TaxTMI 
TaxTMI 
2021 (6) TMI 990
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....substance of the allegations in the FIR is that, during 2011, a consortium of 14 banks with SBI as the lead bank, had sanctioned working capital credit facilities which KGPL (A1) had allegedly diverted, resulting in loss to the banks to the tune of Rs. 824.15crores as on 31.12.2017. Since the FIR disclosed the commission of a 'schedule offence' under the Prevention of Money Laundering Act, 2002 (in short "the PML Act"), the Enforcement Directorate registered a case in ECIR No. CEZOI/07/2018 on 22.03.2018, conducted investigation under the PML Act, collected materials and filed a complaint in C.C.No.13 of 2018 in the Court of the Principal Sessions Judge (Special Court), Chennai, against KGPL (A1), Bhoopesh Kumar Jain (A2), Mohanlal Jewellers Pvt. Ltd. (in short "MJPL") (A3), Suresh Khatri (A4) and T.K.S.Pugazhendi (A5) for the offence under Section 3 read with 4 of the PML Act, for quashing which, MJPL (A3) has filed Crl.O.P.No.25688 of 2018 and Suresh Khatri (A4) has filed Crl.O.P.No.20127 of 2018 under Section 482 Cr.P.C. 3. Heard Mr. A. Ramesh, learned Senior Counsel representing Mr. Jayesh B. Dolia, learned counsel on record for MJPL (A3) and Suresh Khatri (A4) and M....
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....er, document evidencing receipt of goods and gold purity certificate, if any" The Forensic Audit has further reported that on examination of the Purchase Register, it was noticed that the total purchases made by KGPL for the review period from April 01, 2009 to June 30, 2017, amounted to Rs. 10,134 Crores. Further, on analysing the yearly purchase it was observed that Rs. 6984 Crores, i.e., about 69% of the total purchases were made in the period FY 2013-14 to FY 201718 (uptill 18th May 2017) revealed that purchases of top ten parties constitute about 65.71% of the total purchases in that period, and M/s.Mohanlal Jewellers Pvt. Ltd., are one among them, who had sold 1089105.37 gms of Gold Bullions valued at Rs. 318.75 Crores to KGPL. KGPL had made the payments from their various bank accounts held inside the consortium, out of working capital borrowings, for the purchase of the Gold Bullions from M/s.Mohanlal Jewellers Pvt. Ltd. which is to the tune of Rs. 318.75 Crores during the above mentioned period. The amounts were paid through RTGS into the account of M/s.Mohanlal Jewellers Pvt. Ltd. held in HDFC Bank, ITC Centre, Anna Salai, Chennai, (now transferred to R.K.Salai B....
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.... bullion traders and that, the transaction between KGPL (A1) and MJPL (A3) will be squarely covered under Section 33 of the Sale of Goods Act, 1930. It is true that the Adjudicating Authority has relied upon Section 33 of the Sale of Goods Act, 1930 and has held that MJPL (A3) had delivered the gold bullions to KGPL (A1), on receipt of monies from them. 10. The short question is, whether the criminal Court is bound bythese findings of the Adjudicating Authority or inter alia can this Court proceed to quash the criminal prosecution, based on such findings of the Adjudicating Authority, especially, when the matter is pending before the Appellate Tribunal. 11. Mr. A. Ramesh placed strong reliance on various judgments, to drive home the point that the findings of the Adjudicating Authority, in certain circumstances, can form the basis for quashing the parallel criminal prosecution. In recent times, the bedrock case on this subject is the judgment of the Supreme Court in Radheshyam Kejriwal Vs. State of West Bengal and Another [(2011) 3 SCC 581], wherein, the Supreme Court has quashed the prosecution under Section 56 of the Foreign Exchange Regulation Act, 1973 (In short "FERA") a....
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....nd MJPL (A3). The Adjudicating Authority has accepted the version of MJPL (A3), by relying upon a certain trade practice and also by relying upon Section 33 of the Sale of Goods Act. 16. As rightly pointed by Mr.Sankaranarayanan, a custom or usage in a particular trade, has to be proved in the manner set out in Section 48 of the Evidence Act and the Court cannot take judicial notice of it. Before the Adjudicating Authority, MJPL (A3) and HDFC bank played the same tune and they were on the same page obviously because, the HDFC bank did not want to lose Rs. 143 crores as it had given loans to MJPL (A3). 17. Unlike the FERA, the Customs Act and the Central Excise Act, where the Adjudicating Authority deals completely with the confiscation proceedings, under the PML Act, the Adjudicating Authority interferes only to confirm the interim order of attachment passed by the Enforcement Officer under Section 5 of the PML Act. In other words, under Section 5 of the PML Act, the Enforcement Officer has the power to pass an interim order of attachment, to safeguard the proceeds of crime from disappearing and the Adjudicating Authority, who exercises powers under Section 8 of the PML Act d....
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.... SCC 420], where the cognizance order has been quashed, on the ground that it did not reflect application of mind. He shoved up his arguments by placing reliance on a judgment of the Karnataka High Court in S.C.Jayachandran Vs. Enforcement Directorate (W.P.No.18442 of 2017 decided on 17.12.2020), wherein, a learned Singe Judge has quashed the order of cognizance, by relying upon the judgment of the Supreme Court in Sunil Bharti Mittal (supra) and has directed the trial Court to pass orders afresh. 22. In criminal law, the principle of stare decisis cannot be mechanically applied. In Sunil Bharti Mittal (supra), the CBI had filed a charge sheet against Bharti Cellular Ltd. and other telecom companies and one Shyamal Ghosh. While taking cognizance, the Special Judge added Sunil Bharti Mittal, Chairman-cum-Managing Director of Bharti Cellular Ltd. and issued process to him. This was the subject matter of the challenge before the Supreme Court. The Supreme Court went into the charge sheet that was filed by the CBI and found that the CBI themselves had come to the opinion that there was no material to implicate Sunil Bharti Mittal. In fact, in paragraph 32 of the judgment, the Suprem....
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....rting the conviction. The court is not required to evaluate the evidence and its merits. The standard to be adopted for summoning the accused under Section 204 CrPC is not the same at the time of framing the charge. For issuance of summons under Section 204 CrPC, the expression used is "there is sufficient ground for proceeding..."; whereas for framing the charges, the expression used in Sections 240 and 246 IPC is "there is ground for presuming that the accused has committed an offence...". At the stage of taking cognizance of the offence based upon a police report and for issuance of summons under Section 204 CrPC, detailed enquiry regarding the merits and demerits of the case is not required. The fact that after investigation of the case, the police has filed charge-sheet along with the materials thereon may be considered as sufficient ground for proceeding for issuance of summons under Section 204 CrPC." The above statement of law cannot be distinguished by contending that it would apply only for a police report because, all investigations culminate in the investigating agencies filing either a police report or a complaint with the materials collected by them, for the Court ....