Gujarat High Court
Kalpeshkumar Shah S/O Jashwantlal Shah vs State Of Gujarat on 27 April, 2026
NEUTRAL CITATION
R/CR.MA/23664/2025 CAV ORDER DATED: 27/04/2026
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Reserved On : 18/03/2026
Pronounced On : 27/04/2026
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL MISC.APPLICATION (FOR ANTICIPATORY BAIL) NO. 23664
of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE UTKARSH THAKORBHAI DESAI
==========================================================
Approved for Reporting Yes No
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KALPESHKUMAR SHAH S/O JASHWANTLAL SHAH
Versus
STATE OF GUJARAT
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Appearance:
NARENDRA K AMIN(9506) for the Applicant(s) No. 1
MR. SOAHAM JOSHI, APP for the Respondent(s) No. 1
==========================================================CORAM:HONOURABLE MR.JUSTICE UTKARSH THAKORBHAI
DESAICAV ORDER
1. The applicant who is apprehending arrest at the hands of
CID Crime Vadodara Zone Police Station for the offence which
came to be registered vide Part-A I CR No. 11201005250003 of
2025 dated 22.06.2025, under sections 406, 409, 420, 467, 468,
471, 474, 114 and 120-B of the IPC and Sections 13(1)(a), 13(1)(b),
13(2), 7(a) of Prevention of Corruption Act, has preferred the
present application praying for anticipatory under section 482 of
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the BNSS, 2023.
2. Heard learned advocate Mr. Narendra K. Amin assisted by
learned advocate Mr. Mukesh Sudarshan, for the applicant. As
mentioned in the bail application, the applicant is a proprietor of
a registered firm namely Chirag Rig Services, and is carrying on
business as government approved contractor, and is involved in
water supply project conducted by Water and Sanitation
Management Organization (WASMO). It was submitted that,
WASMO is merely a tender-approving authority appointed by the
State of Gujarat, whereas, the Water Committee of the
respective Village Panchayat is authorized to issue work orders,
supervise the work, and make payments. It is further submitted
that, the project work was carried out under the direct
supervision of the concerned Village Water Committee.
2.1 It is further submitted that, during the years 2021 to 2023,
Chirag Rig Services was awarded contracts in different villages of
Mahisagar District under the “Nal Se Jal” scheme and that the
work orders were issued by the respective Village Water
Committees, after approval of tenders by WASMO. It is
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submitted that, the Talati is the signatory authority at the village
level.
2.2 It is further submitted that, the applicant was never
allotted any contractual work for Undra and Govindpur Bariya
villages and that false and fabricated facts have been stated in
the FIR.
2.3 It is further submitted that, WASMO was not directly privy
to the contract with the applicant and that, the applicant had
entered into contracts with the respective Village Water
Committees. According to the submissions, the work executed by
the applicant was duly supervised, measured, verified on site, and
completion certificates were issued, before initiation of the
payment process.
2.4 It is also submitted that, all the measurements of the work
completed were taken and maps were prepared and joint
measurements were also taken by both the parties and were sent
for approval of the WASMO, and after complete cross-
verification having been done, bills were prepared by the
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department.
2.5 It has also been submitted that, recovery notices issued by
WASMO were vague and without detailed particulars, compelling
the applicant to file Special Civil Application No. 15913 of 2024
before the Hon’ble High Court of Gujarat.
2.6 It is also submitted on behalf of the applicant that, the
department had remained silent for two years and had not
released his outstanding dues despite repeated follow-ups, and
then, all of a sudden had passed absolutely wrong and illegal
orders of not only blacklisting the applicant’s firm along with 110
other firms for indefinite period, but, had also made an attempt
to recover the amount more than what was paid to the
applicant’s firm, against the execution of the works, which were
awarded by the way of contract.
2.7 It is also submitted that, the applicant was neither given
any chance to put up his defence nor a prior notice was given to
him before issuing the recovery notice. However, the order of
blacklisting and recovery was challenged by the applicant as well
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as other contractors before the High Court and all the orders of
recoveries were set aside whereas, the order of blacklisting the
applicant’s firm and other firms was voluntarily revoked by the
department.
