TaxTMI 
TaxTMI 
2018 (4) TMI 1410
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....t the respondents to forbear from taking any coercive steps or action or proceeding against the petitioner under any provision of the Prevention of Money Laundering Act, 2002 in connection with the professional fees received by the petitioner by cheques from (M/s.Saradha Realty India Ltd) on behalf of her client, after deduction of tax and which fees has been subjected to maximum rate of income tax at the hands of the petitioner. 3. Pleadings of the petitioner: The petitioner is a Senior Advocate having an active practice in the Supreme Court of India, High Court of Madras and other High Courts. The petitioner was the Standing Counsel for the Income Tax Department for 17 years. She had appeared in almost all the High Courts across the country. The petitioner has extensive practice and is practicing for almost 45 years uninterruptedly. The petitioner had been an assessee under the Income Tax for many years. In the course of her professional work in or about August, 2009, the petitioner was engaged by one Ms.Manoranjana Sinh as a Senior Counsel instructed by Mr.Krishna Kumar, Advocate on record, New Delhi to appear in CP No.46(ND) of 2009 before the Company law Board, Delhi. Fu....
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....h of M/s.GNN Pvt Ltd and M/s.Bengal Media Pvt Ltd. The said agreement, inter alia, contained the following clause. Clause 5.2. of the June, 2010 agreement reads as follows:- "5) Rights and Obligations of Buyer: Investor (M/s.Bengal Media Pvt Ltd) hereby commits that it will professionally and legally assist Manoranjana in her personal litigation with Positive and other cases as the Investor wants to ensure 100% effective involvement of Manoranjana for the success of the business of the company. 9. As part of the agreement between Ms.Manoranjana Sinh and Mr.Sudipto Sen, wherein Mr.Sudipto Sen agreed to fund the legal expenses of Ms.Manoranjana Sinh in contesting the cases against her husband, it was mutually agreed between Ms.Manoranjana Sinh and Mr.Sudipto Sen that the professional fees of the petitioner, who was already appeared on behalf of Ms.Manoranjana Sinh before the Company Law Board, New Delhi and Delhi High Cour, would be paid by Mr.Sudipto Sen/his company. Accordingly, Mr.Sudipto Sen, through his real estate company, M/s.Saradha Realty India Ltd paid, from time to time, the professional fees of the petitioner on behalf of Ms.Manoranjana Sinh amounting....
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....Mr.Studipto Sen on any matters relating to his businesses. Nor did the petitioner offer legal advice to Mr.Sudipto Sen on any of his businesses except for the opinion given to her client Ms.Manoranjana Sinh based on the due diligence report of Mr.Mahadevan. The professional services rendered by the petitioner were only vis-a-vis Ms.Manoranjana Sinh and her TV related businesses. Ms.Manoranjana Sinh in her statement to the press dated 25.4.2013 and in an email stated as follows:- "Since my lawyer was Mrs.Nalini Chidambaram since long, I asked her to draft the agreement between Saradha and us. Ms.Chidambaram is my standing counsel and has worked as a legal advisor in her professional capacity. As per our agreement, her payment was made by Mr.Sen since in our agreement it was mentioned that all expenses towards legal fees and other litigation would be paid by him." 13. Meanwhile, it transpired that Mr.Studipto Sen started defaulting in payment of principal and interest to his depositors. Hence, it is learnt that the CBI registered a case against Mr.Studipto Sen for the offence of cheating under the IPC which is a scheduled offence within the meaning of the Prevention of Mo....
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....spondent on 11.2.2016 and submitted all the documents. Again another letter dated 18.2.2016 was given to the second respondent by the authorised representative in person along with documents. He submitted that no agreements had been entered between the petitioner or M/s.NC Associates with Mr.Sudipto Sen or his entities. Further, the authorised representative submitted the details of professional services rendered by the petitioner to Ms.Manoranjana Sinh/her entities. It was further stated that no services rendered by the petitioner to Mr.Sudipto Sen/his entities. The details of payments received by the petitioner from Ms.Manoranjana Sinh and from Mr.Sudipto Sen/his entities, who had agreed to pay the fees of the petitioner on behalf of Ms.Manoranjana Sinh, were also submitted. 17. The petitioner further states that another order dated 4.3.2016 was issued to the petitioner by CBI under Section 91 Cr.P.C to produce certain documents either by the petitioner or through a responsible person. The documents were produced by the authorised representative of the petitioner on 14.3.2016. It is reliably learnt and believed to be true that CBI had filed the Final Report before the Designat....
