PMLA bail and scheduled offence findings cannot be inconsistently assessed on the same foundational facts.

In bail proceedings under the Prevention of Money Laundering Act, 2002, where the applicants had already obtained bail in the scheduled offence under the NDPS Act on a prima facie finding that they were not guilty and would not commit further offence, the Court treated the laundering allegation as dependent on the same foundational facts and alleged proceeds of crime. It held that the statutory scheme links money-laundering to the scheduled offence, so a contrary prima facie satisfaction under the PMLA bail provision could not be sustained on the same material. On that basis, the twin conditions for bail were not treated as defeating release, and bail was granted subject to conditions.

---

---

Issues: Whether bail in a prosecution under the Prevention of Money Laundering Act, 2002 could be refused when the applicants had already been enlarged on bail in the scheduled offence under the Narcotic Drugs and Psychotropic Substances Act, 1985 on a prima facie finding that they were not guilty and would not commit an offence while on bail.

Analysis: The allegations under the money-laundering law were treated as dependent upon the existence of a scheduled offence and the generation of proceeds of crime from that offence. The statutory scheme of the Act, including the definitions of proceeds of crime and the provisions dealing with attachment and confiscation, was read to show that the laundering offence is an extension of the scheduled offence and that the criminal process under the Act is linked to the underlying offence. In the bail context, the Court held that where a competent court had already recorded a favourable prima facie satisfaction under the stricter bail provision applicable to the scheduled offence, it would be inconsistent to record a contrary satisfaction under the money-laundering provision on the same foundational facts. Reliance was also placed on the principle that liberty should not be curtailed without cogent grounds and that the satisfaction required for bail is only prima facie and for that purpose alone.

Conclusion: The contrary satisfaction under the money-laundering bail provision could not be sustained on these facts, and bail was granted.

Final Conclusion: The applicants were entitled to release on bail in the money-laundering case, subject to the conditions imposed by the Court.

Ratio Decidendi: When a scheduled offence has already resulted in a prima facie favourable bail finding, the court may treat the money-laundering accusation as failing the statutory twin conditions for bail if the laundering charge is founded on the same alleged criminal activity and proceeds of crime.

---