TaxTMI 
TaxTMI 
2013 (4) TMI 979
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....s. S.D. Corporation Private Limited. This S.D. Corporation had by an agreement dated 10-8-2006 engaged the services of a proprietary concern by name M/s. PRS Enterprises to provide management consultancy in respect of this development project. One Sudhansu Khot was the proprietor of the company at that time. It is alleged that the concern is now owned by the applicant's brother Nilesh Thakur. The brothers seem to have also formed another concern by name M/s. PRS Developers, shown to be a proprietary concern of Nilesh Thakur. The applicant and his family members formed a company by name M/s. Acecard Infrasol Private Limited with the applicant's brother and mother as Directors. It seems that PRS Enterprises under the applicant went on to engage the services of Mukesh Waghela and Pandurang Thakur to undertake the liaisoning job in the said project. The applicant is alleged to have agreed to pay to each of them, that is, Waghela and Pandurang Thakur 5% commission from the amount which PRS Enterprises was to receive from S.D. Corporation towards the consultancy. Waghela and Pandurang Thakur had been provided with vehicles and also seemed to have been paid substantial amount for ....
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.... 4. The present application does not show whether the applicant had first approached the Court of Sessions. However, since the application was entertained way back on 17-9-2012 and some interim orders were passed directing, amongst other things, that the application would be taken up for final hearing, this matter was finally heard. 5. The learned counsel for the applicant, first, contended that the applicant was not at all involved in any offence of cheating, forgery or extortion and the reports of Waghela and Pandurang Thakur, which have culminated into filing of charge-sheets, may, at worst, make out a case of breach of contract. He submitted that there was no entrustment or inducement to Waghela or Pandurang Thakur duo to part with any security, etc., and therefore the offence of cheating was not made out. The learned counsel submitted that a catena of Judgments lay down that intention to cheat must be shown to have existed at the inception in case breach of contract is to be made the foundation of offence for cheating. Therefore, according to the learned counsel, since there was no intention to cheat, there was no question of any offence being registered or non-payment of....
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....property is taken without the consent of owner, with dishonest intention in criminal misappropriation, property is acquired without dishonest intention, but by subsequent change of intention, retention or disposal of property becomes wrong and fraudulent. Similarly for the offence of forgery making of a false document with intend to commit fraud or that fraud may be committed is essential. ......" 8. Since the matter pertaining to offence of cheating is actually pending before a Magisterial Court, it may be inappropriate to express any views on the question of cheating. Suffice it to observe that whether an intention to cheat existed at the inception or not would be a matter of evidence and which could be gathered only on the basis of subsequent conduct of the accused. There would be no means of concluding at this stage whether intention to cheat existed at the inception or not, since the conduct of any party who may harbour such intention to cheat at the time when a transaction is entered into would only be to instil a sense of confidence in the other party so that the adversary parts with money or acts in a manner which would harm its interest. 9. Curious though it may soun....
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....eir enterprise, it is not clear as to why the applicant claims to have resigned from his job as a Deputy Collector. It has to be noted that his defence is that the concern which made money belongs to his brother, thus attempting to distance himself from those activities and at the same time claiming to have resigned to show that he had not made any extra income while in service by his entrepreneurship. This rags to riches story needs to be dealt with firmly before it inspires others. In any case, right now the applicant has been prosecuted for the offence of cheating and the allegation is that a part of the money which he has and from which he has purchased properties comes from the amount which has not been paid to Waghela and Pandurang Thakur. 11. The learned counsel for the applicant next submitted that since the applicant had already been arrested in Crime No.56 of 2011 and had been bailed out after a substantial period of incarceration, there is no question of the applicant being subjected to a second arrest for the same offence and sought to invoke the constitutional protection against double jeopardy. 12. As rightly pointed out by the learned ASG, there is no question ....
