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2022 (10) TMI 198
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....o the registration of the above numbered ECIR, can be stated as under : 2.1 A FIR bearing C.R.No.35 of 2021 was registered with Gamdevi Police Station, Mumbai, in connection with an occurrence, wherein a gelatin laden SUV was found near the residence of an industrialist. NIA took over investigation. Mr. Sachin Waze, the then API attached to the Crime Investigation, Unit of Crime Branch, Mumbai was arrested. In the wake of the controversy, by an order dated 17th March, 2021, Mr. Param Bir Singh, the then Commissioner of Police, Mumbai, came to be transferred from the said post. The Applicant was then holding the office of the Home Minister, Government of Maharashtra. 2.2 Mr. Param Bir Singh, addressed a letter dated 20th March, 2021 to the then Chief Minister of Maharashtra, making certain allegations against the Applicant. As the contents of the said letter came in public domain, a batch of Petitions including Public Interest Litigation No.6 of 2021, were instituted in this Court. The Division Bench of this Court by an order dated 5th April, 2021 directed the Central Bureau of Investigation (CBI) to conduct a preliminary inquiry into the complaint made by Smt. Jayshree Patil,....
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.... November, 2021. 2.6. In the meanwhile, on 23rd August, 2021 the Respondent filed a prosecution complaint against Mr. Sachin Waze and 13 others. The Special Court took cognizance of the offences on 16th September, 2021. After the arrest of the Applicant and necessary investigation, the Respondent filed supplementary prosecution complaint, wherein the Applicant has been arraigned for the offence of money laundering, giving an account of the role of the Applicant therein. The Special Court took cognizance of the offneces. 3. The gravamen of indictment against the Applicant, as borne out by the allegations in the supplementary prosecution complaint, can be summarised as under : 3.1 The Applicant in the capacity of the Home Minister played a crucial role in reinstatement of Mr. Sachin Waze, who was under suspension for 16 years. The Applicant and Mr. Sachin Waze were working as a team to get illegal gratification through extortion and illegal activities. The Applicant instructed Mr. Sachin Waze to collect Rs.3 Lakhs per month from 1750 bar and restaurants across Mumbai. On the instructions of the Applicant, Mr. Sachin Waze collected cash amount of Rs.4.70 Crores from the bar o....
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....gh, which do not command a semblance of credence. The statements of rest of the witnesses do not have any incriminating tendency qua the Applicant. It would, therefore, be extremely unjust to deprive the personal liberty of the Applicant based on the statements of Mr. Sachin aze and Mr. Param Bir Singh, who stand thoroughly discredited by their acts, conduct and statements, which emerge from the prosecution case itself. 5. The Applicant asserts there is not an iota of incriminating material as regards the allegations of influencing the transfers and postings of the police officials. In fact, the Applicant in the capacity of the then Home Minister was statutorily empowered to pass orders of transfers and postings on the recommendations of PEB. In a majority of cases, orders were passed in conformity with the recommendations of PEB. In any event, there is no allegation that the Applicant made the members of PEB to make recommendations for illegal gratification. The Applicant further contends, neither there is material to show that the Applicant allegedly received a sum of Rs.4.70 Crores either directly or indirectly. Nor there is material to show that the sum of Rs.1.70 Crores whi....
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....f the witnesses recorded by CBI and the statements of witnesses recorded under Section 164 of the Code of Criminal Procedure, 1973 by the learned Magistrates. 9. The learned Counsel also invited my attention to the various orders passed by the Supreme Court and this Court, in multiple proceedings. However, at the outset, it is necessary to note that the various orders passed by the Supreme Court and this Court, especially as regards the gravity of the allegations in the aforesaid letter dated 20th March, 2021, underscoring the necessity of a fair and impartial investigation, were in the context of the stage of the proceedings. At this juncture, we have traversed the stage of investigation qua the Applicant to a substantial extent, though in the supplementary prosecution complaint, the Respondent - ED, seeks to keep the door ajar for further investigation. At this stage, therefore, the Court is called upon to consider the entitlement of the Applicant for bail in the light of the material which is collected during the course of investigation. Of course, the prelude which led to the registration of ECIR needs to be kept in view. 10. Mr. Chaudhari, learned Senior Advocate appeari....
