Issue

The issue involved concerned the power of the High Court or Sessions Court to grant an interim order of stay of operation of an order granting bail till the disposal of the application for cancellation of bail under sub-Section (2) of Section 439 of the CrPC, and the corresponding provision under sub-Section (3) of Section 483 of the BNSS.

Background

The appellant was arrested on 20th January 2023 in connection with a PMLA matter, despite not being named as an accused in the FIR, the ECIR, or the first complaint. On 17th June 2023, the Special Court granted regular bail after recording a finding that the appellant satisfied the twin conditions under Section 45(1)(ii) of the PMLA. On 21st June 2023, the Directorate of Enforcement applied under Section 439(2) of the CrPC before the Delhi High Court. On 23rd June 2023, the Hon’ble High Court of Delhi stayed the order granting bail ex-parte, without hearing the advocate for the accused and without recording any reasons. This stay continued for over one year across 28 dates of listing, during which three learned Judges recused themselves, one recusal occurring more than one month after judgment was reserved. The application by the appellant to vacate the stay was also not heard due to paucity of time. The Hon’ble Supreme Court, by order dated 7th June 2024, stayed the order of stay, paving the way for the appellant's release on bail.

Law On Cancellation Of Bail

The Court reaffirmed that bail can be cancelled under Section 439(2) of the CrPC not only when an accused has committed breaches of terms and conditions of bail or misconducted himself, but also when the bail order is wholly unjustified, patently illegal, or perverse. The power to stay an order granting bail is implicit in the Court dealing with applications for cancellation of bail.

Power To Grant Interim Stay

The Court held that when a Court competent to grant bail finds the accused entitled to be enlarged on bail, the accused cannot be normally deprived of his right to liberty guaranteed under Article 21 of the Constitution. Courts should be very slow in granting the drastic interim relief of stay of the order granting bail. Instead, the High Court may impose additional bail conditions to ensure the accused does not flee. Crucially, even if the stay is not granted, the final order of cancellation of bail, if passed, can be implemented by taking the accused into custody. The interim relief of stay of the order granting bail is not necessarily in the aid of final relief.

Key Holdings

The Court held:

(a) the power to grant an interim stay of operation of an order granting bail can be exercised only in exceptional cases when a very strong prima facie case of the existence of the grounds for cancellation of bail is made out, and brief reasons must be recorded;

(b) as a normal rule, ex-parte stay of the bail order should not be granted; where such a drastic ex-parte order is passed, the Court is duty-bound to immediately hear the accused on the prayer for continuation of the interim relief, and must record reasons why the case was a very rare and exceptional one warranting such an order.

The appeals were accordingly allowed and the impugned orders of the High Court granting stay of the order granting bail were set aside.