TaxTMI 
TaxTMI 
TaxTMI 
2017 (1) TMI 461
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....ese writ petitions by contending that the issue involved in these writ petitions relate to 2G Spectrum Case and therefore, this Court has no jurisdiction to entertain these writ petitions. It is further contended on behalf of the respondents that cases pertaining to 2G Spectrum are being monitored by the Honourable Supreme Court of India and no writ petition should be filed in any of the High Courts in the Country. Therefore, the respondents pleaded that these writ petitions can only be dealt with or adjudicated by the Honourable Supreme Court and this Court has no jurisdiction to exercise the power conferred under Article 226 of The Constitution of India to grant any relief in these writ petitions. Thus, the arguments advanced by counsel on either side was mainly confined to whether this Court has got jurisdiction to entertain these writ petitoins as the dispute involved in these writ petitions relates to 2G Spectrum scam. Therefore, these writ petitions are taken up for disposal to adjudicate whether the writ petitions are maintainable or not. WP No. 40240 of 2015:- 3. In this writ petition, it is mainly argued that the receipt of the sum of Rs. 26,00,444/- by the petitioner co....
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....es leading to the grant of FIPB approval and consequently into the payment of Rs. 26,00,444/- by AVTL to ASCPL. 4. According to the petitioner, the question of placing reliance on the order dated 10.02.2011 by the Honourable Supreme Court to the facts of this case has no application and it will not be a bar for entertaining this writ petition before this Court. According to the petitioner, this Court is empowered to entertain this writ petition under Article 226 of the Constitution of India. There is no charge sheet filed by the CBI pertaining to the grant of FIPB approval which allegedly landed the tainted proceeds in the hands of the accused. It is further contended that charge sheet should have been lodged by CBI in the Court of competent jurisdiction relating to FIPB approval. Unless a police report under Section 173 of Cr.P.C. has been filed by the CBI in connection with FIPB approval, the enforcement directorate cannot commence any investigation into the said transaction because it would be doing so without there being any proceeds of the crime held out by the accused as untainted money. Lastly, it is contended that the order of Supreme Court is dated 10.02.2011. The complai....
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....ppear in person on 31.08.2016 in connection with file number ECIR/05/DZ/2012 and to produce certain records. According to the petitioner, in response to the summons dated 19.08.2016, he has sent a legal notice dated 29.08.2016 seeking to furnish certain information as to whether the offences for which the summons have been sent to him relates to a scheduled offence and what are the proceeds of the crime and how the petitioner is involved in such activity connected with the proceeds of the crime. Since there was no response to the legal notice, the petitioner earlier filed WP No.3 1288 of 2016 to quash the summons contending that he has reasons to believe that such summons have been issued to him are motivated by malice in law and malice in fact on the part of the respondents. It was contended that the petitioner has reason to believe that there is determined campaign made to bring discredit and to harm the reputation of his father Shri. P. Chidambaram, who is now a leading member of the Opposition and former Finance Minister. In the said writ petition, the respondents have not filed their counter however, an affidavit dated 28.09.2016 has been filed by the Assistant Director, Direc....
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.... commission of underlying scheduled offence. In this context, reliance was placed on the decision in the case of Mahanivesh Oils and Foods Pvt Ltd., vs. Directorate of Enforcement, reported in 2016 SCC Online Delhi 475 wherein it was held that in cases under PMLA, where the commission of a scheduled offence is not established, there can be no question of the enforcement directorate exercising powers of investigation available only to the prosecuting agency. 8. In support of his contentions, the petitioner in WP No. 31288 of 2016 relied on the affidavit filed by Shri. P. Chidambaram, former Finance Minister stating that the CBI had already investigated the manner in which FIPB approval was given. After filing of the charge sheet in the Aircel-Maxis case, the agency has filed a status report before the Honourable Supreme Court which was also recorded in the order dated 09.09.2015. It is further stated that the CBI has recorded the statements of various officials, including his statement on 06.12.2014. Thereafter, on 28.08.2014, the CBI has filed the charge sheet in the Aircel-Maxis case. In such view of the matter, the former Finance Minister, in his affidavit, has stated that no sc....
