that therefore, mere subsequent filing of the chargesheet
cannot be a ground to cancel the bail granted in favour of the respondent     G
– original Accused No. 1, once he was released on default bail on non-
conclusion of the investigation and non-filing of the chargesheet within
the stipulated time.
      6.3 It is submitted that as per the catena of decisions of this Court
as such to release the accused on bail on non-filing of the chargesheet       H
750             SUPREME COURT REPORTS                            [2023] 1 S.C.R.


A     within the stipulated time as mentioned under Section 167(2) Cr.P.C. is
      an indefeasible right accrued in favour of the accused. It is submitted
      that once in exercise of such right available when the accused is released
      on bail under Section 167(2) Cr.P.C., the same cannot be taken away
      and/or cancelled on subsequent filing of the chargesheet. Learned senior
      counsel appearing on behalf of the respondent – original Accused No. 1
B
      has heavily relied upon the decision of this Court in the case of Mohamed
      Iqbal Madar Sheikh and Ors. Vs. State of Maharashtra, (1996) 1
      SCC 722 (paragraph 10).
            6.4 Making above submissions and relying upon the decisions in
      the case of Mohamed Iqbal Madar Sheikh and Ors. (supra), it is
C     prayed to dismiss the present appeal.
              7. Shri Siddhartha Dave, learned Senior Advocate appearing on
      behalf of the proposed impleader –daughter of the deceased has
      supported Shri Nataraj, learned ASG and has submitted that looking to
      the seriousness of the charges alleged against the respondent herein –
D     original Accused No. 1 and that looking to the gravity of the offence and
      in view of the post-bail conduct of the accused after he was released on
      bail, considered by this Court while deciding Writ Petition (Criminal) No.
      169 of 2022, it is prayed to cancel the bail granted in favour of the
      respondent herein – original Accused No. 1. He has also relied upon the
E     decision of this Court in the case of Rakesh Kumar Paul Vs. State of
      Assam, (2017) 15 SCC 67 (paragraphs 15 and 49) by submitting that
      as observed by this Court in the said decision, in case the accused is
      released on default bail, it does not prohibit or otherwise prevent the
      arrest or re-arrest of the accused on cogent grounds in respect of the
      subject charge and upon arrest or re-arrest, the accused is entitled to
F     petition for grant of regular bail which application should be considered
      on its own merit.
             8. Having heard the learned counsel appearing for the respective
      parties, the short question, which is posed for the consideration of this
      Court is whether the bail granted under the proviso to sub-section (2) of
G     Section 167 Cr.P.C. for failure to complete the investigation within the
      period prescribed therein can be cancelled after the presentation of a
      chargesheet and if the said question is answered in affirmative, then, on
      what grounds and circumstances, the bail can be cancelled?
            8.1 At the outset, it is required to be noted and it cannot be disputed
H     that when an accused is released on default bail under proviso to sub-
  THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                       751
       GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


section (2) of Section 167 Cr.P.C., he is released on furnishing the bail       A
bond by him on the failure of the investigating agency to complete the
investigation and file the chargesheet within the stipulated time mentioned
therein. The proviso to sub-section (2) of Section 167 fixes the outer
limit within which the investigation must be completed and if the same is
not completed within the period prescribed therein, the accused has a
                                                                                B
right to be released on bail if he is prepared to and does furnish bail.
Considering proviso to Section 167(2) Cr.P.C., it cannot be disputed that
a person released on bail (default bail) is deemed to be released under
provisions of Chapter XXXIII of the Cr.P.C., which includes Section
437 and 439 also. The object and purpose of proviso to Section 167(2)
Cr.P.C. is to impress upon the need for expeditious investigation within        C
the prescribed time limit and to prevent laxity in that behalf. The object
is to inculcate a sense of its urgency and on default the Magistrate shall
release the accused if he is ready and does furnish bail. Thus, it cannot
be said that order of release on bail under proviso to Section 167(2)
Cr.P.C. is an order on merits. An accused is released on bail under
                                                                                D
proviso to Section 167(2) Cr.P.C. on the failure of the prosecuting agency.
Therefore, the deeming fiction under Section 167(2) Cr.P.C. cannot be
interpreted to the length of converting the order of bail not on merits as
if passed on merits. Keeping in view the above, the issue involved in the
present appeal is required to be considered.
       9. While considering the issue involved, some observations made          E
by this Court in the case of Aslam Babalal Desai (supra) and Abdul
Basit Alias Raju and Ors. (supra) are required to be referred to.
Speaking for the Bench, Justice A.M. Ahmadi (as he then was) has
observed in paragraphs 14 and 15 as under:-
             “14. We sum up as under:                                           F

