Reiterating the same objections is not a ground to take away bail, and the CBI loses on both counts

Nearly four years after a Special Judge released the former Mumbai Police Commissioner and the former head of the National Stock Exchange, the agency’s challenge reaches judgment — and fails on the narrowness of its own case.

On 21 December 2022 a Special Judge under the Prevention of Corruption Act at Rouse Avenue granted regular bail to Sanjay Pandey and to Chitra Ramakrishna in the CBI’s case about the interception of telephone calls at the National Stock Exchange. The CBI challenged both orders under the High Court’s inherent jurisdiction.

On 23 September 2026, Justice Madhu Jain dismissed both petitions. The bail stands.

What the CBI alleges

Sanjay Pandey, an Indian Police Service officer since retired, incorporated iSEC in 2001, held half its shareholding and was one of its two directors. He resigned as a director in 2006 and transferred his shareholding to members of his family. The CBI’s case is that even after his formal association with the company ended he continued to participate in and exercise control over its day-to-day affairs — the extent and nature of which he disputes.

Chitra Ramakrishna was, over the same period, a senior functionary at the NSE: Deputy Managing Director until 2010, Joint Managing Director until 2013 and Managing Director until December 2016. That tenure substantially overlaps the period for which iSEC remained engaged by the exchange.

In 2009 iSEC submitted an undated proposal to the NSE described as a “Periodic Study of Cyber Vulnerabilities”. It was initiated within the exchange by Mahesh Haldipur and approved by Ravi Narain and Chitra Ramakrishna. A work order of 3 June 2009 followed, endorsed “kind attention to Sanjay Pandey”, and the arrangement was renewed year on year.

The CBI alleges that what iSEC actually did went beyond what the proposal and the work orders disclosed — that it included unauthorised interception, recording and examination of the telephone calls of certain NSE employees. As against Chitra Ramakrishna specifically, the allegation is that she introduced Sanjay Pandey to a senior NSE official and entrusted him with coordinating the assignment.

Two agencies, two sets of arrests

The procedural history matters to the outcome, because the case ran on two tracks at once.

The CBI registered its case in July 2022 on a complaint received the same day, against iSEC, both respondents and others. The FIR invoked Sections 120-B, 409 and 420 of the Indian Penal Code; Sections 69B, 72 and 72A of the Information Technology Act, 2000; Sections 20, 21, 24 and 26 of the Indian Telegraph Act, 1885; Sections 3 and 6 of the Indian Wireless Telegraphy Act, 1933; and Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988.

Four days later the Enforcement Directorate registered its own case on the scheduled offences arising from the CBI’s. The ED arrested Chitra Ramakrishna on 14 July 2022 and Sanjay Pandey on 19 July, and their bail applications in those proceedings were refused in August 2022.

The CBI then arrested Sanjay Pandey on 24 September 2022 and Chitra Ramakrishna on 27 September, and both applied for regular bail before the Special Judge.

The judgment sets the two tracks out side by side. In the ED’s case, Chitra Ramakrishna was arrested on 14 July 2022 and Sanjay Pandey on 19 July, and bail followed for him on 8 December 2022 and for her on 9 February 2023. In the CBI’s case, he was arrested on 24 September 2022 and she on 27 September, with bail for both on 21 December 2022. Between them the two agencies produced four arrests and four separate bail decisions arising from the same alleged facts.

While those applications were pending, a coordinate bench of the Delhi High Court granted Sanjay Pandey regular bail in the ED’s case by a judgment of 8 December 2022. When the Special Judge came to decide the CBI bail applications later that month, she referred to the prima facie observations about the scheduled offences in that judgment, and granted bail to both.

One feature of the timeline is worth stating plainly. The orders under challenge were passed in December 2022; the petitions against them were filed in 2023; judgment came in September 2026. Counsel for Chitra Ramakrishna told the Court that cognizance had still not been taken since the filing of the charge-sheet. Both respondents have been on bail throughout.

The CBI’s case for cancelling

The agency’s central complaint was about what the bail orders had borrowed. They reproduce the prima facie conclusion of the PMLA bail judgment — that the ingredients of the scheduled offences were not made out — and apply it to the CBI’s own case without an independent evaluation. That, the CBI argued, effectively prejudges the very offences sought to be tried and is capable of seriously prejudicing the prosecution. The customary formula that nothing in a bail order expresses a view on merits, it said, cannot cure an order which in substance rests entirely on a finding that the prosecution’s case is not made out.

For the law it relied on Deepak Yadav v. State of U.P. (2022) 8 SCC 559 — that an order granting bail may be set aside where relevant material has been ignored, irrelevant considerations have governed the decision, or the discretion has been exercised arbitrarily or perversely. The relief sought was not that bail be refused outright, but that the orders be set aside and the applications remitted to the Special Judge for fresh consideration on the present record.

The respondents answered that the two proceedings were differently situated. Manik Bhattacharya v. Ramesh Malik, on which the CBI leaned, concerned the effect of interim protection against coercive action by a different investigating agency; this case concerns regular bail granted after custody and after the investigation had substantially progressed. The order under challenge neither restrains the CBI from investigating nor confers any immunity from its case. It determines one thing only — whether continued custody was warranted.

Setting aside bail is not the same as cancelling it

Before answering anything, the judgment separates two things that are routinely conflated, and the distinction governs the rest of it.

Setting aside an order granting bail, and cancelling the bail of an accused, may produce the same practical consequence — the person goes back into custody — but they are governed by distinct legal considerations. The Court therefore delineates them expressly before identifying which principles apply here.

