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    Teesta misappropriated funds for wine & Luxury: Gujrat to Supreme Court

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    Teesta misappropriated funds for wine & Luxury: Gujrat to Supreme Court

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    © All Rights Reserved
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    836 views31 pages

    SLP Teesta SC 1512 21.07.15

    Uploaded by

    Milind Arolkar
    Teesta misappropriated funds for wine & Luxury: Gujrat to Supreme Court

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    © All Rights Reserved
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    IN THE SUPREME COURT OF INDIA CRIMINAL APPEAL NO 38/2015 SPECIAL LEAVE PETITION (CRU) No. 1512/2015 In the matter of, Teesta Atul Setalvad & Anr Petitioners, Versus State of Gujarat Respondent [Rea ae TT Page No E Affidavit in Reply. Letter Dated 21.2,2013 addressed by members of society to the Petitioner No] Annexure “A”, ‘Memorandum dated 182.2013 addressed by members of society to Commissioner of Police Ahmedabad. asAnnexure “ | Complaint dated 12.3.2013 addressed by members of society to Joint Commissioner of Police Annexure “C”. Letters of 2 Trusts both dated 02.02.2015 Annexure “D” (couy) | Replies of Trusices of 2 Trusts dated 31 03.2015 And | 01.04.2015 Annexure “E(Colly). | eu | beta be) ‘Copy Of Order Dated 12.02.2015 Of Hon'ble Gujarat High Court Annexure “F", — Letters dated 27/2/15 atidressed by LO to the Petitioners and reply thereto 3/3/15 Annexure Letter dated 24/3/15 addressed by 10 to the Petitioners Annexure “H”. Tetier addressed by the Petitioners to the LO dated | 25/9/15 Annexure “1”. ‘Letter addressed by the Petitioner. No 2 to the 1.0 dated 26/3/15 Annexure “J”. Letter addressed by 1.0 dated Annexure “K” (Colly). Letters addressed from the Petitioners to the 1.0 4/4/15, 17/4/15, 28/4/15, 7/5/15. Annexure “L" (Colly). Letters addressed by the LO to the Auditors and replies, thereto Annexure “M” (Colly). ‘Synopsis of personal -divect Expenses As ANNEXURE “Nr. 16 Prescribed format of Schedule IX and the manipulated format as submitted by the Petitioners ANNEXURE “0”, IN THE SUPREME COURT OF INDIA CRIMINAL APPEAL NO 338/2015 SPECIAL LEAVE PETITION (CRL) No.1512/2015 In the matter of Teesta Atul Setalvad & Anr . Petitioners, Versus State of Gujarat son Respondent To ‘The Hon'ble Chief Justice of India And His Lordships Companion Justices of the Supreme Court of India AFFIDAVIT-IN-REPLY OF RESPONDENT-STATE OF GUAJRAT MOST RESPECTFULLY SHOWETH 1. 1, K.N. Patel, aged 57 years, occupation - service, Assistant Commissioner of Police, Cyber Crime Cell, Crime Branch, Ahmedabad City, do hereby solemnly affirm and state on oath as under: 2. Ihave been served with a copy of the Petition and Application for the rection filed by the petitioners dated 06.05.2015 herein on I have examined the contents thereof, investigation papers relating to the PLR, dated 04.01.2014 and I crave leave to file the present affidavit- wy in-reply, Iam conversant with the facts of the present petition and, ae ae aa ear CAS! therefore, I am competent and authorized to file the present affidavit-in- reply. ‘The present affidavit-in-reply is filed for the purpose of placing on record the circumstance in which the FIR in the instant case came to be filed and relevant material facts that have emerged during the course of investigation. The present deponent craves leave to file a further affidavit as and when the same is necessitated. Save and except admitted hereinafter, all the facts stated, contentions raised and allegations leveled are hereby categorically denied. Not dealing with the Petition para-wise may not be construed as an admission of any fact on the part of the present deponent. JF THE PROSECUTION I say that on 12,3.2013, a complaint was addressed by 11 inhabitants of the Gulbarg Society, Chamanpura, Ahmedabad, including Mr. Firozkhan Saidkhan Pathan, to the Joint Commissioner of Police, Crime Branch, Ahmedabad City, alleging that every year, since the unfortunate 2002 riots, the accused have been organizing a function in the memory of those who lost their lives in the riots. During such functions, various schemes for rehabilitation of the riots victims, financial support for the victims, payments of rents and support for the reconstruction of the victims’ houses, etc, were announced by accused Petitioner No.1, under the banner of 2.N.G.Os. run by her viz. “Sabrang Trust” and “Citizen for Justice and Peace” (CJP) (hereinafter referred to as the 2 Trusts for the sake of brevity). Over a period of time the Petitioners established close ties with the riot vietims. In the month of December 2007, the accused Q— cesured the sot victims that ifthe members of the scetyco-perate wr with them in raising funds through publications, interviews, programs, appeals on web pages and publications ete they would collect funds for their welfare in addition to reimbursing all rent expenses borne by them eo over the years. They also represented that from the funds thus collected, they would purchase all the damaged houses of the Gulbarg society at the current market price to convert the same into *Gulbarg Society Museum of Resistance’. A formal proposal was given by the Sabrang ‘Trust in January 2008 to Society Members. The consent of the members. of the society was taken in June 2008 and a resolution dated 29.06.2008 was accordingly passed by, the Gulbarg society. However, in spite of using the Society and its member's plight as poster boys for the collection of funds no financial support was ever disbursed, no rent was