2.8 It is submitted that, the applicant was served with a fresh
notice whereby, he was called at Gandhinagar and that, he had
submitted all the relevant documents and bills with the
department, and he was assured that his balance amount would
be released soon by the department. However, the same was not
done.
2.9 It is also mentioned that, the government portal of Gujarat
government has posted the scheme of “Nal Se Jal Yojana” of
Mahisagar district highlighting it as a grand success, and the
same was completed and the department had achieved 100%
target as expected by the same scheme.
2.10 It is stated on behalf of the applicant that, he came to know
that one Mr. Girish Amarshibhai Agola (unit Manager), had filed a
complaint with CID crime police station alleging huge scam worth
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crores of rupees in the Nal Se Jal Yojana of Mahisagar district,
wherein all 12 persons i.e. officials of the department were
shown as accused in the said FIR. During the course of
investigation names of 111 contractors were also included as
accused in the said FIR. Hence, the present application came to
be filed.
3. Heard learned advocate Mr. Narendra K. Amin for the
applicant who has reiterated the averments of the application
and has taken the court through the evidence which was
collected by the investigation officer. Mr. Amin has placed on
record the documents pertaining to completion of work under
the project of “Nal Se Jal Yojana” by the applicant. He has
forcefully submitted that, the applicant had placed on record all
the documents revealing completion of work before the
department, and though he had given a detailed explanation to
the notice of the department pursuant to the order passed by
the High Court, the same was not considered. Mr. Amin has
further submitted that, the department had initiated
proceedings by filing the FIR after a delay of almost 2 years, and
that, there is no iota of evidence to substantiate such allegations.
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3.1 Learned advocate Mr. Amin has forcefully submitted that,
there are no incriminating ingredients in the FIR to rope in the
applicant as an accused. The applicant was never entrusted any
government property. The delay in lodging the FIR has not been
explained. The prosecution has failed to collect evidence as to
who had forged the documents/bills which were allegedly
submitted by the applicant. Mr. Amin by drawing the court’s
attention to clause-25 of the WASMO guidelines has submitted
that, the department/agency/government can at the most
initiate recovery proceedings against the applicant for
uncompleted and/or deficient work. The dispute in question is of
civil nature, and all allegations pertain to documentary evidence
which has already been collected by the Investigating Officer.
3.2 Though the applicant had submitted all the documents
before the department, it had not considered the same in true
and correct spirit. The applicant has not committed any
misappropriation of monies, and the allegations in the FIR are
hugely concocted. Accordingly, Mr. Amin has urged the court to
allow this application and grant the anticipatory bail to the
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applicant. Mr. Amin, upon instructions has submitted that, the
applicant is ready and willing to deposit more amount.
4. Heard learned APP Mr. Soaham Joshi on behalf of the
respondent-State who has submitted that, the applicant had not
completed the works contract of 4 villages of Mahisagar district
which were awarded to him, and thereafter, though the work was
incomplete, had raised false and bogus bills pertaining to
purchase of pipes and also false report of pipe testing, the said
false bills were approved. It is further submitted that, the
applicant while being awarded the works contract had not
purchased pipes from authorized vendor and false invoices for
purchasing pipes were raised. The applicant had also submitted
false bills and had not completed the works which were allotted
to him. It is also submitted that, the WASMO had conducted
inspection at various villages namely Ladan na Muvada, Rampur
Padedi, Tejakui, Nana Sonela, Sarad, Salera, Jethola etc. from
wherein, it was revealed that, the pipes used by the applicant
were not of approved quality and the measurement as
mentioned in the tender was also not followed. So also, the pipe
testing report from Gujarat Industrial Research and Development
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Agency (In short ‘GIRDA’) the same was false. The works were
deficient, however, excess payments were made in favour of the
applicant, false bills were raised for incomplete work. Learned
APP has submitted that, the applicant by not completing the
works for which contract was awarded to him and by submitting
false bills had committed fraud with the government. Hence,
considering his role in the offence the present application be
dismissed.
4.1 Learned APP has stated that, the applicant was a direct
beneficiary of the government funds which were siphoned off.
