Bail Application No.

1096/2021
State Vs. Navneet Kalra
FIR No. 116/2021
PS- Lodhi Colony (Crime Branch)
U/s 3 & 7 of the Essential Commodities Act, Section 3 of the
Epidemic Diseases Act, 1879 & Section 420/188/120-B/34 IPC

13.05.2021.
The present application has been received by way of
transfer pursuant to order dated 12.05.2021, passed by the court
of Ld. Principal District & Sessions Judge, South East District,
New Delhi and is taken up through Video Conferencing.

Present: Sh. Atul Srivastava, Sh. Mohd. Iqrar, Ld. Addl. PPs
for the State with ACP, Crime Branch and IO SI
Kamal Kumar.
Sh. Vikas Pahwa, Senior Advocate with Sh. Vineet
Malhotra, Sh. Vishal Gohri, Sh. Harsh Sethi, Sh.
Hemant Shah, Sh. Shubhendu Kaushik, Sh. Sumer
Singh Boparai, Sh. Shadman Siddiqui, Sh. Arham
Masud, Sh. Abhishek Pati and Mrs. Raavi Sharma,
Ld. Counsels for applicant/accused.

The present application, under Section 438 Cr.P.C.

seeking grant of anticipatory bail, has been filed on behalf of
applicant/accused Navneet Kalra.
It is emphatically contended by Ld. Senior Counsel
for applicant/accused that the applicant / accused is in profession
of operating Optical stores and Restaurants. He is a married
person having family consisting of senior citizen parents, two
major children and wife. The safekeeping of his family during
pandemic of Covid-19 is upon the applicant / accused.
The applicant / accused had accidently fell down
and was sustained about 20 stitches at AIIMS Hospital on
19.04.2021. Thereafter, he also underwent surgery of his jaw at
Medanta Hospital on 05.05.2021. The applicant / accused has
clean antecedents and has never been involved in any criminal
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case whatsoever, but he is now being implicated in a false and
frivolous complaint made by third party. The applicant / accused
is being implicated on account of business and personal rivalry
by third party against whom, the applicant / accused had filed
complaint with police authorities suspecting black marketing of
machines, which applicant company was selling.
One M/s Matrix Cellular (International) Services
Ltd. was importing Oxygen concentrators and thermal imagery
during the pandemic for wide-spread distribution and making the
Oxygen concentrators available to the public at large, vide
advertisements on internet, Apps and all social media platforms.
The applicant/accused had also requested M/s Matrix Cellular
(International) Services Ltd. to supply some concentrators so that
the applicant/accused can also be involved in wide-spread
distribution of the same in order to save lives during pandemic of
Covid-19.
All the sales were being made only through Banking
Channels. On 28.04.2021, the applicant had lodged a complaint
through an e-mail with SHO, PS Fatehpur Beri, against one Mr.
Sujeet, who wanted to purchase one Oxygen concentrator. Mr.
Sujeet was creating a ruckus outside the office of Dayal Opticals,
Khan Market, New Delhi. When the e-mail bounced, the
complaint was sent to SHO, PS Fatehpur Beri through
WhatsApp. If the applicant/accused would have indulged in some
kind of the black marketing, he would have not lodged that
complaint.
The present FIR was lodged on 05.05.2021 alleging
black-marketing of Oxygen concentrators, thermal imagery and
KN-95 masks U/s 420/188/34 of IPC, Section 3 r/w Sec. 7 of the
Essential Commodities Act and Sec. 3 of the Epidemics Act,
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against the applicant / accused which prescribes maximum
punishment for seven years. Four of the employees of applicant /
accused were arrested from Nege & Ju restaurant on 05.05.2021.
As per the Judgment of the Hon’ble Supreme Court
of India in Arnesh Kumar Vs. State of Bihar (2014) 8 SCC 273,
the applicant is ready and willing to join investigation. The
applicant/accused should not be arrested as the maximum
punishment prescribed is 7 years. As per minutes of meeting
dated 04.05.2021 of High-Powered Committee, guidelines laid
down in Arnesh Kumar’s judgment are to be followed.