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....and the agreement between Ms.Manoranjana Sinh and M/s.Bengal Media Pvt Ltd/Mr.Sudipto Sen. 21. After a lapse of 4-1/2 months, the petitioner received another summons dated 17.8.2016 from the second respondent under Section 50 (2) and (3) of the Act. Unlike in the two earlier summonses when the petitioner was given the option to appear in person or through authorised representative, in the instant summons, the petitioner was directed to appear in person at the Kolkata Office on 2.9.2016, a Friday. The purpose of the summons is stated as Explanation of submitted Documents. The third respondent leaked the issuance of summons to the Press and the Times of India published the news on 25.8.2016. The petitioner through her authorised representative, wrote to the second respondent by letter dated 29.8.2016, once again explaining all the submitted documents and also drew the attention of the second respondent to Section 160 Cr.P.C under which no woman may be called for questioning except at her place of residence. It is relevant to state that the petitioner resides in Chennai and in the summons dated 17.8.2016, the petitioner was summoned to appear before the second respondent in Kolkata....
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....d 17.8.2016 was considered and rejected and directed the petitioner to appear in person on 23.9.2016. No reasons were assigned as to why the representation was rejected even though the authorised representative had relied on a Delhi High Court's judgment on Section 160 Cr.P.C, which is final and binding on the respondents. It is necessary to point out that the third respondent had leaked the rejection of the representation sent on behalf of the petitioner invoking Section 160 Cr.P.C to the Media even before the petitioner received the letter dated 7.9.2016, rejecting the representation dated 17.8.2016 along with the summons to appear in person on 23.9.2016. The schedule to the summons dated 17.8.2016 had asked the petitioner to explain the submitted documents. Till the summons dated 17.8.2016, the petitioner was always asked to produce the documents and explain the submitted documents either in person or through authorised representative and the authorised representative had always appeared before the second respondent and produced all the documents and explained them. In response to the summons dated 4.3.2016, he had explained the submitted documents. Again in response to the ....
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....stablishing that the amounts received by the petitioner by cheques after deduction of tax were only professional fees for legal services, which have been duly disclosed in the returns of income and tax paid, the respondents are continuing to harass the petitioner with ulterior motives and malice, in fact, and malice in law by issuing repeated summonses. 28. The learned Senior Counsel Mr.Satish Parasaran, appearing on behalf of the writ petitioner, contended that the protections granted under Section 160 Cr.P.C., to be extended to the writ petitioner. When the required documents, as sought for by the respondents, were already submitted by the authorised representative of the writ petitioner there is no reason to issue further summons for the personal appearance of the writ petitioner. 29. Pleadings of the respondents: Saradha Group of Companies, represented through its Director Shri Sudipto Sen, was a Chit Fund Company, collecting deposits from public at large in the States of West Bengal, Assam and Orissa. However, its business spread across 14 States of India. The modus operandi of business of this Company was to cheat the public at large during the years 2008-2009 to 201....
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....290 of 2009 pending before Delhi High Court in the cases filed by Mrs.Manoranjana Sinh against her estranged husband Mr.Matang Sinh relating to M/s.Positive Television Pvt. Ltd., and its group companies. It would not be out of place to state that this case has no relation with Saradha Group of Companies. No agreement was entered between Mrs.Nalini Chidambaram or M/s.NC Associates with Smt.Manoranjana Sinh or her entities or Sudipto Sen or his entities. No service was rendered by Mrs.Nalini Chidambaram, Senior Advocate to Shri Sudipto Sen or Saradha Group of Companies. Mrs.Nalini Chidambaram was instructed to appear in C.P. No.46 (ND) of 2009 before the Company Law Board, Delhi and C.S. (O.S.) No.290 of 2009 before the Delhi High Court by Ms.Manoranjana Sinh with Mr.Krishna Kumar, Advocate, who was the counsel on record. 31. Ms.Manoranjana Sinh paid a sum of Rs. 1 lakh by cheque to Smt.Nalini Chidambaram as retainer and informed that she does not have funds to pay fees of Mrs.Nalini Chidambaram and assured Mrs.Chidambaram that she would pay the fees of Mrs.Chidambaram as and when she mobilised the funds. Shri Sudipto Sen was introduced to Ms.Manoranjana Sinh by a mutual friend an....
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....eding paragraphs are correct or incorrect, will be known only after examining the petitioner in WP 32848 of 2016 in person and any order at this stage will seriously affect the course of investigation. 34. Mrs.Nalini Chidambaram was summoned under Section 50(2) and (3) of PML Act, 2002, on 4.3.2016 to appear in person or through authorised representative on 1.4.2016. Mrs.Nalini Chidambaram authorised Shri N.R.R.Arun Natarajan, Advocate to appear on her behalf. Accordingly, statement of Shri N.R.R.Arun Natarajan, the authorised representative of Mrs.Nalini Chidambaram was recorded on 1.4.2016, wherein, he reiterated the facts already submitted vide his above mentioned letters. During the course of statement, several new facts came out and certain contradictions emerged in the information provided on behalf of Mrs.Nalini Chidambaram and the statement given by Ms.Manoranjana Sinh. In particular, Ms.Manoranjana Sinh had stated that she had no idea that Smt.Nalini Chidambaram was paid by Shri Sudipto Sen on her behalf. Therefore, it was felt necessary to summon Smt.Nalini Chidambaram in person. 35. In view of the above factors, summons dated 17.8.2016 was issued to Mrs.Nalini Chid....
