Court Grants Bail to Applicant After 20 Months in Custody

The court granted regular bail to the applicant, who had been in custody for 20 months in connection with offences under the Prevention of Money Laundering Act. The court considered factors such as flight risk and influencing witnesses but allowed bail, imposing conditions including surrendering the passport and not leaving India without permission. The court emphasized the applicant's previous compliance with bail conditions and the absence of evidence of tampering or influencing witnesses during the interim bail period. The court's decision was based on the applicant's time spent in custody and imposed conditions to ensure cooperation with the prosecution.

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Issues Involved:
1. Application for regular bail under Section 439 Cr.P.C. read with Section 45 of the Prevention of Money Laundering Act, 2002 (PMLA).
2. Allegations of cheating a consortium of banks and money laundering.
3. Arguments regarding business failure versus criminal conspiracy.
4. Applicability and interpretation of Section 45 of the PMLA post-amendment and the Nikesh Tarachand Shah judgment.
5. Consideration of flight risk, tampering of evidence, and influencing witnesses.

Detailed Analysis:

1. Application for Regular Bail:
The applicant sought regular bail under Section 439 Cr.P.C. read with Section 45 of the PMLA in connection with ECIR No.AMZO/02/2018 for offences punishable under Sections 3 and 4 of the PMLA. The applicant was arrested on 20.09.2019 and had been in custody since then.

2. Allegations of Cheating and Money Laundering:
The applicant, a director of several companies, was accused of cheating a consortium of banks led by SBI to the tune of Rs. 867.43 Crores. The allegations included diverting loan proceeds for personal use and purchasing properties worth Rs. 56 Crores. The applicant contended that the company had a good business track record and the financial distress was due to factors beyond control, including non-cooperation from banks.

3. Business Failure vs. Criminal Conspiracy:
The applicant's counsel argued that the financial distress and subsequent FIRs were a result of business failure and not criminal intent. They highlighted that the company had repaid Rs. 342 Crores to the banks and had significant pending orders. The forensic audit report indicated that the company faced issues such as non-payment by debtors and premature termination of contracts, leading to financial liquidity crunch.

4. Applicability and Interpretation of Section 45 of the PMLA:
The applicant's counsel argued that the twin conditions for bail under Section 45 of the PMLA were struck down by the Supreme Court in Nikesh Tarachand Shah v. Union of India (2018 11 SCC 1). They contended that post-amendment, the twin conditions were not revived, and the bail considerations should be similar to those under the IPC. The court noted that the amendment to Section 45 did not explicitly revive the twin conditions and considered the bail application without applying these conditions.

5. Consideration of Flight Risk, Tampering of Evidence, and Influencing Witnesses:
The court considered the factors of flight risk, tampering of evidence, and influencing witnesses. The applicant had previously been granted bail in related cases and had not violated bail conditions. The court found that the applicant's surrender of passport and other conditions could mitigate the risk of flight. There was no evidence of tampering or influencing witnesses during the interim bail period.

Conclusion:
The court allowed the bail application, noting that the applicant had already spent 20 months in custody and cumulatively 47 months. The court imposed conditions including surrendering the passport, not leaving India without permission, and not acting in a manner injurious to the prosecution. The connected applications for extension of temporary bail were disposed of, and the rule was made absolute to the extent of granting bail.

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