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....eeds of crime generated therefrom on the one hand and the petitioner. Acccording to the petitioner, there is no mention as to how the petitioner is connected with the commission of offence even assuming it is an offence related to 2G spectrum case. The petitioner is neither a Director nor a shareholder of M/s. Advantage Strategic Consulting Private Limited. Therefore, according to the petitioner, it is strange that an FIPB approval granted during March 2006 could be connected to the aforesaid order of transfer and re-transfer of shares during March/October 2011. In fact, CBI has not filed a complaint or charge sheet in respect of FIPB approval, and hence, there is no predicate/scheduled offence made. In the absence of a predicate/scheduled offence, the enforcement directorate would have no jurisdiction to investigage any aspect of the FIPB approval or rely upon the order dated 10.02.2011 of the Supreme Court of India. 10. According to the petitioner, CBI has already issued a notice to M/s. Chess Management Services Private Limited relating to receipt of US Dollar 103,624 (for the year 2007-09); US Dollar 59,016 (for the year 2009-2011) and US Dollar 32,190 (for the year 2009-2010)....
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....s have been filed by the financial institutions in respect of the 26 entitles, the same may be informed immediately along with their batch ids to the Consultant at the e-mail id given therein. 12. According to the petitioners, a perusal of the names of the 26 companies indicate that they are companies where Mr. Karti Chidambaram has direct interest or companies owned by the relatives and friends of Mr. Karti Chidambaram. The petitioner companies are directly connected with Mr. Karti P. Chidambaram who is the son of former Finance Minister of India and presently Member of Parliament. According to the petitioners, even companies with a tenuous link with Karti P. Chidambaram have been targeted and included in the schedule to the impugned communication on the basis of malafide intention and politically motivated targets. Out of the 26 companies to which the notice was sent, four companies do not exist at all and their names have already been struck off by the Registrar of Companies three years ago. Further, the remaining 22 companies have no suspicious financial transactions, however, they were charged for having allegedly committed a scheduled offence as defined under Section 2 (y) o....
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....circumstances, the petitioners seek for quashing the communication which is impugned in these writ petitions. WP No. 36736 of 2016:- 14. This writ petition has been filed by M/s. Advantage Strategic Consulting Private Limited for a Mandamus directing the respondents to return the small plastic folder containing Indian Overseas Bank Deposit Receipts No. 35160 dated 08.03.2014; 351999 dated 08.03.2014, 351598 dated 08.03.2014 and 351597 dated 08.03.2014 in the name of the petitioner which was seized by the second respondent from the residence of the Director of the petitioner Mr. C.B.N. Reddy during the search operations on 01.12.2015 under the Panchanama in exercise of power under Section 37 of FEMA, 1999. The very same petitioner has filed WP No. 40240 of 2015 mentioned above for the relief of declaration. According to the petitiner, they are engaged in the business of consultancy with professionals in the field. The petitioner has set up a subsidiary in Singapore. The petitioner has been regularly filing FLA statement being the form of annual return on foreign liabilities and assets showing the summary of foreign assets and liabilities. Thus, all the assets and liabilities of th....
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....ents contained in the writ petitions. The affidavits filed in these cases are almost identical and similar. In one such affidavits filed in WP No. 31288 of 2016, it is stated by the respondents that the writ petitions are not maintainable and therefore they have raised a preliminary objection as regards maintainability of these writ petitions before this Court. According to the respondents, the investigations done by the department relates to 2G spectrum scam case and the Aircel-maxis case. Therefore, only the Honourable Supreme Court has jurisdiction to decide whether the present case is related to investigation carried on with respect to the financial irregularities committed by Aircel Maxis or not. 17. The respondents placed reliance on the order passed by the Honourable Supreme Court on 16.12.2010 in CPIL vs. Union of India reported in 2011 (1) SCC 560 wherein the Honourable Supreme Court directed that progress reports based on the investigation conducted by the CBI and ED were to be produced before it on 10.02.2011. Subsequently, in the very same case in CPIL Vs. Union of India reported in (2011) 1 SCC 560 the Honourable Supreme Court has directed that a first information rep....
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.... case. This case relates to the investigation carried on relating to grant of FIPB approval in relation to the take over of Aircel Limited by Maxis Bhd., through Global Communication Services Holdings Limited, the approval of which was given by the then Finance Minister. On 20.04.2015 and 09.09.2015, further status reports were filed before the Honourable Supreme Court relating to the on-going investigation in the 2G case. Further, the learned Special Judge hearing the 2G Spectrum Case, in its order dated 17.09.2016, upheld its jurisdiction in the Airtel Maxis case holding it to be a case involving 2G spectrum scam. Such an order dated 17.09.2016 passed by the learned Special Judge was upheld by the Honourable Supreme Court on 17.10.2016. 20. It is the vehement contention of the respondents that on 07.02.2012, the Enforcement Directorate recorded an Enforcement Case Information Report bearing No. ECIR/05/D/2012 and commenced investigation in to Aircel-Maxis Case under the provisions of PMLA. The enforcement directorate filed a complaint dated 08.01.2016 (Enforcement Directorate vs. Dayanidhi Maran) before the Special Court. As per the complaint, the investigation relates to FIPB a....