reimbursed and absolutely no funds were received for rehabilitation of the affected persons. No steps were taken cither for the reconstruction of the houses of the inhabitants of Gulbarg society, nor was the society converted into Museum even after more than 4 years had passed from the date of passing the resolution Members of the society, addressed a letter dated 21,2.2013 to the1*Petitioner, requesting her to furnish the details of the amounts collected as donations using their plight as an instrument to collect funds. The said letter was never replied to by the Petitioner. Annexed herewith is the letter dated 21.2.2013 as Annexure “A”. ‘Tired by such annual functions and rituals on every 28! February in the society, wherein the victims of the riots were projected as show pieces in front of the media, a memorandum dated 18.2.2013 was submitted by 15 members/residents of the society to the Commissioner of Police, Ahmedabad, requesting him to prohibit outsiders from entering the Gulbarg society on 28.2.2013. Annexed herewith is the letter dated 18.2.2013 as Annexure “B”. ‘The said application referred to the advertisement published in a magazine called “Communalism Combat" and its website, calling upon the public to generously donate to help develop @ memorial for the victims of communal violence ie. “Gulbarg Society Museum of Resistance”, “Communalism Combat” is a magazine owned by the 3 the petitioners are the Editors. The applicants Petitioners, wherein both alleged that the 2 Trusts run by the Petitioners, were involved in collecting huge funds as donations in the name of providing financial assistance, legal assistance, etc. to the 2002 Gujarat riot victims, The donations to Sabrang Trust which till financial year ended 31% March, 2008 which were in the region of Rs . 10 Lakhs , subsequent to the ‘announcement of the setting up of the Gulberg Memorial fund by the Sabrang Trust increased to approximately Rs 16 Lakhs in the financial year 2008-09and approximately Rs 92 Lakhs in the financial year 2011- 12, The applicants referred to details furnished by the Ministry of Home Affairs, Government of India, stating that according to the FC Form-3 submitted by the CuJ:P,, in the period between 2009 0 2011, foreign donations to the tune of Re. 63 Lace were received in the IDI Bank ‘account No, 014104000204204736 of CJP and during the period from 2008 to 2011, foreign donations to the tune of Rs. 88 lacs were received in the Union Bank of India Account No. 369102010802885 of Sabrang ‘trast, With these allegations, with a request to register on FIR, @ complaint came to be addressed by 11 inhabitants of the Gulbarg Society sesioner of Police, Crime Branch, Ahmadabad City: INVESTIGATION CARRIED QUT TILL DATE: 5. Upon receipt of the complaint dated 12.3.2013, addressed by 11 inhabitants &f Gulbarg Society including the present complainant, the Crime Branch carried ont & preliminary inquiry into the matter. Statements of several witnesses have becn recorded. 10 witnesses have ecorded their statements before the Ld magistrate under section 164 of the Cr-P.C. Website details of CJP/Sabrang Trust have been recovered by ge drawing panchnames. Annexed herewith is the letter dated 12.3.2013 as Annexure “C”. ‘The 10 addressed a communication dated 18.3.2013 to the present Petitioners, seeking copies of Audited account statements and Balance Sheet, of Sabrang Trust and CJP for the last ten years apart from other information regarding donations received from national and international institutions for providing financial and legal assistance to the riot victiths and the utilization of the said funds. Specific queries were raised with regard tp the receipt and utilization of donations received from the national/international institutions and private individuals for providing legal and financial assistance to the 2002 riot victims in the accounts of the 2 Trusts. In response thereto, vide communication dated 263.2013, the petitioners declined to furnish any specific details sought for. Except maligning the Gujarat State Police, Constitutional functionaries and alleging victimization the petitioners did not reply to any of the queries raised. ‘The 10 addressed a second communication dated 8.5.2013, secking information as sought for vide communication dated 18.3.2013, calling ‘upon the petitioners to co-operate with the investigation and furnish necessary details. Vide letter dated 20.5.2013, the petitioners informed the 10 that they had received Rs. 4,60,000/- towards the proposed “Dream Museum’, their ‘accounts were audited and submitted to the relevant authorities and investigating into the matter reflects the vindictive attitude of the forces trying to subvert the process of justice". However, no details sought for by the IO were furnished. ‘The LO thereafter addressed communications to the Ministry of Home [Affairs (MHA), seeking details of the permission granted to 2 Trusts, enabling receipt of foreign donations under Foreign Contribution egulation) Act (FCRA). The MHA intimated the 10 that 2 Trusts obtained FCRA registration on 21.11.2007 bearing registration no- 083781099 and no. 083781100 under the category of “Educational, social” and “Economic Educational” respectively. MHA also furnished copies of Form FC-6, mandatory required to be submitted by every NGO 5 | ae = oe _* | annually declaring details of the foreign funds received. Condition no. 3 of the FCRA registration specifically stipulates that the association cannot bring out any publication (registered under PRB Act, 1867) or act as correspondent, columnist, editor, printer or publisher of a registered newspaper at a later stage thereby attracting provisions of the Section 3{1)(g) and (h) of the FOR Act, 2010. Details of accounts of 2 Trusts were received from the IDB! Bank and the Union Bank of India. 