TaxTMI 
TaxTMI 
2019 (10) TMI 962
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....ovisions of Cr.P.C. shall apply, in so far as they are not inconsistent with the provision of the PMLA. Section 65 of the PMLA is reproduced hereunder:- "65. Code of Criminal Procedure, 1973 to apply.- The provisions of the Code of Criminal Procedure, 1973 (2of 1974) shall apply, insofar as they are not inconsistent with the provisions of this Act, to arrest, search and seizure, attachment, confiscation, investigation, prosecution and all other proceedings under this Act." 4. Brief facts of the case are that a search u/s 132(1) of the Income Tax Act was conducted on the premises of the Petitioner and other persons on 02.08.2017 in New Delhi and other places. During the course of search, at the premises of the Petitioner in Delhi at B-2/107, Safdarjung Enclave, New Delhi, an amount of Rs. 41,03,600/- was recovered in cash. The Petitioner explained the source of the aforesaid money having been reflected in the return of income filed by the Petitioner for A.Y. 2018-19. 5. Thereafter, the Income Tax Department filed 3 complaints against the Petitioner before the Special Court, Bengaluru, u/s 200 Cr.P.C. alleging offences under the Income Tax Act. Pursuant thereto, the....
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....and therefore, there is no question of invoking the provisions of PML Act on the basis of Section 120B IPC alone. Furthermore, the High Court of Karnataka in its judgment dated 29.08.2019 in W.P. No. 6210/2019, left the question w.r.t Section 120B open as regards the question of commission of criminal conspiracy to commit as scheduled offence under the PML Act. However, a conjoint reading of section 2(l)(u), 2(l)(x),2(l)(y) and 3 of the Prevention of Money Laundering Act,2002, reveals that the offence of money laundering, and the concept of proceeds of crime is necessarily relatable to the existence of a schedule offence. 10. Dr. Singhvi, submitted that the concept of conspiracy is not something unknown to criminal law. It is a settled proposition that conspiracy requires an offence and there cannot be a conspiracy for conspiracy, however, it should lead to an illegal act or act which is not illegal to be done by illegal means. While there is no quarrel with the proposition that Section 120B is a substantive offence, but it doesn't mean that without an existence of another offence or an agreement to conduct another offence, the offence of conspiracy can be said to be made ou....
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.... 45 by the Finance Act 2018 is only with respect to substituting the term 'offence punishable for 3 years' with 'offence under this Act'. The said amendment does not revive the twin conditions already struck down by the aforesaid judgment. Reliance is placed upon the judgment of Delhi High Court in the case of Upendra Rai vs. Directorate of Enforcement (Bail Application No. 249/2019). 13. Since the twin conditions for bail in section 45 of the PML Act have been struck down by the Hon'ble Supreme Court and the same are neither revived nor resurrected by the Amending Act therefore, as of today there is no rigor of said two conditions under original Section 45(l)(ii) of the PML Act for releasing the Petitioner on bail. The provisions of section 439 of Cr.P.C and the conditions therein will only apply in the case of the Petitioner for grant of bail. 14. Dr. Singhvi also submitted that the Petitioner has been elected seven times as a member of Legislative Assembly, State of Karnataka and is former minister of energy, water and power. The Petitioner has deep roots in the society and admittedly, is not a flight risk. Reliance is placed upon the judgment in the ca....
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....tioner was kept in Cardiac Care Unit (CCU) and as the Petitioner complained of chest pain, Angiography was also performed on the Petitioner on18.09.2019. 19. Moreover, the proviso to Section 45 of the PML Act, provides that in case of sick person, bail should be granted to the person arrested. 20. On the other hand, Mr. Natrajan, learned Additional Solicitor General of India submitted that the present case involves the commission of grave economic offence of laundering of the proceeds of crime by the petitioner and his associates through a series of transactions and projecting the ill gotten proceeds as untainted. 21. The Income Tax Investigation Directorate of Karnataka has conducted searches on the petitioner and his associates on 02.08.2017 at various places which led to seizure of (cash, loose sheets, diary & several incriminating material connected with criminal conspiracy) from premises under control of the petitioner and his associates. The scrutiny of transactions recorded in incriminating documents revealed unaccounted cash transactions and its laundering running into at least Rs. 143 Crores. During course of search, statement of several persons including petition....
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....lained the illegal generation of money found during search as well as deposited in several bank accounts and has been evasive. The transactions as recorded in the incriminating documents recovered indicate that he has generated large sums of money and looking into the position he has been holding as Minister for several times in the State Government of Karnataka and using some Government Servants and he is authority for furtherance of his conspiracy for both generation of huge amount of money through misuse of his official position and business relations is not ruled out as the statement given by various persons have already emphasized that all the money they were handling belonged to the petitioner and all his family members like mother, wife, daughter have shown phenomenal growth in assets in the period when he was holding high position which has not come out of legitimate business which he is claiming. The petitioner has directly as well as indirectly been involved in the process, concealment, possession, acquisition and use of the proceeds of crime which was directly/indirectly derived as a result of criminal activity relating to schedule offence. 25. Further submitted, it h....
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....n and standing there is every likelihood that he would employ every means to frustrate the investigations against him. Furthermore, his mere presence at large would intimidate the witnesses. 30. It is submitted that means, position and standing of the petitioner is an extremely vital factor to be considered while granting bail to the accused. Furthermore, it is also well settled that if the accused is of such character that his mere presence at large would intimidate the witnesses or if there is material to show that he will use his liberty to subvert justice or tamper with the evidence, then bail has to be refused. 31. Heard learned counsel for the parties and perused material on record. 32. It is not in dispute that the petitioner was discharged by the Special Court, Bengaluru in 3 out of 4 complaints vide order dated 28.02.2019. however, the application seeking discharge in the 4th complaint was dismissed by the Special Court, Bengaluru, vide order dated 25.06.2019. The petitioner had challenged the said order in Revision Petition No. 955/2019 filed before the High Court of Karnataka which granted stay of further proceedings vide order dated 20.08.2019 in the said 4t....