Court sentences 3 to 5 years in jail for cheating investors in 20-year-old case

Thousands of investors see a ray of hope in a 20-year fight for justice after a Delhi court sentenced the three directors of two companies, who had induced the public to invest in the firms promising handsome returns, to five years in jail for cheating.

Mujeeb-Ur-Rehman, his wife Shaista Nusrat and Habib-Ur-Rehman were sentenced under sections 120-B (criminal conspiracy) and 420 (cheating) of the Indian Penal Code. Additional Chief Metropolitan Magistrate Pawan Singh Rajawat also slapped a fine of Rs 50,000 on each of them.

The convicts had incorporated two companies M/s Habib Investment Ltd and M/s Habib Mercantile Ltd in 1995 with the aim of encouraging savings and investments by receiving deposits without authorisation, according to the prosecution.

The court said it is “satisfied…beyond reasonable doubt” that the convicts acting through the two companies cheated the public with the false promise of giving handsome returns.

The companies were also fined Rs 50,000 each by the court.

The court rejected the convicts’ plea for suspension of the sentence pending appeal under the provision of the Criminal Procedure of Code (CrPC).

“The majority of investors are yet to receive their money and I am satisfied that if the convicts are released they may try to scuttle the process of disbursal of the invested amount. Hence, no grounds are made out to suspend the sentence. Application under section 389 CrPC stands dismissed,” the judge said in a a recent judgment.

He sent them to Tihar jail to serve the sentence.

The charge sheet filed by the Economic Offences Wing (EoW) of Delhi police had stated that the companies and the directors in conspiracy with 17 others cheated investors by receiving over Rs 3 crore in various schemes of daily deposit and FDRs.

The companies did not have any authorisation from the Reserve Bank of India, it stated.

When the investors went to collect the return on their investments, they found the company offices locked and the accused absconding.

The investors filed a complaint with the EoW and an FIR was registered.

Twenty accused were chargesheeted. Out of them, two expired during the trial and another was declared a proclaimed offender. The rest 17 faced trial.

During the trial, advocate Mohd Nasir, counsel for one of the complainants, alleged that one of the accused had taken a loan of Rs 12 lakh from Habib Mercantile which was advanced out of the deposit of the investors.

Complainants and advocates Zulfaquar Ahmad and Anees Ahmad alleged that another had caused destruction of evidence by disposing of the properties of the firms. The accused denied the allegations and said their business was legal and proper accounts were maintained.

The court acquitted 12 accused as the prosecution failed to prove the allegations against them.

Advocate Zulfaquar Ahmad said the investors who have not yet submitted their records of investment can contact mobile number 7982490974 as soon as possible.

The Delhi court, in its order, said the fine, if deposited by the convicts, be released to a committee for disbursal to eligible investors as compensation.

“Most of the investors are having small-time jobs and they had hoped for some improvement in their lives with the promised returns. However, due to the cheating committed by the convicts, the dreams of the investors have shattered,” it said.

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