8, itis noteworthy that when the Petitioners failed to provide even the copies of audited balance sheets and books of accounts of 2 Trusts, the 10 to verify the allegations against them, addressed a communication to the Charity Commissioner, Mumbai in April 2014, for providing the same ‘the Office of the Charity Commissioner, Mumbai, furnished the audited statement of accounts of the 2 Trusts for only some years. It was found i that audited statement of accounts of Sabrang Trust for 6 years i.¢,2002- 03, 2003-04, 2004-05, 2005-06, 2006-07 and 2007-08 were::not submitted by the Petitioner to the Charity Commissioner and these 6 year’s audited statement of accounts were filed on 26.03.2014 Le after i sing of he present FIR on 04.01.2018 i similarly, investigation revealed that auclited statement of accounts of CUP for the period April 2008 to March 2010 i.e. for 7 years were not | submitted by the Petitioner to the Charity Commissioner and these 7 ears audited statement of accounts were submitted on 05.01.2012 in cone lot, The reason given by the Petitioners, for non submission of audited statément of accounts to the Charity Commissioner, in case of oth the Trusts, was. mentioned as “Unfortunate slip of communteation” bveween the Auditors and the Trustees, Whereas & ot communication can occur once, the same slip occurring for SEVEN years for 2 Trusts speaks volumes for the attention paid by the reco an the Autor to comely ith hea G2” sven oy tie oom admission there was inaicent tenon pal statutory compliances by the auditors and the other Trustees which is ae c \ obvious from the fact that such a major failure to comply went unobserved till it was pointed by the regulatory authorities. It is important to note that it is on the basis of the Reports of these very auditors and approval of the very same trustees that the accused are proclaiming that their deeds and actions have been vetted and approved land hence they have done no wrong. Thus repeated claims of the Petitioners that their accounts are audited every year and audited statement of accounts are submitted to the Charity Commissioner's Office every year were proved totaly false. It is pertinent to note that the Petitioners in their additional Affidavit in rejoinder dated 23.07.2014 (served in the Gujarat High Court on 26.08.2014) running into 44 pages, have intentionally concealed the fact that audited statement of accounts of CJP were also not submitted on time by the Petitioners and that they have sought 7 years condonation of delay from the Charity Commissioner in January 2012 It is humbly submitted that as Managing Trustees of Sabrang Trust, the Petitioners have made incorrect statements on oath in 2 petitions before the Hon'ble High Court of Bombay (WP No- 173/2014 filed on 15.01.2014, CWP No-293/2014 filed on 24.01.2014), SLP No 1770/2014 filed on 20.02.2014 in the Hon'ble Supreme Court and MCA No 761/2014 filed on 20.02.2014 before the Sessions Court, Ahmedabad ‘and whilst stating on oath that they have annually submitted regular audited statement of accounts & reports, whereas in fact till 26th March 2014, annual accounts for continuously of 6 years, were not even filed before the Charity Commissioner ‘hat there was a conscious attempt to avoid disclosure of the state of aifairs of the trust more specifically the receipt of donation and funds ao ‘and their application. It was only when the FIR was registered wherein serious allegations of misappropriation of funds have been alleged, that ‘all of a sudden the accounts from April, 2003 to March, 2008 were submitted which establishes the Petitioner's brazen lies on oath before various Courts It is humbly submitted that the Petitioner-Accused are willfully not co- operating with the investigation and seeking time, again and again, on one pretext or the other, from the last one and half years to avoid submission of documents which are necessary for the investigation and are of such nature that they should have been in the record and custody of every charitable organization and easily provided to authorities such as the Gujarat Police. In fact whenever such documents were asked for, the Petitioners gave the following reasons in their replies and did not submit the required documents: a) Investigation seems to be part of concerted efforts of Gujarat Govt to harass us, b) FIR has been filed to malign CJP & Sabrang Trust o) It is a part of sinister campaign being unleashed against us. 4) It is neither necessary nor desirable for the present investigation. ¢) Legal opinion is sought for providing the information. {) This investigation seems to be a roving and fishing one. g) Accounts Executives are not attending office due to illness. 1h) Documents required are voluminous and compilation will take time. * 10, It is humbly submitted that any effort to approach other trustees of 2 ‘Trusts for providing such documents, was responded to by a stereotype reply stating ‘Since the record requested by you is voluminolis please do give us 7 days from the date of receipt of this letter to revert back to you" jointly signed by all the trustees and submitted to the investigation oo officer. No documents have been submitted by these trustees till date. Annexed herewith are the letters of 2 Trusts both dated 02.02.2015 8 Se SRST Se dated 12.3.2013 as Annexure “D”. Further similar stereotype replies of trustees of 2 Trusts sent on 31.03.2015 and 01.04.2015 are also annexed as Annexure “E”(Colly). 