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....e authority in the Home Minister, in the matter of transfers and postings of police officials, Mr. Chaudhari would urge that the accusation is simply unfounded. In any event, there is no material to show that the said exercise generated any proceeds of crime to fall within the dragnet of money laundering. 14. Placing reliance on the recent pronouncement of the Supreme Court in the case of Vijay Madanlal Choudhary V/s. Union of India and Ors. 2002 Online SC 929, Mr. Chaudhari urged, with a degree of vehemence, that the allegation that the Applicant had, over a period of time, amassed ill gotten wealth, approximately Rs.13.25 Crores, and transferred the same to the account of Shri Sai Shikshan Sanstha, by no stretch of imagination, can render the said amount 'proceeds of crime', even if assumed to be unaccounted, since there is no predicate offence in relation thereto. Even the sum of Rs.1.71 Crores allegedly transferred to the account of Shri Sai Shikshan Sanstha during February/March, 2021, cannot be termed as proceeds of crime in the absence of any link evidence to show placing, layering and integration of the said amount. 15. Lastly, Mr. Chaudhari would urge that the twin c....
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....lected during the course of investigation to show that the Applicant was involved in money laundering. It was further submitted that what the Applicant desires the Court to do is, to hold a mini trial to arrive at the conclusion that the Applicant is not guilty of the offence. To this end, according to Mr. Singh, the Applicant has adopted selective approach in banking upon the statements of witnesses which suit the Applicant's case. However, the material is required to be appraised as a whole. In any event, the credibility and reliability of the witnesses is not to be judged at this stage, and that is a matter for trial. Therefore, the Court would not be justified in embarking upon the exercise of evaluating the credibility of the witnesses at this stage. 19. To bolster up the aforesaid submission, Mr. Singh, in addition to the observations in the case of Vijay Choudhari (supra), placed reliance on the judgments of the Supreme Court in the case of Satish Jaggi V/s. State of Chhatisgarh (2007) 11 SCC 195 and Ors. and National Investigating Agency V/s. Zahoor Ahmad Shah Watali 2019 (5) SCC 1. 20. I have given anxious consideration to the aforesaid submissions. To begin with, it....
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....tions, which the statutory provisions envisage and the tests to be applied to ascertain whether, in a given case, the statutory restrictions are overcome. 24. A useful reference in this context can be made to a three Judge Bench judgment of the Supreme Court in the case of Ranjitsingh Brahmajeetsing Sharma V/s. State of Maharashtra (2005) 5 SCC 294 wherein the contours of the power of the Court to grant bail in the face of the interdict contained in Section 21(4) of the Maharashtra Control of Organized Crime Act, 1999 arose for consideration. The interdict against the grant of bail under Section 21(4) of the MCOC Act, 1999 is pari materia the bar contained in Section 45(1) of the PMLA. In Ranjitsingh Sharma (supra) the Supreme Court illuminatingly postulated the approach to be adopted in arriving at the satisfaction as to whether the accused is "not guilty of such offence' and that the accused is "not likely to commit any offence while on bail". They read as under : "35. Presumption of innocence is a human right. [See Narendra Singh and Another Vs. State of M.P., (2004) 10 SCC 699, para 31] Article 21 in view of its expansive meaning not only protects life and liberty b....
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....to record a finding as to the possibility of his committing a crime after grant of bail. However, such an offence in futuro must be an offence under the Act and not any other offence. Since it is difficult to predict the future conduct of an accused, the court must necessarily consider this aspect of the matter having regard to the antecedents of the accused, his propensities and the nature and manner in which he is alleged to have committed the offence. 45.It is, furthermore, trite that for the purpose of considering an application for grant of bail, although detailed reasons are not necessary to be assigned, the order granting bail must demonstrate application of mind at least in serious cases as to why the applicant has been granted or denied the privilege of bail. 46. The duty of the court at this stage is not to weigh the evidence meticulously but to arrive at a finding on the basis of broad probabilities. However, while dealing with a special statute like MCOCA having regard to the provisions contained in sub-section (4) of Section 21 of the Act, the Court may have to probe into the matter deeper so as to enable it to arrive at a finding that the materials c....
