Megacity scam: HC dismisses Yogeshwar's pleas

The High Court of Karnataka has dismissed eight petitions filed by former minister C P Yogeshwar challenging the trial court order impleading Megacity (Bangalore) Developers and Builders Limited as accused in the proceedings related to Megacity scam case.

Yogeshwar, who was a managing director of the company, had challenged the July 8, 2022 order passed by the Additional Chief Metropolitan Magistrate at Bengaluru, allowing the application filed by Serious Fraud Investigation Office (SFIO).

The case pertains to a housing scheme called 'Vajragiri Township Project' launched in 1994-95. The project attracted about 3,100 applications at the time of its launch itself. However, owing to several reasons, such as steep increase in land prices and acquisition of lands for the Bangalore-Mysore Infrastructure corridor project, ‘Vajragiri Township Project’ could register only 1,360 residential plots and refunded the money along with interest to 1,030 applicants under various court orders.

It was the case of SFIO that the company had collected around Rs 60 crore from applicants. Of this, Rs 3.03 crore was invested for construction of a building at Channapatna and rented out to Fashion Forum (India) Pvt. Ltd, a company to which Yogeshwara is the Managing Director. The prosecution alleged misappropriation of funds raised from the applicants of Vajragiri Township Project.

In his petition, Yogeshwar contended that Megacity (Bangalore) Developers and Builders Limited could not have been impleaded as an accused as the project was in the name and style of Vajragiri Township Project. It was further submitted that power under section 319 CrPC could not have been invoked in the cases at hand.

Justice M Nagaprasanna has noted that in the teeth of the law laid down by the apex court, the Megacity ought to have been made an accused before the concerned court, as there is enough material against it for having allegedly misappropriated the amounts.

"The allegation of misappropriation is also against promoters and directors of Megacity (Bangalore) Developers and Builders Limited, may be erstwhile. But, without the company, the proceedings could not have gone on further. Therefore, the concerned court has rightly allowed the application, bearing in mind the necessity of the company to be an accused in the proceedings and it is in tune with the law laid down by the Supreme Court in the form of guidelines as noticed above," the court said.