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A Supreme Court bench of Justices Sanjay Kishan Kaul and MM Sundaresh today orally observed that the government is acting ‘penny wise pound foolish’ by not upgrading the existing State Forensic Labs and not having more such labs. 

The top court noted that though the government is putting efforts to recover money from fraudulent businessmen it is not upgrading the infrastructure to back its efforts up.

The observation came when Additional Solicitor General of India(ASG) SV Raju submitted that extracting data of defrauded investors from a hard disk is time-consuming and expensive. He further submitted that the Telangana State Forensic Lab is not cooperating with the Serious Fraud Investigating Agency.

He told that there is a fear of the data being tampered with as the agency itself has one copy of the raw data on a hard disk.

Court then asked Raju as to why private individuals cannot be hired to expedite the process.

Raju submitted that when huge costs are incurred for hiring private individuals, questions may arise. The court, at this point, remarked, "The costs will be minuscule when compared with the recoveries made. The government is acting 'penny wise pound foolish' they should upgrade the existing forensic labs and have more such labs."

Essentially, Court was hearing a plea against Heera Gold Exim Pvt Ltd which had collected investors' money on the promise to pay 36% dividend return, however, the same was not paid.

The investors' money was allegedly duped. Earlier, Court had granted bail to its Managing Director on the ground of settling investors' money.

Court, in its order, noted, “ We are unable to appreciate as to why the assistance of the Petitioner has not been taken since the Investigating Agency (Serious Fraud Investigation Agency) has not been able to perform give the task.” 

Ranjit Kumar, Sr. Adv appearing for Heera submitted that he will ensure that two of the officers of the petitioner company will be present in three days to ensure that the data is retrieved and a list of investors is prepared. Court accepted this and permitted the technical staff of Heera to work under the supervision of SFIO.

The matter has now been adjourned for further consideration and compliance.

Case title: The State of Telangana Represented by Special Officer Vandhana & Ors. vs M/s Heera Gold Exim Pvt Ltd & Ors.