              The provisions of the Code, in particular Sections 57 and
      167, manifest the legislative anxiety that once a persons’s liberty
      has been interfered with by the police arresting him without a
      court’s order or a warrant, the investigation must be carried out
      with utmost urgency and completed within the maximum period               G
      allowed by the proviso (a) to Section 167(2) of the Code. It must
      be realised that the said proviso was introduced in the Code by
      way of enlargement of time for which the arrested accused could
      be kept in custody. Therefore, the prosecuting agency must realise
      that if it fails to show a sense of urgency in the investigation of the   H
752      SUPREME COURT REPORTS                            [2023] 1 S.C.R.


A     case and omits or defaults to file a charge-sheet within the time
      prescribed, the accused would be entitled to be released on bail
      and the order passed to that effect under Section 167(2) would be
      an order under Section 437(1) or (2) or Section 439(1) of the
      Code. Since Section 167 does not empower cancellation of the
      bail, the power to cancel the bail can only be traced to Section
B
      437(5) or Section 439(2) of the Code. The bail can then be
      cancelled on considerations which are valid for cancellation of
      bail granted under Section 437(1) or (2) or Section 439(1) of the
      Code. The fact that the bail was earlier rejected or that it was
      secured by the thrust of proviso (a) to Section 167(2) of the Code
C     then recedes in the background. Once the accused has been
      released on bail his liberty cannot be interfered with lightly i.e. on
      the ground that the prosecution has subsequently submitted a
      charge-sheet. Such a view would introduce a sense of complacency
      in the investigating agency and would destroy the very purpose of
      instilling a sense of urgency expected by Sections 57 and 167(2)
D
      of the Code. We are, therefore, of the view that once an accused
      is released on bail under Section 167(2) he cannot be taken back
      in custody merely on the filing of a charge- sheet but there must
      exist special reasons for so doing besides the fact that the charge-
      sheet reveals the commission of a non-bailable crime. The ratio
E     of Rajnikant case [(1989) 3 SCC 532] to the extent it is
      inconsistent herewith does not, with respect, state the law correctly.
              15. Even where two views are possible, this being a matter
      belonging to the field of criminal justice involving the liberty of an
      individual, the provision must be construed strictly in favour of
F     individual liberty since even the law expects early completion of
      the investigation. The delay in completion of the investigation can
      be on pain of the accused being released on bail. The prosecution
      cannot be allowed to trifle with individual liberty if it does not take
      its task seriously and does not complete it within the time allowed
      by law. It would also result in avoidable difficulty to the accused if
G     the latter is asked to secure a surety and a few days later be
      placed behind the bars at the sweet will of the prosecution on
      production of a charge-sheet. We are, therefore, of the view that
      unless there are strong grounds for cancellation of the bail, the
      bail once granted cannot be cancelled on mere production of the
H     charge- sheet. The view we are taking is consistent with this
  THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                     753
       GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