11. It is humbly submitted that the Hon’ble Gujarat High Court in its order and judgment dated 12.02.2015 in Criminal Mise Application (for Anticipatory Bail) No-4677/2014 acknowledges that the Petitioners are not cooperating with the investigation and stated that: “Having gone through the materials on record, I have noticed something very shocking, and at the same time, extremely sad. There are serious allegations against the applicants of misuse and misappropriation of huge amount received by them through various donors. The money which should have gone to the poor and the needy appears to have been prima facie misused for their personal pleasure and comfort. Although in the course of lengthy arguments it was vehemently submitted that the applicants are ready and willing to cooperate with the investigation, yet I have noticed that there ts no cooperation worth the name. It is only after the arguments were concluded that the ie thought fit to with their income tax returns and vouchers.” Pe eee oy ees sejre he meget ea ee questions forthe purpose ofefetie tnvertigation. oat pe anata neering) of howe applications, made available for my perusal the or case-diary, wherein number of questions were put 9 to the applicants and the stock reply which I find is necessary to be quoted: “As the question relates to accounts, the reply of which is given in our affidavit. If there is no reply, and if you wit! give me in writing, we will give you reply for the same.” To very few specific questions as regards purchase of air tickets, holiday resorts bills, fees paid in dollars so far as the education of children is concerned, credit card payments, expensive shoes, clothes, beauty parlour bills, etc., the stock reply was, “Please give me in writing, we will give you reply for the same”. To few other questions, the-only reply was, “At tT tren it. ve me iting, I will le ion of the same later on’ To a specifie question as regards the personal expenses incurred using the credit cards from the bank accounts of the CJP and the Sabrang Trust, the reply was, “I state that we have submitted the detailed rey it Car e No[s). 606 to 613 and Page No(s).617 to 659, in “annexure-A (Colly) 0} vit 1 4 to our Han inal__ Application No.4677/2014 filed the Hon’ble High Cor of We also ts in A of Shri_D.M.Shat! that we have not_incurred any personal ex; from Trust 10 Bank Acct ts infor n is asked for on! to harass and de; You have not produced cumentary proof r yur_allegation in the matter.” To’ a specific question regarding vouchers, the reply was, “If we are asked in writing to submit vouchers of particular time and _ expenses, thereafter, we will provide the s er the legal advice, we have obtained, it is neither necessary nor desirable to the the present investigation.” To a specific question regarding the income tax returns, the reply was, “You have demanded copies LT.Returns for the m_ 2004-05 to 2012- 13, but we are not to produce the same (before you)” If everything is in the affidavit filed before this court, and if everything is to be looked into by the Investigating Officer and understand from the affidavit, then that hardly can be a ground for grant of anticipatory bail. ‘The above is suggestive of the fact that there is no cooperation at all. At any cost, the applicants want to evade the interrogation and are not ready and willing to disclose the true facts. If such are the answers given by the applicants to the questions put by the Investigating’ Officer at a n 12. stage when they are under the umbrella of an oral interim protection, I wonder what would be the position when they appear before the Investigating Officer armed with a fullfledged anticipatory bail order. 4 It is at that stage and in such circumstances that the custodial interrogation becomes a very important factor.” From the above it is proved beyond doubt that the Petitioners are not co- operating with the investigation and some of the basic documents like IT Retums, Audited statements of accounts were submitted only after the arguments were concluded in the Gujarat High Court which was specifically recorded by the Hon'ble High Court in its order. Copy of order dated 12.02.2015 of Gujarat High Court is annexed herewith” as Annexure “F”. ‘That even after the filing of the instant SLP and in spite of the observations of the Bench directed towards counsel of the Petitioners during the course of the hearing of the instant case on 19/2/2015, that the Petitioners were bound to furnish all documents as required/ requested by the investigating agency, the Petitioners as also the Auditors of the 2 Trusts have willfully and for oblique purpose refused to furnish the thajority of the documents sought for and have by their conduct revealed that they are intent on impeding the investigation. ‘This is manifestly clear from the letter dated 27/2/15 from the 1.0 to the Petitioners and the response of the Petitioners thereto dated 3/3/15. ae herewith are the said letters dated 27/2/15 and 3/3/15 as Annexure “G”, The Petitioner’s letter dated 3/3/15 was replied to by the er 1.0 by letter dated 24/3/2015 deprecating the lack of co-operation with the investigation by the petitioners. The said letter dated 24/3/15 is annexed herewith as Annexure “H”. A letter was received by the 1.0 from the Petitioners on 25/3/15 which sought time to furnish documents requested for on the ground that they ‘were still being collated. Annexed herewith is the letter dated 25/3/15 as Annexure “I", Thereafter a letter to the same effect was also received separately from the Petitioner no 2 dated 26/3/15 seeking time to furnish the documents, Annexed herewith is the letter dated 26/3/15 as Annexure“, ‘Thereafter