2022 (3) TMI 1651 - HC - Money Laundering

Bail denied where petitioner wilfully violated bail conditions, sold attached assets, avoided attendance, risked obstructing justice; Section 50 PMLA

HC dismissed the petition for regular bail in a money-laundering matter. The petitioner, though not originally an accused in the FIRs, had been granted ... Money Laundering - seeking grant of regular bail - petitioner is neither an accused nor is in any way involved with the 7 FIRs but was also called by the Enforcement Directorate in terms of Section 50 of PMLA and statements were duly recorded - petitioner was declared a Proclaimed Offender - HELD THAT:- It is abundantly clear that petitioner was released on bail accepting the bail bonds and surety bonds in pursuance to the orders dated 28.02.2017 passed in CRM-M-42455 of 2016 by this Court. In the said order specific conditions were imposed, out of which, one being to the effect that 'he would continue to avail the concession of bail subject to the attachment/seizure of his immovable properties already identified by the Enforcement Directorate'. It was also directed in the said order that the trial Court shall ensure that no order to release the attached properties is passed. From the records it is crystal clear that the petitioner-Harmesh Kumar Gaba has sold out 2 properties which were attached by the Enforcement Directorate pleading that he was un-aware about the attachment of these properties. Such contention of the petitioner is absolutely contrary to the record, as the Provisional Attachment Order No. 04/2015 dated 17.12.2015 identifying the properties to be attached, has such a reference specifically therein. Even the notices to vacate the properties under sub-Section 4 of Section 8 of the Act were issued. These notices bear the signature of the petitioner as a token of receipt of the notice to vacate. This shows the conduct of the petitioner, who alleged to have sold those properties despite receiving notices to vacate - From the factual aspects and record, no iota of doubt is left in the mind of this Court, that the petitioner was well aware of attachment of all the properties, attached by the Enforcement Directorate including the one which has now been sold. The petitioner had full knowledge that the property which he was selling was attached and can not now feign ignorance regarding these facts. This Court is of the conclusive view that the petitioner not only violated the terms and conditions stipulated in his bail order dated 28.02.2017 passed in CRM-M-42455 of 2016 but also dared to stay away from the Court for creating hindrance in the furtherance of justice. There is a serious and justified apprehension that if such concession is granted to the petitioner again, as prayed in the present petition, he would again violate the conditions whatsoever and may also thwart the process of the trial. Petition dismissed. ISSUES PRESENTED AND CONSIDERED 1. Whether regular bail under Section 439 Cr.P.C. is maintainable in a prosecution under the Prevention of Money Laundering Act where the applicant previously enjoyed pre-arrest bail subject to specific conditions but is alleged to have violated those conditions. 2. Whether sale/disposition of immovable property subject to provisional attachment under the Act and notice to vacate constitutes breach of bail condition and/or sufficient ground to refuse further bail. 3. Whether non-appearance after cancellation of bail, issuance of non-bailable warrants and declaration as a Proclaimed Offender under Section 82 Cr.P.C. justifies refusal of subsequent bail applications. 4. Whether illiteracy, advanced age or claimed unawareness of attachment can excuse alleged violation of bail conditions and non-cooperation with the trial process. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Maintainability of regular bail under Section 439 Cr.P.C. after prior conditional pre-arrest bail Legal framework: Section 439 Cr.P.C. confers power on the High Court to grant regular bail. Bail is a discretionary remedy and may be refused where conditions of earlier bail have been breached, or where there is apprehension of interference with trial. Precedent Treatment: The judgment does not rely upon or distinguish any authority; the Court proceeds on principles of judicial discretion governing bail. Interpretation and reasoning: The Court noted that pre-arrest bail was granted on specific terms, including continued bail 'subject to the attachment/seizure of his immovable properties already identified by the Enforcement Directorate' and a directive that the trial court shall ensure no release of attached property. The applicant's conduct (sale of attached properties, non-appearance after cancellation of bail) was held to demonstrate misuse of the earlier bail concession and an intent to obstruct the process of law, warranting denial of fresh bail. Ratio vs. Obiter: Ratio - The Court's refusal of bail rests on the principle that breach of explicit bail conditions and conduct obstructing trial are proper grounds for denying subsequent bail under