It works through the authorities. Neeru Yadav v. State of U.P. drew the distinction between cancellation founded on post-release conduct and a challenge to the order itself. Meena Devi v. State of U.P. (2022) 14 SCC 368 explained that a challenge to the correctness of an order granting bail requires examining whether the discretion was exercised improperly or arbitrarily, whereas an application to cancel ordinarily proceeds on supervening circumstances or a breach of bail conditions. More recently Ashok Dhankad v. State (NCT of Delhi) (2025) consolidated the position after considering those decisions.

The rule that emerges is that the two operate in distinct fields. On a challenge to correctness, the superior court examines whether the discretion exercised at the time of granting bail was vitiated by perversity, illegality, non-application of mind, consideration of irrelevant material, or omission to consider material and relevant circumstances. On an application to cancel, the inquiry centres on the accused’s subsequent conduct, violation of conditions, or supervening circumstances.

The CBI’s petitions were of the first kind. It alleged nothing about the respondents’ conduct since release; its case was that the orders were wrong when made. That confines what it had to prove.

The narrow question on a challenge to bail

Justice Jain frames the scope of the inquiry tightly, and the framing does most of the work.

The Court was required only to conduct a limited assessment of whether the orders of 21 December 2022 suffered from perversity, illegality, material defect or non-application of judicial mind, such as to warrant interference in the exercise of inherent jurisdiction. Not whether the High Court would have granted bail on the same material — whether the order granting it was sustainable at all.

That assessment resolved into two questions. First, whether the Special Judge was entitled to take into account the coordinate bench’s PMLA judgment concerning Sanjay Pandey. Second, whether, having done so, she independently considered the remaining material the CBI had placed before her and exercised her own discretion.

Borrowing from the PMLA judgment

On the first, the Court holds the Special Judge was entitled to take the December 2022 judgment into consideration, and that doing so did not by itself amount to an abdication of her jurisdiction. The judgment was neither binding nor determinative on her when deciding bail, but it was a relevant circumstance.

The more difficult version of the objection was that the two respondents were differently placed — the PMLA judgment had granted bail only to Sanjay Pandey, and the acts attributed to each of them are not the same. Justice Jain answers it by separating two things that the objection runs together.

The Special Judge did not proceed on the footing that the acts attributed to the two were identical. Her reliance on the earlier judgment was directed at the common ingredients of the alleged predicate offences. The individual role of an accused and the essential ingredients of an offence are distinct considerations, and even where the acts attributed to two accused differ, a prima facie judicial assessment about the absence of an essential ingredient of the common offence may remain relevant to both. The Special Judge had also expressly noted that the observations she was drawing on were prima facie, and that what was before her was likewise confined to bail.

Because the allegations against the two were not identical, the Court went on to examine each separately, rather than treating the pair as one case.

Did she consider the CBI’s objections?

On the second question the Court read the bail orders against the objections and found the objections recorded rather than passed over.

The Special Judge expressly noted the CBI’s point that it had not been a party to the ED proceeding. She noted its further objection that its status report had been filed in the quashing proceedings, not in the PMLA bail application before the coordinate bench. She then examined the factual connection between the two proceedings — that both arose from the alleged interception of telephone lines at the NSE between 2009 and 2017 — and recorded the alleged payment of Rs 4.54 crore by the NSE to iSEC and the offences underlying the ED case.

The CBI also urged that a charge-sheet filed one day after the orders now warranted a fresh assessment. The Court refused that squarely: the legality of the exercise of discretion on 21 December 2022 must be examined against the material and the prosecution case placed before the Special Judge on that date. A charge-sheet filed afterwards, including any alteration or addition of penal provisions, cannot retrospectively render the orders perverse; the consequences of an offence later added are for the competent court at the appropriate stage.

Manik Bhattacharya was held not to carry the matter further either. It arose from protective directions operating against a particular investigating agency, and does not make an order passed in one proceeding binding on another agency. The respondents claimed no immunity from investigation or lawful action by the CBI. The limited question remained whether the Special Judge had independently applied the governing parameters.

What the respondents said

Counsel for Chitra Ramakrishna invoked the proviso to Section 437(1) of the Code, making clear that her status as a woman was not being advanced as an absolute entitlement to bail but as an express statutory circumstance the court may weigh — alongside the length of the proceedings, the completion of the investigation, and her conduct while on bail.

A second argument went to consistency. Other co-accused, including a senior NSE officeholder, had been granted bail, and the CBI had not challenged every such order. No principled basis had been shown, it was submitted, for unsettling this bail while leaving the others undisturbed.

Why the challenge failed

The conclusion turns on what the CBI did not do rather than on what it argued.

The agency did not identify any material circumstance placed before the Special Judge that she had omitted from consideration. Nor did it demonstrate that the discretion she exercised was vitiated by perversity, illegality or reliance on an irrelevant consideration.

The objections it pressed — that the CBI and ED proceedings are distinct, that it was not a party to the PMLA bail proceedings, and that its status report had been filed in the connected quashing matter — were not being raised for the first time. They had been put to the Special Judge and dealt with by her.

What the CBI offered, in other words, was a reiteration of the same objections it had made below. That, the judgment holds, cannot justify substituting the High Court’s discretion for the Special Judge’s without establishing a legally sustainable ground for interference. The objections were held devoid of merit and rejected.

Finding no ground to interfere with the orders of 21 December 2022, the Court dismissed both petitions, disposed of the pending applications and vacated any interim orders.

It closed with the standard but consequential caveat: the observations in the judgment are confined to the adjudication of these petitions, and the trial court is to proceed uninfluenced by any prima facie observation made in it.