correspondence between the investigating agency and the Petitioners ensued on 11/4/2015 and 1/5/15 from the 10 to the Petitioners and 4/4/15, 17/4/15, 28/4/15, 7/5/15 from the Petitioners to the 10. Copies of the letters addressed by 1.0 to the petitioners dated 11/4/2015 and 1/5/15 are collectively annexed herewith as Annexure “1 (Coly.). Copies of the lettersaddressed by the petitionersto 1.0 dated 4/4/15, 17/4/18, 28/4/15, 7/5/15 as ANNEXURE “L” (Colly). All the above correspondence indicates that the documents requested for by the LO were submitted in piecemeal fashion and after 7/5/15 no documents have been submitted in spite of assurance of compliance by the Petitioners. Even such documents that have been submitted, have been submitted under faulty indices, are incomplete as no dates are mentioned on several pages of the accounts, the ledger a/c is not mentioned in the entries, as also the trial balance is not submitted. The accounts have not been submitted in machine-readable accounting software format but in PDF formats thus preventing a meaningful analysis. On a test check itis found that the final accounts do not tally with the accounts as submitted. Bank Vouchers , Journal Vouchers and supporting third party bills and memos paid through the bank or accounted through Journal vouchers have not been submitted. B 13. It is reiterated that the data as submitted does not permit comprehensive analysis thereof, The submissions in this affidavit have been compiled under the above circumstances and the figures though materially correct may not be 100% accurate. It is respectfully submitted that emphasis be given to the substance of the submissions rather than the arithmetical accuracy of any submissions, In addition the 10 has addressed notices to the Auditors of the 2 Trusts respectively, the copies of which are collectively annexed herewith as Annexure “M”, The replies of the auditors not only indicates non co- operation but also contains an allegation by one of them that the Petitioners are not co-operating with the said Auditor, It is respectfully submitted that the investigation has revealed the perpetration of a colossal fraud by the Petitioners herein aided and abetted by others to collect funds in the name of riot victims by a massive fund collection drive from 2007-2014 through advertisements in ‘a magazine published by a concern which is owned and controlled by the Petitioners as also on their web pages and through the conduct of musical and artistic events. Having raised funds in the name of riot victims during the said period amounting to between 6-7 Crores [if not more as the Petitioners have still not supplied complete list of donors as also all their bank accounts of the two trusts}, the Petitioners by diverse means, both audaciously and by blatant and subtle camouflage dishonestly misappropriated and/or converted to their own use, funds ble purposes, Indeed the actual user of money collected in the 2 trusts both shocks the conscience meant for the riot victims’ and other ch and is perverse in the extreme on the part of those claiming to be trustees of charity. A very miniscule amount is disbursed directly to the victims on whose name the petitioners were collecting the funds.in addition to disproportionately high administration expenses significant sums are spent on air travel.Petitioner number one for instance was travelling for 113 days in a single year. 14. Results of investigation regarding misappropriation of funds. A] Sabrang Trust : 1] Excessive and unreasonably high payments to Petitioner trustees. a) In a public charitable trust a trustee at best is entitled to a honorarium. In case of Sabrang Trust, Petitioner no 1 has drawn an annual salary ranging from Rs.1,79,400/- in FY. 1/4/08 to 31/3/09 to Rs. 8,75,800 for FY ending 31/3/13. In other words as donations to Sabrang Trust increased on account of continuous widespread advertising publicity regarding the plight of riot victims ‘and the Trustees avowed intention of building a Museum in Gulbarg, Petitioner no 1's salary rose commensurately with the ‘annual increase of donations to Sabrang Trust, The increase in the 2 Petitioner No 1’s salary from 09-13 discloses a compounded annual increase of almost 50% per annum. Similarly remuneration drawn by Petitioner no 2 has increased at a compounded annual rate of 53% per annum from 2,40,000 in FY 1/4/09 to 31/3/10 to 8,61,000 FY ending 31/3/18. ‘Together the Petitioners as trustees of Sabrang Trust have pocketed in excess of 20% of the donation to the Trusts on an annualized basis. b) In addition to salary the Petitioners have claimed medical allowance each of Rs. 25000/- each. The riot victims have received no medical allowance whereas the Petitioners have claimed these ‘medical expenses and even exceeded this Uberal allowance in some years. 