Section 439 Cr.P.C. Obiter - No broader pronouncements on bail jurisprudence beyond application to the facts were made. Conclusion: Regular bail under Section 439 Cr.P.C. was refused in view of the proven breach of prior conditional bail and the real likelihood of repeat violation and obstruction of trial. Issue 2 - Effect of sale/disposition of property subject to provisional attachment under the Act Legal framework: The Prevention of Money Laundering Act permits provisional attachment of properties and issues under the Act include notices to vacate and prohibitions on disposal of attached assets; compliance with attachment orders is a condition that may be imposed as part of bail. Precedent Treatment: No precedents were cited or considered; the Court assessed the statutory scheme and documentary record. Interpretation and reasoning: The Court examined the provisional attachment order and notices under Section 8(4) of the Act, noting the attachment specifically identified the properties sold. Documentary evidence - notices bearing the applicant's receipt signature and an appeal filed by him against attachment identifying the same properties - established knowledge of attachment. The Court rejected the contention of ignorance, finding the sale of attached properties a deliberate breach of both statutory prohibition and bail condition. Ratio vs. Obiter: Ratio - Selling attached property, when done after notice and attachment, constitutes a material breach that may justify cancellation/refusal of bail. Obiter - The Court's factual findings on specific belongings and receipt signatures are particular to the case. Conclusion: The sale/disposition of properties subject to attachment was a proven violation that undermined the applicant's entitlement to bail and supported refusal of regular bail. Issue 3 - Consequence of non-appearance, issuance of non-bailable warrants and declaration as Proclaimed Offender Legal framework: Order of cancellation of bail, issuance of non-bailable warrants and declaration as a Proclaimed Offender under Section 82 Cr.P.C. are legal steps reflecting deliberate non-cooperation; courts consider such conduct in exercising discretion on subsequent bail petitions. Precedent Treatment: The Court did not reference specific case law but applied established discretionary principles regarding bail and contempts of process. Interpretation and reasoning: The Court recorded that after cancellation of bail bonds the applicant failed to appear despite notices; non-bailable warrants could not be executed and the applicant was declared a Proclaimed Offender. This conduct led to inability to frame charges and impeded trial progress. The Court concluded there was a justified apprehension that granting bail again would enable further evasion or obstruction. Ratio vs. Obiter: Ratio - Deliberate non-appearance after cancellation of bail and status as a Proclaimed Offender are valid and weighty grounds for refusing subsequent bail applications to protect trial integrity. Obiter - No additional remedial measures or alternative safeguards were prescribed. Conclusion: Non-appearance culminating in proclamation as an offender materially justified denial of the present bail application. Issue 4 - Sufficiency of illiteracy, age or alleged ignorance as excuse for breach of bail/attachment Legal framework: Defences based on illiteracy, age or limited education may be considered, but must be weighed against objective documentary evidence and overall conduct; such personal circumstances do not automatically excuse deliberate flouting of judicial or statutory orders. Precedent Treatment: No authorities were cited; the Court relied on factual assessment and equitable discretion. Interpretation and reasoning: The Court examined documentary proof (signed notices, appeal identifying attached properties, conduct of avoiding courts) and found the plea of illiteracy and ignorance inconsistent with these records. The pattern of deliberate non-cooperation and evasion contradicted any innocent explanation based on age or education. Ratio vs. Obiter: Ratio - Personal factors like illiteracy or age cannot nullify clear documentary evidence of knowledge and deliberate breach; such factors do not compel granting bail where there is credible evidence of deliberate obstruction. Obiter - The Court did not elaborate on standards for assessing such personal defences in other contexts. Conclusion: Illiteracy, age and claimed unawareness were rejected as excuses; they did not mitigate the proven breaches and therefore did not favour granting bail. Overall Conclusion The Court concluded that the applicant had violated express bail conditions and statutory attachment orders, deliberately evaded court processes resulting in proclamation as an offender, and therefore the petition for regular bail under Section 439 Cr.P.C. was devoid of merit and dismissed. The holdings set forth are directed to the facts proved: breach of bail conditions (including sale of attached property), non-appearance and obstruction of trial justify denial of further bail.