     Court’s view in the case of Bashir [(1977) 4 SCC 410] and                A
     Raghubir [(1986) 4 SCC 481] but if any ambiguity has arisen on
     account of certain observations in Rajnikant case [(1989) 3 SCC
     532] our endeavour is to clear the same and set the controversy
     at rest.”
     9.1 Justice K. Ramaswamy (as he then was) in his concurring              B
judgment has observed in paragraphs 39 and 40 as under:-
            “39. Undoubtedly, by operation of the proviso to Section
     167(2) of the Code, the accused is entitled to bail due to default
     by the investigating officer in completing the investigation and
     laying the charge-sheet within the prescribed period of 90/60 days       C
     and not on merits. The fiction of law under the proviso applying
     the provisions in Chapter XXXIII is to serve the purpose of law,
     namely not only the release of the accused on taking the requisite
     bond and conditions to be incorporated therein as envisaged in the
     said Chapter, but also the power of the court to cancel the bail
     and to take the accused into detention for the grounds mentioned         D
     under the relevant provisions in Sections 437(5) and 439(2) of the
     Code. The Legislature is aware of the pre-existing practice of not
     filing the charge-sheet within 15 days as envisaged under sub-
     section (2) of Section 167 of the old Code and the consequences
     as well. The doubtful procedure of seeking further detention on          E
     securing order of remand under Section 344 of the old Code and
     Section 309 of the present Code was to be put to an end to, while
     preserving the power to the court to cancel the bail, if circumstances
     warrant to take the accused into custody. At the earliest this Court
     in Matabar Parida case [(1975) 2 SCC 220] also took note of
     the fact that even under Section 167(2) proviso, it might not be         F
     possible to complete the investigation into grave crimes within the
     outer limit of the time set out in the proviso. In the light of the
     statutory animation to have the accused released from detention
     on expiry of 90/60 days if the accused shall be prepared to and
     does furnish bail, the consequences are inevitable and the release       G
     is a statutory paradise to the criminals not by judicial fiat but
     legislative mandate.
           40. The purpose of interpretation is to sustain the law. The
     court must interpret the words or the language in the statute to
     promote public good and misuse of power is interdicted. Criminal         H
754      SUPREME COURT REPORTS                            [2023] 1 S.C.R.


A     law primarily concerns social protection and prescribes rules of
      behaviour to be observed by all. Law punishes for deviance,
      transgression, violation or omission. Liberty of the individual and
      security and order in the society or public order are delicate and
      yet paramount considerations. Undue emphasis on either would
      impede harmony and hamper public good as well as disturb social
B
      weal and peace. To keep the weal balanced, must be the prime
      duty of the Judiciary. The purpose of the proviso to Section 167(2)
      read with Chapter XXXIII of the Code is to impress upon the
      need for expeditious completion of the investigation by the police
      officer within the prescribed limitation and to prevent laxity in that
C     behalf. On its default the Magistrate shall release the accused on
      bail if the accused is ready and does furnish the bail. At the same
      time during investigation or trial the power of the court to have
      the bail cancelled and have the accused taken into custody are
      preserved. But as interpreted by this Court on the happening of
      the catalyst act i.e. expiry of 90/60 days the hammer of release
D
      on default would fall. Later filing of the charge-sheet (challan) is
      not by itself relevant to have the bail cancelled on committing the
      accused for trial or taking cognizance of the offence. As
      emphasised by this Court in Bashir [(1977) 4 SCC 410] and
      Raghubir [(1986) 4 SCC 481] cases, on curing the defect by
E     filing the charge-sheet (challan) if the prosecution seeks to have
      the bail cancelled on the ground that there are reasonable grounds
      to believe that the accused has committed a non-bailable offence
      and that it is necessary to arrest and commit him into custody,
      prima facie at that stage, strong grounds indeed are necessary.
      For cancellation of the bail after filing of the charge-sheet the
F
      factum of dismissal of the bail on the earlier occasion is not
      relevant. But during investigation some strong prima facie evidence
      and gravity and magnitude of the crime or the manner in which
      the crime was committed and other attending circumstances may
      be relevant as prima facie grounds to have a fresh look to cancel
G     the bail. The grounds for cancellation of the bail in Chapter XXXIII
      are, dehors the merits in the matter, namely, necessity due to the
      conduct of the accused and abuse of liberty i.e. obstruction of the
      smooth investigation or suborning witnesses or attempting to tamper
      the evidence, threatening the witnesses with dire consequences
      or making or attempting to remove himself beyond the reach of
H
  THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                       755
       GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


