Bombay High Court grants bail to Cox and Kings auditor in bank fraud case

The Bombay High Court has granted bail to Naresh Jain, an internal auditor of Cox and Kings Limited (CKL) and one of the accused in a fraud case being probed by the Economic Offences Wing (EOW) of the Mumbai police. The bench, led by Justice Manish Pitale, observed that Jain had already spent significant time in custody.
Earlier, Jain was granted bail in a related case that was probed by the Enforcement Directorate.
The allegations against Jain came from complaints filed in 2020 at the Cuffe Parade and MRA Marg police stations. The EOW later took over the probe. The case is based on a complaint filed by a vice president of IndusInd Bank, accusing Jain, along with CKL’s chief financial officer and directors, of defrauding the bank.
According to the complaint, IndusInd Bank extended a commercial credit card facility to CKL in February 2015 with a credit limit of Rs 25 crore. This was meant to support the company’s travel and tourism business. Over time, the limit spiked, reaching Rs 370 crore by March 2018. In June 2019, CKL defaulted on statutory payments and informed stock exchanges about its inability to repay commercial paper worth Rs 150 crore. Several other banks were also affected, the probe revealed.
In July 2019, several banks, including IndusInd Bank, Axis Bank, Yes Bank, and State Bank of India, filed a case before the National Company Law Tribunal (NCLT) for claims amounting to Rs 270 crore.
The committee appointed “Price Waterhouse Coopers” as a forensic auditor, which reported alleged misappropriation of funds by CKL. These funds were allegedly diverted to entities owned and operated by individuals, including Jain.
During the hearing, Jain’s lawyer, Advocate Satyavrat Joshi, argued that the chargesheet had been filed and the primary allegation against Jain involved falsification of accounts. Joshi noted that Jain had already been in custody for nearly three years, and even if convicted, the maximum sentence for the charges would not exceed seven years.
While giving the orders, Justice Pitale noted, “This Court finds that there is sufficient material… to indicate that such amounts were received as professional charges and professional fees with regard to the services provided by the applicant to CKL.”
The court also observed that Jain had paid taxes on these amounts, which could not be considered a basis to deny bail.