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....nvestigation conducted into the Aircel-Maxis case about the FIPB clearance. 23. It is stated that the communication dated 16.05.2016, which is challenged in WP No. 35844 of 2016 was issued to banks and not to petitioner companies. The letter was issued in exercise of powers under Section 12A of PMLA read with the guidelines issued in the notification No.5/2005 dated 01.07.2005. Such letters were sent on behalf of FIU on the basis of request made by the Directorate of Enforcement under the provisions of PMLA. Since those letters were sent by electronic mode, they were not signed. The e-mails have been sent through the official e-mail id of the consultant and not from a personal e-mail id and therefore it has the force of law. 24. As regards the allegation of the petitioners that a predicate offence has not been made out, it is stated by the respondents that the conclusion of the on-going investigation may or may not result in a predicate offence and therefore, such an averment made on behalf of the petitioners is premature. At this stage, it is too early for the petitioners to allege that the investigation did not disclose a predicate offence. When the investigation is in progress....
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....as against the petitioners. There is nothing on record to show that the petitioners are being investigated in connection with 2G Spectrum case. Further, the names of the petitiners is not shown as accused for any predicate offence pertaining to 2G Spectrum Scam or Aircel-Maxis case. No where it has been stated why the petitioners are being investigated, especially when CBI has not named the petitioners as accused in any predicate offence pertaining to the 2G Spectrum or to the Aircel-maxis transaction. Therefore, the investigation carried on by the endorcement directorate against the petitioners has no nexus or connection to the order passed by the Honourable Supreme Court and consequently, the writ petition before this Court filed by the petitioners is maintainable. The instant summons issued to the petitioners cannot be used against them to conduct a rowing or fishing enquiry. The order dated 10.02.2011 passed by the Honourable Supreme Court directing that no court should pass any order which would impede the investigation being carried out by the CBI and ED cannot apply to the first information reports filed subsequently by the CBI and the enforcement directorate in Aircel-maxis....
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....ormation reports registered during the year 2006. The investigation mainly relates to the FIPB approval granted by then Finance Minister of the Country. According to the learned Senior counsel, in the garb of investigation, the officials attached to the enforcement directorate, only to harass the petitioners and their family members and to compel them to subject to their investigation, has issued summons of this nature. Therefore, according to the learned senior counsel for the petitioners, the respondents, without any jurisdiction, have issued the impugned summons. The learned Senior counsel for the petitioners also would contend that even in the year 2015 itself, CBI has filed status report before the Honourable Supreme Court and nothing much has been stated in those status reports against the petitioners. Further, the then Honourable Finance Minister himself has filed an affidavit before this Court stating that he and other persons have been examined by the CBI and pursuant to such examination, the CBI has not made any complaint or charge sheet thereof. In the absence of a complaint or charge sheet, the question of carrying out any investigation will not arise. Further, in the a....
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....des the investigation being carried out by the CBI and Directorate of Enforcement, the learned Special Public Prosecutor opposed the writ petitions and contend that this Court has no jurisdiction to entertain these writ petitions and the jurisdiction of this Court is ousted. It is further vehemently contended that investigation into the FIPB approval is still going on. Such investigation has been commenced to investigate the irregularities in the 2G spectrum scam. Even though charge sheet has been filed in the Aircel-maxis case even in the year 2014, in the charge sheet, it has been clearly stated that as far as FIPB approval is concerned, the investigation is yet to be completed. On 27.02.2016, the Special Court where the complaint has been filed, has granted permission and/or leave to file additional charge sheet on the basis of the outcome of the investigation to be done by the department. Above all, since the investigation carried on by the department is being monitored by the Honourable Supreme Court, periodical reports are being filed before the Honourable Supreme Court indicating the progress of the investigation made by the Department. The Honourable Supreme Court has been ....