2] Payments made to an entity called Sabrang ‘Communication Pvt [ herein after referred to a SCPPL for the sake of brevity] eo Limited ; substantially owned and fully controlled by the Petitioners under the pretext of administration expenses. During the period 01/04/09 to 31/03/2013 SCPPL had no significant business or income of its own, The registered office of the said entity is disclosed at the residential address “Nirant, Juhu Mumbai” belonging to the late father of the Petitioner no 1. The Petitioners have disclosed the registered office of Sabrang Trust at the same address as SCPPL ic. *Nirant, Juhu Mumbai". The i Petitioners claim that work of Sabrang Trust was being conducted t from the said office premises and in view thereof SCPPL charged the trust’ an increasing amount for “shared i expenses"/‘establishment expenses"/“secretariat expenses” commensurate with the increase in donations to the Trust in between the years 2009-2013, Thus SCPPL which had practically no income prior to the financial year ending 2009 received payments from Sabrang Trust of Rs. 2,64,000/- for the FY 31/3/2009 which increased every year until in the FY 2012-13 the ‘rust was paying SCPPL an annual amount of Rs 23,79,000 i.e. @ 1 compounded annual increase of almost 75%. It is extremely i unclear why these payments were being made and no tax has been i deducted at source by the trust while making these payments i indicating that SCPPL had paid no tax on these amounts received i from the Trust. it ‘the final Accounts, Annual Report and Annual IT returns of SCPPL | have not been furnished to the investigating agency. The bank i statements of SCPPL which have been furnished to the i 1 investigating agency by the banks indicate that the Petitioners | a have withdrawn a total sum of Rs.47 lakhs from SCPPL [ the total amount paid by Sabrang Trust to SCPPL is Re.72 lakhs). In GB ston SOP nn pa an anon april 9 i to Petitioner no 2, about Rs. 8 Lakhs to Petitioner no 1 and Rs 3 eee 16 Lakhs to Amli Setalvad the sister of Petitioner no 1. The inescapable conclusion is that the entire amount paid by Sabrang ‘Trust to SCPPL has been siphoned off by the Petitioner under the guise of cash withdrawal and cheque payments. SCPPL is a vehicle used by the Petitioners for the purpose of siphoning donations to the Sabrang Trust. It is to be noted that 45% of total funds received in 08-13 by Sabrang Trust have found its way to the Petitioners either directly or through SCPPL. 3] Expenses by Petitioners of purely personal nature claimed as having being incurred towards the object of the trust. In the most shocking modus operandi for misappropriation of monies belonging to charity the Petitioners have saddled the trust with expenses in the nature of conspicuous consumption and self indulgence as expenses which relate to the objects of the Trust Some of the glaring instances of the same are as follows: a. Consumption of Liquor, Whisky, Rum. b. Purchase of Movie CDs of Singham, Jodha Akbar, PAA, Andha Kanoon, Ghajini ete c. Payment for several pairs of spectacles for the trustees and their family 4. Wining and dining at some of the best restaurants and Fast food outlets of Mumbai like Gaylord, China Garden, Lite Italy, Subway, TGF! (Thank GOD its Friday}, DON Giovani, Leopold Café Food Takeway's ordered at their residence from Foodinn and parceled food from Bademiyan f Purchase of Cakes and Sweets from premium outlets like ‘Theobrahma, Gaylord ae —— g. Several Books including romantic novels like Mills and Boons, Thrillers like Total Control ete h. Purchase of Blackberry Phone, expenses for personal investments, T Shirts Purchased, Flower wreaths on demise of associates’ family members, clothes washing ete, i, Purchase of purely personal items like ear buds, wet ‘wipes, nail clippers, ladies personal items |. Purchase of sanitary napkins [ surprisingly for Petitioner No 2) Annexed herewith is the summary/synopsis of the details of the personal expenses observed from limited information made available by the petitioners. ANNEXURE “N”. ‘The Petitioners have repeatedly on oath, through their counsel in court and in public fora been protesting about their reputations being maligned by the Gujarat police by alleging that they had saddled: the trust with their personal expenses. It’ is stated that the limited documents furnished by the Petitioners themselves to the investigating jously disclose the patent fraud on the part of the agency unam! Petitioners and expose their protestations as being hollow. 4] Personal expenses claimed from the trust under the guise of daily/ travel allowance. ‘There are several vouchers submitted by the Petitioners which reveal that although the Petitioners charged the trust with expenses on account of travel allowance which the trustees permitted them to claim Rs 1200 for Petitioner No.1 and RS. 600 for Petitioner No.2 respectively ‘as travel allowance for out station trips). This facility was grossly misused and under the guise of travel allowance personal expenses were claimed from the funds of the trust as under: Sas eae ee h In FY 2011-12 the Center for Dialogue and Reconciliation [CDR] organized a dialogue at Pakistan , which was attended by the Petitioner no 1 in her capacity as the editor of Communalism Combat a magazine published by SCCPL. Apart from the fact that the visit was not in her capacity as trustee of Sabrang trust, the event did not advance the objects of the trust, particularly not the interest of riot victims. Although the event was for two days i.e, 28/4/2011 and 29/4/11, the Petitioner no 1 claimed allowance for 5 days @ Rs. 1200 totaling to Rs 6000/- between 26/4/11 to 30/4/11, This allowance was used to fund personal expenses incurred prior to and during the trip i.e. hair styling at Shivas Hair Designers on 25/4/2011 for Rs 3800/- and some purchase at The Body Shop on 27/4/2011 for Rs 1570/-. The daily allowance was actually claimed on 24/5/2011 The 2 amounts were paid by the personal credit card, the bill for which had to be paid by 1/6/2011 Although this credit card bill was paid from her personal account, the sum expended for the said items was taken from the trust as daily allowance and effectively used to pay these expenses. In fact the petitioners had no income and all the monies in their personal account were monies obtained from the trust under one pretext or the other i.e by way of salary, allowance. When Petitioner No.1’s personal account was credited with the amount from the trust by way of travel allowance ‘The said emount along with other credits into her personal account from the trust account was utilized to pay the entire credit bill. It is submitted that the investigating agency does not have to prove how the money illegally claimed as travel allowance was spent. However the fact that the travel allowance claimed for the trip to Pakistan was jlized for personal expenses is corroborated by a similar modus ‘Sperandi on other occasions. In FY 2012-13 a Global Action meeting was held in Rome, Italy on 10th and 11% December, 2012. The Petitioner no 1 attended this meeting, Just prior to her departure she spent a sum of Rs 700 on 19 = . 