2022 (10) TMI 198 - HC - Money Laundering

Applicant granted bail in PMLA case over money laundering & corruption allegations. Health condition considered.

The court granted bail to the Applicant in a PMLA case involving allegations of money laundering and corruption. The court considered the Applicant's ... Seeking grant of bail - money laundering - proceeds of crime - creation of various assets in the name of his family members out of unaccounted money - twin conditions under Section 45 of the PMLA - HELD THAT:- As the starting point of the alleged demand to collect money from the bars and restaurants was allegedly in the meeting in the month of October 2020 in which Mr. Karunakar Shetty had given the list of 1750 bars and restaurants, during the course of hearing, the Court inquired as to whether the statement of Mr. Karunakar Shetty was recorded. Mr. Anil Singh fairly tendered a copy of the statement of Mr. Karunakar Shetty which was recorded on 8th November, 2021. It would be suffice to note that Mr. Karunakar Shetty had a different tale to tell. He claimed to have met Mr. Sachin Waze once and, in the said meeting, the latter demanded Rs.10 lakhs for unhindered functioning of his restaurants and bar till late hours - In the confession before the learned Magistrate, Mr. Sachin Waze stated that he received call from Mr. Kundan Shinde and, thereupon, went to the designated places and delivered the cash. No call was thus attributed to the Applicant before the delivery of the cash amount. This omission, prima facie, cannot be said to be innocuous. In a sense this runs against the claim of Mr. Sachin Waze of direct instructions by the Applicant to Mr. Sachin Waze, immediately before the alleged delivery of cash to Mr. Kundan Shinde. Without delving into the aspect of the alleged inconsistent statements made by Mr Sachin Waze before the other forums including Justice Chandiwal Commission of Enquiry, where Mr. Sachin Waze, allegedly disowned everything, in my view, the aforesaid material, prima facie, renders it unsafe to place reliance on the statement of Mr. Sachin Waze, a co-accused, that cash amount was collected and delivered to Mr. Kundan Shinde at the instructions of the Applicant. The material on record does indicate that the Applicant has been suffering from multiple ailments. He is 73 years of age. Few of the ailments may classified as de-generative. The medical reports/certificates also show that the Applicant is suffering from chronic ailments, as well. In the light of the material on record, it would be audacious to observe that the Applicant is not a sick person - Evidently, the exercise of discretion on medical ground is rooted in facts of a given case. In the case at hand, the Court has considered the entitlement of the Applicant for bail on merits as well, and found a prima facie case for exercise of discretion is made out. As the proviso empowers the Court to exercise the discretion in favour of an accused who is otherwise sick or infirm, the Court has considered the material on record and finds, in the totality of the circumstances, a case for exercise of the discretion under the proviso as well. The Applicant appears to have roots in society. The possibility of fleeing away from justice seems remote. The apprehension on the part of the prosecution of tampering with evidence and threatening the witnesses can be taken care of by imposing appropriate conditions - Application allowed. Issues Involved:1. Bail Application under PMLA.2. Allegations of money laundering and corruption.3. Influence over police transfers and postings.4. Health condition of the Applicant.Detailed Analysis:1. Bail Application under PMLA:The Applicant sought bail in PMLA Case No.1089 of 2021, arising from ECIR No. NBZO/1/66 of 2021, for alleged offences under Section 4 read with Section 3 of the Prevention of Money Laundering Act, 2002 (PMLA). The Applicant was in judicial custody since 15th November 2021, after initial remand to ED's custody. The court considered the Applicant's entitlement to bail based on the material collected during the investigation.2. Allegations of Money Laundering and Corruption:The gravamen of the indictment against the Applicant included:- The Applicant, in his capacity as Home Minister, allegedly reinstated Mr. Sachin Waze, who was under suspension for 16 years. The Applicant and Mr. Waze allegedly worked together to extort money from bar owners.- The Applicant instructed Mr. Waze to collect Rs. 3 Lakhs per month from 1750 bars and restaurants across Mumbai. Mr. Waze collected Rs. 4.70 Crores from December 2020 to February 2021, which was handed over to Mr. Kundan Shinde, the Applicant's PA.- The Applicant allegedly laundered the proceeds of crime through shell companies managed by Surendra and Virendra Jain, transferring Rs. 1.71 Crores to Shri Sai Shikshan Sanstha, a charitable trust managed by the Applicant's family.The court noted that the prosecution's case primarily rested on the statements of witnesses, including Mr. Sachin Waze and Mr. Param Bir Singh, whose credibility was questioned by the Applicant.3. Influence over Police Transfers and Postings:The Applicant was accused of influencing transfers and postings of police officials for undue advantage. Statements from Mr. Sanjeev Palande, Mr. Ravi Vhatkar, Mr. Sitaram Kunte, and Mr. Param Bir Singh indicated that the Applicant provided unofficial lists for transfers and postings, which were often accepted by the PEB. However, there was no direct evidence of illegal gratification. The court found the statements of Mr. Sachin Waze and Mr. Param Bir Singh to be hearsay and lacking certainty.4. Health Condition of the Applicant:The Applicant, aged 73, cited multiple ailments as grounds for bail. The court considered the medical reports indicating the Applicant's chronic and degenerative conditions. The first proviso to Section 45 of PMLA allows for bail on grounds of sickness or infirmity. The court found that the Applicant's health condition warranted consideration for bail, in addition to the merits of the case.Conclusion:The court concluded that the Applicant had succeeded in crossing the first hurdle of demonstrating reasonable grounds for believing he was not guilty of the offence. The court also considered the Applicant's health condition and the lack of antecedents. Consequently, the court granted bail with specific conditions to ensure the Applicant's compliance and prevent tampering with evidence or influencing witnesses. The bail order was stayed until 13th October 2022, to allow the Respondent to approach the Supreme Court.