The anticipatory bail application of officers of WASMO have been
rejected. In all 26 persons have been arrested and chargesheets
have been filed against 24 of them. Considering the nature of
offence, there do not appear any exceptional circumstances to
grant anticipatory bail to the applicant.
5. At the outset, an FIR came to be lodged before the CID
Crime, Vadodara Zone Police Station on 22.06.2025, by one Mr.
Girish Amarshibhai Agola, who was the Unit Manager of District
Water and Cleanliness Unit, Water Sanitation and Management
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Organisation (WASMO), Mahisagar, wherein, various office
bearers of WASMO along with contractors were named as
accused.
6. The Government had approved the project of “Nal Se Jal
Yojana” in all the Talukas of Mahisagar district, whereby 620
villages were to be provided drinking water through pipeline,
wells and tube wells for which the Government had allocated
budget. However, the office bearers of the WASMO and
concerned Government department in collusion with the
applicant and the other co-accused had entered into a criminal
conspiracy and had siphoned off funds which were meant for the
completion of the “Nal Se Jal Yojana”.
7. It is further alleged that, the pipelines, home connections
and incidental work were not completed by the contractors as
per the contract agreement and bogus documents, accounts and
invoices were created in connivance with the government
officials, and accordingly, loss of Rs. 123.22 crores was caused to
the Government of Gujarat.
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8. So far as the allegations against the applicant are
concerned, he was awarded contract for 39 villages of Mahisagar
District. As per the report of the fact finding committee,
irregularities were noticed in villages namely Laadan Na Muvada,
Rampur Padedi, Tejakui, Sonela, Saraad, Salera, Jethola, Pandya
Na Muvada, Jalkukdi, Kaaranta, Boravi, Kharolvanka, Korvai
Nishal, Dedawada, Dalelpura, Paandarwada, Kantiyada and
Dhodiyarpir. The same were were as regards payments being
done for the entire work which was of lesser length at the spot,
excess payments done for digging, refilling and pipelines laying
instead of the actual work which was done, the pipelines which
were laid were at lesser depth than the prescribed depth, for
which payments were done, the works were not completed and
the works being done without any agreement, the purchase of
pipes not being done from the approved vendors and inspite of
the purchase not being done from the approved vendors, the
payment as regards price variation was done to the applicant, the
payment was done for the pipelines which were of lesser length
than what was prescribed, work was done for lesser connections
and payments were accepted for more connections, and though
contacts were awarded to other agencies the applicant having
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done poor quality work and having raised bills for the same.
9. Thus, it is alleged that the works which were shown to
completed were either not fully completed or not completed at
all, as per the terms and conditions of the tenders which were
floated by the Government, pursuant to which contracts were
awarded.
10. The I.O. had also recorded the statement of one Mitesh
Kumar Kantibhai Prajapati who is a research assistant with
GIRDA. He has clearly mentioned in his statement that, the report
which was submitted by the applicant is false. It is also alleged
that, the measurements of the work were not as per the tender
document.
11. It is true that, the applicant herein had preferred a Special
Civil Application No. 15913 of 2024 praying for Writ of
Mandamus for recovery of amount from the respondents. The
Co-ordinate bench vide order passed on 25.11.2024, had
disposed off the said application by directing the respondents to
supply necessary information/ documents to the applicant in
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respect of recovery notices within a period of three weeks, of
which the applicant would file his reply within two weeks
thereafter, and the competent authority would give one hearing
to the applicant, before finally adjudicating the recovery notices,
considering the applicant’s reply, within a period of four weeks
thereafter.
12. It is pertinent to observe that, the applicant herein had
given a reply to the Chief Engineer of WASMO, wherein he had
denied all the allegations against him and had submitted that, he
had neither raised any false bills nor had done any scam.
However, the spot verification done by the agency did not find
that, the works done by the applicant were as per the terms and
conditions of the tender, and so also, the bills which were raised
being neither true nor valid nor legal.
