Long Incarceration Won't Yield Any Benefits: Madras High Court Grants Interim Bail To Financier In Mylapore Hindu Permanent Fund Case

Justice G Jayachandran noted that keeping the accused in jail for long would not yield any benefits and said:

"At the same time, this Court also take note of the fact that the petitioner was arrested on 13.08.2024 a year ago and till date, the depositors are not in a position to get even a fraction of the money deposited. In the said circumstances, long incarceration of this petitioner is not going to yield any result, except diminution of assets value available for liquidation".

The court thus directed Yadav to be released on interim bail till 30^th October and asked him to mobilise a sum of Rs. 100 Crore, to be deposited before the court dealing with cases under the Tamil Nadu Protection of Interests of Depositors (TNPID) Act.

The court also directed Yadav to surrender before the Special Judge after the expiry of the interim bail period, after which he was to be committed to prison. The court added that Yadav should take steps to sell the properties and provide details to the Special Court. However, the court cautioned that any sale must only be with the approval of the Special Court. The court also said that no transfer or encumbrance could be created in on the property without the approval of the Special Court.

“The petitioner shall take all endeavour to sell the properties offered in his affidavit dated 22.08.2025 along with the supporting affidavit of Mr.Solamon Mohan Dass and Mr.Sudhir Shankar and he shall produce the proposal and progress about the liquidation of the said assets to the TNPID Court by 30.10.2025. Any sale of those properties shall be only on the approval of the Special Court for TNPID Act Cases, Chennai and with consent of the prosecution,” the court said.

Yadav, who was the managing director of M/s. Mylapore Hindu Permanent Fund Limited – Nidhi company was accused of canvassing deposits through various schemes and arrangements, promising high returns and defaulting the payment of maturity amounts. He was accused of diverting the amount collected towards deposits for personal gains and unjust enrichment, along with the directors of the company. He was subsequently arrested on August 13, 2024.

Seeking bail, Yadav argued that the delay in repayment to the matured depositors was due to covid pandemic. He argued that the delay caused panic among the depositors and they rushed for premature closure, which led to the filing of the complaint. It was submitted that after Yadav's arrest, the fund office was sealed, and those who wanted to repay the loan amount were prevented from doing so. He also contended that the TV company that was functioning in the premises was closed, and its share value also came down to zero. Yadav submitted that if he was released on bail, he could liquidate the assets and pay the dues.

The state, on the other hand, objected to the bail petition and argued that the details of the property provided in the affidavit were not the personal property of Yadav. It was also pointed out that the properties were not free from any encumbrances. The State also argued that the market value shown for the property was excessive and exorbitant. The State thus argued that Yadav had not come to the court with clean hands, and if he was released on bail, he would abscond.

The court noted that the amount alleged to have been cheated from the public was to the tune of Rs. 619 crores and a further amount of Rs. 700 crore had been disbursed from the fund account, by way of fake gold loans. The court also noted that though the value of property as claimed by Yadav was around 633 crore, as per the State, the guideline value of the property was only 36 crore.

While the court agreed that the assets offered by Yadav, by way of the affidavit would not be adequate to meet the liability, the court also noted that even after his arrest over a year ago, the depositors were not in a position to get even a fraction of the money deposited.

Yadav was asked to execute a bond of Rs. 10 Lakh with two sureties for like sum to the satisfaction of the Special Judge. Yadav was also asked to surrender his passport before the special judge and report before the special judge every Monday.

Counsel for the petitioner: Mr. S. T. S. Murthy, Senior Counsel for Mr. R. Hari

Counsel for the Respondents: Mr. E. Raj Tilak, APP, Mr. A. Ashwin Kumar, Mr. Arun C. Mohan, Mr. R. Thirumoorthy, Mr. K. Sarathkumar, Mr. K. Rahul, Mr. T. Harish Chowdhary, Mr. R. Shriram Adhethyen

Case Title: T Devanathan v. The State

Citation: 2025 LiveLaw (Mad) 310

Case No: Crl. O.P.No.18872 of 2025