2022 (2) TMI 62 - HC - Money Laundering

Petitioner's Anticipatory Bail Denied, Petition Dismissed, CRM Cases Deemed Moot

Kailash Aggarwal Versus State of Punjab & Another

The court denied the petitioner's request for anticipatory bail due to the ongoing investigation, validity of attachment orders, inapplicability of cited ... Money Laundering - Seeking grant of anticipatory bail - Hawala transactions - defrauding the bona-fide investors while using the NSEL - petitioner has executed the sale deeds in respect of some of the properties attached - siphoning off of funds - HELD THAT:- It becomes quite explicit that these provide two different spells for the validity of the order qua the confirmation of the attachment of any property, on the basis of the stage of the proceedings in respect of any offence under the PMLA by specifying that in case, the investigation is continuing in respect of the commission of any such offence, then, the said order shall remain operative for a period upto 365 days but if the proceedings are pending before the Court, then it shall continue during the pendency of the same. The subject FIR is an off-shoot of the economic offence pertaining to the scam involving the investments of the genuine/ bona-fide depositors to the tune of ₹ 5600 crore approximately and a sum of ₹ 720 crore, out of the same, has allegedly been swindled away by the petitioner through his Companies. It has specifically been observed by the Apex Court in P. CHIDAMBARAM VERSUS DIRECTORATE OF ENFORCEMENT [2019 (9) TMI 286 - SUPREME COURT] that “the economic offences stand as a different class as they affect the economic fabric of the society and the merits of the contentions that Section 8 of the Prevention of Corruption Act, 1988 cannot be the predicate offence qua the appellant and whether it is attracted or not and as to whether the Enforcement Directorate had the threshold to acquire jurisdiction under the PMLA, cannot be considered at the stage when this Court is considering only the prayer for anticipatory bail”. In view of these observations, it is explicit that the afore-said contention cannot be looked into and adjudicated upon while deciding the instant petition qua the prayer of the petitioner for grant of anticipatory bail. This Court deems it appropriate and necessary to precisely discuss the conduct of the petitioner as the same would also be one of the key factors to adjudicate/ascertain his entitlement for the relief as prayed for in this petition. It has specifically been mentioned in Para 2 (VII) & (VIII) in the Reply, as initially filed by respondent No.2- Directorate, that the petitioner failed to comply with the order Annexure R-2/1 passed by Bombay High Court while granting him the relief of bail - it has also been specifically mentioned in Para 13 of the Reply filed on behalf of respondent No.1-State that the detailed investigation is required to be conducted to know about the officials of the Revenue Department and other persons who had helped the petitioner in disposing of the said properties and that the custodial interrogation of the petitioner would be required for the proper investigation of the present case. The petitioner does not deserve the relief of anticipatory bail and the petition in hand, being sans any merit, deserves dismissal - petition dismissed. Issues Involved:1. Legitimacy of the anticipatory bail request by the petitioner.2. Validity and duration of the attachment order under the Prevention of Money Laundering Act (PMLA).3. Applicability of legal precedents cited by the petitioner.4. Consideration of the petitioner’s age and health.5. Conduct of the petitioner in relation to court orders and compliance.Issue-wise Detailed Analysis:1. Legitimacy of the anticipatory bail request by the petitioner:The petitioner sought anticipatory bail, fearing arrest in a criminal case under various sections of the IPC, related to the NSEL Scam involving Rs. 5600 crore. The court noted that the investigation was still at a nascent stage and the petitioner had not yet joined it. The court emphasized that at this stage, it is not appropriate to determine whether the alleged offenses are made out or not.2. Validity and duration of the attachment order under the Prevention of Money Laundering Act (PMLA):The petitioner argued that the attachment order had lapsed as per Section 8(3) of the PMLA, which limits the validity to 365 days. However, the court found that the attachment order continues during the pendency of proceedings before the court. The court highlighted that the charge-sheet had already been presented and the trial was pending, thus the attachment order was still in force. The petitioner’s appeal against the attachment orders further indicated their validity.3. Applicability of legal precedents cited by the petitioner:The petitioner relied on the case of Seema Garg Vs. Deputy Director, Directorate of Enforcement, but the court found it inapplicable as the circumstances differed significantly. In Seema Garg, the investigation was pending, and the appellants were not accused in the FIR or the complaint. In contrast, the petitioner in this case was already charge-sheeted, and the trial was ongoing. The court also dismissed the relevance of Md. Ibrahim & Ors vs. State of Bihar & Anr., as it pertained to an appeal against charge framing, not anticipatory bail.4. Consideration of the petitioner’s age and health:The petitioner’s counsel argued for bail citing the petitioner’s age (73 years) and poor health, referencing the judgment in Arnesh Kumar vs. State of Bihar & Anr. The court noted that the directions in Arnesh Kumar applied to offenses punishable with imprisonment up to seven years, whereas the current case involved Section 467 IPC, which is punishable with life imprisonment. Thus, the petitioner’s age and health did not merit anticipatory bail in this context.5. Conduct of the petitioner in relation to court orders and compliance:The court scrutinized the petitioner’s conduct, noting multiple instances of non-compliance with court orders, including the sale of attached properties despite explicit directions not to do so. The court emphasized that the petitioner’s actions demonstrated a pattern of evading legal obligations and flouting court orders, which weighed against granting anticipatory bail. The court also highlighted the need for custodial interrogation to uncover the involvement of other individuals and officials in the disposal of attached properties.Conclusion:The court concluded that the petitioner did not deserve anticipatory bail due to the ongoing investigation, the validity of the attachment orders, the inapplicability of cited precedents, and the petitioner’s non-compliant conduct. The petition for anticipatory bail was dismissed, with a clarification that the court’s observations should not influence the merits of the case.CRM Nos.23269 & 18681 of 2021:These applications were rendered infructuous due to the final adjudication of the main petition and were disposed of accordingly.