2025 (11) TMI 308 - HC - Money Laundering

Expungement denied; cancellation of open non-bailable warrants refused as custodial probe needed to trace complex money trail

HC refused to expunge a reported remark, finding the comment was an innocuous general observation about adjournments wrongly sensationalized by media and ... Seeking expungement of the remark allegedly made by this Court, as reported in various Media Houses - such reporting has caused great harm to the reputation of the learned Senior Advocate and requires clarification - HELD THAT:- It has become a disturbing trend in recent times to report even some most innocuous remark that may be made by the Court during the case hearings, which may or may not even be connected with the proceedings, merely to create sensation. Such reporting of the court proceedings, which may generate curiosity of public to read with more interest, is accepted without realizing that such remarks are not part of the proceedings or do not pertain to the merits of the case, and need no prominence or even reporting - This is also one such case where an innocuous general remark expressing a concern about repeated adjournments by Counsels, was made. To observe and falsely attribute that the remark was specifically directed toward the Senior Advocate, is not only incorrect but is essentially designed to create a sensational news story of interest to the public at large, with scant regard to the harm it may cause to an individual who is diligently discharging his duty of representing the litigant. This is clearly not the mandate for the media, which owes the responsibility of not only making correct information available to the public but also ensure that unnecessary sensationalization is not created by taking innocuous remarks out of context and reporting them as the main event. With their expertise in journalism and reporting, no guidance from any Court is required as to what is germane to the court proceeding that may be reported and that which is of no consequence. Thus, no further clarification is required. It is expected that the Media houses which are of great repute, would themselves consider whether such reporting should be allowed to continue on their media Portals. No further directions are required - application disposed off. Dismissal of Petitioner’s Application for cancellation of Non-Bailable Warrants (NBWs) - It is claimed that the issuance of non-bailable warrants against the Petitioner is mala fide and has been done for oblique reasons to curtail the precious liberty of the Petitioner - whether the learned Trial Court was justified in recording its objective satisfaction that the Petitioner was wilfully evading the process of law, despite the Petitioner’s repeated offers to join the investigation through video conferencing, thereby warranting the issuance and subsequent refusal to cancel the Non-Bailable Warrants? - HELD THAT:- NBWs should not be issued where the investigative purpose is merely procedural or primarily aimed at forcing a confession, as has been held in Santosh [2017 (10) TMI 1478 - SUPREME COURT]. However, in the instant case, the NBW is essential for legally compelling the custodial interrogation of the accused, which the investigating agency deems indispensable to uncover the complex money trail. The ED has stated that effective investigation and unearthing the conspiracy cannot be done without confronting the accused with voluminous documents seized during search in June 2020 and incriminating evidence received through Letter Rogatories regarding foreign entities controlled by him. The investigations reveal that funds, which were the proceeds of crime from the main conspirators, were transferred to various Companies under the control of the Petitioner. Furthermore, the Petitioner’s Company, EMAAR MGF Land Limited, was connected to a middleman, Guido Haschke, whose resignation coincided with a dispatch of Christian Michel James, pointing to his role in the alleged conspiracy - The Investigating Officer concluded that the Petitioner was prima facie guilty and his custodial interrogation was necessary. This finding, coupled with the Accused’s failure to join the investigation, made the issuance of the NBW warranted and proper. The Petitioner’s underlying fear is that his physical appearance will inevitably lead to his arrest. While the purpose of the NBW is to secure his attendance, the law provides adequate remedies for this apprehension - The Petitioner’s fear that he would “necessarily be arrested” is a misplaced apprehension. The Petitioner has ample safeguards and provisions under the law to seek protection, once he subjects himself to the jurisdiction of the Court. In the totality of circumstances, it is hereby held that there is no ground for cancellation of the open NBW issued by the ACMM - Petition dismissed. ISSUES PRESENTED AND CONSIDERED 1. Whether the Court should expunge or clarify any allegedly attributed adverse judicial remark reported by media and/or direct media houses to retract and apologise for false reporting of court proceedings. 