13. This court cannot be oblivious to the fact that, after
thorough inquiry and verification done by the WASMO, the entire
scam was unearthed, wherein, the applicant along with the other
co-accused were expressly involved, and in spite of the
Government of Gujarat having allocated funds to provide
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drinking water to 620 villages of Mahisagar district, the
concerned government officials in connivance with the
contractors not having completed the works as per the terms and
conditions of the tenders, and instead have caused loss to the
exchequer to the tune of Rs.123.22/- crores. In the State of
Gujarat, the government is making every effort to see that
drinking water reaches every household. The government being
mindful of the said fact had allocated funds to provide drinking
water to every household of the 620 villages of Mahisagar
district. It clearly appears that, the government officials and the
contractors involved in this scam by either not completing the
work fully or doing the work of substandard quality, has deprived
the villagers of 620 villages of Mahisagar district.
14. The investigation officer in his affidavit before the Sessions
Court of Mahisagar at Lunawada has rightly submitted that, a
thorough investigation is required for which the custody of the
applicant is mandatory.
15. It would be apposite to refer to the judgment of the
Hon’ble Apex Court in the case of Serious Fraud Investigation
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Office Vs Aditya Sarda reported in 2025 SCC Online SC 764, the
Hon’ble Apex Court in para nos. 18, 19, 20 and 21 has observed
thus:-
18. Now, so far as anticipatory bail is concerned, this
Court has consistently emphasized that anticipatory bail
should not be granted as a matter of routine, particularly in
serious economic offences, involving large scale fraud, public
money or complex financial crimes. In P. Chidambaram vs.
Directorate of Enforcement, it was observed as under: –
“Grant of anticipatory bail in exceptional cases
69. Ordinarily, arrest is a part of procedure of the
investigation to secure not only the presence of the accused
but several other purposes. Power under Section 438 CrPC is
an extraordinary power and the same has to be exercised 2
(2019) 9 SCC 24 sparingly. The privilege of the pre-arrest bail
should be granted only in exceptional cases. The judicial
discretion conferred upon the court has to be properly
exercised after application of mind as to the nature and
gravity of the accusation; possibility of the applicant fleeing
justice and other factors to decide whether it is a fit case for
grant of anticipatory bail….
70. ………….
71. Article 21 of the Constitution of India states that no
person shall be deprived of his life or personal liberty except
according to procedure prescribed by law. However, the
power conferred by Article 21 of the Constitution of India is
not unfettered and is qualified by the later part of the Article
i.e. “…except according to a procedure prescribed by law”. In
State of M.P. v. Ram Kishna Balothia [State of M.P. v. Ram
Kishna Balothia, (1995) 3 SCC 221: 1995 SCC (Cri) 439] , the
Supreme Court held that the right of anticipatory bail is not a
part of Article 21 of the Constitution of India and held asPage 15 of 22
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under: (SCC p. 226, para 7)
“7. … We find it difficult to accept the contention that
Section 438 of the Code of Criminal Procedure is an integral
part of Article 21. In the first place, there was no provision
similar to Section 438 in the old Criminal Procedure Code. The
Law Commission in its 41st Report recommended
introduction of a provision for grant of anticipatory bail. It
observed:
‘We agree that this would be a useful advantage.
Though we must add that it is in very exceptional cases that
such power should be exercised.
‘ In the light of this recommendation, Section 438 was
incorporated, for the first time, in the CriminalProcedure
Code of 1973. Looking to the cautious recommendation of
the Law Commission, the power to grant anticipatory bail is
conferred only on a Court of Session or the High Court. Also,
anticipatory bail cannot be granted as a matter of right. It is
essentially a statutory right conferred long after the coming
into force of the Constitution. It cannot be considered as an
essential ingredient of Article 21 of the Constitution. And its
non-application to a certain special category of offences
cannot be considered as violative of Article 21.
(emphasis supplied)
72. We are conscious of the fact that the
legislative intent behind the introduction of Section 438 CrPC
is to safeguard the individual’s personal liberty and to protect
him from the possibility of being humiliated and from being
subjected to unnecessary police custody. However, the court
must also keep in view that a criminal offence is not just an
offence against an individual, rather the larger societal
interest is at stake. Therefore, a delicate balance is required
to be established between the two rights–safeguarding the
personal liberty of an individual and the societal interest. It
cannot be said that refusal to grant anticipatory bail would
amount to denial of the rights conferred upon the appellantPage 16 of 22
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under Article 21 of the Constitution of India….