      the court to hamper the smooth trial, etc. are independent of the         A
      merits in the matter. Cancellation of the bail would be necessitated
      by the conduct of the accused himself after the release. I agree
      with brother Punchhi, J. that it might be possible to abuse the
      proviso by deliberate delay in completing the investigation to
      facilitate the release of the accused on bail. I also agree that
                                                                                B
      merits brought out in the charge-sheet and attending circumstances
      are relevant, as the bail was granted due to default of the
      investigating officer without court’s adverting to the merits but
      strong grounds are necessary to cancel the bail. To that extent
      brother Ahmadi, J. also laid emphasis, namely, strong grounds are
      to be made out in the charge-sheet. With respect I agree with             C
      brother Ahmadi’s emphasis that filing the charge-sheet (challan)
      itself is not sufficient. However, I lay emphasis that the High Court
      or the Court of Sessions should consider the merits of the case.
      With respect, K.J. Shetty, J., laid emphasis on the subsequent
      filing of the charge-sheet and the power for cancellation under
                                                                                D
      Sections 437 and 439 of the Code. Unfortunately, the ratio in
      Parida [(1975) 2 SCC 220] and Bashir [(1977) 4 SCC 410] cases
      was not brought to the notice of the learned Judge, which was
      directly on the point and for the reasons stated I find it difficult to
      agree with the learned Judge in that respect. I am in full agreement
      with the view expressed by brother Ahmadi, J. and the order               E
      proposed by him.”
       9.2 In a concurring judgment, Justice K. Ramaswamy (as he then
was) has concurred with some of the observations made by Justice
M.M. Punchhi (as he then was) made in a dissenting judgment that it
might be possible to abuse the proviso to Section 167(2) Cr.P.C. by             F
deliberate delay in completing the investigation to facilitate the release
of the accused on bail. However, thereafter has agreed with the view
that the merits brought out in the chargesheet and attending circumstances
are relevant, as the bail was granted due to default of the investigating
officer without Court’s adverting to the merits but strong grounds are
necessary to cancel the bail and mere filing of the chargesheet itself is       G
not sufficient.
     9.3 Justice M.M. Punchhi (as he then was) in his dissenting
judgment has observed in paragraphs 23, 25, 26, 27 and 28 as under:-

                                                                                H
756      SUPREME COURT REPORTS                            [2023] 1 S.C.R.


A             “23. The mere circumstance that Section 167(2) ordains
      that every person released on bail under this sub- section shall be
      deemed to be so released under the provisions of Chapter XXXIII
      for the purposes of that Chapter does not ipso facto mean that the
      bail order assumes the content and character of bail orders on
      merit, of the kind conceived of in sub-sections (1) and (2) of Section
B
      437 or sub-section (1) of Section 439 of the Code. The deeming
      requirement of Section 167(2) puts the release on bail of such
      person as if under the provisions of Chapter XXXIII but only for
      the purposes of that Chapter. In other words, it means that by this
      fiction the provision is to be read as a part of Chapter XXXIII so
C     that it invites the purposes of that chapter such as filling of bonds,
      provision of sureties etc., as also permitting cancellation of bail. It
      is on the thrust of such inclusion that cancellation under Section
      437(5) can be attempted as if fictionally the bail order had been
      passed under sub-sections (1) and (2) of Section 437 but not on
      considerations as if the bail order was on merit. Fiction of this
D
      kind cannot be permitted to go to the length of converting an order
      of bail not on merit as if passed on merit.
                                  XXXXXXXX
              25. The emphasised words are reflective of the view that
E     the Court could at that stage after the challan is filed be of the
      opinion that there appear sufficient grounds for entertaining the
      view that the accused had committed a non-bailable offence and
      that it was necessary that he should be arrested and committed to
      custody. Besides the afore-mentioned ground for cancellation, a
      ground singularly sufficient and special to an order-on-default,
F     the Court may also arrest and commit to custody such person on
      other grounds judicially noted and others relevant; such as
      tampering of evidence etc. The later hinted grounds are those
      grounds which normally weigh with a Court while cancelling a
      merited bail under Section 437(5) when the bail in strictu sensu
G     has been granted on merit under sub- sections (1) and (2) of Section
      437. But a deemed bail under Chapter XXXIII, under the thrust
      of Section 167(2), as is discernible, appears to me on a different
      footing, permitting cancellation of bail not only on the well-known
      grounds for cancellation of bail but also on the special singular
      ground on the Court’s entertaining the view that there are sufficient
H
THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                   757
     GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


