TaxTMI 
TaxTMI 
2021 (9) TMI 478
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....utory Investigating Agency established in India, and entrusted with the task and authority to implement and enforce the provisions of the Prevention of Money Laundering Act, 2002 (Hereinafter referred to as "PMLA Act"). 3. Heard Mr. Anil Singh, the learned Additional Solicitor General and Mr. Rajiv Chavan, the learned Senior Counsel for the respondent no.1. 4. Mr. Chavan the learned Senior Counsel for the respondent no.1 has raised preliminary issue as to the maintainability of the application filed under Section 439(2) of the Code of Criminal Procedure, 1973 ('Cr.P.C.' for short) and would contend that provisions of Section 439(2) of the Cr.P.C. cannot apply in a case where an order for release of bail has not been availed of. 5. Mr. Anil Singh, the learned Additional Solicitor General for applicants contended that; (i) The Trial Court while granting bail relied on the irrelevant material although prima-facie, case of money laundering has been made out against the respondent no.1; (ii) The learned Court has not recorded, what were the fresh grounds which persuade it to take a view different from one taken in the earlier application; (iii) after rejecting first bail applic....
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....Schedule to Prevention of Money Laundering Act, 2002 (As Amended) ('PMLA Act' for short). On the basis of aforesaid information, PMLA Case vide ECIR 14/MZ0/2013, dated 14th October, 2013 was registered against NSEL, Directors, its key officials, 25 defaulters of NSEL and others for investigation under the provisions of the PMLA Act. 9. Investigation revealed that defaulters M/s. Astha Minmet India Private Limited and M/s. Juggernaut Projects Ltd. resorted to large-scale laundering of funds earned by indulging into the criminal activity of fictitious trading of commodities. Multiple transactions were used to bring such proceeds of crime into the banking channel and to layer and mask the criminal origin of funds so as to further layer and project the same as untainted and avoid detection. Investigation revealed that funds / movable / immovable properties totally valued at Rs. 186.22 Crores were purchased by the said accused out of proceeds of crime. During the course of the investigation, bank accounts of M/s. Vihang Aastha Housing Projects LLP was called and scrutinised. It was noticed, that M/s. Vihang Aastha Housing Projects LLP received Rs. 21,74,000,00/- from M/s. Aastha Group ....
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....ls, total acquisition value of the said land parcels was only Rs. 1.70 Crores. Thus, alleged in actual, rest of the funds were further diverted by him to acquire various properties in his name and in the name of his wife. Investigation also revealed that the farmers/land owners whose lands, respondent no.1, sold to M/s. Vihang Aastha Housing Project LLP, have not been sold to Respondent No.1 by these farmers and the said farmers are actual owners of the said land parcels. Respondent No.1 transferred these land parcels fraudulently to M/s. Vihang Aastha Housing Projects LLP and thus, also cheated the farmers. Therefore, it is the case of the applicant that, the respondent no.1 is in receipt of proceeds of crime to the tune of Rs. 10.5 Crores within the purview of Section 2(1)(u) of the PMLA Act, which he layered and integrated in form of properties in the name of himself and his wife. 14. The respondent no.1 was arrested on 6th April, 2021. On 21st May, 2021, respondent no.1 filed an application for bail before the Special Judge. It was rejected vide order dated 18th June, 2021 ('First Order' for short). 15. Applicant filed complaint/charge-sheet on 4th June, 2021. Cognizance of t....