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.... 26. The aforesaid pronouncements, thus, indicate that the statutory restrictions in the matter of grant of bail are required to be considered reasonably. A finding that the accused is not guilty of the offence and that he is not likely to commit an offence if released on bail, are required to be recorded only for the purpose of arriving at an objective finding on the strength of the material on record to assess the entitlement for bail only. If the Court having regard to the material brought on record is satisfied that, in all probability, the accused may not be ultimately convicted, an order granting bail may be passed. Conversely, it is not peremptory that the Court must arrive at a positive finding that the Applicant has not committed an offence under the Act. Likewise, a satisfaction that the accused is not likely to commit an offence while on bail is qua the offence of the kind with which the accused is charged and not any other offence. 27. On the aforesaid touchstone, reverting to the facts of the case, it has to be seen whether the aforesaid twin tests can be said to have been satisfied. To this end, the nature of evidence/material pressed into service against the Ap....
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....2011, by likewise transferring the amounts in the account of Shri Sai Shikshan Sanstha. It is also alleged that during the period 23rd July, 2011 to 13th May, 2019 unaccounted amount of Rs.10.42 Crores was accordingly integrated, (third component). 30. In substance, the Applicant allegedly laundered a sum of Rs.13.25 Crores since the year 2011, out of which Rs.2.83 Crores during his tenure as Home Minister, which also comprised a sum of Rs.1.71 Crores, out of Rs.4.70 Crores collected from the Orchestra bar owners through Mr. Sachin Waze (paragraph 8.9 of the Supplementary Prosecution Complaint). 31. Mr. Chaudhari strenuously submitted that the aforesaid allegation of money laundering in respect of the alleged transfer of Rs.1.12 Crores during the period the Applicant was holding the Office of Home Minister (second component) and a sum of Rs.10.42 Crores during the period 2011-19 (third component), cannot be termed as 'proceeds of crime'. The charge is, thus, totally misconceived. Those amounts, in the absence of any predicate offence in relation thereto, can never be termed as 'proceeds of crime'. 32. To bolster up this submission, Mr. Chaudhari placed a heavy reliance on ....
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....ed as proceeds of crime. In other words, property in whatever form mentioned in Section 2(1)(v), is or can be linked to criminal activity relating to or relatable to scheduled offence, must be regarded as proceeds of crime for the purpose of the 2002 Act. It must follow that the Explanation inserted in 2019 is merely clarificatory and restatement of the position emerging from the principal provision [i.e., Section 2(1)(u)]. 251. The "proceeds of crime" being the core of the ingredients constituting the offence of money-laundering, that expression needs to be construed strictly. In that, all properties recovered or attached by the investigating agency in connection with the criminal activity relating to a scheduled offence under the general law cannot be regarded as proceeds of crime. There may be cases where the property involved in the commission of scheduled offence attached by the investigating agency dealing with that offence, cannot be wholly or partly regarded as proceeds of crime within the meaning of Section 2(1)(u) of the 2002 Act - so long as the whole or some portion of the property has been derived or obtained by any person "as a result of" criminal activity re....
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....ion which is for the removal of doubts and to clarify that the term property includes property of any kind used in the commission of an offence under the 2002 Act or any of the scheduled offences. In the earlier part of this judgment, we have already noted that every crime property need not be termed as proceeds of crime but the converse may be true. Additionally, some other property is purchased or derived from the proceeds of crime even such subsequently acquired property must be regarded as tainted property and actionable under the Act. For, it would become property for the purpose of taking action under the 2002 Act which is being used in the commission of offence of money-laundering. Such purposive interpretation would be necessary to uphold the purposes and objects for enactment of 2002 Act. 253. Tersely put, it is only such property which is derived or obtained, directly or indirectly, as a result of criminal activity relating to a scheduled offence can be regarded as proceeds of crime. The authorities under the 2002 Act cannot resort to action against any person for money-laundering on an assumption that the property recovered by them must be proceeds of crime and ....
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....unded that the offence of money laundering is not dependent on or linked to the date on which the scheduled offence or predicate offence has been committed. The relevant date is the date on which the person indulges in the process or activity connected with such proceeds of crime. It was further submitted that the Supreme Court has also held that the offence under Section 3 is a standalone offence. Therefore, according to Mr. Singh, the fact that the unaccounted money came to be transferred to the account of the Shri Sai Shikshan Sanstha before the alleged dates of the commission of predicate offence is of no significance. 36. It is true that the Supreme Court has observed in paragraph 270 of the judgment in the case of Vijay Choudhary (supra), that the offence of money laundering is not dependent on or linked to the date on which the scheduled offence is committed and the date which assumes significance is the date on which the person indulges in the process or activity connected with such proceeds of crime. However, further observations in paragraph 281 to 283 make the position abundantly clear that the existence of the proceeds of crime within the meaning of Section 2(1) (u) ....