   grounds that the accused had committed a non-bailable offence          A
   and that it was necessary that he should be arrested and committed
   to custody. The seeming diversity in Bashir case [(1977) 4 SCC
   410] crops up only if it is understood that it takes a bail order
   under Section 167(2), as if an order on merit under sub-sections
   (1) and (2) of Section 437. But if the fiction, as it appears to me,
                                                                          B
   extends to the extent of the bail order being treated as if passed
   under Chapter XXXIII and that too under sub- sections (1) and
   (2) of Section 437 read with the provisions of Section 167(2) as
   part and parcel of that chapter so that the bail order remains an
   order passed on default and not on merit, the tangency disappears.
   And even if this aspect is ignored, Bashir case [(1977) 4 SCC          C
   410] goes on to add a singular and special ground for cancellation
   of bail granted under Section 167(2) over and above the other
   well-known grounds for cancellation of bail granted under sub-
   sections (1) and (2) of Section 437 of the Code. The provision
   employable in that event again is Section 437(5) of the Code,
                                                                          D
   notwithstanding the text of the provision, for besides that there is
   no other provision with the Court.
          26. The existence of such special ground for cancellation
   of bail, over and above the well-known grounds for cancellation
   of bail, granted under Section 167(2) of the Code was re-affirmed
   and repeated in a decision of this Court by a two-member Bench         E
   in Raghubir Singh v. State of Bihar [(1986) 4 SCC 481] at page
   826 by stating as follows: (SCC p. 502, para 22)
         “Where bail has been granted under the proviso to Section
         167(2) for the default of the prosecution in not completing
         the investigation in 60 days, after the defect is cured by the   F
         filing of a charge-sheet, the prosecution may seek to have
         the bail cancelled on the ground that there are reasonable
         grounds to believe that the accused has committed a non-
         bailable offence and that it is necessary to arrest him and
         commit him to custody. In the last mentioned case, one would     G
         expect very strong grounds indeed.”
          The strong grounds referred in the context obviously are
   grounds on merits of the case, which are reflective from the formal
   accusation put in the challan which the accused has to face at the
   trial.                                                                 H
758      SUPREME COURT REPORTS                           [2023] 1 S.C.R.


A           27. Raghubir Singh case [(1986) 4 SCC 481] was followed
      by a decision of a vacation Judge of this Court in Rajnikant
      Jivanlal Patel v. Intelligence Officer, NCB, New Delhi [(1989)
      3 SCC 532]. It was observed at page 536 as follows: (SCC p.
      536, paras 13 and 14)
B           “An order for release on bail under proviso (a) to Section
            167(2) may appropriately be termed as an order-on-
            default. Indeed, it is a release on bail on the default of the
            prosecution in filing charge-sheet within the prescribed
            period. The right to bail under Section 167(2) proviso (a)
            thereto is absolute. It is a legislative command and not court’s
C           discretion. If the investigating agency fails to file charge-
            sheet before the expiry of 90/60 days, as the case may be,
            the accused in custody should be released on bail. But at
            that stage, merits of the case are not to be examined.
            Not at all. In fact, the Magistrate has no power to remand
D           a person beyond the stipulated period of 90/60 days. He
            must pass an order of bail and communicate the same to
            the accused to furnish the requisite bail bonds.
            The accused cannot, therefore, claim any special right
            to remain on bail. If the investigation reveals that the
E           accused has committed a serious offence and charge-
            sheet is filed, the bail granted under proviso (a) to
            Section 167(2) could be cancelled.”
                                                      (emphasis supplied)
             28. On analysis of the case law above discussed I have
F     rather come to the conclusion that a compulsive bail order made
      by a court under Section 167(2) of the Code being one not on
      merit, when required to be cancelled after the filing of the challan,
      would not involve any review of a decision made on merit. Such
      bail is cancellable if the court has reason to entertain the belief
G     that the accused has committed a non-bailable offence and that it
      is necessary to arrest him and commit him to custody. The
      occasion to grant or refuse bail on merit becomes available to the
      court after the filing of the challan because earlier thereto merit
      of bail could not figure at the time of the grant of compulsive bail.
      The goal of the court in any event is to strike a judicial balance
H
  THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                       759
       GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