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....57. In the said judgment, Justice Kathawala has held that the expression "any Person who has been released on bail used in Section 439(2)" would mean, that accused is not only granted bail but, has availed of the same and is released from jail custody and, therefore, it is only then, that the Court may direct person to be re-arrested and commit to the custody as provided in Section 439(2) of the Cr.P.C. Thus, held that, no question of re-arrest or re-committal to the custody can arise unless the accused is 'actually released', on bail granted to him. Thus, Mahendra Manilal (Supra) followed the judgment in the case of B.S.Rawat (Supra). Mr. Chavan the learned Senior Counsel further elaborated his arguments contending that, bail means release from the custody or prison and delivered into the hands of sureties, who undertake to produce the accused in the Court on appointed date. Mr. Chavan submitted that expression "Release on bail" means release of a person from legal custody. He contended that word "Bail" is used in our common law for freeing or setting at liberty of one arrested or imprisoned upon any action, either civil or criminal, on surety taken for his appearance on a day and....
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....said judgment has held and concluded that; (a) This is a Section that takes into account circumstances under which a superior Court may interfere with a bail order that has been passed by a subordinate Court or wherein a Court may review an earlier bail order passed by a Court of parallel jurisdiction. (b) An order directing the release of an accused on bail is an order that becomes effective forthwith unless the Court specifies that it will take effect after a certain amount of time has elapsed. (c) An order for release of an accused on bail, therefore, is permissible of reconsideration, under Section 439(2) of the Code of Criminal Procedure, at any point of time after the order is passed. (d) The law does not take into account formalities relating to the release of the accused, such as approval of surety nor does the law take into account a situation whereby for whatever reason the Accused person may not immediately avail of the bail order that is passed. (e) that the clause "any person who has been released on bail under this Chapter" will have to be strictly construed as meaning any person who has been released on bail by a Court. (f) The subsequent part of the Sect....
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....rt in the case of Mahendra M. Shah (Supra) is per-incuriam. Submission is, although in Mahendra M. Shah, judgment in B.S.Rawat (Supra) has been followed, but judgment in the case of Madam Ayabo (Supra) delivered in October, 1990 was not brought to the notice of the Court. Mr. Singh submitted, Justice M.F.Saldanha, who had delivered the judgment in Madam Ayabo (Supra) has distinguished the judgment in B.S.Rawat (Supra) and concluded that application under Section 439(2) of Cr.P.C. was maintainable, against the unsustainable bail order irrespective of fact, whether accused is actually released on bail. Mr. Singh vehemently submitted that the two learned Judges of this Court in the case of Madam Ayabo (Justice M.F.Saldanha) and in the case of State of Maharashtra v. Santosh Hiraman Purankar (Justice A.M.Khanwilkar) have taken consistent view that if bail order itself is manifestly wrong, section 439(2) would not provide any bar to the prosecution from asking for review of that order and question as to where accused is physically released or not is quite irrelevant. Mr. Singh, therefore, submitted that the ratio laid down in the case of B.S.Rawat (Supra) would not deter this Court from....
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....ts own consequences. Obviously, this would, defeat not only object of Section 439(2) but also defeat, statutory right of aggrieved person to challenge the said order. Thus, interpretation suggested by Mr. Chavan, would amount to grafting on a clause of Section 439(2), which does not exist in it and would amount to narrowing down the scope of Section 439(2) of the Cr.P.C. which something is impermissible having regard to the principles of law that govern the interpretation of statutes. 27. For the reasons aforestated, in my view, instant application filed by the prosecution under Section 439(2) is maintainable, although the accused actually has not been released. Primary objection as to the maintainability is overruled. 28. Next, Question is whether decision in Nikesh Tarachan Shah (Supra) has lost its' significance because of amendment in Section 45 of the PMLA Act. Mr. Singh, learned ASG vehemently submitted that, twin conditions set out in Section 45 of the PMLA are valid and would be applicable in the instant case. This submission is made on following two grounds, viz. (i) binding precedent of the Hon'ble Apex Court holding that twin conditions apply; Reliance is placed on t....