2. Whether the Non-Bailable Warrants (NBWs) issued during investigation were legally sustainable - specifically: (a) whether the Trial Court objectively recorded satisfaction of 'wilful evasion' warranting NBWs; (b) whether issuance of NBWs under Section 73 Cr.P.C. during investigation is permissible; (c) whether the accused's willingness to cooperate via video-conferencing (VC) negates requirement for physical attendance; (d) whether custodial interrogation was necessary given the documentary nature of the investigation; (e) whether issuance of NBWs was mala fide or discriminatory. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Media reporting of Court proceedings and relief sought for alleged false attribution Legal framework: - Media have a constitutional and professional duty to report court proceedings accurately and not to publish distorted or misleading versions that prejudice reputation or public opinion; courts may clarify or require remedial action where reporting is false and defamatory. Precedent treatment: - The Court relied on established authorities holding media responsible for accuracy and fair reporting and recognizing that journalists are not immune when publishing distorted versions of judicial proceedings. Those authorities were cited to underline the media's duty rather than to mandate specific coercive remedies in every instance. Interpretation and reasoning: - The reported narrative arose hours after the hearing and selectively attributed an adverse remark to the Court which, on record, did not form part of the judicial Order. The Court characterized the reported remark as an innocuous general observation on repeated adjournments taken out of context and sensationalised to target a counsel's reputation. However, the Court noted the media houses involved are reputed and capable of self-correction. Ratio vs. Obiter: - Ratio: Media must ensure accuracy and refrain from sensationalised reporting that misattributes judicial remarks; courts have power to clarify record where false reporting injures reputation. - Obiter: Observations criticizing contemporary media trends in selective reporting and sensationalism extend beyond the narrow facts and constitute policy observations urging responsible journalism. Conclusions: - No court-ordered expunction or mandatory deletion/apology was directed: the Court found that a formal clarification was unnecessary on the facts and expected reputed media houses to self-evaluate and act responsibly; the application for further directions was disposed of accordingly. Issue 2(a) - Validity of NBWs: Objective satisfaction of wilful evasion Legal framework: - Power to issue warrants (including NBWs) affects Article 21 rights and must be exercised judiciously; NBWs are an extraordinary coercive measure aimed at securing attendance where there is objective satisfaction that the accused is evading process. Precedent treatment: - The Court applied and followed authorities recognizing (i) the circumstances in which NBWs may be issued (reasonable belief of non-appearance, inability to serve summons, or risk of harm/tampering) and (ii) that Magistrates can issue NBWs during investigation to secure attendance. Interpretation and reasoning: - The Court examined the sequence of summonses, the accused's overseas presence since 2019, the medical certificates and subsequent travel, alleged applications for foreign citizenship, and repeated failure to physically join despite nine summonses and offers to provide documents through representatives. The Trial Court's recorded objective satisfaction was held to rest on admissible facts and reasonable inferences of evasion and flight risk. Ratio vs. Obiter: - Ratio: Where repeated summonses are ignored, prima facie material exists and objective satisfaction of wilful evasion can be recorded to justify NBWs; issuance during investigation is permissible when necessary to prevent stalling and secure custody for effective interrogation. - Obiter: Broader policy comments on how long-running investigations may be frustrated by insistence on VC are supplemental observations. Conclusions: - The Trial Court's conclusion of wilful evasion was sustained; NBWs were justified on facts showing persistent non-appearance and risk of placing oneself beyond reach of jurisdiction. Issue 2(b) - Power to issue NBWs during investigation (Section 73 Cr.P.C.) Legal framework: - Section 73 Cr.P.C. and the general scheme of Cr.P.C. permit Magistrates to take measures necessary to secure attendance; such power is not confined to the trial stage and may be exercised during investigation. Precedent treatment: - The Court followed precedent affirming the Magistrate's ancillary power to issue process, including NBWs, at the investigation stage where required to aid investigation and prevent miscarriage of justice. Interpretation and reasoning: - Authorities permitting issuance of warrants during investigation were applied; the Court held that issuance of NBWs to secure an accused's attendance for investigative confrontation is within the Magistrate's jurisdiction when objective satisfaction exists. Ratio vs. Obiter: - Ratio: Issuance of NBWs under Section 73 during investigation is legally permissible when objectively justified by the accused's conduct and the needs of effective investigation. Conclusions: - NBWs issued during investigation in the present facts were lawfully within the Magistrate's powers. Issue 2(c) - Whether willingness to cooperate via Video-Conferencing negates requirement for physical presence Legal framework: - VC is an established procedural facility to record evidence or facilitate participation but does not create an absolute right to avoid physical presence when attendance is legally required for effective investigation or confrontation. Precedent treatment: - The Court acknowledged precedents allowing VC for evidence recording and witness testimony, but distinguished their factual contexts from situations where custodial confrontation and interrogation are necessary for investigation. Interpretation and reasoning: - VC was characterised as a facilitative measure primarily for recording evidence and minimizing hardship, not as a tool for an accused to dictate investigative modality. Given the volume of seized documents, digital evidence, and foreign letters rogatory, the Court accepted the investigating agency's contention that physical confrontation and custodial interrogation were necessary and that VC would be insufficient to secure prompt, effective investigation. Ratio vs. Obiter: - Ratio: A plea to appear only via VC does not automatically defeat an objectively justified NBW; VC cannot substitute physical presence where custodial confrontation is necessary for effective investigation. Conclusions: - The accused's insistence on VC did not negate the need for physical attendance; the Trial Court's rejection of that contention was upheld. Issue 2(d) - Necessity of custodial interrogation where investigation is documentary Legal framework: - In offences involving complex money-trail and foreign transactions, physical confrontation and custodial interrogation may be necessary to clarify transactions, confront seized documents, and secure evidence; however custody cannot be sought merely to extract confession. Precedent treatment: - The Court applied precedents cautioning against custodial measures used simply to force confessions, but recognized authority allowing custody where prima facie material and the nature of investigation necessitate it. Interpretation and reasoning: - While many aspects of the probe rely on documentary records, the Court accepted the investigating agency's averment that voluminous documents and foreign correspondence required immediate confrontation that could not be effectively conducted by VC. The Court balanced the presumption of innocence with the practical needs of unraveling a complex international money-laundering trail. Ratio vs. Obiter: - Ratio: Custodial interrogation may be justified even in documentary cases where confrontation with large volumes of seized material and foreign evidence is essential for investigation; such justification must rest on prima facie material and necessity. Conclusions: - Custodial interrogation and physical presence were held to be legitimately sought for investigative purposes in the instant facts; this supported the issuance of NBWs. Issue 2(e) - Allegation of mala fide, discrimination and availability of safeguards Legal framework: - Allegations of mala fide in issuance of judicial process carry a heavy burden of proof; investigating agencies may adopt coercive measures against individuals based on individual conduct and evidence without being bound to treat all co-accused identically. Precedent treatment: - The Court applied authority stressing the high threshold to establish mala fide and rejecting unsupported claims of political vendetta; it also followed precedent that differential coercive action may be permissible if justified by material specific to an accused. Interpretation and reasoning: - The Court found the mala fide and discrimination allegations unsubstantiated on record. The repeated summonses, prima facie material linking proceeds to entities under the accused's control, and specific investigative needs differentiated the accused from other co-accused abroad. The Court also noted legal safeguards available to the accused upon appearance, negating the argument that physical attendance necessarily equates to arrest without remedy. Ratio vs. Obiter: - Ratio: Mere allegation of mala fide or discrimination, without high-order proof, cannot invalidate objectively justified NBWs; individualised coercive measures are permissible when supported by evidence and necessity. Conclusions: - The mala fide and discrimination pleas failed; legal safeguards exist for the accused upon surrender, and the issuance of NBWs was not vitiated by mala fide or discriminatory motives. Final Disposition (as to the NBW challenge) - Considering the totality of circumstances - repeated summonses, overseas travel after medical certification, alleged attempts to place oneself beyond jurisdiction, prima facie material from seized documents and letter rogatory, and the investigative necessity for physical confrontation - the Trial Court's objective satisfaction of wilful evasion and the consequent refusal to cancel the open NBW were upheld. The petition under Section 482 Cr.P.C. challenging the dismissal of the cancellation application was dismissed as devoid of merit.