      depending on the exigencies of the situation keeping in view              A
      amongst others the claims of personal liberty and the larger interests
      of the State. It cannot be overlooked that a bail order under Section
      167(2) of the Code could even be managed through a convenient
      investigating officer, however heinous be the crime. The court
      would have to grant bail under the mandate of law, debarred as it
                                                                                B
      is to see to the merits of the case at that stage. To say that
      thenceforth the court is for ever shut to see to the merits of the
      case, though it otherwise has power to cancel bail, is to deprive it
      of its elementary function to administer justice and weigh the claims
      on merit inter se. I would rather loathe for such an interpretation
      as that would frustrate justice, and would on the other hand let the      C
      court have the power to cancel bail, for once examining the merits
      of the case in such a situation.”
       Therefore, as such, even Justice Punchhi, had concurred with the
other Hon’ble Judges taking the view that every person released on bail
under sub-section (2) of Section 167 Cr.P.C. shall be deemed to be so           D
released under the provisions of Chapter XXXIII for the purposes of
that Chapter and does not ipso facto mean that the bail order assumes
the content and character of bail orders on merit, of the kind conceived
of in sub-sections (1) and (2) of Section 437 or sub-section (1) of Section
439 of Cr.P.C.
                                                                                E
      9.4     Thus, as per the law laid down by this Court in the case of
              Aslam Babalal Desai (supra), (i) release of accused on
              default bail under Section 167(2) Cr.P.C. is not on merits,
              but on the failure of the investigating agency in completing
              the investigation and filing the chargesheet within the
              stipulated time prescribed therein;                               F

      (ii)    That every person released on bail under Section 167 (2)
              Cr.P.C. shall be deemed to be so released under the
              provisions of Chapter XXXIII Cr.P.C., which includes
              Sections 437(5) and 439(2);
                                                                                G
      (iii)   That the bail in favour of a person, who is released on default
              bail under Section 167(2) Cr.P.C. cannot be cancelled on
              mere filing of the chargesheet, but can be cancelled on
              making out a special and strong ground that commission of
              non-bailable crime is disclosed from the chargesheet.
                                                                                H
760            SUPREME COURT REPORTS                              [2023] 1 S.C.R.


A            9.5 In the case of Abdul Basit Alias Raju and Ors. (supra)
      after considering the decision of this Court in the case of Aslam Babalal
      Desai (supra), it is observed and held in paragraphs 13 and 14 as under:-
                    “13. It is trite that Section 167(2) creates a deeming fiction
            whereby the release of a person is equated to his release under
B           Chapter XXXIII of the Code. However, an order for release on
            bail under proviso (a) to Section 167(2) is not an order on merits
            but an order-on-default of the prosecuting agency. Such an order
            could be nullified for special reasons after the defect/default has
            been cured. The accused cannot, therefore, claim any special
            right to remain on bail. If the investigation reveals that the accused
C           has committed a serious offence and charge-sheet is filed, the
            bail granted under proviso (a) to Section 167(2) could be cancelled
            on an application by the prosecuting agency.
                    14. Under Chapter XXXIII, Section 439(1) empowers the
            High Court as well as the Court of Session to direct any accused
D           person to be released on bail. Section 439(2) empowers the High
            Court to direct any person who has been released on bail under
            Chapter XXXIII of the Code be arrested and committed to custody
            i.e. the power to cancel the bail granted to an accused person.
            Generally the grounds for cancellation of bail, broadly, are, (i) the
E           accused misuses his liberty by indulging in similar criminal activity,
            (ii) interferes with the course of investigation, (iii) attempts to
            tamper with evidence or witnesses, (iv) threatens witnesses or
            indulges in similar activities which would hamper smooth
            investigation, (v) there is likelihood of his fleeing to another country,
            (vi) attempts to make himself scarce by going underground or
F           becoming unavailable to the investigating agency, (vii) attempts
            to place himself beyond the reach of his surety, etc. These grounds
            are illustrative and not exhaustive. Where bail has been granted
            under the proviso to Section 167(2) for the default of the prosecution
            in not completing the investigation in sixty days after the defect is
G           cured by the filing of a charge-sheet, the prosecution may seek to
            have the bail cancelled on the ground that there are reasonable
            grounds to believe that the accused has committed a non- bailable
            offence and that it is necessary to arrest him and commit him to
            custody. However, in the last mentioned case, one would expect
            very strong grounds indeed. (Raghubir Singh v. State of Bihar
H           [(1986) 4 SCC 481.)”
  THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                      761
       GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


