Chennai-based homestay aggregator Stayzilla’s co-founder and chief executive Yogendra Vasupal, who was arrested last month on charges of defrauding a vendor, is granted bail by the Madras High Court, a top company executive told VCCircle.
The bail comes after Vasupal’s two earlier applications were turned down by Chennai Special Metropolitan Magistrate and Principal Sessions Court, respectively, last month.
Rupal Yogendra, co-founder and wife of Vasupal, confirmed that he is granted conditional bail, subject to furnishing legal procedures pertaining to surety bonds and depositing Rs 40 lakh.
“Vasupal should be out by day after tomorrow after we complete the legal formalities,” said Rupal.
According to Rupal, Justice Bhaskaran S, who presided over the hearing, said the case should be settled in a civil court as it concerns a dispute between two businessmen.
Vasupal was booked under Indian Penal Code sections 506 (1) (criminal intimidation), 420 (cheating) and 406 (criminal breach of trust) on 14 March in Chennai, after Jigsaw Advertising, a Chennai-based advertising agency, filed a criminal complaint alleging non-payment of dues.
According to Rupal, the legal representatives of Jigsaw Advertising have reached out on several occasions for an
out-of-court settlement, but Vasupal intends to bring the case to a logical conclusion through legal means.
Following Vasupal’s arrest, a litany of entrepreneurs and investors—including Flipkart’s co-founder Sachin Bansal and Snapdeal’s co-founder Kunal Bahl—took to social networking platforms voicing their ire and demanding Vasupal’s release. They said the arrest of an entrepreneur on criminal charges against the backdrop of several early-stage firms shutting down will further hurt the startup ecosystem.
“A simple question of non-payment of dues has led to the unnecessary arrest of an individual. However, more often than not, (apex court’s) guidelines are not scrupulously followed by the investigating police officer,” said Guruprasad Manoharan, an advocate practising at the Madras High court.
In February, Stayzilla—which has raised close to $30 million in funding since inception—halted operations and said it will re-launch with a different business model.
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