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....nd every proceedings under Section 50(2) and (3) of the Act, shall be deemed to be a judicial proceedings within the meaning of Sections 193 and 228 of the IPC 1860. The petitioner in WP No.32848 of 2016 got an opportunity to appear before the summoning authority to adduce evidence as per the principles of natural justice. But instead of co-operating with and appearing before the summoning authority, the present writ petition is filed questioning the issuance of summons under Article 226 of the Constitution of India, which is not maintainable in law and liable to be dismissed in limine. 38. It is further contended that the documents submitted by the authorised representative of Mrs.Nalini Chidambaram before the Assistant Director, Enforcement Directorate in WP No.32848 of 2016 do not contain any agreement by Mrs.Nalini Chidambaram with Shri Sudipto Sen for making payments on behalf of Ms.Manoranjana Sinh. The documents do not show any rates to be charged and any bills raised by Mrs.Nalini Chidambaram for which she claims to have received the amount totalling to Rs. 1,24,90,000/- as professional fees and charges for drafting the agreements. Thus, it is necessary to question Mrs.N....
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....t of the Enforcement Directorate. It was ensured that sufficient time is provided to Mrs.Nalini Chidambaram, enabling her to appear in person for the purpose of questioning. Such allegations were never raised in the representation regarding issue of summons neither any adjournment was sought for. 43. Calling a person to adduce evidence is within the four corners of provisions of Section 50(2) and (3) of "PMLA". Besides, the deeming fiction contained under sub-section (4) of Section 50 of the Act, makes such statement as admissible piece of evidence and statutory presumption as contained under Section 80 of the Indian Evidence Act, shall get attracted rendering such statement as truthful and voluntary. Under Section 63 of the Act, law provides imposition of penalty as well as launching of criminal prosecution under Section 174 of IPC for non-compliance of the summons issued under the Act. 44. It is pertinent to mention that the provisions of Cr.P.C., 1973 are not applicable to Section 50(2) and (3) of "PMLA". Non-compliance of Section 50(2) and (3) of "PMLA" entails imposition of penalty under Section 63 of the Act. Besides, in terms of Section 174 of IPC, prosecution can be i....
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....ction 160 of the Code of Criminal Procedure. Proviso to Section 160 of the Code of Criminal Procedure, categorically enumerates that no women shall be required to attend at any place other than the place in which such women resides. Such being the definite provision of law, the respondents cannot seek for the personal appearance of the writ petitioner. The exemption granted under the Statute is absolute. Such concessions granted in the Criminal Procedure Code cannot be violated by the respondents. If at all, the respondents intend to get some clarification, then it is left open to them to approach the writ petitioner in a place where she resides. The intention of Section 160 of the Code of Criminal Procedure is to grant exemption and such an intention expressly made in the Code, cannot be interpreted otherwise. 47. At the outset, the learned Senior Counsel is of an opinion that if at all such an exemption to be diluted on account of the developments occurred in our Nation, the same is to be done only through the Parliament, this Court is bound by the exemption granted in the Code of Criminal Procedure. The learned Senior Counsel is of an opinion that the impugned summon states t....
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....n her personal litigation with Positiv Television and Other personal cases. Investigation disclosed that Saradha Group paid Rs. 1,00,00,000/-(Rupees One Crore Only)to Smt.Nalini Chidambaram, learned Senior Advocate on behalf of Smt.Manoranjana Sinh towards her legal expenses. Apart from the above, another Rs. 34.90 lakhs were paid by Saradha Group to Smt.Nalini Chidambaram towards drafting the agreement. Investigation disclosed that Saradha Group also paid for the hotel bills and air tickets of Smt.Manoranjan Sinh on a number of occasions. 51. Relying on the said findings of the Central Bureau of Investigation(CBI) in the charge sheet, the petitioner in person made a submission that no involvement of the petitioner has been ascertained even during the CBI enquiry and therefore, the respondents in these writ petitions cannot further probe into the matter. The respondents ought to have dropped all further proceedings in view of the findings of the CBI. It is confirmed during the investigation that the petitioner had received the said amount of Rupees one crore and thirty nine lakhs(Rs.1 crore and 39 lakhs only) towards the legal fees and for that, the petitioner had submitted all ....
