New Delhi, July 28, 2026: The Supreme Court of India has ruled that an accused cannot ordinarily be compelled to deposit money allegedly involved in a cheating dispute as a pre-condition for obtaining anticipatory bail. The Court set aside a condition imposed by the Punjab and Haryana High Court requiring the accused to deposit ₹4 crore for the grant of pre-arrest bail.
The judgment was delivered by a Bench comprising Justice Ujjal Bhuyan and Justice Atul S. Chandurkar in Renu Mehta & Anr. v. State of Punjab & Ors., Criminal Appeal No. 3485 of 2026, arising out of SLP (Criminal) No. 4913 of 2026. The Supreme Court pronounced the order on 28 July 2026.
Supreme Court’s Key Finding
The Supreme Court held that when a High Court concludes that an accused is entitled to anticipatory bail, it should not impose a monetary deposit as a condition precedent for granting such bail, particularly in a private dispute involving allegations of cheating.
The Court specifically set aside the High Court’s direction requiring the appellants to deposit ₹4,00,00,000 before the concerned Magistrate as a condition for pre-arrest bail.
The ruling reinforces the principle that bail proceedings cannot be converted into proceedings for recovery of money allegedly cheated from the complainant.
What Was the Case About?
The appellants were accused in FIR No. 78 of 2022, registered at Police Station Phase-1, S.A.S. Nagar, Mohali, under Sections 406, 420 and 120-B of the Indian Penal Code, 1860.
According to the allegations in the FIR, the appellants had allegedly duped the informants of a substantial amount of money invested for the purchase of an industrial estate at Mohali, Punjab.
The informants had also instituted a civil suit for specific performance, which was pending before the Civil Judge, Senior Division, S.A.S. Nagar, Mohali. The High Court had observed that the dispute had a predominantly civil flavour and granted anticipatory bail to the appellants.
However, while granting anticipatory bail, the High Court directed the appellants to deposit ₹4 crore in the form of a Fixed Deposit Receipt (FDR) with the concerned Magistrate or Investigating Officer within six months.
Supreme Court Stayed the ₹4 Crore Bail Condition
The Supreme Court had earlier, on 13 April 2026, issued notice and stayed the condition requiring the appellants to deposit ₹4 crore as a condition precedent for bail.
At that stage, the Court directed the appellants to give an undertaking before the Trial Court that they would not transfer the properties further.
The appellants subsequently informed the Supreme Court that the undertaking had already been filed.
Bail Cannot Be Made Dependent on Payment of Money
While examining the legality of the ₹4 crore condition, the Supreme Court relied upon its earlier decisions, particularly Munish Bhasin v. State (NCT of Delhi) and Ramesh Kumar v. State (NCT of Delhi).
In Munish Bhasin, the Supreme Court had cautioned courts against imposing harsh, onerous, excessive or irrelevant conditions while granting anticipatory bail under Section 438 of the CrPC.
The Court in the present case also relied heavily upon its decision in Ramesh Kumar, where it had noticed a growing tendency in cheating cases to turn bail proceedings into mechanisms for recovering allegedly cheated money.
The Supreme Court observed that conditions imposed while granting bail should be directed towards ensuring the accused’s appearance before the investigating officer or trial court. A condition requiring payment of money may create the impression that an accused can secure bail by depositing the amount allegedly involved in the offence. The Court made it clear that this is not the purpose of bail provisions.
Exception for Exceptional Cases
The Supreme Court also clarified that its ruling does not mean that a monetary deposit can never be considered in any circumstances.
Referring to Ramesh Kumar, the Court noted that in exceptional situations—such as allegations involving misappropriation of public money, where an accused voluntarily offers to make good the allegedly misappropriated amount—the court may consider the issue in the larger public interest.
However, such an approach would generally not be warranted in private disputes where private parties allege that their money has been involved in an offence of cheating.
Supreme Court Refers to Gajanan Dattatray Gore
The Court also relied upon Gajanan Dattatray Gore v. State of Maharashtra & Anr., reiterating that courts should not grant regular bail or anticipatory bail on the basis of an undertaking by the accused or family members to deposit a particular amount.
According to the principle referred to by the Supreme Court, bail applications must be decided on their merits and in accordance with law, rather than by making bail conditional upon payment or deposit of money.
Why the Supreme Court Did Not Follow the Subhelal Sahu Case
The Punjab and Haryana High Court had relied upon the Supreme Court’s decision in Subhelal Alias Sushil Sahu v. State of Chhattisgarh, reported as (2025) 5 SCC 140.