77. After referring to Siddharam Satlingappa
Mhetre [Siddharam Satlingappa Mhetre v. State of
Maharashtra, (2011) 1 SCC 694 : (2011) 1 SCC (Cri) 514] and
other judgments and observing that anticipatory bail can be
granted only in exceptional circumstances, in Jai Prakash
Singh v. State of Bihar [Jai Prakash Singh v. State of Bihar,
the Supreme Court held as under: (SCC p. 386, para 19)
“19. Parameters for grant of anticipatory bail in a
serious offence are required to be satisfied and further while
granting such relief, the court must record the reasons
therefor. Anticipatory bail can be granted only in exceptional
circumstances where the court is prima facie of the view that
the applicant has falsely been enroped in the crime and
would not misuse his liberty. (See D.K. Ganesh Babu v. P.T.
Manokaran [D.K. Ganesh Babu v. P.T. Manokaran, State of
Maharashtra v. Mohd. Sajid Husain Mohd. S. Husain, and
Union of India v. Padam Narain Aggarwal.”
Economic offences
78. Power under Section 438 CrPC being an
extraordinary remedy, has to be exercised sparingly; more so,
in cases of economic offences. Economic offences stand as a
different class as they affect the economic fabric of the
society. In Directorate of Enforcement v. Ashok Kumar Jain
[Directorate of Enforcement v. Ashok Kumar Jain, (1998) 2
SCC 105: 1998 SCC (Cri) 510], it was held that in economic
offences, the accused is not entitled to anticipatory bail.”
19. In Y.S. Jagan Mohan Reddy vs. Central Bureau
of Investigation,3 it was observed as under: –
“34. Economic offences constitute a class apart
and need to be visited with a different approach in the matter
of bail. The economic offences having deep-rooted
conspiracies and involving huge loss of public funds need to
be viewed seriously and considered as grave offences
affecting the economy of the country as a whole and therebyPage 17 of 22
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posing serious threat to the financial health of the country.
35. While granting bail, the court has to keep in mind
the nature of accusations, the nature of evidence in support
thereof, the severity of the punishment which conviction will
entail, the character of the accused, circumstances which are
peculiar to the accused, reasonable possibility of securing the
presence of the accused at the trial, reasonable apprehension
of the witnesses being tampered with, the larger interests of
the public/State and other similar considerations.”
20. In Nimmagadda Prasad vs. Central Bureau of
Investigation,4 it was observed as under: –
“23. Unfortunately, in the last few years, the country
has been seeing an alarming rise in white-collar crimes, which
has affected the fibre of the country’s economic structure.
Incontrovertibly, economic offences have serious
repercussions on the development of the country as a whole.
In State of Gujarat v. Mohanlal Jitamalji Porwal [(1987) 2
SCC 364: 1987 SCC (Cri) 364] this Court, while considering a
request of the prosecution for adducing additional evidence,
inter alia, observed as under: (SCC p. 371, para 5)
“5. … The entire community is aggrieved if the
economic offenders who ruin the economy of the State are
not brought to book.
A murder may be committed in the heat of moment
upon passions being aroused. An economic offence is
committed with cool calculation and deliberate design with
an eye on personal profit regardless of the consequence to
the community. A disregard for the interest of the community
can be manifested only at the cost of forfeiting the trust and
faith of the community in the system to administer justice in
an even-handed manner without fear of criticism from the
quarters which view white- collar crimes with a permissive
eye unmindful of the damage done to the national economy
and national interest.”
21. Recently in Srikant Upadhyay and Others vs. State
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of Bihar, a very pertinent observations have been made with
regard to the powers of the Court to grant anticipatory bail
under Section 438 of CrPC. It has been observed that –
“9. It is thus obvious from the catena of decisions
dealing with bail that even while clarifying that arrest should
be the last option and it should be restricted to cases where
arrest is imperative in the facts and circumstances of a case,
the consistent view is that the grant of anticipatory bail shall
be restricted to exceptional circumstances. In other words,
the position is that the power to grant anticipatory bail under
Section 438, Cr. PC is an exceptional power and should be
exercised only in exceptional cases and not as a matter of
course. Its object is to ensure that a person should not be
harassed or humiliated in order to satisfy the grudge or
personal vendetta of the complainant. (See the decision of
this Court in HDFC Bank Ltd. v. J.J.Mannan alias J.M. John
Paul).