An Oxygen concentrators and Thermal imaging
machine have not been notified as Essential Commodities and
therefore, Essential Commodities Act, Epidemic Diseases Act
and Section 188 IPC could not have been invoked. There is no
recovery of KN-95 masks from applicant/accused. There is no
cap/ceiling price for the Oxygen concentrators or thermal
imaging machines set by the Central or State Government and
the price of liquid Oxygen/Oxygen cylinder has only been
notified by the Central Government. Even Hon’ble High Court
was informed on 06.05.2021 that cap/ceiling price for these
products had not been notified by the Central and State
Governments.
The applicant/accused allegedly dealt with Oxygen
concentrators and not with liquid Oxygen Cylinders. There are
no allegations of false / fraudulent representation /
misrepresentation against the applicant/accused and therefore,
invocation of Sec. 420 IPC is not justifiable. Applicant / accused
was conducting sales openly and making / receiving payments
through banking channels. Admittedly, he had not imported the
Oxygen concentrators and other goods. The applicant / accused is
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being portrayed as a criminal in the social media and his
photograph is being circulated which is causing grave prejudice
to the applicant / accused. Applicant/accused is ready and willing
to join investigation and he is squarely covered by the
observations of the HPC Minutes dated 04.05.2021 in respect of
strict compliance of Arnesh Kumar Vs. State of Bihar (2014) 8
SCC 273.
Vide order dated 12.05.2021, the court of Ld. CMM,
South East has granted regular bail to four co-accused persons.
The applicant/accused undertakes to abide by all conditions as
may be imposed by this court. There is neither any violation of
Essential Commodities Act, 1955 & Epidemic Diseases Act,
1897, nor applicant / accused has committed any offence under
provisions of Indian Penal Code. The applicant/accused / his
company has bought the machines through legal method i.e.
through cheques and there is no illegal hoarding of the machines.
There is no violation of any directions issued by the
Central Government either U/s 3 or 7 of the Essential
Commodities Act, 1955 or Section 3 of Epidemic Diseases Act,
1897, as alleged. The allegations against the applicant/accused,
as per FIR are that he had permitted the Oxygen concentrators to
be delivered to third parties from his premises where he was
running restaurant under the name of ‘Neji ju’. As far as
incriminatory statements of co-accused are concerned, the
confessional statements made to a “police officer”, are not
admissible U/s Section 25 of the Evidence Act.
Self-incriminatory / disclosure statements cannot be
read against the applicant/accused at this juncture as the same
would be required to be proved with cogent and corroborative
evidence during trial. He is absolutely innocent and has deep
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roots in the Society. There is no likelihood of his absconding.
The applicant / accused undertakes to join and cooperate with
investigating agency and appear before the Court as and when
required. Therefore, the applicant/accused be released on
anticipatory bail.
Reliance is placed upon judgments delivered by
Hon’ble Supreme Court in the cases of Prakash Babu
Raghuvanshi Vs. State of MP (2004) 7 SCC, In Re : Contagion
of Covid-19 Vs. In Prisons Suo Motu Writ Petition (C) No.
1/2020, Chirag Indravadan Shah Vs. State of Gujarat, 2020 SCC
Online GUJ 2263 and Sagar Somnath Mutekar Vs. State of
Maharashtra 2020 SCC Online BOM 7937; judgment delivered
by Hon’ble High Court of Gujarat in cases of Deviben Bharabhai
Khimani Vs. State of Gujarat, Criminal Misc. Application (For
Anticipatory Bail) No. 17 of 2018, Rameshbhai Arjanbhai Gohil
Vs. State of Gujarat, Criminal Misc. Application (For
Anticipatory Bail) No. 24926 of 2017, Mukesh Vrajlal Halani
Vs. State of Gujarat, Criminal Misc. Application No. 13955 of
2008, Rizwan Usman Mansuri Vs. State of Gujarat, R/Criminal
Misc. Application No. 18497 of 2020; judgment delivered by
Hon’ble High Court of Patna in case of Md. Eltaf @ Md. Eltaf
Raza Vs. The State of Bihar, Criminal Misc. No. 14488 of 2020
and judgment delivered by Hon’ble High Court of Delhi in case
of Gaurav Yadav & Anr. Vs. Union of India & Ors., W.P.(C) No.
