TaxTMI 
TaxTMI 
2021 (6) TMI 424
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....vate Limited, which is engaged in printing and publishing a newspaper "Satyam Times," in Gujarati and English languages. The arrest order reveals that, the applicant and Shri Sitaram Adukiya have falsely declared very high numbers of circulation of these newspapers i.e. 23,500 and 6,000-6,300 copies daily for the Gujarati and English editions respectively, whereas actual circulation was much less i.e. only 300-600 and 0-290 respectively. It is stated that false figures of higher circulation were used to attract the prospective advertisement agencies, including Directorate of Advertisement and Visual Publicity. By virtue of forgery and use of such fraudulent circulation claims, the applicant and Shri Sitaram Adukiya cheated the Government and private advertisement agencies and thereby gained Rs. 2,70,00,000/- towards advertisement. They used bogus purchase invoices and made false entries in the Books of Accounts for showing higher circulation and commission of the fraud. It appears that the applicant and the co-accused Shri Sitaram Adukiya had committed the scheduled offence and thereby generated proceeds of crime to the tune of Rs. 2,70,00,000/-. Accordingly, the applicant was arre....
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....te of Advertising and Visual Publicity, which falls under the Ministry of Information and Broadcasting, Government of India. It is submitted by the learned Senior Advocate that it is not the case of the Enforcement Directorate that the Directorate of Advertising and Visual Publicity has alleged any irregularities or misuse of the rates fixed by them. Learned Senior Advocate Mr. Syed has also referred to Section 45 of the PMLA Act, more particularly, Sub-section (1) clauses (i) and (ii) thereof. In reference thereto, he has placed reliance on the judgment of the Apex Court rendered in the case of Nikesh Tarachandra Shah vs. Union of India, (2018) 11 S.C.C. 1, and has submitted that both the conditions, as envisaged in section 45 of the PMLA Act, are set aside by the Apex Court and the Court has to decide the bail application only in light of the provisions of Section 439 of the Cr.P.C. Reference is also made to the order of the Delhi High Court rendered in the case of D.K. Shivakumar vs. Director of Enforcement, (2019) 264 D.L.T. 586. He has also placed reliance on the judgment of the Apex Court rendered in the case of P. Chidambaram vs. Directorate of Enforcement, 2020 (13) S.C.C. ....
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....l income from the advertisement. It is submitted by Mr. Vyas that the present applicant and Sitaram Adukiya-both being the Directors of M/s. Sanket Media Pvt. Ltd., had violated the advertisement contract given to them and have illegally gained the aforesaid amount. While referring to the provisions of Section 45 of the PMLA Act, he has submitted that after the decision of the Apex Court in the case of Nikesh Tarachandra Shah (supra), the Legislature has amended the provisions and in fact, the amended provisions do not dilute the two conditions. In this regard reference is also made to the decision of the Apex Court in the case of P. Chidambram vs. Enforcement Directorate, 2019 (9) S.C.C. 24. He has submitted that the applicant has satisfied that he is not guilty of the offence and he will not again commit the same offence while on bail. Further, reference is also made to Section 24 of the PMLA Act, which shows that the burden is on the accused to prove contrary that he is not involved in the money laundering. Mr. Vyas has also referred to Section 3 of the PMLA Act, which stipulates that the offence of money laundering and Section 50 of the PMLA Act, which prescribes the production....
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....on 45 of the PMLA Act reinforcing twin conditions attached thereto will not have any effect since they were set aside by the Supreme Court. Similar view has been taken by the High Court of Delhi in the case of D.K. Shivakumar (supra). In the case of P. Chidambaram (supra) (2019 (9) S.C.C. 24), the Supreme Court, while examining the case of the applicant for grant of anticipatory bail, has incorporated both-former and later provisions of section 45 the PMLA Act, i.e. before and after Nikesh Tarachands case, but the issue of relevancy or applicability of the twin conditions after the amendment was not before the Apex Court, and no opinion in this regard has been expressed. 9. On the backdrop of the aforementioned inter-meshed position on twin conditions of section 45 of the PMLA Act, I may examine the case of the applicant in light of the decision of the Apex Court in case of Nikesh Tarachand(supra). Section 45 post Nikesh Tarachand's decision reads as under:- "45. Offence to be cognizable and non-bailable.-(2) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), no person accused of an offence under this Act shall be released on bai....
