Identifiable proceeds of crime are essential for money-laundering charges; absence of a scheduled offence supported bail.

Bail under the Prevention of Money Laundering Act was considered alongside the requirement of identifiable proceeds of crime. The court noted that investigation had substantially progressed, the case depended mainly on documentary material and recorded statements, and further custodial interrogation was not shown to be necessary; bail was therefore granted. It also held that cricket betting was not the scheduled offence and that the material did not establish proceeds of crime, as the alleged link concerned SIM cards rather than a proven predicate offence. On that basis, the statutory presumptions were treated as inapplicable and the money-laundering allegation was not made out on the record.

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Issues: (i) Whether the applicants were entitled to bail in the complaint under the Prevention of Money Laundering Act, 2002; (ii) Whether the material disclosed that the applicants were involved in money-laundering on the basis of any identifiable proceeds of crime.

Issue (i): Whether the applicants were entitled to bail in the complaint under the Prevention of Money Laundering Act, 2002.

Analysis: The application was considered under Section 439 of the Code of Criminal Procedure, 1973, read with the bail restrictions under Section 45 of the Prevention of Money Laundering Act, 2002. The Court noted that investigation had substantially progressed, custody and remand had already been obtained, and the case rested largely on documentary material and recorded statements. The principles governing bail, including the absence of necessity for further custodial interrogation and the assessment of liberty against the gravity of accusation, were applied to the facts of the case.

Conclusion: The applicants were held entitled to bail.

Issue (ii): Whether the material disclosed that the applicants were involved in money-laundering on the basis of any identifiable proceeds of crime.

Analysis: The Court examined Sections 3, 4, 2(u), 2(y), 17, 23 and 24 of the Prevention of Money Laundering Act, 2002. It held that cricket betting itself was not the scheduled offence and that, on the material placed, the alleged proceeds related to SIM cards and not to any established proceeds of crime within the meaning of the Act. On that reasoning, the statutory presumption under Sections 23 and 24 was treated as inapplicable in the absence of identifiable proceeds of crime. As the foundational ingredient of money-laundering was not made out against the applicants, the rigours of Section 45 did not bar bail.

Conclusion: The Court found that the applicants were not shown to be guilty of money-laundering on the material before it.

Final Conclusion: The prosecution was held not to have established a prima facie case of money-laundering based on proceeds of crime, and the applicants were enlarged on bail on conditions.

Ratio Decidendi: In the absence of identifiable proceeds of crime arising from a scheduled offence, the offence under Section 3 of the Prevention of Money Laundering Act, 2002 is not made out and the bail restrictions under Section 45 do not apply with full force.

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