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.... of Cr.P.C. are held to be applicable, therefore, they are required to follow the same. Keeping in view the provisions of Section 65 of "PMLA" and also the fact that there is no procedure prescribed in "PMLA" for investigation of the offence, I am of the opinion that the procedure which has been prescribed under the Cr.P.C. is required to be followed while investigating the offence under "PMLA". 53. The Gujarat High Court at Ahmedabad in the case of Foziya Samir Godil vs. Union of India [Special Criminal Application (Direction) No.1725 of 2014 with Special Criminal Application No.1748 of 2014 decided on 9.5.2014], wherein in paragraph-42, held as under:- 42. However, so far as petitioner-Foziya Samir Godil is concerned, being a woman, it is rightly contended by the learned counsel for the petitioners that she is entitled to benefits of all the procedures applicable to the woman under the relevant law and to that extent, the respondents at the threshold shall have to comply with the provisions of law. 54. Relying on the said Gujarat High Court judgment, it is submitted that the Hon'ble Supreme Court of India in the case of Kusum Ingots and Alloys Ltd vs. Union of ....
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....nforcement v. Deepak Mahajan (Supra). In this case Apex Court held that the operation of Section 4(2) of the code is straightaway attributed to the areas of investigation, enquiry and trial of offences under the special laws including the FERA and the customs. Section 4 is comprehensive and, that Section 5 is not in derogation of Section 4(2) of the Code. It only relates to the extent of application of the Code in the matter of territorial and other jurisdiction but does not nullify the effect of Section 4(2) of the Code. It has further been observed that the provision of the Code would be applicable to the extent in the absence of any contrary provision in the special Act or any other special provision excluding the jurisdiction or applicability of the Code. That reading of Section 2 of the Code r/w Section 26(B) which governs any criminal proceeding as regards the course of which an offence is to be tried and as to the procedure to be followed renders the provision of the Code applicable in the field not covered by the provision of FERA or Customs Act. Admittedly, Apex Court in Deepak Mahajan's case (Supra) was not dealing with the proviso of Section 160 Cr.P.C. but was deali....
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....tation, violating the commandment of Section 160 of the Code, when a heavy load of questions is handed in, some permissible, some not, where the area of constitutional protection against self-crimination is (until this decision) blurred in some aspects, when, in this Court, counsel for the accused unreservedly undertakes to answer in the light of the law we here lay down, when the object of the prosecution is to compel contrite compliance with Section 161 Cr.P.C abandoning all contumacy and this is achieved by the undertaking, when the pragmatic issues involved are so complex that effective barricades against police pressure to secure self-incrimination need more steps as indicated in our judgment, we hold that persistence in the prosecution is seeming homage to the rule of law and quashing the prosecution secures the ends of justice the right thing to do is to quash the prosecution as it stands at present. We regret that this dimension of the problem has escaped the Executive's attention for reasons best left unexplored. 59. The said judgment is also irrelevant in respect of the facts and circumstances of the writ petitioner. In para 76, the Hon'ble Supreme Court of Ind....
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....ould cooperate to cull out the truth and to clarify certain documents in relation to the transactions, which all are sought to be clarified. As of now, no complaint is registered. In the absence of registration of a complaint under the Act, no cause of action would arise for the writ petitioner to move the present writ petition under Article 226 of the Constitution of India. In the absence of a complaint, the writ petitioner cannot refer all these provisions for the purpose of quashing the summons, which were issued under the provisions of the Act and the authorities competent are empowered to call any person for the purpose of clarifications and for verification of documents. It is the duty of all the citizens concerned to cooperate for such investigations conducted under the provisions of the Act and the very object of the Act is to prevent such evil offences of Money-Laundering. The investigation under the PMLAneed not be compared nor akin to that of Police investigation. The statements made by the persons, are binding under the provisions and, these documents and records and clarifications sought for are only for the purpose of ascertaining the truth behind the alleged offences....
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....nt Director, or any other officer authorised in this behalf by the Central Government by general or special order, has on the basis of material in his possession reason to believe (that reason for such belief to be recorded in writing) that any person has been guilty of an offence punishable under this Act, he may arrest such person and shall, as soon as may be, inform him of the grounds for such arrest. (2) The Director, Deputy Director, Assistant Director or any other officer shall, immediately after arrest of such person under sub-section (1), forward a copy of the order, along with the material in his possession, referred to in that sub-section, to the Adjudicating Authority, in a sealed envelope, in the manner, as may be prescribed and such Adjudicating Authority shall keep such order and material for such period, as may be prescribed. (3) Every person arrested under sub-section (1) shall within twenty-four hours, be taken to a Judicial Magistrate or a Metropolitan Magistrate, as the case may be, having jurisdiction: Provided that the period of twenty-four hours shall exclude the time necessary for the journey from the place of arrest to the Magistra....