5222/2020 decided on 13.08.2020.
Per contra, it is contended by the Ld. Addl. PP
appearing for the State has submitted that during patrolling by
SHO, PS Lodhi Colony on 05.05.2021, a restaurant in the name
and style of ‘Nege & Ju’ was found to be operating in Central
Market, Lodhi Colony, New Delhi and during search of the said
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restaurant, 32 boxes of Oxygen concentrators, with capacity of
09 Ltr. & 5 Ltr, one box of thermal scanner and KN-95 Masks
were recovered. Thereafter, present case was registered and
investigation was carried out.
On 05.05.2021, accused persons viz. 1). Gaurav Suri
2). Satish Sethi 3). Hitesh Kumar and 4). Vikrant were arrested.
During their sustained interrogation, the accused persons
disclosed that they used to purchase Oxygen concentrators and
other Covid-19 treatment related equipments from various means
and sold them at exorbitant price to needy persons, who were
suffering from Covid. 387 Oxygen concentrators, 112 boxes
containing KN-95 Masks and 95 Oximeters were recovered at the
instance of accused persons from Matrix Cellular International
Services Pvt. Ltd, 7 Khullar Farms House, Mandi Road, Fathepur
Beri, New Delhi.
On 06.05.2021, during the PC remand of accused
Hitesh, employee of applicant/accused Navneet Kalra, 09
Oxygen concentrators were recovered from Town Hall
Restaurant, Khan Market, New Delhi at his instance. On
07.05.2021, 96 Oxygen concentrators were recovered from Khan
Chacha Restaurant, Khan Market, New Delhi. Invoices in the
name of Dayal Opticals for selling 250 Units of Oxygen
concentrators were seized at the instance of accused Hitesh.
Accused Gaurav Suri, Business Head of Matrix
Cellular had disclosed about selling those 250 Units of Oxygen
concentrators to applicant / accused Navneet Kalra, who is the
owner of Dayal Opticals. On 07.05.2021, accused Gaurav
Khanna, CEO of M/s Matrix Cellular International Services Pvt.
Ltd. was arrested, who was looking after the operations of M/s
Matrix Cellular International Services Pvt Ltd, Khullar Farms,
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Sultanpur, Mandi Road, Mehrauli, New Delhi and subsequently,
investigation was transferred to ISC/Crime Branch, Chankyapuri,
New Delhi on 08.05.2021.
Accused Gaurav Khanna had disclosed that due to
Covid-19 global pandemic in year 2020, the work of the
company was badly affected and therefore, they started dealing
in Covid-19 items and imported some articles like Oximeters,
Oxygen concentrates, Masks KN 95 and also procured some
other articles. Accused Gaurav Khanna further disclosed that
applicant / accused company had sold the Oxygen concentrators
to the needy persons with profit / margin of Rs 40,000/- to
42,000/- per piece.
The delivery of some Oxygen concentrators was
given by them from Khullar Farm (Sultanpur) & Nege & Ju
restaurant, Lodhi Colony and they had sold around 300-350
Oxygen concentrators to applicant / accused, owner of Dayal
Opticals. The sale of recovered oxygen concentrators etc., was
unauthorizedly operational from Nege & Ju restaurant at central
market, Lodhi Colony, New Delhi during the lockdown.
The import of oxygen concentrators under
applicable laws, the quality of the recovered Oxygen
concentrators, in respect of payment and cash transaction
involved in sale of Oxygen Concentrators and other equipments,
importing and acquiring oxygen concentrators from third parties
and thereafter, selling the same to customers, import / domestic
acquisition of oxygen concentrators by Matrix are subject matter
of verification and these aspects are being verified during
investigation. As per report received from Shriram Institute, the
output of Oxygen concentration, given by the concentrators being
sold by applicant / accused, has been found to be merely 20.8 %.
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 The details of customers, who had purchased the
Oxygen concentrators through online mobile application 'X
Factor' are being obtained and investigation is yet to be carried
out regarding the manner of sale and purchase. Investigation is
yet to be carried out in respect of delivery of Oxygen
concentrators, either directly or through its distributors and their
details / mode of payment etc. Accused persons were taking
undue advantage of the situation created by second wave of
Covid pandemic and they made wrongful pecuniary gains by
fraudulently representing that they were selling premium portable
oxygen concentrators manufactured with German collaboration,
which were sufficient to meet requirement of two persons.