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....ing Act of the year 2009 with effect from 1.6.2009. For appreciating the argument it is necessary to quote Section 3, Section 2(u) and 2(v) of the Act: 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 the proceeds of crime and projecting it as untainted property shall be guilty of offence of money-laundering. 2(u) 'proceeds of crime' means any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence or the value of such property. 2(v) 'property' means any property or assets of every description, whether corporeal or incorporeal, movable or immovable, tangible or intangible, and includes deeds and instruments evidencing title to, or interest in, such property or assets, wherever located. 4. According to the learned Counsel for the petitioner it is the date when the 'proceeds of crime' were acquired/generated which is the relevant date. The argument proceeds further to say that the word 'Crime' is in Secti....
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....desh High Court in his Order, dated 25-8-2011, in V. Surynarayana Prabhakara Gupta & Anr. v. Union of India & Ors. {Writ Petition No.27898 of 2010} held as under: "From the abovementioned Judgment, the principle that can be deduced is that, Article 20 prohibits only conviction or sentence under an "ex post facto" law and not the trial thereof and such trial cannot "ipso facto" be held to be unconstitutional. In view of this undisputed principle, the resistance offered by the petitioners to the impugned orders, is totally misconceived and unacceptable. The present one is not the stage for securing protection under Article 20 of our Constitution." 18. Furthermore, the learned ASG submitted that offence of money-laundering is a continuing offence since it also punishes possession of property acquired from crime and therefore there is no question of retrospective criminalisation. In State of Bihar v. Deokaran Nenshi and another, reported in (1972) 2 SCC 890, the Apex Court held as under: "A continuing offence is one which is susceptible of continuance and is distinguishable from the one which is committed once and for all. It is one of those offences which arises o....
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.... submitted that any other conclusion would be violative of retrospective criminalisation in as much as it results in the applicant being subjected to consequences more rigorous than those he could have suffered had he been promptly booked and tried. In my view, in the light of the foregoing discussion about offence of money-laundering being a continuous offence, the dates of amendment to the Schedule and registration of offence are not relevant, at least for the purpose of considering the applicant's entitlement to bail, so long as the alleged proceeds of crime are with the applicant, as this would amount to involvement in any process or activity connected with proceeds of crime. It may be useful to quote from a Judgment of a Division Bench of this Court in the context of attachment of properties on which the learned ASG relied. 21. In Mr. Radha Mohan Lakhotia v. The Deputy Director, reported in 2010 (5) Bom.C.R. 625, the Division Bench observed as under: "13. The Appellants however, have placed emphasis on the expression "such person" used in clause (b) of section 5(1) of the Act. According to them, the word "such" is prefix to the word "person" in clause (b). That....
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....f the Schedule, a police report or a complaint has been filed for taking cognizance of an offence by the Special Court constituted under section 36(1) of NDPS Act, 1985. This proviso essentially is directed against the second category of person covered by sub-section (1), namely, person who has been charged of having committed a schedule offence. In other words, action of attachment of proceeds of crime in possession of the person charged of a scheduled offence can be proceeded only on forwarding of a report to Magistrate under section 173 of the Code or a complaint has been filed for taking cognizance of offence by the Special Court constituted under the NDPS Act. In so far as the person who is not named in the scheduled offence, there can be no question of filing of any report or complaint for taking cognizance. That stipulation has no application to the person who is not a person having been charged of a scheduled offence. The view that we propose to take is reinforced from the purport of section 3 and 4 of the Act of 2002. The same deal with the offence of money-laundering and punishment for money-laundering respectively. Both these provisions, even on strict construction, plai....