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.... petitions prematurely and by challenging the very summon issued by the competent authorities under the provisions of PMLA. Thus, the writ petitions deserve to be rejected on the ground of maintainability, as premature and even on merits. 68. Judgments relied on by the respondents: The Hon'ble Supreme Court of India in the case of State of Haryana and Others vs. Bhajan Lal and Others [1992 Supp (1) SCC 335], in paragraph 108, held as under:- 108. No doubt, there was no love lost between Shri Bhajan Lal and Dharam Pal. Based on this strained relationship, it has been then emphatically urged by Mr K. Parasaran that the entire allegations made in the complaint due to political vendetta are not only scurrilous and scandalous but also tainted with mala fides, vitiating the entire proceedings. As it has been repeatedly pointed out earlier the entire matter is only at a premature stage and the investigation is not yet proceeded with except some preliminary effort taken on the date of the registration of the case, that is on November 21, 1987. The evidence has to be gathered after a thorough investigation and placed before the court on the basis of which alone the court ....
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....with or according to the intent and purpose of the Act. 9. As per the said provision, no notice, summons, order, document or other proceeding..... issued or taken in pursuance of any of the provisions of shall be invalid, or shall be deemed to be invalid merely by reason of any mistake, defect or omission in such notice, summons, order, document or other proceeding if such notice, summons.......is in substance and effect in conformity with or according to the intent and purpose of the Act. The reasons for introducing Money Laundering Act is that the money laundering causes serious threat not only to the financial systems of the country, but also their integrity and sovereignty and the object of the Act is to prevent money laundering and provide for confiscation of property, derived from income involved in money laundering or materials connected or incidental thereto. Therefore, the points urged by the petitioner are unsustainable. Even in the impugned summons, it has been indicated that every proceeding under Section 50(2) and (3) of the Money Laundering Act shall be deemed to be judicial proceeding within the meaning of Sections 193 and 228 of the Indian Penal Code and if....
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....ain the merits of the issues, when the investigation or interrogation by the Enforcement Directorate is in progress? 3) Whether the provisions of Section 160 Cr.P.C., can be applied scrupulously in all cases of women in relation to the investigation and interrogation by the Enforcement Directorate more so under PMLA? 4) Whether the "PMLA" will have the overriding effect with reference to the provisions under Cr.P.C., in the matter of issuance of summons, proceeding with the investigation and summoning a person to appear in person under PMLA? 5) Whether the writ petitioner is entitled for any other relief based on any distinct circumstances or as an exceptional case? 72. The Prevention of Money Laundering Act, 2002 was introduced as its statement of objects and reasons mentioned, to make money laundering an offence and to attach property involved under money laundering, so that serious threat to the financial system of India is adequately dealt with. It is worth setting out the statement of objects and reasons of the Act in full. 73. STATEMENT OF OBJECTS AND REASONS OF PMLA: It is being realised, world over, that money laundering poses a serious threat not only to ....
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...., the Prevention of Money-Laundering Bill, 1998 was introduced in the Lok Sabha on the 4th August, 1998. The Bill was referred to the Standing 5 Committee on Finance, which presented its report on the 4th March, 1999 to the Lok Sabha. The recommendations of the Standing Committee accepted by the Central Government are that (a) the expressions banking company and person may be defined; (b) in Part I of the Schedule under Indian Penal Code the word offence under section 477A relating to falsification of accounts should be omitted; (c) knowingly be inserted in clause 3(b) relating to the definition of money-laundering; (d) the banking companies, financial institutions and intermediaries should be required to furnish information of transactions to the Director instead of Commissioner of Income-tax (e) the banking companies should also be brought within the ambit of clause II relating to obligations of financial institutions and intermediaries; (f) a definite time limit of 24 hours should be provided for producing a person about to be searched or arrested person before the Gazetted Officer or Magistrate; (g) the words unless otherwise proved to the satisfaction of the authority concerne....
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....Schedule means the Schedule to this Act; (y) scheduled offencemeans (i) the offences specified under Part A of the Schedule; or (ii) the offences specified under Part B of the Schedule if the total value involved in such offences is one crore rupees or more; or (iii) the offences specified under Part C of the Schedule. 77. Section 3. Offence of money-laundering. Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with proceeds of crime including its concealment, possession, acquisition or use and projecting or claiming it as untainted property shall be guilty of offence of money-laundering. 78. Section 4. Punishment for money-laundering. Whoever commits the offence of money-laundering shall be punishable with rigorous imprisonment for a term which shall not be less than three years but which may extend to seven years and shall also be liable to fine: Provided that where the proceeds of crime involved in money-laundering relates to any offence specified under paragraph 2 of Part A of the Schedule, the provisions of this section shall have effect....