As a matter of fact, the concentrators being sold by
applicant / accused were not manufactured with German
collaboration and were manufactured in China. Accused persons
have admitted the procurement price of the medical equipment
ranging between Rs. 12,500/- to Rs. 20,669/- and selling these
equipments for upto Rs. 70,000/- and above. On 02.05.2021,
during hearing of W.P.(C) No. 4984/2021 titled as M/s. Bram
Health Care Private Ltd. Vs. Union of India & Anr., the Hon'ble
Delhi High Court had ordered as below:
"During the course of hearing, we have been
informed that Oxygen gas cylinders, Oxygen flow meters, and
medicines required for treatment of Covid-19 disease are being
sold in the black market at a much higher price above the
Maximum Retail Price (MRP). We direct the State to ensure that
none of the equipments, or medicines used in the treatment of
Covid-19 disease are sold at prices above the MRP. Any person
found indulging in malpractice of either hoarding the equipments
or medicines, or selling the same at prices above the MRP shall
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be booked, and brought to the notice of this Court for initiating of
independent contempt action against all such persons. "
The relevant notifications under the Essential
Commodities in respect to Oxygen Concentrators are as follows:
(i) Office Memorandum of Government of India
vide File No. 20 (8)/09/2019/ Div.III/ NPPA dated 29th June
2020, wherein it has been directed that "This is in reference to
Notification No. 1232 (E) dated 31st March 2020 issued by this
Office for regulation of Medical Devices under Drugs (Prices
Control) Order, 2013 read with Essential Commodities Act 1955
w.e.f. 1st April 2020. Accordingly, Maximum Retail Price of
Medical Devices cannot be increased more than ten percent
(10%) in a year.
In order to monitor the price movements of critical
Medical Equipments required in clinical management of Covid-
19, it has been decided to call for MRP details for the following
Medical Devices viz. (i) Pulse Oximeters and (ii) Oxygen
Concentrator in the prescribed format. All the manufactures /
importers of (i) Pulse Oximeters and (ii) Oxygen Concentrators
are hereby directed under Para 29 of the DPCO, 2013 to submit
the MRP details in the prescribed format within 10 days of issue
of this O.M. A soft copy of the same shall also be sent to the
following e-mail id mandatorily: [email protected].
In view of the above, all Manufacturers/Importers of aforesaid
Medical Devices are hereby advised to ensure compliance of the
provisions of Para 20 of the DPCO, 2013 failing which action
may be initiated for violation of provisions of DPCO, 20103 read
with Essential Commodities Act 1955.
(ii) Office Memorandum of Government of India
vide File No. X.11035/281/2018-DRS dated 11th February 2020,
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herein it has been notified that "S.O. 64B (E). - In pursuance of
sub-clause (iv) of clause (b) of section 3 of the Drugs and
Cosmetics Act; 1940 (23 of 1940), the Central Government, after
consultation with the Drugs Technical Advisory Board, hereby
specifies the following devices intended for use in human beings
or animals as drugs with effect from the 1st day of April 2020,
namely: - All devices including an instrument, apparatus,
appliance, implant, material or other article, whether used alone
or in combination, including a software or an accessory, intended
by its manufacturer to be used specially for human beings or
animals which does not achieve the primary intended action in or
on human body or animals by any pharmacological or
immunological or metabolic means, but which may assist in its
intended functions by such means for one or more of the specific
purpose of –
i. Diagnosis, prevention, monitoring, treatment or
alleviation of any disease or disorder;
ii. Diagnosis, monitoring, treatment, alleviation or
assistance for, any injury or disability;
iii. Investigation, replacement or modification or support
of the anatomy or of a physiological process;
iv. Supporting or sustaining life;
v. Disinfection or medical devices; and
vi. Control of conception."
(iii) Notification vide order No.