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....MCG Distributors Pvt Ltd., (KFDPL) subsequently. In the year 2009, Sh. CBN Reddy and KFDPL Ltd., were allotted 19% shares and in the year 2011 Ausbridge was allotted 66.67% shares. It is further submitted that application to FIPB was filed on 30.01.2006 by Aircel Limited and the company Ausbridge was incorporated on 07.01.2006. 17. It is revealed further during the course of investigation under PMLA that ASCPL issued 2 lakh equity shares to Ausbridge in 2011 on payment of Rs. 5 lakh i.e., @ Rs. 2.5 per share. Whereas, in the year 2008, ASCPL allotted shares at the premium of Rs. 77.50 per share. The book value of share of ASCPL was Rs. 140.33 on 31.03.2010 and Rs. 1219 as on 31.03.2011. The net-worth of ASCPL in the year 2011 appears to be Rs. 18 crore approx. 18. It is revealed further during the course of investigation under PMLA that the company ASCPL was already in financial transactions with the other companies namely M/s. Chess Health Care Solutions Pvt. Ltd., M/s Chess Management Services Pvt Ltd., and M/s. Halidon Marketing Pvt Ltd., since the F.Y. 2005-2006. It is most respectfully submitted that further investigation under PMLA is being carried out. 19. It is most r....
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....ned Special Public Prosecutor would contend that in the earlier round of litigation before this Court, which involved attachment proceedings under PMLA in relatin to the Aircel Maxis investigation, by order dated 10.06.2015, this Court dismissed WP No. 12464 of 2015 filed by Kal Communication Pvt Ltd., holding that this Court has no jurisdiction to entertian the writ petition. In the above said order, this Court has noted the investigation done by the CBI regarding the allegations relating to FIPB approval in Aircel Maxis deal in Case NO. RC DAI 2011 (A) 9922. Siimilarly, the jurisdiction of the Special Court itself has been challenged and by order dated 23.07.2015, the Special Court dismissed an application filed by some of the accused in CBI vs. Shyammal Ghosh, CC. No. 1 of 2012 which was relatable to RC DAI-20110-A-0024. By raising very same averments, the petitioners herein, who are Directors of the company in question, have filed the present writ petitions questioning the authority of the respondent to carry out investigation under PMLA and FEMA. According to the learned Special Public Prosecutor, all the cases related and referable to 2G Spectrum Case is being monitored by th....
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....the arguments. Further, it was stated that the minutes of the meeting was not signed by a competent officer of the Enforcement Directorate but only by the Assistant Director of Income Tax. Further, an objection was raised that it is not an authenticated copy produced before this Court. 35. The learned Public Prosecutor only submitted that only to show that the investigation is in progress and to disprove the contentions raised on behalf of the petitioners, he has produced a copy of the minutes of the meeting. In any event, according to the learned Public Prosecutor, the investigation is still going on. At this stage, the learned Public Prosecutor, in a carefully worded submissions, would state that "investigation is going on and the investigation ultimately may or may not result in a predicated offence against the petitioners". Therefore, according to the learned Special Public Prosecutor, at this stage, it is premature for the petitioners to question the manner in which the respondents are conducting the investigation. At any rate, at the instance of the petitioners, the investigation agency need not be restrained from carrying out a lawful investigation which is being monitored ....
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....y the CBI or the Directorate of Enforcement. Such an order was reiterated by the Honourable Supreme Court in the subsequent order passed on 11.04.2011 in the case of CPIL vs. Union of India (2012) 3 SCC 117 holding that any prayer for either staying or impeding the trial could only be made to it. Further, in the order dated 24.02.2014 passed by the Honourable Supreme Court in ETHL vs. Registrar General, Delhi High Court in WP No. 70 of 2012, it was held that whether or not a particular case relates to a 2G Spectrum scam or not has to be decided only by it. Accordingly, periodical status reports have been filed before the Honourable Supreme Court in relation to the investigation under PE DAI 2011 A 0001 on various dates. On 09.10.2011, CBI registered a first information report in RC DAI 2011 A 0022 which pertains to the irregularities said to have been committed in the Aircel Maxis case. Subsequently, on 29.08.2014, CBI has filed charge sheet in CBI vs. Dayanithi Maran before the Special Court, the investigation of which includes grant of FIPB approval given by the then Finance Minister in relation to the take over of Aircel Limited by Maxis Bhd through Global Communication Services....
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....rned, when the jurisdiction of this Court has been ousted by an express order passed by the Honourable Supreme Court, this Court cannot pass any orders in these writ petitions thereby directly or indirectly impeding the investigation carried on by the respondents. 40. The learned Special Public Prosecutor appearing for the respondents brought to the notice of this Court the order dated 17.04.2013 passed by the Honourable Supreme Court in I.A. Nos. 36, 38 to 57 and 58 in Civil Appeal Nos. 10660 of 2010. It is evident from the said order that the counsel representing the CBI has handed over three sealed envelopes containing progress report dated 20.02.2013, Note regarding investigation taken up by CBI regarding allegations about FIPB approval in Aircel Maxis deal in Case No. RC DAI 2011 A 0022 vis-a-vis issues raised by Dr. Swamy in IA No. 36 as also the response of the CBI to the Central Vigilance Commission's objection letter dated 11.03.2013. After perusing the reports, the Honourable Supreme Court returned the sealed envelopes in open Court and they were re-sealed at the direction of the Honourable Supreme Court. This order dated 17.04.2013 has been produced to show that the....