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....ibed and such Adjudicating Authority shall keep such order and material for such period as may be prescribed. (3) Every order of attachment made under subsection (1) shall cease to have effect after the expiry of the period specified in that sub-section or on the date of an order made under sub-section (2) of section 8, whichever is earlier. (4) Nothing in this section shall prevent the person interested in the enjoyment of the immovable property attached under sub-section (1) from such enjoyment. Explanation. For the purposes of this sub-section, person interested, in relation to any immovable property, includes all persons claiming or entitled to claim any interest in the property. (5) The Director or any other officer who provisionally attaches any property under subsection (1) shall, within a period of thirty days from such attachment, file a complaint stating the facts of such attachment before the Adjudicating Authority. 80. CHAPTER IV OBLIGATIONS OF BANKING COMPANIES, FINANCIAL INSTITUTIONS AND INTERMEDIARIES Section 12. Reporting entity to maintain records. (1) Every reporting entity shall (a) maintain a reco....
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....receiving evidence on affidavits; (e) issuing commissions for examination of witnesses and documents; and (f) any other matter which may be prescribed. (2) The Director, Additional Director, Joint Director, Deputy Director or Assistant Director shall have power to summon any person whose attendance he considers necessary whether to give evidence or to produce any records during the course of any investigation or proceeding under this Act. (3) All the persons so summoned shall be bound to attend in person or through authorised agents, as such officer may direct, and shall be bound to state the truth upon any subject respecting which they are examined or make statements, and produce such documents as may be required. (4) Every proceeding under sub-sections (2) and (3) shall be deemed to be a judicial proceeding within the meaning of section 193 and section 228 of the Indian Penal Code, 1860 (45 of 1860). (5) Subject to any rules made in this behalf by the Central Government, any officer referred to in sub-section (2) may impound and retain in his custody for such period, as he thinks fit, any records produced before him in any proceedings under thi....
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....9. The very object of the provision is unambiguously enumerated in the said provisions. 90. Section 50 of the "PMLA" states that the Director for the purpose of Section 12 shall have the same powers as are vested in a Civil Court under the Code of Civil Procedure, 1908, while trying a suit in respect of the matters stipulated. Therefore, enforcing the attendance of any person is certainly permissible for the purpose of proceeding investigation. Sub-clause (2) also clarifies the same. 91. Sub-clause (3) to Section 50 states that the persons who received such summons from the competent authorities under the "PMLA" is bound to attend in person. However, the authorised agents are also permitted to attend the investigation on behalf of the person against whom such summon was issued. However, if the competent authorities under the "PMLA" is of an opinion that personal appearance is required for the purpose of seeking certain specific clarifications, then the scope of the Act is wide and the authorities competent are empowered to issue summons for the personal appearance of a person to participate in the investigation process. 92. The "PMLA", being a Special Act, has provided cer....
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....de in this behalf, provide for the payment by the police officer of the reasonable expenses of every person, attending under sub-section (1) at any place other than his residence. 95. A reading of the proviso clause, this Court is of an opinion that the privilege has been given to the aged persons and for a woman and mentally or physically disabled persons are provided to avoid any personal inconvenience or hardship to such persons. Such a special provision made for the purpose of avoiding certain hardships cannot be applied in a straight jacket formula. Certain concessions provided in the Criminal Procedure Code, which is to be construed that the same is to be applied only in genuine cases, where it is not actually possible for a person to travel for a long distance and participate in the investigation proceedings. Thus, the factual circumstances are also to be looked into in such cases. The very intention of the Legislation with reference to Section 160 of the Code of Criminal Procedure Code is that the aged persons, women or mentally or physically retarded disabled, cannot be compelled to travel for a long distance for the purpose of investigation. In such cases alone, the au....
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....Court, the Court has an obligation to recognise legal rights and duties on the assumption that they were all created by the community as an institution. Further, a concept of law can only be said to be true if it imbibes the principles of justice, fairness and procedural due process, a Judge when deciding any new case shall enforce these as it would ensure that every person has a fair and just standing in front of the same standard. 100. Dworkin holds that the inclusion of these principles will result in the finest constructive interpretation of the community's legal practice. Law as integrity states that the law must speak with one voice, so Judges must assume that the law is structured on coherent principles about justice, fairness and procedural due process, and that in all fresh cases which comes before them, Judges must enforce these so as to make each person's situation fair and just by the same standard that is to say, treat every equally. 101. Difference between liberal and constructive interpretation is that liberal interpretation is used to advance the object for which the Statute was enacted irrespective of the changes that happen in the society or without ....
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....t absolute and subject to certain qualifications. Such qualifications are to be determined on ascertaining the facts and circumstances in each case. 104. In the present case on hand, the writ petitioner is a Senior Advocate actively practicing before the Hon'ble Supreme Court of India as well as before various High Courts across the country. Such being the voluntary statement of the writ petitioner, this Court has no reason to believe that such an exemption to be extended to the writ petitioner for the purpose of her non-participation in the investigation process, by appearing in person. 105. Taking another view of the matter, Section 5 of the Code of Criminal Procedure stipulates the Saving Clause which reads as under:- 5. Saving. Nothing contained in this Code shall, in the absence of a specific provision to the contrary, affect any special or local law for the time being in force, or any special jurisdiction or power conferred, or any special form of procedure prescribed, by any other law for the time being in force. 106. It is enumerated that in the absence of a specific provision to the contrary, affect any special or local law for the time being in force....
