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Arvind Johari released on conditional bail

Arvind Johari, promoter of Lucknow-based Cyberspace Ltd, held on the charge of misappropriating Unit Trust of India funds to the tune of Rs 320.8 million, was on Tuesday released on conditional bail by a special court.

The designated judge, S R Mehra, released him on bail in the sum of Rs 750,000 with one or two sureties of the like amount. In the alternative, Johari was allowed to furnish cash bail of Rs 750,000.

The registrar of the court was directed to issue an urgent memo to the Superintendent of Central Prison to hand over the custody of Johari on Wednesday morning to CBI so that he could be taken to Lucknow for production in another case pending against him.

CBI was given liberty to move the special court for production of Johari in the UTI scam case whenever required.

Johari was directed not to leave India without the permission of the court and to co-operate with investigations.

He was restrained from visiting offices of UTI and financial institutions such as LIC, GIC, SBI Capital Market and BSE.

Johari's lawyer Mahesh Jethmalani argued that his client was in custody since July 24 and had cooperated with the investigating agency. His custodial interrogation was not required because documents had already been seized by CBI.

CBI prosecutor Gopal Sharan contented that Johari was the brain behind the UTI scam and would tamper with evidence if bail was granted.

The judge observed that Johari's custodial interrogation was not necessary. His role vis-a-vis co-accused and his nexus with other persons or public financial institutions could be unearthed even if Johari was not in custody, the judge felt.

"I am therefore inclined to grant him bail on certain terms and conditions," remarked special judge S R Mehra.

The judge, however, made it clear that if Johari sought bail from the magistrate's court in Lucknow he should make himself available to CBI in Mumbai as and when required in the UTI scam case.

Perusing case dairies and remand application, the judge remarked, "They show that investigation is progressive and regular."

On August 7, the court granted bail to co-accused, former UTI chairman P S Subramanyam, suspended UTI executive directors S K Basu and M M Kapoor and stockbroker Rakesh Mehta.

The accused are charged with conspiracy to cause wrongful loss to UTI to the tune of Rs 320.8 million by subscribing to 3,45,000 shares of Cyberspace in a private placement at an exorbitant price of Rs 930 per share.

CBI alleged that UTI officials, Subramanyam, Kapoor and Basu had allegedly reversed their own decision taken earlier to reject the offer of buying these shares. The agency alleged that Johari had paid Rs 5 million bribe to these officials through broker Rakesh Mehta to strike the deal.

Opposing his bail, CBI said that Johari was the main brain behind the entire conspiracy and had masterminded misappropriation of funds to the tune of Rs 320.8 million.

The end use of these funds had yet to be traced.

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