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....ectrum case. In this context, useful reference can be made to the order dated 01.07.2013 passed by the Honourable Supreme Court in WP (C) No. 57 of 2012 in which the order dated 21.12.2011 passed by the Special Judge, CBI, New Delhi has been challenged. In the order dated 01.07.2013, the Honourable Supreme Court clearly held that 2G Spectrum Case is triable by the Special Judge against the persons accused of offences punishable under the provisions of the Prevention of Corruption Act in view of sub-section (1) of Section 4. It was further held that the Special Judge alone can take cognisance of the offence specified in sub-section (1) of Section 3 and conspiracy in relation to them. Whle trying any case, the Special Judge may also try an offence other than the offence specified in sub-section (1) of Section 3, in view of sub-section (3) of Section 4. It was also held that a Magistrate cannot take cogniswance of offence as specified in Sectin 3 (1) of thew Prevention of Corruption Act. It was further held in the order dated 01.07.2013 that in that case, the petitiners were shown as co-accused in the second supplementary charge sheet filed in 2G scam case. While so, it was held that ....
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....an authority authorised by the Central Government under this Act for the collection of evidence. It is therefore evident that the investigation carried on by the enforcement directorate is related to 2G Spectrum case and the original complaint has been filed by the investigation agency for a predicate offence. It is also seen from the charge sheet filed by the CBI in RC 22 (A)/2011-DLI (Aircel-Maxis Case) that the investigation is also being carried on relating to the manner in which FIPB approval has been granted and other related issues. Further, the Honourable Supreme Court in the order dated 09.02.2015 in WP (Crl) No. 14 of 2015 has categorically held that liberty has not been given to the petitioner therein to approach the High Court or any other Court except the Special Judge, at the first instance to raise the jurisdictional issue. 45. Attention of this Court has also been drawn to the order dated 23.07.2015 passed by the Special Court, CBI Cases (2G Spectrum Cases) New Delhi in C.C. No. 1 of 2012 wherein it was observed that all cases arising out of irregularities allegedly committed from2 001 to 2006-2007 are part of what is known as "2G Spectrum scam" and as such, all ca....
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....dents. The details sought for by the respondent is only to fish out evidence and to conduct a rowing enquiry which affects the fundamental rights guaranteed to them besides it affects the privacy of an individual. Further, the notices have been issued by a private party - consultant, which is legally not sustainable. It is further stated that none of the companies, to which the notices dated 16.05.2016 has been issued are in any manner connected with Mr. Karti P. Chidambaram. The petitioners companies are carrying out their lawful business in accordance with law. 48. In the counter affidavit filed by the respondents, it is stated that the notices dated 16.05.2016 has been issued in exercise of the powers conferred on the first respondent under Section 12A of PMLA read with notification No.5 of 2005 dated 01.07.2005. According to the respondents, the notices dated 16.05.2016 was sent on behalf of the first respondent on the basis of a request made by the Directorate of Enforcement which is investigating the offences committed under the provisions of PMLA and the first respondent is an authorised agency under Section 66 of the PMLA to receive information from FIU-India. It is furthe....
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....igation in 2G Spectrum case, as per the order passed by the Honourable Supreme Court, this Court has no jurisdiction to entertain these writ petitions. 50. The investigation presently carried on by the respondents is seized of by the Honourable Supreme Court and the progress of such investigation is being periodically monitored by it. The Special Court constituted to deal with 2G Spectrum case or Aircel Maxis case has granted permission to carry out further investigation which would empower the respondent to file supplementary charge sheet as contemplated under Section 173 (8) of Cr.P.C. In such circumstances, this Court is not inclined to entertain these writ petitions and the writ petitions only deserve to be dismissed. 51. Even though a preliminary objection relating to maintainability of these writ petitions have been raised by the respondents, the learned Special Public Prosecutor appearing for the respondents would submit that what is challenged in some of these writ petitions is a summon issued by the respondents. Normally, this Court cannot interfere with the summons issued to any Citizen seeking certain information. Further, the petitioners need not apprehend that any vi....