10. When a Court grants anticipatory bail what it
actually does is only to make an order that in the event of
arrest, the arrestee shall be released on bail, subject to the
terms and conditions. Taking note of the fact the said power
is to be exercised in exceptional circumstances and that it
may cause some hinderance to the normal flow of
investigation method when called upon to exercise the power
5 (2024) SCC OnLine SC 282 under Section 438, Cr.PC, courts
must keep reminded of the position that law aides only the
abiding and certainly not its resistant. By saying so, we mean
that a person, having subjected to investigation on a serious
offence and upon making out a case, is included in a charge
sheet or even after filing of a refer report, later, in
accordance with law, the Court issues a summons to a person,
he is bound to submit himself to the authority of law. It only
means that though he will still be at liberty, rather, in his
right, to take recourse to the legal remedies available only in
accordance with law, but not in its defiance. We will dilatePage 19 of 22
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this discussion with reference to the factual matrix of this
case. However, we think that before dealing with the same, a
small deviation to have a glance at the scope and application
of the provisions under Section 82, Cr.PC will not be
inappropriate……
25. We have already held that the power to grant
anticipatory bail is an extraordinary power. Though in many
cases it was held that bail is said to be a rule, it cannot, by
any stretch of imagination, be said that anticipatory bail is
the rule. It cannot be the rule and the question of its grant
should be left to the cautious and judicious discretion by the
Court depending on the facts and circumstances of each case.
While called upon to exercise the said power, the Court
concerned has to be very cautious as the grant of interim
protection or protection to the accused in serious cases may
lead to miscarriage of justice and may hamper the
investigation to a great extent as it may sometimes lead to
tampering or distraction of the evidence. We shall not be
understood to have held that the Court shall not pass an
interim protection pending consideration of such application
as the Section is destined to safeguard the freedom of an
individual against unwarranted arrest and we say that such
orders shall be passed in eminently fit cases. At any rate,
when warrant of arrest or proclamation is issued, the
applicant is not entitled to invoke the extraordinary power.
Certainly, this will not deprive the power of the Court to
grant pre-arrest bail in extreme, exceptional cases in the
interest of justice. But then, person(s) continuously, defying
orders and keep absconding is not entitled to such grant.”
16. So also, the Hon’ble Apex Court in the case of Sudhir Vs
State of Maharashtra with Chandrakant Vs State of
Maharashtra reported in 2015(0) AIJEL-SC 57156 while dealing
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NEUTRAL CITATION
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with the criminal appeals filed by the accused challenging their
cancellation of anticipatory bail by the Bombay High Court, had
declined to interfere with the order of cancellation of
anticipatory bail passed by the said High Court and consequently,
had dismissed the appeals preferred by the accused therein the
subject matter of the said case also pertained to serious
allegations of criminal misappropriation of funds released for
implementation of schemes of drinking water in the villages of
Waghlud and Sonwad Khurd in Tehsil Dharangaon, Maharashtra.
The Hon’ble Apex Court in para no. 14 has observed thus:-
“14. Having considered the submissions made by
learned counsel for the parties, and after considering the
gravity of the offence, circumstances of the case, particularly,
the allegations of corruption and misappropriation of public
funds released for rural development, and further considering
the conduct of the appellants and the fact that the
investigation is held up as the custodial interrogation of the
appellants could not be done due to the anticipatory bail, we
are of the opinion that the High Court has rightly cancelled
the anticipatory bail granted to the appellants by the
Additional Sessions Judge, Jalgaon. Therefore, we are not
inclined to disturb the same.”
17. The aforesaid observations of the Hon’ble Apex Court in
both the cases are squarely applicable to the case on hand.
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18. Thus, considering the investigation papers in its entirety, it
does not deem fit to this court to exercise discretion in favour of
the applicant, accordingly the present bail application is rejected.
(UTKARSH THAKORBHAI DESAI, J)
ANIRUDH OJHA
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