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....ith reference to the offences committed under the "PMLA". In such circumstances, no person can claim any privilege or advantage from and out of the procedures contemplated under the Code of Criminal Procedure. Even Section 65 speaks about the investigation. Therefore, in respect of the investigation, the Code of Criminal Procedure need not be applied in the event of specific provisions under the "PMLA". In the present case on hand, the summons are issued under Section 50(2) and (3) of the "PMLA". Section 50(2) of the "PMLA" categorically enumerates that the Assistant Director shall have power to summon any person whose attendance he considers necessary. 111. The counter-affidavit filed on behalf of the respondents categorically enumerates that the presence of the writ petitioner Mrs.Nalini Chidambaram is required for the purpose of getting certain specific clarifications in relation to certain monetary transactions and the documents submitted. The reasons for securing the personal appearance are also enumerated in the counter-affidavit. On a perusal of the whole counter-affidavit filed on behalf of the respondents, this Court is of an opinion that, when the Investigating Officer....
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....ppear in person to explain to the authorities competent the truth or otherwise. If the authorities are of the opinion that such person is incapable of attending the process of investigation in person, then they are empowered to grant exemption in a particular manner by ascertaining the facts and circumstances and grant such exemption in a judicious manner. The authorities are also not empowered to grant such exemptions in a routine manner. They are bound by the provisions of "PMLA". The very purpose and the object of the Act is to ensure that the offence of money laundering is prevented in the manner stipulated under the provisions of the Act. Therefore, it is not automatic or as a matter of routine in respect of grant of exemptions from personal appearance of the witnesses for investigation or interrogation. 115. At the outset, this Court is of an opinion that the provisions of the "PMLA" will prevail over as the same is the Special Act enacted for the purpose of dealing with the offences of money laundering. When there is a specific provision for personal appearance, then the only course would be to assist the competent authorities for the purpose of conducting the investigati....
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....itioner to appear in person on a Friday. The learned Additional Solicitor General of India Mr.G.Rajagopalan, clarifies this point by stating that the Investigating Authorities have no such intention at all. Everything is in a premature stage. Nobody can presume the result of the investigation both the writ petitioner as well as the respondents. All these aspects are to be decided only after the completion of the investigation and after arriving a concrete conclusion based on the evidences and the documents. 121. The learned Additional Solicitor General of India has stated that in the event of consent by the writ petitioner to participate in the process of investigation, then he would request the respondents to fix any other day other than a Friday. Therefore, the date fixed on Friday has no significance and no relevance at all. It is a mere apprehension based on imagination and therefore, such apprehensions can never be entertained in a writ petition, wherein the very issuance of summon is questioned. The writ petition is not only premature and the writ petitioner has not made out any cause of action for the purpose of entertaining the present writ petition and the writ petition....
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.... before us. 123. The observations made by the Three Judges Bench are categorical in nature. For achieving the object of such an enquiry if the appropriate authorities of the view that such persons should be dissociated from the atmosphere and the company of persons who provide encouragement to them in adopting a non-cooperative attitude to the machineries of law, there cannot be any legitimate objection in depriving them of such company. Therefore, it is the subjective satisfaction of the Investigating Authorities. If the Investigating Authorities are of the opinion that the personal investigations and clarifications are imminent through personal appearance of the writ petitioner, then the same is to be done in the manner known to law. Under those circumstances, the writ petitioner cannot seek an exemption merely citing general exemptions granted under Section 160 of the Code of Criminal Procedure, 1973. 124. The general exemptions are granted under the Code of Criminal Procedure in order to ensure that certain genuine cases wherein such personal appearances of such classified persons are not possible, then the provision may be invoked. Such general provisions are not made in....
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.... Constitution reads as under: "21. Protection of life and personal liberty.-No person shall be deprived of his life or personal liberty except according to procedure established by law." 57. But this Court in Bachan Singh [(1980) 2 SCC 684 : 1980 SCC (Cri) 580] held that in view of the expanded interpretation of Article 21 in Maneka Gandhi [(1978) 1 SCC 248], it should read as follows: (Bachan Singh case [(1980) 2 SCC 684 : 1980 SCC (Cri) 580] , SCC p. 730, para 136) "136. ... 'No person shall be deprived of his life or personal liberty except according to fair, just and reasonable procedure established by valid law.' In the converse positive form, the expanded article will read as below: 'A person may be deprived of his life or personal liberty in accordance with fair, just and reasonable procedure established by valid law.'" 58. This epoch-making decision in Maneka Gandhi [(1978) 1 SCC 248] has substantially infused the concept of due process in our constitutional jurisprudence whenever the court has to deal with a question affecting life and liberty of citizens or even a person. Krishna Iyer, J. giving a concurring opi....