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.... shall be released on bail or on his own bond". Thus, held, twin conditions of Section 45 would revive and apply to the offence of, money laundering. In so far as the judgment in the case of Moti Lal is concerned, the said judgment neither makes any reference to the judgment in P.Chidambaram (Supra) or deal with the effect of amendment to Section 45 of the PMLA Act. In the said case, bail was sought on a parity. Thus, the judgment of the Patna High Court in the case of Moti Lal does not further the case of the applicants. 31. Mr. Singh has also invited my attention to the judgments of this Court in Samir Bhujbal v. Directorate of Enforcement (Bail Application No.286 of 2018) and Deepak Kochhar (Bail Application No.1322 of 2020). In these judgments, this Court has held that, "amended Section 45, would not revive twin conditions as imposed in Section 45(1) of the PMLA Act and would not have application, while granting bail to the accused of an offence under the PMLA Act." Mr. Singh submitted that the judgment in the case of Samir Bhujbal was delivered, before the judgment in the case of P. Chidambaram and, therefore, this judgment is to be kept out of consideration, while deciding t....
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....case of Samir Bhujbal, Dipak Kochhar and in the case of Upendra Rai by the Delhi High Court, that Amendment of 2018, would not revive twin conditions and would have no application while granting bail to accused of an offence of 'money laundering'. 33. Although the learned ASG strenuously argued that the judgment in the case of P. Chidambaram (Supra) is binding a precedent, as to application of twin conditions, to offence under the Act; however, issue as to the application of twin conditions to the offence of money laundering, after 2018 amendment, has not been deliberated upon either in paragraphs 35 or 37 or in other part of the judgment. For these reasons, judgment in P. Chidambaram, would not advance applicants' case. 34. Once, it is held that twin conditions enumerated under Section 45 of the PMLA Act have no application while granting bail to accused of money laundering, it is to be ascertained, whether the trial Court granted bail on irrelevant considerations. 35. Mr. Singh, the learned Additional Solicitor General would contend that the Special Judge granted bail to the respondent no.1 by ignoring the "relevant material", indicating prima-facie, involvement of the respond....
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....have not been interrogated. Mr. Singh submitted that protection granted to the co-accused was not on the merits but in view of the order dated 16th June, 2020 passed by the Hon'ble Apex Court in the Special Leave Petition instituted by Paramvir Singh Saini v. Baljit Singh and Ors. Mr. Singh further submitted, interim protection granted to co-accused, itself was not a ground to release the applicant on bail. He further submitted, on release of the applicant, there is every possibility of tampering the prosecution evidence since co-accused have also been granted protection from the arrest. 37. Mr. Singh, learned ASG, argued that although the material in the charge-sheet was not considered by the trial Court while deciding the first bail application, yet, fling of the charge-sheet would not constitute, 'change' in the circumstance. Submission is, even assuming that the trial Court had not referred to material in the charge-sheet while rejecting first bail application, yet fling of the charge-sheet, itself would not constitute a change in the circumstance. According to Mr. Singh, it was irrelevant consideration. On the point of 'irrelevant considerations\', Mr. Singh, relied on the fo....
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....essive bail applications were rejected and orders were confrmed in Special Leave Petition, bail was granted without recording 'Fresh grounds'. Here, facts are different. The observations in paragraph 13 in Virupakshappa (Supra) do not suggest that fling, of the charge-sheet/complaint, is not change in the circumstance. What has been observed is that fling of the "Charge-sheet" does not in any manner lessen the allegations made by the prosecution. Therefore, in my considered view, the judgments in aforesaid three cases were of no assistance to the prosecution. Be that as it may, herein, the applicant was arrested on 6th April, 2021 for the offence punishable under Sections 3 and 4 of the PMLA Act. His first bail application was rejected on 18th June, 2021. Complaint/charge-sheet was filed on 4th June, 2021. Cognizance of the same was taken on 16th June, 2021. 39. The learned Special Court declined the bail (First Bail) to the respondent no.1 on the following grounds: (I) There was prima-facie material showing complicity of the applicant in the activity of laundering proceeds of the crime; (ii) Investigation was in progress; (iii) Partners/Directors of Vihang Aastha Housing Pr....