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....(under Section 66(2) of the 2002 Act) for registration of a scheduled offence contemporaneously, including for further investigation in a pending case, if any. On receipt of such information, the jurisdictional police would be obliged to register the case by way of FIR if it is a cognizable offence or as a non-cognizable offence (NC case), as the case may be. If the offence so reported is a scheduled offence, only in that eventuality, the property recovered by the authorised officer would partake the colour of proceeds of crime under Section 2(1)(u) of the 2002 Act, enabling him to take further action under the Act in that regard. 283. Even though, the 2002 Act is a complete Code in itself, it is only in respect of matters connected with offence of money- laundering, and for that, existence of proceeds of crime within the meaning of Section 2(1)(u) of the Act is quintessential. Absent existence of proceeds of crime, as aforesaid, the authorities under the 2002 Act cannot step in or initiate any prosecution." 37. In the case at hand, as regards the aforesaid second and third components of transfer to the account of Shri Sai Shikshan Sanstha, it appears that in respect of....
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....plicant and a list for recommending the transfers and postings of the police officials was made final, and no record was maintained in the office of the Home Minister. Mr. Ravi Vhatkar, who was then working as OSD in the office of the Applicant, stated that the Applicant in consultation with another Cabinet Minister, used to prepare the list and forward the same to the concerned PEB for necessary action at their end. 42. Mr. Sitaram Kunte, the then Additional Chief Secretary (Home), and chairperson of PEB, also stated that the Applicant used to handover an unofficial list containing suggestions in respect of certain police officers/certain posts with regard to transfers and postings. He used to orally convey those recommendations /suggestions to the other members of PEB. The said suggestions were discussed and evaluated and whoever found suitable, as per merits, was considered and included unanimously by the PEB in the recommended list. He further added that most of the suggestions/recommendations given by the Applicant, in the form of unofficial list, used to be included in the final order. At times, on the directions of the Applicant, Mr. Palande, then PS, used to handover suc....
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....re given to the Applicant. 47. Mr. Param Bir Singh in the statement recorded under section 50 of the PMLA also adverted to the said incident of transfers and postings of DCPs in the month of July, 2020 and asserted that he 'had heard' that there were huge consideration paid to the Applicant through some intermediary for favourable transfers and postings. 48. In the aforesaid statements, evidently both the deponents claimed to have 'learnt or heard' that money changed hands. These statements ex-facie cannot bear weight of the allegation of generation of proceeds of crime out of the alleged predicate offence of exercise of influence over the transfers and postings of the police officials. These statements ex-facie lack the element of certainty as to the source, time and place. They prima facie appears to be hear-say. 49. It is pertinent to note that there is no categorical allegation in the supplementary prosecution complaint that a particular property has been derived or obtained as a result of criminal activity relating to the scheduled offence of exercise of undue influence over transfers and postings. Instead what is alleged is that the Applicant laundered unaccounted ca....
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....ainst following the instructions of the Applicant. The subsequent statements of Mr. Waze are in elaboration of or explanatory to the aforesaid statement. 54. In the confession before the learned Magistrate, in CBI Case, Mr. Waze stated that, post Diwali 2020, the Applicant had told him that there were 1750 bars in Mumbai and on an average Rs.3 Lakhs per bar should be collected and given to him. On his disinclination, the Applicant threatened to suspend him again. Immediately, thereafter, he informed the said fact to Mr. Param Bir Singh, the then Commissioner of Police. Upon insistence of the Applicant, Mr. Waze claimed to have had a meeting with the representatives of the bar owners in mid December, 2020 and asked them to collect money and hand it over to him to be paid to 'No.1', a code word for the Applicant. Initially a good luck amount of Rs.40 Lakhs was paid by the bar owners namely Mahesh Shetty and Jaya Poojari. Only after the collections in the months of January and February, 2021, he had given the cash, so collected, to the Applicant through Mr. Shinde, the co-accused. The first installment was in the last week of January 2021, of about 1.70 Crores. Mr. Shinde had calle....