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....ed under section 5 of the Act and upon receipt of complaint under section 5(5) of the Act. We are not referring to other provisions mentioned in the said section 8(1), as we are dealing only with the case arising under section 5 of the Act. Considering the above, we are of the considered opinion that there is no merit in the argument of the appellants that action under section 5 of the Act could not have proceeded against them, as they were not charged of having committed a scheduled offence." 22. The learned counsel for the applicant next submitted that even so the restrictions on grant of bail in Section 45 of the PML Act do not require that when the prosecution opposes the application for bail the Court must record in the strict sense a satisfaction that the applicant is not guilty and not likely to commit any offence while on bail. For this purpose, the learned counsel relied on the observations of the Supreme Court, in the context of similar provision of Section 21 of the MCOC Act, in the case of Ranjitsing Brahmajeetsing Sharma v. State of Maharashtra and another, reported in (2005) 5 SCC 294 and Vasanthi v. State of A.P., reported in (2005) 5 SCC 132. In Ranjitsing ....
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....rant of bail shall consider the question from the angle as to whether he was possessed of the requisite mens rea. Every little omission or commission, negligence or dereliction may not lead to a possibility of his having culpability in the matter which is not the sine qua non for attracting the provisions of MCOCA. A person in a given situation may not do that which he ought to have done. The Court may in a situation of this nature keep in mind the broad principles of law that some acts of omission and commission on the part of a public servant may attract disciplinary proceedings but may not attract a penal provision." The learned ASG submitted that this Judgment may not help the applicant in the face of provisions of Section 24 of the PML Act which provides that once a person is accused of having committed offence under Section 3 of the Act, the burden of proving that (alleged) proceeds of crime are untainted property would be on the accused. The learned counsel for the applicant pointed out that Section 24 of the PML Act has been amended in 2013 and if the amended Schedules have to be looked into, this amended section would apply. The provisions of Section 24 before and after....
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.... redevelopment project. In the face of provisions of Section 24 of the PML Act, even after applying the principles laid down in Ranjitsing Brahmajeetsing Sharma's case, I am not in a position to over-look the bar to grant of bail enacted under Section 45 of the PML Act. 25. The learned counsel for the applicant next submitted that even so, in view of settled principles about grant of bail his client ought to be admitted to bail, first because he has already suffered custodial interrogation for offence punishable under Section 420 of the IPC, that final report dated 1-3-2013 is ready and therefore the applicant's being in custody for further investigation is not necessary. He relied on a celebrated Judgment of the Supreme Court in Shri Gurbaksh Singh Sibbia and others v. State of Punjab, reported in AIR 1980 SC 1632 where the Court observed as under: "12. We find ourselves unable to accept, in their totality, the submissions of the learned Additional Solicitor General or the constraints which the Full Bench of the High Court has engrafted on the power conferred by Section 438. Clause (1) of Section 438 is couched in terms, broad and unqualified. By any know....
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....dicially. The legislature conferred a wide discretion of the High Court and the Court of Session to grant anticipatory bail because it evidently felt, firstly, that it would be difficult to enumerate the conditions under which anticipatory bail should or should not be granted and secondly, because the intention was to allow the higher courts in the echelon a somewhat free hand in the grant of relief in the nature of anticipatory, bail. That is why, departing from the terms of Sections 437 and 439, Section 438(1) uses the language that the High Court or the Court of Session "may, if it thinks fit" direct that the applicant be released on bail. Sub-section (2) of Section 438 is a further and clearer manifestation of the same legislative intent to confer a wide discretionary power to grant anticipatory bail. It provided that the High Court or the Court of Session, while issuing a direction for the grant of anticipatory bail, "may include such conditions in such directions in the light of the facts of the particular case, as it may think fit", including the conditions which are set out in Clauses (i) to (iv) of Sub-section (2). The proof of legislative intent can best be found in the l....
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....ly and emphatically, is in the negative. The High Court and the Court of Session to whom the application for anticipatory bail is made ought to be left free in the exercise of their judicial discretion to grant bail if they consider it fit so to do on the particular facts and circumstances of the case and on such conditions as the case may warrant. Similarly, they must be left free to refuse bail if the circumstances of the case so warrant, on considerations similar to those mentioned in Section 437 or which are generally considered to be relevant Under Section 439 of the Code." 26. In Siddharam Satlingappa Mhetre v. State of Maharashtra & Ors., reported in AIR 2011 SC 312 on which the learned counsel for the applicant relied, the Supreme Court has observed that arrest should be the last option. The learned counsel also drew my attention to the amended provision of Sections 41 and 41A of the Criminal Procedure Code to support his contention that arrest or custodial interrogation is not warranted in this case since the offence attracts maximum punishment of imprisonment for seven years only. 27. The learned ASG on the other hand relied on a Judgment of the Supreme Court in Jai....
