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Home » News » Supreme Court Grants Bail to Bengali Film Producer Srikant Mohta Accused in Rose Valley Default Case


On Monday, the Supreme Court has granted bail to the Bengali film producer Srikant Mohta, who was arrested by the CBI in January 2019, in connection with a Rose Valley default case.

The bench headed by Justice D Y Chandrachud granted the bail to Srikant, after three successive rejections of his bail applications by the Orissa High Court.

The bench heard Mohta’s Special Leave Petition against the 1st December 2020 decision of the High Court which denied him bail for the third time for the commission of offenses punishable under sections 420, 409 read with section 120-B of the Indian Penal Code and sections 4, 5 and 6 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978.

“Liberty of an individual cannot outweigh the interest of the society. An economic offense has to be viewed from a serious perspective and no lenient view can be taken. A murderer takes away the life of a person but a person committing economic offense leaves a living person dead,” the High Court stated while denying him bail.

Before the Apex Court, Senior Counsel Kapil Sibal appearing for the appellant submitted that it is an undisputed position that the appellant has suffered two brain strokes for which he was being treated initially at SCB Medical College and Hospital, Cuttack and thereafter, AIIMS Bhubaneswar.

On the other hand, Solicitor General of India, Tushar Mehta appearing on behalf of the respondent, stated that upon due verification of the medical condition of the appellant he has instructions to state that it appears correct that the appellant has undergone treatment for two brain strokes which have a bearing on his present medical condition.

Subsequently, the court granted bail to Srikant on medical grounds.

“In view of the undisputed position as noted above, we accede to the prayer for the release of the appellant on bail on medical grounds. We accordingly order and direct that the appellant shall be released on bail, subject to such terms and conditions as may be imposed by the Special CJM (CBI),” stated the bench while granting bail to Srikant.

Background of the case

Rose Valley scam is one of the biggest financial frauds which rocked the state of West Bengal in 2013. The states affected by the scam include West Bengal, Assam, and Bihar.

As per Enforcement Directorate estimates, Rs 17,520 crore was reportedly raised from investors across India. The All-India small depositor’s association pegged on an amount at Rs 40,000 crore while few reports pegged an amount at over Rs 60,000 crore. According to ED, a portion of the money was also used to bribe politicians so that the scam could run smoothly. The ED had frozen 2,500 accounts of the Rose Valley group and the agency suspects that there are many more to be tracked and frozen.

The group had allegedly floated a total of 27 companies for running the alleged chit fund operations, of which only half a dozen were active. It was also alleged that the company had made ‘cross investments’ in its various sister firms to suppress its liabilities towards investors.

Arrests made in relation to the Rose Valley Scam

The accused persons, namely Gautam Kundu, Chairman of Rose Valley, Shibamoy Dutta, Managing Director, Ashok Kumar Saha and Ram Lal Goswami, Directors of Rose Valley in furtherance of criminal conspiracy by establishing branches of the companies in different parts of India, collected money from the public through a multi-level agent network system.

Reportedly, the accused have cheated the investors/depositors by way of camouflaged schemes and false assurance about legal sanctity, and false promise of higher rates of interest. The accused persons also cheated the depositors as well as the agents by making a false assurance that the accused companies were legally empowered to collect money from the public. They were running Ponzi schemes and circulating the money collected from the depositors which were not disclosed to the depositors and agents. The accused persons made false propaganda that Rose Valley is having a big business empire and diversified business. They fraudulently claimed that the money collected from the depositors would be invested in those businesses and with the help of high returns from those companies, they would be able to pay back to the depositors their invested money with interest on maturity.

In 2015, Rose Valley chairman Gautam Kundu was arrested in the money laundering case and probed by the CBI and Enforcement Directorate. In the course of the investigation, the government froze all the 2,600 bank accounts of the Rose Valley Group, which held around Rs 800 to 1,000 crore.

Further, on 25 January 2019, the CBI had arrested the Bengali film producer Srikant Mohta for duping Rose Valley Group by Rs 25 crore.


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