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.... ago postulates, "That excessive bail ought not to be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted". 61. Our Constitution does not have a similar provision but after the decision of this Court in Maneka Gandhi case [(1978) 1 SCC 248] jurisprudentially the position is virtually the same and the fundamental respect for human dignity underlying the Eighth Amendment has been read into our jurisprudence. 62. Until the decision was rendered in Maneka Gandhi [(1978) 1 SCC 248], Article 21 was viewed by this Court as rarely embodying the Diceyian concept of the rule of law that no one can be deprived of his personal liberty by an executive action unsupported by law. If there was a law which provided some sort of a procedure it was enough to deprive a person of his life or personal liberty. In this connection, if we refer to the example given by S.R. Das, J. in his judgment in A.K. Gopalan [AIR 1950 SC 27 : (1950) 51 Cri LJ 1383] that if the law provided the Bishop of Rochester "be boiled in oil" it would be valid under Article 21. But after the decision in Maneka Gandhi [(1978) 1 SCC 248] which marks a watershed in the development of ....
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....t on the general provisions of the Code of Criminal Procedure in case of conflict between them. Section 45 of "PMLA" imposes the following two conditions for grant of bail to any person accused of an offence punishable for a term of imprisonment of more than three years under Part A of the Schedule to "PMLA": (i) That the prosecutor must be given an opportunity to oppose the application for bail; and (ii) That the court must be satisfied that there are reasonable grounds for believing that the accused person is not guilty of such offence and that he is not likely to commit any offence while on bail. 30. The conditions specified under Section 45 of "PMLA" are mandatory and need to be complied with, which is further strengthened by the provisions of Section 65 and also Section 71 of "PMLA". Section 65 requires that the provisions of CrPC shall apply insofar as they are not inconsistent with the provisions of this Act and Section 71 provides that the provisions of "PMLA" shall have overriding effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. "PMLA" has an overriding effect and the provisions of CrPC would apply only....
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.... woman is exempted from personal appearance under Section 160 of the Code of Criminal Procedure. By citing the general provisions of Section 160 Cr.P.C., the writ petitioner cannot seek absolute exemption for personal appearance in the investigation process. Except by claiming that women are exempted under Section 160 of the Code of Criminal Procedure, the facts regarding the position, status and capacity of the writ petitioner to travel and provide informations to the authorities are not denied. The writ petitioner, being a Senior Advocate and having active and lucrative practice in various High Courts and before the Supreme Court of India, cannot say that she is not capable of personally appearing before the authorities concerned for the purpose of investigation. More-so, this Court expect that the respected Senior Advocate like the writ petitioner, should not shy away from co-operating for an effective investigation of such offences committed under the provisions of the "PMLA". The offences of money laundering is affecting the economic growth of our great Nation. The magnitude of the alleged money laundering in the present case is running to several thousand crores and therefore....
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....the facts and the circumstances for the purpose of granting any such exemption, and the same cannot be granted otherwise under the provisions of the "PMLA". In the present case on hand, the respondents have explained the instances and the circumstances under which they have insisted upon the personal appearance of the writ petitioner for further clarification. It is further recorded that the statements/explanations and the documents submitted by the authorised representative of the writ petitioner Shri N.R.R.Arun Natarajan were not satisfactory and certain ingredients are to be ascertained only by getting a personal statement from the writ petitioner in relation to the financial transactions. Therefore, this Court is of an opinion that there is no irregularity or illegality in respect of insisting the writ petitioner for personal appearance for the purpose of seeking certain clarifications so as to cull out the truth in relation to the financial transactions and the documents filed by the writ petitioner before the Enforcement Directorate through her authorised Agent. 134. This Court is of an opinion that the writ petitioner based on mere apprehension, cannot be permitted to mov....
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.... documents and the clarifications in respect of the statements given by the writ petitioner, the Court cannot come to a conclusion that there is no Proceeds of Crime against the writ petitioner. The Proceeds of crime has to be concluded only after the completion of the investigation and after filing the complaint under the PMLA. Thus, the very contention deserves no merit consideration. 137. This Court is of an opinion that Section 50(2) states that the Director, Additional Director, Joint Director, Deputy Director or Assistant Director shall have the power to summon any person whose attendance he considers necessary whether to give evidence or to produce any records during the course of any investigation. The word person employed in Section 50(2) has to be understood with reference to the definition provided under Section 2(s) of PMLA. Section 2(s) defines personincludes- (i) an individual, (ii) a Hindu undivided family, (iii) a company, (iv) a firm, (v) an association of persons or a body of individuals, whether incorporated or not, (vi) every artificial juridical person not falling within any of the preceding sub-clauses, ....