TaxTMI 
TaxTMI 
2022 (4) TMI 650
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....nd handed over the same to Preet Kumar Agarwal at his office itself violating the procedure of handing over the sealed boxes at the security hold or boarding area itself. After receiving the said articles, he put it to a strolley bag and handed over the strolley bag to his father, the accused herein. Then Sanjay went straight to cargo complex, broke the seals of customs affixed on the boxes and booked them with Indigo Airlines domestic cargo for delivery at Hyderabad airport. He then boarded a flight to Hyderabad using a boarding pass in the name of his son Preet. This was the precise way how huge quantity of gold ornaments, meant for export, was diverted to domestic market. Thereafter, Sanjay was intercepted by the officers of DRI. 2. The petitioner, his son, wife, since claimed to be divorced and other associates of the alleged offence of alleged smuggling were implicated for committing offences under Section 135 of the Customs Act, Section 12 of the Passport Act and also under the penal provision of Prevention of Money Laundering Act (PMLA, for short). Petitioner's case 3. The petitioner purchased gold from authorised companies, like MMTC, STC etc submitting security deposit ....
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....ner was booked under the PMLA Act took place on 4th April, 2018. Both the petitioner and his son were arrested on 6th April, 2018. The competent authority under the COFEPOSA Act passed an order of detention of the petitioner, his son and his brother on 1st June, 2018 for the allegation of smuggling goods, abetting the smuggling of goods or engaging in transporting or concealing or keeping smuggled good or dealing in smuggled in future. However, the said order of detention was revoked by the advisory board vide order dated 15th August, 2018. The petitioner and his brother challenged the detention order under COFEPOSA Act before the Delhi High Court in WP (CRL) 1971 of 2018 and Crl. M.A 12159 of 2018. Vide order dated 27th August, 2018 the detention order of the petitioner and his brother under the COFEPOSA Act was set aside by the High Court at Delhi. The ED preferred special leave petition before the Hon'ble Supreme Court being SLP No.6940 of 2019 which was also dismissed on 11th March, 2019. The petitioner was also enlarged on bail by the learned Chief Judicial Magistrate, North 24 Pgs in case No.C-562 of 2018 filed by DRI over the incident that allegedly took place on 4th April, ....
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....The aforesaid decision was discussed, deliberated and referred time and again by different High Courts in cases under PMLA with reference to the importance and applicability of Section 45 of the PMLA. Paragraph 46 and 47 are very relevant and quoted below:- 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. 47. The judgment in Kartar Singh v. State of Punjab, is an instance of a similar provision that was upheld only because it was necessary for the State to deal with terrorist a....
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....ion 45 of the present Act." 11. Finally the Hon'ble Supreme Court struck down Section 45(1) of the PMLA with the following observation in paragraph 54:- "Regard being had to the above, we declare Section 45(1) of the Prevention of Money Laundering Act, 2002, insofar as it imposes two further conditions for release on bail, to be unconstitutional as it violates Articles 14 and 21 of the Constitution of India. All the matters before us in which bail has been denied, because of the presence of the twin conditions contained in Section 45, will now go back to the respective Courts which denied bail. All such orders are set aside, and the cases remanded to the respective Courts to be heard on merits, without application of the twin conditions contained in Section 45 of the 2002 Act. Considering that persons are languishing in jail and that personal liberty is involved, all these matters are to be taken up at the earliest by the respective Courts for fresh decision. The writ petitions and the appeals are disposed of accordingly." 12. It is also submitted by Mr. Mukherjee that twin condition for bail contained in Section 45(1) being struck down by Supreme Court in Nikesh Tarachand Saha....
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....ore than 650 crores which was meant to be exported. The said gold owing to 2717 kgs was contended property used for commissioning the offence for diversion of gold as well as the offence of money laundering. The petitioner used to purchase the gold from authorized agents such as MMTC, STC, Diamond India Ltd. etc at a discounted rate for export. While processing export, the petitioner and his associates namely his son, brother and wife surreptitiously diverted the said gold to domestic market and sale out the jewellery at the prevailing domestic market rate which is higher than the export rate of gold. The gold was diverted through the proprietorship firms, namely M/s PH Jewels, M/s Kalpataru Jewelles and Exports Corporation and M/s Shree Ganesh Jewels and M/s V.N. Jewellery, being managed and controlled by the petitioner. More than 120 bank accounts were used by the petitioner, his son, wife and brother and other trusted person to layer integrate and conceal the true origin of funds. Transactions were made without any invoice or bill in this way the accused diverted gold worth Rs. 650 crores in the domestic market. After placing the funds in the bank accounts of the above named fir....
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....intervention vide amendment Act 13 of 2018? The following paragraphs are important for the purpose of this case and quoted below:- "45. The reference which arises out of bail application is to the limited extent of expressing about existence or non-existence of twin conditions after amendment despite the earlier pronouncement of the Supreme Court in the case of Nikesh Shah (supra). Whether the Amendment Act No. 13 of 2018 has cured all the defects pointed out by the Supreme Court is an issue directly touching to the constitutional validity of the Amendment Act which cannot be dealt without proper pleading and proper challenge. 46. After decision of Nikesh Shah (supra) the Parliament has introduced an amendment to Section 45 of the Act, which has changed the entire complexion. Merely because the entire section is not re-enacted, has no consequence. Admittedly, the Amending Act is not struck down yet by the Courts as the said challenge is pending. Since the Legislative amendment on date is in existence, presumption of constitutionality would apply. In the subsequent pronouncement of P. Chidambaram's case (supra), the Supreme Court took a note of its earlier decision in case....
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....n has to be resurrected afresh. The very effect of the amendment has changed the periphery of its applicability. The section which stands after amendment has to be read as a whole. 50. Absence of reference in notification dated 29.03.2018 thereby amending section 45(1) of the Act about its retrospective applicability (as observed in Sameer Bhujbal's case), does not take away the force and impact of amendment. It is for the Legislature to give effect to the amending provisions prospectively or retrospectively. However, that cannot be reason for ineffecting the amending provisions of the Act. Conclusion :- 51. We may reiterate that the reference arose out of statutory jurisdiction and not constitutional jurisdiction of this Court. Unless there is proper challenge and pleadings, the issue of constitutional validity cannot be undertaken. Undoubtedly, the Legislature has power and competence to amend the provisions of the Act. Unless the amended provision is struck down by the Courts, it cannot be watered down. Since after the amendment the entire complexion of section 45 has been changed, we are not in agreement with the contention that the entire section has to be re- en....
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....t was declared unconstitutional on 19th April, 2018. Therefore, on the date of commission of alleged offence on 4th April, 2018 there was no rigors of Section 45 of the PMLA Act and petitioner is entitled to be enlarged on bail because in the main case instituted by the DRI the petitioner was released on bail. Conclusion 19. Having heard the learned Counsels at length and having due regard to the decisions of the Hon'ble Supreme Court as well as different High Courts. Let me record at the outset the scheme of PMLA Act. It is needless to say that for registration of a crime under the PMLA, the only prerequisite is registration of a predicate/scheduled offence as prescribed in various paragraphs of the schedule appended to the Act nothing more than it. In other words, for initiating or setting the criminal law in motion under the PMLA, it is only that requirement of having a predicate/scheduled crime registered prior to it. Once an offence under the PMLA is registered on the basis of a scheduled offence, then it stands on its own and it thereafter does not require support of predicate/scheduled offence. It further does not depend upon the ultimate result of the predicate/scheduled ....