The Supreme Court stayed the virtual anticipatory bail granted to Shridhar Pujar in the Karnataka Bitcoin scam case. Pujar has now approached the Karnataka High Court for interim bail, fearing arrest by the SIT.
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BENGALURU: The Supreme Court of India imposed a stay on the virtual anticipatory bail order previously granted to Shridhar Pujar, a police officer under investigation in a high-profile Bitcoin-linked scam in Karnataka. In response, Pujar has now moved the Karnataka High Court seeking interim bail, fearing arrest by the Special Investigation Team (SIT) of the Criminal Investigation Department (CID). The high court briefly heard the matter on Tuesday( 4th June) from the petitioner’s side and adjourned it for further hearing.
Earlier, on May 24, the Supreme Court had intervened to stay a May 2 order by the Karnataka High Court, which had granted virtual anticipatory bail to the deputy superintendent-ranked police officer, Shridhar Pujar, involved in the Bitcoin scam investigation in Bengaluru. The SIT had approached the Supreme Court on May 15 to challenge the High Court’s decision. The High Court had ordered Pujar’s release on a surety of Rs two lakh after a day of questioning, despite Pujar not explicitly seeking bail in his petition.
The Supreme Court’s vacation bench, consisting of Justice Bela Trivedi and Justice Pankaj Mithal, passed an order on May 24, staying the High Court’s decision but granting Pujar the liberty to file a formal plea for bail.
The court stated-
“A stay is hereby imposed on the enforcement of the challenged order.”
Shridhar Pujar’s move to seek interim bail from the Karnataka High Court is seen as a critical step in his legal strategy, especially after the Supreme Court’s stay order. The ongoing investigation by the SIT continues to unravel the details of the scam, and the legal battles surrounding the case are expected to shed more light on the involved parties and the extent of the scam.
The Supreme Court has provided specific legal recourse for a Karnataka DSP implicated in a Bitcoin scam, emphasizing that the officer can seek bail independently of prior rejections.
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The Supreme Court clarified that the officer has the liberty to file for anticipatory bail or bail, stating-
“However, respondent No.1 is free to submit a separate application for anticipatory bail or bail before the relevant court. If such an application is submitted, it will be evaluated solely on its own merits, without being influenced by the High Court’s contested order or any previous rejections of respondent No.1’s application(s).”
during the proceedings on May 24.
This directive comes in the backdrop of a contentious legal battle involving DSP Shridhar Pujar, who was denied anticipatory bail by a special CID court in Bengaluru. The bail plea was rejected on February 23, with the court highlighting the severe nature of the allegations related to the Bitcoin scam involving international hacker Srikrishna, also known as Sriki. The court observed that the case presented instances suggestive of “a fence eating the crop,” pointing to a severe breach of trust and corruption within the police force.
Further complicating the legal landscape, the Karnataka High Court had previously granted relief to Pujar not by addressing his anticipatory bail directly but by quashing two cases against him and a proclamation order for evading investigation. This decision was made despite the Special Investigation Team’s (SIT) argument that the officer had used his investigative authority for personal gain.
The SIT highlighted-
“The investigating officer, entrusted with the responsibility of conducting inquiries and apprehending offenders, has misused his investigative authority to engage in unlawful activities, including the unjustified detention of accused individuals in prior cases and the unauthorized access of cryptocurrency wallets, websites, gaming applications, etc., for illicit gains.”
reflecting deep concerns about the misuse of power.
In an additional measure to ensure cooperation, the Karnataka High Court bench mandated that Pujar “join the investigation and cooperate with the investigation process.” It allowed the SIT to take him into judicial custody on May 8 for one day for custodial investigation but stipulated his release at the end of the day upon the furnishing of a Rs 2 lakh bond.
The Karnataka Police’s management of a high-profile hacking case has come under serious criticism, following accusations of misconduct by several police officers. These claims have led to a fresh round of investigations led by a Special Investigation Team (SIT), formed by the recently elected Congress government. The focal point of these allegations is Srikrishna, popularly known as Sriki, whose involvement in multiple hacking incidents has rattled the local law enforcement’s reputation.
Overview of the Case and Accusations
Srikrishna, a 29-year-old hacker, was arrested in November 2020 and has been a controversial figure in the realm of cybercrime in Karnataka. His re-arrest by the SIT on May 6, 2024, was linked to the theft of 60.6 Bitcoins, approximately valued at Rs 1.14 crore, from a cryptocurrency exchange in Tumkur in 2017. The re-emergence of these charges points to unresolved issues within the initial investigations conducted by the Crime Branch of Bengaluru.
The allegations against the former Crime Branch officers include illegal confinement, breach of trust by public servants, and destruction of evidence. Those implicated are Sridhar Pujar (now a Deputy Superintendent of Police), inspectors Prashanth Babu, Chandradhar S R, Lakshmikanthaiah, and a private cyber expert, K S Santhosh Kumar, who had assisted in the 2020 investigation. The FIR against these individuals, lodged on January 24, 2024, highlights the severity of the procedural missteps purportedly taken during the initial probe.
Investigations into the case have unveiled numerous procedural lapses attributed to the Central Crime Branch (CCB). Notable issues included the illegal detention of suspects, the absence of proper documentation for logins, passwords, and computer usage data of the accused, and unorthodox methods such as providing Sriki with a laptop worth Rs 60,000 to demonstrate his hacking abilities while in custody.
These procedural errors have not only compromised the integrity of the investigations but also led to allegations of corruption. The handling of these cases by the police under the BJP-led state government, particularly after the arrests made in November 2020, had previously sparked accusations from the Congress. These accusations gained further traction when the Congress took office in June 2023 and established the SIT to probe into the so-called Bitcoin scam.
The controversy deepened with statements made by Sriki, which are documented in the charge sheets filed by the crime branch.
He claimed-
“I was compelled to surrender all cryptocurrency in my possession to the authorities while under police custody between November 2020 and January 2021.”