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Synopsis

The Karnataka High Court has temporarily stayed the investigation in a First Information report (FIR) filed against Union Finance Minister Nirmala Sitharaman and others, accused of extorting money under the pretext of electoral bonds. The stay is in effect until the next hearing on October 22.

The ruling, delivered by Justice M Nagaprasanna, comes in response to a petition filed by Bharatiya Janata Party (BJP) member Naleen Kumar Kateel, challenging a criminal complaint lodged against him. The FIR also accuses BJP national president JP Nadda, BJP Karnataka president BY Vijayendra, senior leader Kateel, and officials from the Enforcement Directorate (ED), of pressuring companies into purchasing electoral bonds as a form of quid pro quo for favourable treatment. The FIR was registered by the city police last week, following the Bengaluru Additional Chief Judicial Magistrate’s decision to take cognizance of a private complaint. Activist Adarsh R Iyer, associated with the NGO Janaadhikaara Sangharsha Parishath, had filed the complaint, alleging the ruling party leaders of extortion and criminal conspiracy under Sections 384 (punishment for extortion), 120B (criminal conspiracy), read with Section 34 (acts done by several persons in furtherance of common intention) of the Indian Penal Code (IPC).

Senior Advocate K.G. Raghavan, representing Kateel, argued that there is no legal basis for the extortion charge. It was contended that the complaint is vague and does not meet the essential ingredients of extortion under Section 383 of the IPC, which requires the complainant to have been placed in fear and to have parted with property as a result of that fear. The petitioner maintained that neither the complainant nor any of the alleged victims were put under such fear, and the accusations were politically motivated.

On the other hand, Senior Advocate Prashant Bhushan, representing the complainant, argued that the case presented a “classic case of extortion.” The complainant alleged that the ED threatened companies with raids, forcing them to purchase electoral bonds in exchange for the cessation of punitive actions. It was further emphasised that although the complainant himself had not been extorted, the scheme’s structure and modus operandi clearly indicated extortion of corporate entities.

The court, after reviewing the arguments, noted that the essence of extortion, as defined under Section 383 of the IPC, requires that the victim be intentionally placed in fear of injury, leading them to deliver property or valuable security to the accused. The court observed : “If the offence is Section 384 (Punishment for extortion) of the IPC, he should necessarily be a victim who has suffered extortion from the hands of the accused. The case of the complainant is not that he has suffered.”

The court also clarified that the complainant's role as an activist did not meet the legal threshold to bring forward charges of extortion on behalf of corporate entities.

Conclusively, the court ruled that “Prima facie, the ingredients of Section 383 of the IPC are not met in the case at hand, for it to become an offence under Section 384 of the IPC. Therefore, permitting further investigation, into the aforesaid crime, would become an abuse of the process of the law.”

Accordingly, the court stayed the investigation until the respondents have filed their statement of objections, with the next hearing set for October 22, 2024.

 

Cause Title: Sri Naleen Kumar Kateel v The State of Karnataka [CRL.P/0010321/2024]