New Delhi: On 23 February, seven people died in a road accident on the Yamuna Expressway after an oil tanker collided with a car. A day later, the Uttar Pradesh Police filed an FIR in connection with the accident.
But this FIR was filed against a chartered accountant, Anuj Jain.
Jain, who is a partner at BSRR & Co, an affiliate of the multinational company KPMG, was handling the insolvency proceedings of the company that built the expressway, Jaypee Infratech, as the interim resolution professional (IRP).
An IRP is appointed by the National Company Law Tribunal (NCLT) after the insolvency process against a company begins. The IRP then manages the entire process of insolvency and bankruptcy and takes the necessary steps to revive the company.
The UP Police blamed Jain for the accident because he allegedly failed to implement suggestions to prevent accidents on the expressway. He was arrested by the police five days after the accident, which even the Supreme Court later said was an “extreme step”.
In the order directing Jain’s release Tuesday, the SC stated that it was “appalled to see the manner in which the Uttar Pradesh Police has handled” the case.
Section 233 of the Insolvency and Bankruptcy Code protects insolvency professionals from any prosecution or other legal proceedings “for anything which is done or intended to be done in good faith under this Code or the rules or regulations”.
The top court, therefore, came down heavily on the UP police, noting that the police official dealing with the case “is not familiar with the provision of privilege” of the IRP under Section 233. It then directed the police to release Jain immediately.
The Registrar (Judicial) of the court was, in fact, asked to personally call the office of the concerned judge to ensure the immediate release of Jain, without imposing any conditions.
The bench, comprising Justices A.M. Khanwilkar and Dinesh Maheshwari, has also issued notice to the investigating officer in the case, Bijendra Singh, asking him why action should not be taken against him “for taking such a drastic action against” Jain.
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How Jain came into picture
Jaypee Infratech developed the 165-km Yamuna Expressway along the Yamuna river, connecting Noida and Agra, as part of a public-private partnership with the UP government.
The government had set up the Taj Expressway Authority (TEA) — now the Yamuna Expressway Industrial Development Authority (YEA) — in 2001 to accomplish the project.
The project was awarded to Jaypee in January 2003 with an agreement with YEA, which allowed Jaypee to maintain the expressway and collect tolls on the road for a period of 36 years from commercial operation date.
However, in August 2017, an IDBI Bank-led consortium petitioned the National Company Law Tribunal (NCLT) to initiate insolvency proceedings against Jaypee Infratech for failing to repay a total debt of approximately Rs 24,000-crore. NCLT Allahabad admitted IDBI’s application and appointed Jain as the IRP the same month.
In March last year, NCLT approved the resolution plan of state-owned NBCC (India) to acquire the debt-hit realty developer through an insolvency process and complete over 20,000 pending flats over the next three and half years. However, appeals were filed against the order by the Jaypee Group and the NBCC.
The NBCC has challenged the modifications made by the NCLT in the original resolution plan submitted by it and as approved by the committee of creditors (CoC) of Jaypee Infratech.
In August 2020, the Supreme Court transferred all the appeals pending before the National Company Law Appellate Tribunal (NCLAT) against NBCC’s plan to itself. It had also directed Jain to continue managing the affairs of the company in the interim.
The safety audit
Meanwhile, in August 2018, the Indian Institute of Technology (IIT) Delhi was employed by the YEA to conduct a safety audit of the expressway.
This was a year after a Supreme Court-appointed committee on road safety recommended an audit in the wake of increasing number of accidents on the expressway.
In April 2019, the audit had recommended several measures for better speed compliance along the expressway, apart from identifying deficiencies in signage marking and roadside barriers.
Jaypee Infratech had then started the process to select a contractor who can install guard rail and crash barriers, among other safety features.
The company had invited bids from contractors or personal companies till 26 December 2020. However, the process is still underway.
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Jain ‘absolutely responsible’ for the accident: FIR
In a letter written to the Commissioner of Police, Noida, on 24 February, a day after the accident that claimed seven lives, the YEA demanded that an FIR be registered against Jain.
The letter claimed that Jain “has been directed in several meetings for implementation of these suggestions, but since the steps were not taken on time, accidents are usually taking place”. It asserted that because of this “the image of government/administration is getting tarnished”.
The FIR was filed the same day, under required provisions including sections 283 (danger or obstruction in public way or line of navigation) and 431 (mischief by injury to public road, bridge, river or channel) of the Indian Penal Code.
It noted that one of the primary suggestions given by IIT Delhi was construction of a crash barrier on the central verge of the expressway. The crash barrier was needed to prevent vehicles from crashing into those on the other side during accidents.
The non-construction of the crash barrier was blamed for the accident that took place on 23 February in the FIR: “It is clear…that if crash barrier was constructed in central verge of Yamuna Expressway, then above accident could have been avoided.”
It also went on to blame Jain, saying that he was “absolutely responsible for all the accidents and loss of life and estate related to this case”.
“Despite of receiving the amount from Toll Plaza of Yamuna Expressway, requisite amount has not been utilized to take action on the recommendations/suggestions indicated in the Road Safety Report given by IIT, Delhi, playing with the life and estate of the passengers moving there,” the FIR added.
No role to play in the accident: Jain
According to Jain’s bail application, filed in the Supreme Court, police officials visited his office on the intervening night between 26 and 27 February. They were, however, informed by the security guards that nobody was present at the office since it was quite late at night.
The police officials then served him a notice on 27 February under Section 161 (examination of witness by police) of the Code of Criminal Procedure, directing Jain to appear before them within three days to record his statement. The same day, Jain filed an application in the SC demanding that the police officials be barred from taking any coercive steps against him and for quashing the FIR.
He then travelled to Mumbai “for official work related purposes” and was arrested on 1 March at around 9pm.
The bail application pointed out that he was arrested even before the three-day period granted to him to appear before the officials lapsed.
Jain, as IRP, “has no role to play in so far as alleged accident at Yamuna Expressway and can in no way be held personally responsible for any safety at Yamuna Expressway”, the application asserted.
During the hearing, the lawyers appearing for the UP government argued that the investigating officer in the case, Bijendra Singh, believed that Jain may leave India to avoid prosecution, and so he found it necessary to arrest him from Mumbai.
ThePrint reached DCP (Greater Noida) Rajesh Kumar Singh to ask him about the investigating officer’s claim but he refused to comment on the issue.
The SC then said that it will “examine this aspect of the matter elaborately at appropriate time”.
It ordered Jain’s release and directed the investigating officer to not take any coercive action against him until further orders were given.
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