        9.6 Now, so far as the reliance placed upon the decision of this       A
Court in the case of Mohamed Iqbal Madar Sheikh and Ors. (supra)
relied upon by the learned senior counsel appearing on behalf of the
respondent – original Accused No. 1 is concerned, at the outset, it is
required to be noted that in the said decision, this Court has not taken a
contrary view than the view taken in the case of Aslam Babalal Desai
                                                                               B
(supra). In the case of Mohamed Iqbal Madar Sheikh and Ors.
(supra), it was a case of refusing to release the accused on default bail.
While releasing the accused on default bail, thereafter, this Court observed
that if the accused is released on bail because of the default in completion
of the investigation, then, no sooner the chargesheet is filed, the order
granting bail to such accused cannot be cancelled. However, thereafter,        C
it is observed in paragraph 10 that the bail of such accused who has
been released, because of the default on the part of the investigating
officer to complete the investigation, can be cancelled, but not, only on
the ground that after the release, the chargesheet has been submitted
against such accused for an offence. Thereafter, it is further observed
                                                                               D
that for cancelling the bail, the well-settled principles in respect of
cancellation of bail have to be made out as observed by this Court in the
case of Aslam Babalal Desai (supra). Therefore, as such the
observations made by this Court in the case of Mohamed Iqbal Madar
Sheikh and Ors. (supra) even supports the case on behalf of the C.B.I.
that the order granting bail shall be deemed to be under Section 437(1)        E
or (2) or Section 439(1) of the Cr.P.C. and that order can be cancelled
when a case for cancellation is made out under Section 437(5) or 439(2)
Cr.P.C.
      9.7 Thus, when special reasons/grounds are being made out from
the chargesheet and the chargesheet reveals the commission of a non-           F
bailable crime, the bail in favour of a person, who has been released on
default bail under Section 167(2) Cr.P.C. can be cancelled considering
Section 437(5) and Section 439(2) Cr.P.C.
       9.8 What can be said to be special grounds for cancellation of the
bail, over and above the well-known grounds for cancellation of the bail       G
granted under Section 167(2) Cr.P.C. has been considered by this Court
in the case of Raghubir Singh and Ors. Vs. State of Bihar, (1986) 4
SCC 481. In paragraph 22, it is observed and held as under:-
             “22. ……………………..Where bail has been granted
      under the proviso to Section 167(2) for the default of the prosecution   H
762             SUPREME COURT REPORTS                           [2023] 1 S.C.R.


A           in not completing the investigation in 60 days, after the defect is
            cured by the filing of a charge-sheet, the prosecution may seek to
            have the bail cancelled on the ground that there are reasonable
            grounds to believe that the accused has committed a non-bailable
            offence and that it is necessary to arrest him and commit him to
            custody. In the last mentioned case, one would expect very strong
B
            grounds indeed.”
            9.9 The decision of Raghubir Singh and Ors. (supra) has been
      followed by this Court in Rajnikant Jivanlal and Anr. Vs. Intelligence
      Officer, NCB, New Delhi, (1989) 3 SCC 532, wherein in paragraphs
      13 and 14, it is observed and held as under:-
C
            “13. An order for release on bail under proviso (a) to Section
            167(2) may appropriately be termed as an order- on-default.
            Indeed, it is a release on bail on the default of the prosecution in
            filing charge-sheet within the prescribed period. The right to bail
            under Section 167(2) proviso (a) thereto is absolute. It is a
D           legislative command and not court’s discretion. If the investigating
            agency fails to file charge-sheet before the expiry of 90/60 days,
            as the case may be, the accused in custody should be released on
            bail. But at that stage, merits of the case are not to be examined.
            Not at all. In fact, the Magistrate has no power to remand a person
E           beyond the stipulated period of 90/60 days. He must pass an order
            of bail and communicate the same to the accused to furnish the
            requisite bail bonds.
            14. The accused cannot, therefore, claim any special right to
            remain on bail. If the investigation reveals that the accused
F           has committed a serious offence and charge- sheet is filed,
            the bail granted under proviso (a) to Section 167(2) could be
            cancelled.”
                                                            (emphasis supplied)
              10. From the above, the law, which emerges is that mere filing of
G     the chargesheet subsequent to a person is released on default bail under
      Section 167(2) Cr.P.C. cannot be a ground to cancel the bail of a person,
      who is released on default bail. However, on filing of the chargesheet on
      conclusion of the investigation, if a strong case is made out and on merits,
      it is found that he has committed a non-bailable offence/crime, on the
      special reasons/grounds and considering Section 437(5) and Section
H
   THE STATE THROUGH CENTRAL BUREAU OF INVESTIGATION V. T.                      763
        GANGI REDDY @ YERRA GANGI REDDY [M. R. SHAH, J.]