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.... (iv) The possibility of the accused's likelihood to repeat similar or (the) other offences; (v) Where the accusations have been made only with the object of injuring or humiliating the applicant by arresting him or her; (vi) Impact of grant of anticipatory bail particularly in cases of large magnitude affecting a very large number of people; (vii) The courts must evaluate the entire available material against the accused very carefully. The court must also clearly comprehend the exact role of the accused in the case. The cases in which accused is implicated with the help of sections 34 and 149 of the Penal Code, 1860 the court should consider with even greater care and caution because over-implication in the cases is a matter of common knowledge and concern; (viii) While considering the prayer for grant of anticipatory bail, a balance has to be struck between two factors namely, no prejudice should be caused to the free, fair and full investigation and there should be prevention of harassment, humiliation and unjustified detention of the accused; (ix) The court to consider reasonable apprehension of tampering of the witness or appre....
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....ncroachment upon personal liberty by the Executive save in accordance with law, and in conformity with the provisions thereof. It is therefore, imperative that before a person is deprived of his life or personal liberty, the procedure established by law must strictly be followed and must not be departed from, to the disadvantage of the person affected. In each case where a person complains of the deprivation of his life or personal liberty, the Court, in exercise of its constitutional power, of judicial review, has to decide whether there is a law authorising such deprivation and whether in the given case, the procedure prescribed by such law is reasonable, fair and just and not arbitrary, whimsical and fanciful. On account of liberal interpretation of the words 'life' and 'liberty' in Article 21, the said Article has now come to be invoked almost as a residuary right, even to an extent which the founding fathers of the Constitution never dreamt of. In a country like ours, if an accused is alleged to have deceived millions of countrymen, who have invested their entire life's saving in such fictitious and frivolous companies promoted by the accused and when thous....
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.... complain of undue harassment on account of protraction of their cases and the persons deceived who have field complaints, will be satisfied with the early conclusions of the trial. 61. True, there are certain orders passed by this Court wherein special directions have been given but his Court while passing the orders have not only been extremely careful but was cautious enough to record therein that the order was passed on the special facts and the circumstances in the issue and the same ought not to be treated as a precedent - in the wake of recording of such a caution and the order being in the specific facts of the matter in issue, question of the same being treated as a judicial precedent would not arise, in any event in the view as noticed herein above, the said orders as a matter of fact have lost its significance. 62. As regards the issue of a single-offence, we are afraid that the fact-situation of the matters under consideration would not permit to lend any credence to such a submission. Each individual deposit agreement shall have to be treated as separate and individual transaction brought about by the allurement of the financial companies, since the p....
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....ossibility of his tampering or absconding is of course there as it is in all cases irrespective of the person who is in the dock. But we have to go by normal presumptions and having regard to the commitments of the petitioner in India it does not appear likely that he will abscond. The chances of his tampering with the witnesses also are not very strong. Nonetheless, the public interest lies in giving the Enforcement Directorate a full and proper opportunity to question the petitioner vis-a-vis the leads that it has obtained. These leads consist in print-outs obtained from a search of Niranjan Shah's premises. Bindu and Panchal have been questioned. The latter is an employee of Niranjan Shah and what he is supposed to have said is indicative of the petitioner being involved in violations of the restrictions imposed upon transactions in foreign exchange. Bindu is reported to have said that she had passed on 8,500 Dollars at the instance of Niranjan Shah to the petitioner while he was in London. The print-outs may be containing some other information and this being in code or a language with which only experts are conversant, requires interrogation of the petitioner. Interrogatio....