6/12/12 on hair sgling and during her vst spent an amount of about ii Rs 5000/-at a Souvenir shop in Rome. On 8/12/2012 a sum of Rs 10,719/- wan pld w AIMCO Forex prt td towards international travel medical insurance in addition to per diem for 5 days for Petitioner No 1 for Global Action Meeting. Neither the hair styling on 8/12/12 nor the a purchase of souvenir at Rome not the travel medical insurance have anything to do with objects of the Trust. So also the visit to Italy for i which travel allowance was claimed had no connection with the objects i ofthe Trust. All these expenses incurred by the trust onthe Petionere i Een Re penpenr es i days totaling to Rs 7200/- between 8/10/12-13/10/12 for a Gulbarg memorial program in Delhi. All payments including a Mumbai -Delhi- Mumbai air ticket, hotel accommodation, food was charged to the trust. A day prior to her departure .ie. 7/10/12 Petitioner no 1 spent Rs. 3100/-at Shivas Hair Designer. The daily allowance amount of Rs. \ { 7200/- was paid to Petitioner no 1 on 13/10/12 and was utilized along with other disbursements from the trust to settle the credit cards bill for the concerned month, It is important to note that all these expenses have been debited under the head “Secular Education” or “ Legal Aid Expenses”. Petitioner no 2 on his part has also misused daily allowance. In FY 2011- | 12 Petitioner no 2 attended a PUCL meeting in Delhi unconnected with the charitable objects of Sabrang trust for 2 days ie. 28/4/11 and 29/4/2011. For this out of town trip the Petitioner no 2 claimed expenses from the trust of Rs 4200/- approx. for 2 days, as daily llowance and for purchase of books’ for personal reading (Who are the I Nagas, Glimpses of North East India, The Story of Binayak Sen.) and conveyance. None of these expenses were concerned with the objects of GE tetra ‘ Petitioner No 2 also travelled to Beed in Maharashtra to attend a Urdu Sahitya Sammelan and charged a daily allowance of Rs 600 per day from 24/1/11 to 28/1/11 amounting to Rs 2400 in addition to travel expenses and local conveyance. Again this trip and expenses have nothing to do with the object of the trust. It is important to note that all these expenses have been debited under the head “Secular Education 5] Art for Sabrang. [An art auction was held at Taj Lands End Bandra, Mumbai on 16/10/08. The gross receipt from the auction was Rs 1 Crore. According to Petitioners the expenses incurred on the auction including payments made to painters who donated paintings for auction] amounted to about 60 lakhs. No evidence has been furnished by Petitioners for the expenses claimed or the gross amount received. Assuming that Petitioners are right, a net amount of Rs 40 lakhs was received by the trust, Even out of this net amount of Rs 40 lakhs an amount of Rs 25 Lakhs was transferred to CJP, leaving an amount of only Rs 15 lakhs out of the art proceeds with Sabrang trust. Although the advertising blitzkrieg soliciting donation for riot victims had commenced, not one penny out of the art auction receipts was disbursed in any manner to or expended on the riot victims. Moreover it was reported at the time of the auction that several paintings were unsold but were available for purchase by the public at anytime, The Petitioners were called upon to furnish the stock details of the paintings received, sold and those lying in stock but have failed to do so .The paintings are the property of the trust; yet the final Ae including the balance sheet and notes appended thereto make no reference/ disclosure to this valuable asset in possession of the eo trustees. It is respectfully submitted that the Petitioners have made a business out of charity. i — 6] Evading disclosure norms laid down by statute to conceal the misappropriation, unilaterally altering the prescribed form (Schedule IX) of the Income and Expenditure Statement. ‘The Petitioners are conscious of the massive fraud perpetrated by them, While most of the devices of misappropriation of charitable funds set out hereinabove require examining of account books and returns of the trust, the excessive remuneration , allowances and payments to a related concer ie, SCPPL, would have been apparent from the face of the Final Accounts if compiled in conformity with the law . It was known to the Petitioners that receipt of salary by them of large quantum was grossly illegal and improper. Further the Petitioners were also aware that the illegal payments were capable of detection because of statutory requirements of disclosure of remuneration paid to trustees. Thus for example, Schedule IX of The Bombay Public Trust Act which consists of fa prescribed form of income and expenditure account mandatorily required to be submitted to the Charity Commissioner. The said form in Schedule IX consists of an entry titled “Remuneration to trustees”, Up to 31-03-2009, this form was submitted by the Petitioners in the prescribed form with the prescribed entry but against the prescribed entry