439(2) Cr.P.C, over and above other grounds on which the bail to a              A
person, who is released on bail can be cancelled on merits.
       11. Therefore, there is no absolute bar as observed and held by
the High Court in the impugned judgment and order that once a person is
released on default bail under Section 167(2) Cr.P.C., his bail cannot be
cancelled on merits and his bail can be cancelled on other general grounds      B
like tampering with the evidence/witnesses; not cooperating with the
investigating agency and/or not cooperating with the concerned Trial
Court etc.
        12. As such, we are in complete agreement with the view taken
by this Court in the aforesaid decisions. The submission on behalf of the       C
respondent – original Accused No. 1 and the view taken by the High
Court in the impugned judgment and order that once an accused is released
on default bail under Section 167(2) Cr.P.C., his bail cannot be cancelled
on merits is accepted, in that case, it will be giving a premium to the
lethargic and/or negligence, may be in a given case of deliberate attempt
on the part of the investigating agency not to file the chargesheet within      D
the prescribed time period. In a given case, even if the accused has
committed a very serious offence, may be under the NDPS or even
committed murder(s), still however, he manages through a convenient
investigating officer and he manages not to file the chargesheet within
the prescribed time limit mentioned under Section 167(2) Cr.P.C. and            E
got released on default bail, it may lead to giving a premium to illegality
and/or dishonesty. As observed hereinabove, such release of the accused
on default bail is not on merits at all, and is on the eventuality occurring
in proviso to sub-section (2) of Section 167. However, subsequently on
curing the defects and filing the chargesheet, though a strong case is
made out that an accused has committed the very serious offence and             F
non-bailable crime, the Court cannot cancel the bail and commit the
person into custody and not to consider the gravity of the offence
committed by the accused, the Courts will be loathe for such an
interpretation, as that would frustrate the justice. The Courts have the
power to cancel the bail and to examine the merits of the case in a case        G
where the accused is released on default bail and released not on merits
earlier. Such an interpretation would be in furtherance to the administration
of justice.
        13. In view of the above and for the reasons stated above, the
impugned judgment and order passed by the High Court dismissing the
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764              SUPREME COURT REPORTS                           [2023] 1 S.C.R.


A     application for cancellation of the bail filed by the C.B.I. under Section
      439(2) Cr.P.C. deserves to be quashed and set aside and is accordingly
      quashed and set aside.
             The issue involved in the present appeal is answered in the
      affirmative and it is observed and held that in a case where an accused
B     is released on default bail under Section 167(2) Cr.P.C., and thereafter
      on filing of the chargesheet, a strong case is made out and on special
      reasons being made out from the chargesheet that the accused has
      committed a non-bailable crime and considering the grounds set out in
      Sections 437(5) and Section 439(2), his bail can be cancelled on merits
      and the Courts are not precluded from considering the application for
C     cancelation of the bail on merits. However, mere filing of the chargesheet
      is not enough, but as observed and held hereinabove, on the basis of the
      chargesheet, a strong case is to be made out that the accused has
      committed non-bailable crime and he deserves to be in custody.
             14. As the High Court has not at all considered on merits the
D     application for cancellation of the bail, the matter is to be remitted to the
      High Court for considering the said application afresh in accordance
      with law and on merits and in light of the observations made hereinabove.
      As pursuant to the earlier judgment and order passed by this Court dated
      29.11.2022 in Writ Petition (Criminal) No. 169 of 2022, the trial of the
      F.I.R. in the present case has been ordered to be transferred to the
E     C.B.I. Special Court, Hyderabad, the proceedings of the cancellation of
      the bail application, which was earlier filed before the High Court of
      Andhra Pradesh at Amravati are ordered to be transferred to the High
      Court of Telangana at Hyderabad and now the High Court of Telangana
      to consider, decide and dispose of the application for cancellation of the
F     bail on merits and in light of the observations made hereinabove.
             Present appeal is allowed accordingly to the aforesaid extent.

      Nidhi Jain                                                     Appeal allowed.
      (Assisted by : Abhishek Pratap Singh, LCRA)

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