PN/206/74/2020/F/F, No. 8(74)/2020DP/NPPA/Div.-II dated 31st
March, 2020 it is ordered that-"S.O. 1232(E). - In pursuance of
Notification No. S.O. 648(E) dated 11th February 2020 issued by
Ministry of Health & Family Welfare, Government of India
whereby Medical Devices intended for use in human beings or
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animals have been notified as Drugs with effect from 1st April
2020; all Medical Devices shall accordingly be governed under
provisions of the Drug (Price Control) Order, 2013."
(iv) Notification No. 4/2015-2020 New Delhi, Dated
30th April, 2021, it has been notified that -"Effect of the
Notification: Para 2.25 of Foreign Trade Policy, 2015-20 is
revised to include import of Oxygen Concentrator for personal
use through post, courier or e-commerce portals in the list of
exempted categories, where Customs clearance is sought as
"gifts", till 31st July 2021."
(v) Order passed by Drugs Control Department
circulated vide No F. 52/ DC. HOO/2020/199 dated 07.05.2021
wherein it is categorically directed that all the stakeholders viz.
Retailers / Whole sellers / Distributors of these items not to sell
these items over and above the notified price / MRP and also to
refrain from dealing in these items in a manner which is not
permitted or unauthorized and should not get indulged in what so
ever in their black marketing.
In view of the said notifications, the Oxygen
concentrators are covered in the definition of Essential
Commodities and price of the same must be governed and
regulated as per the directions of the Government issued and
promulgated time and again through the above notifications. The
accused persons had never informed the concerned authorities
about the MRPs labeled or pasted over the Oxygen Concentrators
boxes.
The Oxygen concentrators were procured and sold
at exorbitant prices. As per statement of one aggrieved, the
applicant/accused had firstly quoted the price of Oxygen
concentrator as Rs. 49,999/- and on the next day, he forced him
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to pay Rs. 55,000/- owing to his urgent requirement. The
purchaser also pointed out that the purity of Oxygen was 48% at
SL/min which is very low and does not serve the purpose.
It has come to notice during investigation through
social media posts that applicant / accused had collected advance
payments from several needy persons for supply of Oxygen
concentrators and he kept on postponing the delivery on the
pretext of shipment being held-up. He kept increasing the price
of the same and eventually, he neither supplied the item to
several persons, nor refunded their advance amount and is
absconding.
A number of persons, who had bought Oxygen
concentrator, found its performance much below the advertised
benchmarks and demanded for replacement / refund from
applicant / accused, but they were told that there is no policy of
refund / replacement, whereas there was no mention to this effect
in the brochure / representation made by the applicant / accused.
Investigation is still at initial stage and probability of
many aggrieved and cheated persons emerging cannot be ruled
out. The margin of profit, in comparison to cost, is very high,
especially in view of ongoing pandemic. Moreover, Matrix
company was selling these Oxygen concentrators clandestinely
by using restaurants premises as cover and no information
regarding storage and sale etc. was conveyed to any Govt.
Authority.
The accused persons have hatched a deep-rooted
conspiracy to gain wrongfully, using the painfully pathetic
situation caused due to the pandemic and compelled the needy
persons to part with their hard-earned money much in excess of
the acceptable international market rates of oxygen concentrators.
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 32 Oxygen Concentrators have been recovered from
Nege N Ju, Lodhi Colony, 9 Oxygen concentrators have been
recovered from Town Hall Restaurant and 96 Oxygen
concentrators have been recovered from Khan Chacha
Restaurant, at the instance of his employee Hitesh. Several raids
have been conducted at all the possible hideouts of the
applicant/accused, but the same were found to be locked.
The applicant/accused has switched off his mobile
phones and is deliberately avoiding the process of law.
Investigation of the case is at very initial stage. 524 Oxygen
concentrators have been recovered at the instance of arrested
accused persons. Considerable recovery of Oxygen concentrators
has been made from the three restaurants, owned by the applicant
/ accused and he is involved in black marketing of Oxygen
concentrators during Covid-19 pandemic.
The complete sequence of procurement of recovered
case property, its distribution, sale at exorbitant prices,
verification and tracking of procurement of recovered material is
yet to be conducted. Details of distributors / customers, who
purchased the Oxygen concentrators from the applicant / accused
are yet to be verified. The custodial investigation of the applicant
/ accused is required to bring on record the facts, manner of sale
and amount involved.