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....conditions laid down do not relate to an offence under the 2002 Act at all, but only to a separate and distinct offence found under Part A of the Schedule. Obviously, the twin conditions laid down in Section 45 would have no nexus whatsoever with a bail application which concerns itself with the offence of money laundering, for if Section 45 is to apply, the court does not apply its mind to whether the person prosecuted is guilty of the offence of money laundering, but instead applies its mind to whether such person is guilty of the scheduled or predicate offence. Bail would be denied on grounds germane to the scheduled or predicate offence, whereas the person prosecuted would ultimately be punished for a completely different offence--namely, money laundering. This, again, is laying down of a condition which has no nexus with the offence of money laundering at all, and a person who may prove that there are reasonable grounds for believing that he is not guilty of the offence of money laundering may yet be denied bail, because he is unable to prove that there are reasonable grounds for believing that he is not guilty of the scheduled or predicate offence. This would again lead to a ....
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....nder Section 45, the Court must be satisfied that there are reasonable grounds to believe that the person is not guilty of such offence and that he is not likely to commit any offence while on bail. 46. We must not forget that Section 45 is a drastic provision which turns on its head the presumption of innocence which is fundamental to a person accused of any offence. Before application of a section which makes drastic inroads into the fundamental right of personal liberty guaranteed by Article 21 of the Constitution of India, we must be doubly sure that such provision furthers a compelling State interest for tackling serious crime. Absent any such compelling State interest, the indiscriminate application of the provisions of Section 45 will certainly violate Article 21 of the Constitution. Provisions akin to Section 45 have only been upheld on the ground that there is a compelling State interest in tackling crimes of an extremely heinous nature." 11. Assuming that the twin conditions of section 45 of the PMLA Act still remain in the Statute Book, in that eventuality also the observations of the Supreme Court do not get obliterated. The Schedules attached to the PMLA Ac....
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....f they stand firm. 12. With regard to burden or proof on the person charged as envisaged in section 24 of the Act, the Supreme Court has held that section 45 of the PMLA Act only speaks of the scheduled offense in Part-A of the Schedule, whereas section 24 speaks of the offence of money laundering, and raises a presumption against the person prosecuted for the crime of money laundering and such presumption has no application to the scheduled offence mentioned in section 45 of the PMLA Act. In the present case, the applicant is charged with scheduled offences as defined under section 2(u) of the Act. An F.I.R. is registered for the offence under Sections 465, 468, 471, 420, 120B of the IPC which are specified in Paragraph No. 2 of Part-A. The maximum punishment prescribed for the offences for which the applicant is charged is seven years. The applicant has been granted bail for the IPC offences on the condition of depositing Rs. 50,00,000/-. 13. It is the case of the Enforcement Directorate that the applicant has illegally gained the aforesaid amount of Rs. 2,70,0000/- by fallaciously inflating the numbers of circulation of the newspapers. Prima facie, from the documents on re....
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....t in this regard may not be treated as adverse to the case of the Enforcement Directorate or the applicant in the trial proceedings. Another relevant aspect, which requires consideration is the satisfaction of three factors, viz.: I) flight risk, ii) tempering with the evidence and iii) influencing the witnesses. It is not contended that the applicant is neither a flight risk nor it is established that he has the tendency to influence the witnesses or temper with the evidence. It is also not contended by the Enforcement Directorate that there is any propensity or possibility of the applicant of repeating the offence. The case of the prosecution is entirely premised on the documentary evidence, which is already collected by the Enforcement Directorate. The applicant has been in custody since 07.12.2020, he is also subjected to custodial interrogation and this Court finds that further incarceration of the applicant in the judicial custody will not serve any purpose since the complaint is filed under section 45 of the PMLA Act before the Designated Special Court. The Supreme Court in the case of P. Chidambaram (supra) (2020 (13) S.C.C. 791), wherein the accused who was charged with th....