However, the Supreme Court distinguished that case from the present matter.
In Subhelal Sushil Sahu, the matter concerned a cryptocurrency scam involving nearly 2,000 investors, and the Supreme Court had directed the accused to deposit ₹35 lakh in view of the peculiar facts of that case and the interests of a large number of depositors.
The Supreme Court in the present case specifically held that the peculiar circumstances of Subhelal Sushil Sahu did not apply to the case of Renu Mehta and another.
Supreme Court’s Final Order
After considering the submissions, the Supreme Court concluded that once the High Court had found that the appellants were entitled to anticipatory bail, it should not have imposed the ₹4 crore deposit requirement as a pre-condition for bail.
The Supreme Court therefore set aside the condition requiring the appellants to deposit ₹4 crore.
The Court further observed that the undertaking given by the appellants not to transfer their properties was redundant because the Civil Court had already passed an order restraining them from alienating the suit property. The undertaking therefore stood merged with the Civil Court’s order.
Since the investigation had been completed, the Supreme Court directed the prosecution to submit the charge sheet within two weeks, after which the parties could avail themselves of their remedies in accordance with law. The appeal was accordingly allowed.
Key Takeaways From the Supreme Court Judgment
The important legal principles emerging from the judgment are:
- Bail cannot ordinarily be made conditional upon payment of the alleged cheated amount.
- Courts should avoid imposing harsh, onerous, excessive or irrelevant conditions while granting anticipatory bail.
- Bail conditions should primarily facilitate the accused’s appearance before the investigating officer or trial court.
- Bail proceedings should not be transformed into money recovery proceedings.
- Monetary deposit conditions may be considered in exceptional circumstances, particularly where larger public interest is involved.
- Private disputes involving allegations of cheating should generally not result in a monetary deposit being imposed as a condition for anticipatory bail.
- Bail must ultimately be decided on the merits and in accordance with law.
- A court should not make anticipatory bail conditional upon an undertaking to deposit a particular amount merely to secure the accused’s release.
What This Judgment Means for Anticipatory Bail Cases
The ruling is significant for accused persons facing cheating and criminal breach of trust allegations arising out of commercial or property disputes.
The judgment reiterates the distinction between criminal proceedings and civil recovery proceedings. Where a dispute has a predominantly civil character and the accused otherwise satisfies the requirements for anticipatory bail, requiring the accused to deposit the alleged disputed amount may effectively turn the bail proceeding into a recovery mechanism.
The Supreme Court’s reasoning therefore provides an important ground for challenging excessive monetary conditions imposed while granting anticipatory bail.
Important Note on BNS and BNSS
The present case arose from an FIR registered under the Indian Penal Code, 1860, and the Supreme Court considered the anticipatory bail issue with reference to Section 438 of the Code of Criminal Procedure, 1973.
Therefore, while the principle is highly relevant to contemporary bail litigation, practitioners should examine the corresponding provisions under the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS) when dealing with cases governed by the new criminal laws.
Case Details
Case: Renu Mehta & Anr. v. State of Punjab & Ors.
Court: Supreme Court of India
Case Number: Criminal Appeal No. 3485 of 2026
SLP: Special Leave Petition (Criminal) No. 4913 of 2026
Date of Judgment: 28 July 2026
Bench: Justice Ujjal Bhuyan and Justice Atul S. Chandurkar
FIR: No. 78 of 2022
Police Station: Phase-1, S.A.S. Nagar, Mohali
Offences: Sections 406, 420 and 120-B IPC
Main Issue: Whether a direction to deposit ₹4 crore could be imposed as a condition precedent for granting anticipatory bail.
Decision: The Supreme Court set aside the ₹4 crore deposit condition and allowed the appeal.
Conclusion
The Supreme Court’s decision in Renu Mehta v. State of Punjab reinforces an important principle of bail jurisprudence: the grant of anticipatory bail should not ordinarily be linked to the accused depositing the money allegedly involved in a private cheating dispute.
The Court’s ruling, read with Munish Bhasin, Ramesh Kumar and Gajanan Dattatray Gore, emphasizes that bail conditions must remain connected to the purpose of bail and should not become a mechanism for recovery of disputed amounts.
The judgment is therefore likely to be an important reference in cases where courts impose substantial monetary deposits or payment conditions while granting anticipatory bail.