During initial investigation, names of Classic Metal
and Spice Healthcare have emerged which requires through
investigation. Due to Covid-19 infection, many victims could not
be joined in investigation till date. The applicant / accused is a
very influential person and he may tamper with the evidence or
influence the witnesses and hamper the pace of investigation.
Custodial interrogation of the applicant/accused is required to
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unearth the entire conspiracy. The applicant/accused may jump
bail, if released and hamper the pace of investigation. The
application deserves to be dismissed.
The court is of the considered view that the
parameters governing anticipatory bail were laid down by a
Constitution bench of the Hon’ble Supreme Court in the case of
Gurbaksh Singh Sibbia Vs. State of Punjab (1980) 2 SCC 565
wherein it was held that while considering grant or denial of bail,
the court has to consider (1) Gravity of offence; (2) Nature of
Evidence on record against the accused; (3) Likelihood of
accused committing further offences; (4) Previous criminal
antecedents; (5) Likelihood of accused absconding or evading
process of law and (6) Larger interest of the public or the State.
The allegations levelled against the
applicant/accused are serious i.e. he made fraudulent
representation to the effect that he was selling premium portable
oxygen concentrators, manufactured with German collaboration,
which were sufficient to meet requirement of two persons. The
applicant / accused collected advance payments from several
needy persons for supply of Oxygen concentrators and he kept on
postponing the delivery on the pretext of shipment being held-up.
He kept increasing the price of the same and eventually, he
neither supplied the product to several persons, nor refunded
their advance amount.
There is prima facie incriminating evidence on
record against the applicant / accused i.e. the concentrators being
sold by applicant / accused were not manufactured with German
collaboration and were manufactured in China. They were not
having adequate output so as to meet requirement of even one
person. As per reports dated 12.05.2021, submitted by Shriram
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Institute for Industrial Research, New Delhi, in respect of two
Oxygen concentrators seized from the premises of applicant /
accused, the average output in terms of Oxygen purity is found to
be 32.7 % & 38.2 %. With the laboratory room air, the Oxygen
concentration was found to be merely 20.8 %.
As per statement of one aggrieved, the
applicant/accused had firstly quoted the price of Oxygen
concentrator as Rs. 49,999/- and on the next day, he forced him
to pay Rs. 55,000/- owing to his urgent requirement. The
purchaser also pointed out that the purity of Oxygen was 48% at
SL/min which is very low and it does not serve the purpose for
which it was purchased. The applicant / accused is reported to
have collected advance payments from several needy persons for
supply of Oxygen concentrators and he kept on postponing the
delivery on the pretext of shipment being held-up. He kept on
increasing the price of the same and eventually, he neither
supplied the product to several persons, nor refunded their
advance amounts.
The applicant/accused has not joined investigation
till date. Investigation in the case is at its initial stage. Mobile
phone of applicant / accused which reportedly contains
incriminating WhatsApp chats with customers, details of calls
made to co-accused persons and his accounts are required to be
seized. Custodial interrogation of applicant / accused is required
to be carried out to unearth the entire conspiracy hatched
between him and a number of co-accused persons. Therefore,
Section 41(1)(b)(ii) Cr.P.C. is applicable which empowers a
police officer to arrest an accused for conducting proper
investigation of the offence. This exception has been recognized
by the Hon’ble Supreme Court in the case of Arnesh Kumar Vs.
Page 15 of 16
State of Bihar (2014) 8 SCC 273 itself. The possibility of
applicant/accused tampering with the evidence or intimidating
the prosecution witnesses cannot be ruled out. Therefore, no case
for grant of anticipatory bail is made out. The application is
accordingly, dismissed.
Nothing expressed herein above shall tantamount to
expression of opinion on merits of the case.
Copies of this order be sent to Ld. Addl. PP for the
State, Ld. Counsels for applicant/accused and IO, through email
forthwith.
Copy of this order be also uploaded on the website
of the court.

(Sandeep Garg)
Additional Sessions Judge,
South East District,
New Delhi/13.05.2021

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