Money laundering case: 38 accused granted bail as indefinite detention violates liberty rights under Section 436-A

The Bombay HC granted bail in a money laundering case involving 38 accused persons. The court held that Section 436-A benefits cannot be denied solely based on serious allegations. While acknowledging the complexity of the case with thousands of pages and numerous witnesses, the court emphasized that indefinite detention is impermissible when trial commencement remains uncertain. The court noted that PMLA trials can proceed independently of scheduled offence trials, though by the same judge. Despite the prosecution filing draft charges, the court found that prolonged pre-trial detention without certainty of trial timeline violates personal liberty rights.

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Issues Involved:
1. Allegations under the Prevention of Money-Laundering Act, 2002 (PML Act).
2. Grounds for bail under Section 436-A of the Code of Criminal Procedure, 1973 (Cr. P.C.).
3. Delay in the conduct of the trial.
4. Seriousness of allegations and severity of punishment.
5. Status of the case before the Special Court.
6. Nature of other orders and their impact on the case.

Summary:

Allegations:
The Enforcement Directorate (E.D.) lodged an Enforcement Case Information Report (ECI Report) on 3rd October 2019 against 38 persons, including the two Applicants, under the PML Act. The allegations involve availing loans worth Rs. 6117.93 Crores from PMC Bank by the Applicants, who are promoters of HDIL, which are claimed to be proceeds of crime derived after committing a scheduled offence.

Grounds for Bail:
The Applicants argued for bail under Section 436-A of the Cr. P.C., stating they have already undergone half of the maximum punishment prescribed u/s 4 of the PML Act. They contended that filing bail applications does not amount to delaying the trial and there is no death penalty prescribed for their offence.

Opposition to Bail:
The E.D. opposed the bail, arguing that Section 436-A of Cr. P.C. does not provide an absolute right to bail. They emphasized the seriousness of the allegations, severity of punishment, and the difference between 'right to default bail' under Section 167 and Section 436-A of the Code. The trial court had noted various circumstances resulting in the delay of the trial.

Punishment Prescribed:
The punishment under Section 4 of the PML Act includes a minimum sentence of 3 years, a maximum of 7 years, and a fine extending to five lakh rupees. There is no death penalty prescribed, satisfying the first requirement for bail under Section 436-A.

Period Under Detention:
The Applicants have been in detention for more than three and a half years, satisfying the second requirement for bail under Section 436-A.

Delay in Conduct of Trial:
The trial court observed that the Applicants have filed numerous applications, which delayed the trial. The court noted that the trial for the scheduled offence and PMLA offences should be conducted independently, though by the same Judge.

Status of the Case:
The trial court has not yet framed charges, and the trial is expected to take a long time due to the complexity and volume of the case.

Findings:
The court acknowledged the Applicants' right to file applications and take steps to protect their liberty but emphasized that these actions should not be seen as delaying tactics unless mala fide is shown. The court also noted the seriousness of the allegations but concluded that the Applicants cannot be detained indefinitely without a clear timeline for the trial's completion.

Conclusion:
The court granted bail to the Applicants on furnishing a personal bond and surety bond of Rs. 5,00,000/- each. The Applicants are directed not to leave Maharashtra without prior permission, not to threaten prosecution witnesses, to attend the trial court punctually, and to surrender their passports to the EOW/ED. The court also directed the Registrar General to address administrative issues faced by the trial court.

Order:
The Bail Applications were allowed, and the Applicants were released on bail with specific conditions to ensure their presence during the trial. The request for cash bail was rejected.

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