ic. “Remuneration to trustees”, a nil amount was shown. After 2009, when the salary of both the Petitioners started increasing exponentially every year, the prescribed format was not submitted but instead a Schedule IX which suited the criminal design of the Petitioners was submitted. This doctored Schedule IX( not in prescribed form) did not contain the entry “Remuneration to trustees”. The motive was to suppress from the Charity aan that the Petitioners were receiving not only salary but exorbitant salary, thus concealing one of the more detectable modes of siphoning the trust's charitable funds. The Petitioners in addition to the offences alleged in the FIR are also of guilty of offences pertaining to 2 cusilipnica concealing information that they were bound to disclose to a public servant ie, the Charity Commissioner; fabricating evidence; forgery and tampering with public documents, Annexed herewith is a blank prescribed format, prescribed format followed by the petitioner and the manipulated format as submitted by the petitioners as ANNEXURE “O” (Colly). B] Misappropriation of funds in CJP Trust. 1) In addition to the monthly salary which she drew from Sabrang Trust, Petitioner No.1 has also drawn salary and allowances ranging from Rs. 46,200 in March ‘09 to Rs. 4,01,000/- in March'l3. In other words, the Petitioner has saddled 2 charities with salary expenses in her capacity of a trustee in each, Apart from the salary payments by the 2 Trusts to Petitioner Nol & Sabrang Trust to Petitioner No.2, the Petitioners apparently have no source of income and it appears that the Trusts in fact became a source of livelihood for both Petitioners. Hence the Petitioners have every interest in perpetuating the activities of the Trust. Significantly the activities appear more to have benefitted the Petitioners themselves than any charitable object, 2) As in the case of Sabrang Trust set out hereinabove, the Petitioner used SCPPL, (an otherwise near defunct company with little or no activity, barring the publication of a monthly magazine “Communalism Combat” itself substantially funded by donations towards subscriptions and with ae miniscule circulation ) , as a convenient vehicle for transferring a portion of CJP's funds for their own use. The salary which Petitioner ee No.1 charged CJP & the expenses which CJP incurred on account of ‘ { i Tate of services allegedly provided by SCPPL to it, constituted about 21% per annum on an average of the Trust’s total receipts. ‘The ledger accounts furnished to the investigating agency by CJP indicate that payments made by the trust to SCPPL are mainly disclosed under the narration ‘shared establishment expenses"/ “shared staff cost"/ “shared telephone” / “mobile expenses". These payments are not on actual expenses incurred but are flat predetermined lump sum payments and appear to be some kind of license fee charged by SCPPL to CIP. The annual report along with the I.T Returns of SCPPL, although sought for by the investigating agency has not been submitted by the Petitioners. It is further to be investigated how these payments were being disclosed in SCPPL’s IT returns if indeed have been filed. It is to be noted that the “Establishment” for which expenses are incurred is part of a residential property of Respondent No 1's late father. In the very nature of the things a fee for the use of those premises ought not to have been charged and most certainly not from a charitable trust. ‘The imposition of these expenses on the Trusts by the Petitioners is tantamount to profiteering from charity. 3) The remaining substantial amount of CJP’s donations have been accounted for by the Petitioner under the head of “Legal Aid Expenses”, ‘While the narrations in respect of some of the expenses disclose that payments are made to lawyers, there are no supporting documents as to why and for which particular cases the lawyers were thus paid, Neither are there any vouchers indicating the payments made to the lawyers nor are there any memos of fees by the lawyers who were allegedly paid by the trust.Other narrations include food bills, travel expenses, hotel expenses, driver's salary, petrol expenses, conveyance charges, gifts to lawyers, purchase of books and newspapers. There are no supporting vouchers in respect of any of the payments made through the Bank 4 $i _| : Account or recorded by Journal entries. None of the alleged expenses can be verified in the absence of important documents like bank and journal vouchers which have been requested for but not provided by the Petitioners, 4] Donation for ambulance service: After the terrorist attack on 26/11/2008 the petitioners advertised that they noticed that during the said terror strike there was shortage of ambulances and lives could have been saved had such existed. The petitioners used this ruse to raise donations for CJP allegedly to purchase ambulances which would be provided for the benefit of citizens of Mumbai by diverse means such as soliciting foreign funds soliciting local funds and organizing a music concert on 21/3/09, the proceeds i from which and box collections during which were earmarked for & purchase of ambulances. Through these methods CJP received a donations of about Rs 37.5 lakhs in the Financial Years 2008-09 and i 2009-10. Out of this amount Rs 22 lakhs was received as foreign i donation, Rs 11 lakhs from local donations and Rs 4.5 lakhs from the ’ ‘The books of accounts of CJP discloses the total receipts of the i music concert held at Shanmukhanand hall on 21/3/09 as being i approvimately Re 20 lakhs, The Petitioners clam thai about Re 17 lakhs

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