Srinagar: The High Court of J&K and Ladakh has denied an anticipatory or pre-arrest bail to a retired Army personnel accused of cryptocurrency fraud worth lakhs of rupees.
The Court of Justice Mohammad Yousuf Wani in a detailed order denied bail to one Naresh Kumar Gulia who is alleged to have set up a fake cryptocurrency Ponzi Scheme to lure investors from India and other South Asian countries with bogus commissions.
Justice Wani while denying the bail recorded that “the petitioner is alleged to be involved in heinous offences of economic nature by being connected with the proceeds of crime. He is alleged to have cheated thousands of people by luring them to part with their hard-earned money under the false hope and expectation of a high percentage of profit/commission, by dragging them to the bogus “crypto currency/Emollient Coin Ponzi Scheme”.
Justice Wani while referring to the constitutional importance of personal liberty under Article 21, acknowledged that anticipatory bail is a safeguard against arbitrary arrest. However, it clarified that such relief must be granted with caution, particularly in economic offences affecting public confidence.
“The petitioner is alleged to have cheated thousands of people by luring them to part with their hard-earned money under false hopes of high returns through a bogus crypto-currency Ponzi scheme.”, the court remarked.
The case stems from an FIR registered at Police Station Leh under Section 420 IPC triggered by a complaint from the Additional District Magistrate, Leh, alleging large-scale public cheating through a crypto coin business run by A.R. Mir and Ajay Kumar Choudhary.
Later on the Enforcement Directorate (ED) registered the case under Sections 3 and 4 of the Prevention of Money Laundering Act, 2002 (PMLA) wherein ED alleged that Gulia and his associates ran the fake cryptocurrency scheme under different company names to lure gullible investors.
Though the petitioner claimed innocence and stated that he had invested in the crypto venture innocently and had no ownership or direct control over the companies involved.
He argued that he had been falsely implicated based solely on statements of co-accused and had not been summoned until a raid was conducted on his residence in Dehradun in January 2025.
Citing parity with co-accused who were granted bail, and offering full cooperation, he sought protection against arrest under Section 482 of the newly enacted Bhartiya Nagarik Suraksha Sanhita (BNSS), 2023.
The Enforcement Directorate vehemently opposed the bail plea, branding Gulia as the “actual mastermind” of the fraud, who had orchestrated the entire Ponzi scheme under the banner of “The Emollient Coin Ltd” and later “Tech Coin Ltd. which came to be dissolved in 2019.
“The petitioner dishonestly lured hundreds of innocent people not only from India but also from South Asian countries to purchase fake crypto Emollient Coins by offering unrealistic returns of up to 40% with additional commissions,” ED stated before court.
The ED also alleged that Gulia and his associates ran the scheme through fake mobile applications and seminars held across India, Vietnam, Cambodia, and the Philippines.
“Following detailed searches in 2024, at various locations in Jammu, Leh, and Haryana, incriminating documents were seized. A sum of ₹91 lakh in cash was recovered, with further evidence suggesting that Gulia was in possession of proceeds of crime worth ₹6.05 crore, including ₹57 lakh received in his nominated accounts from co-accused, they pointed Despite multiple summons under Section 50 of PMLA, the petitioner failed to join the investigation,” the investigating agency said.
Justice Wani recorded anticipatory bail is aimed at protecting those who genuinely apprehend arrest on false and frivolous grounds. This case does not inspire that confidence.
“The presence of the accused in custody before the Investigating Agency appears to be imperative for a logical and result-oriented investigation in the case,” court remarked and dismissed the plea of Gulia.
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