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....r the collection of Rs.3 Lakhs each from 1750 bars and restaurants across Mumbai was being made, to which he replied that the figure of number of bars was false and he and his branch were not indulging in any such collection. Mr. Patil claimed to have informed the said fact about the said conversation with Mr. Palande to Mr. Param Bir Singh, the then Commissioner of Police. 59. Mr. Patil in his statement under Section 161 of the Code before the Investigating Officer in CBI Case, claimed to have enquired with Mr. Waze as to why he was collecting the amount from the orchestra bar owners. Mr. Waze replied that he was doing it for 'No.1'. When he asked as to who was 'No.1', Mr. Waze informed him that it was Commissioner of Police. In another statement recorded by the learned Metropolitan Magistrate under Section 164 of the Code in C.R.No.71 of 2021 registered with Goregaon Police Station, Mr. Sanjay Patil reiterated that after the meeting with the orchestra bar owners, he had enquired with Mr. Sachin Waze as to why he was collecting the amount, the latter replied that it was for No.1. Upon being further questioned as to who was No.1, Mr. Waze told that it was Commissioner of Police.....
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....ny Pvt. Ltd. and M/s. Utsav Securities Pvt. Ltd. 64. Mr. Sudhir Baheti, CA states that he had known Mr.Surendra and Virendra Jain, co-accused and Mr. Hrishikesh Deshmukh, son of the Applicant, who was managing the affairs of Shri Sai Shikshan Sanstha. At Mr. Hrishikesh's instance, he had coordinated transfer of credit to the account of Shri Sai Shikshan Sanstha during the period 2013-2021. A sum of Rs.4,18,67,782/- was, thus, credited to the account of Shri Sai Shikshan Sanstha in the aforesaid fashion. After receipt of the credit, Mr. Hrishikesh Deshmukh used to pass the required amount in cash through Jain brothers to Havala operators. 65. As enunciated in the case of Vijay Choudhary (supra), in the context of the allegation of money laundering, in the case at hand, it has to be seen whether there is material to show that the aforesaid amounts, especially a sum of Rs.1.71 Crores transferred to the account of Shri Sai Shikshan Sanstha, partakes the character of 'proceeds of crime'. To put it in other words, whether the said amount was derived or obtained directly or indirectly as a result of criminal activity relating to the scheduled offences for which the Applicant and oth....
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....rests on the claim of Mr. Sachin Waze. 69. During the course of the submissions, on instructions, the Court was informed that Mr. Sachin Waze has been declared an approver by the CBI in the predicate offences, and in instant case also, an application has been preferred by Mr. Sachin Waze to declare him as an approver and the ED has given its no objection to the grant of the said prayer. 70. As of now, the status of Mr. Sachin Waze is a co-accused. The statements of Mr. Sachin Waze, banked upon by the prosecution, are but statements of a co-accused. To what extent, even at this stage, the statements of co-accused can be used against another, may warrant consideration. Even if it is assumed that the confession of a co-accused can be used against another co-accused, in the event of a joint trial, under Section 30 of the Evidence Act, 1872, or for that matter in the event of grant of pardon, the co-accused Mr. Sachin Waze deposes as an approver in favour of the prosecution, the question of reliability may arise in the light of the well recognized principles of law. Undoubtedly, that would be a matter for trial. But the character in which the statements are made by Mr. Sachin Waze....
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....r. Sachin Waze claimed to have appraised Mr. Param Bir Singh that there was instruction from the Applicant to collect money from the bars/restaurants in the month of February, 2021, but he did not disclose that he was already collecting the amount. The claim that Mr. Sanjeev Palande had also asked Mr. Sanjay Patil and Mr. Raju Bhujbal to collect a sum of Rs.3 Lakhs per month from 1750 bars/restaurants in a meeting of 4th March, 2021, prima facie, does not seem to have been borne out by the statement of Mr. Sanjay Patil. A perusal of the statement of Mr. Sanjay Patil indicates that, in the said meeting, Mr. Sanjeev Palande inquired with Mr. Sanjay Patil as to whether such amount was being collected from the bars/restaurants. 74. Without delving into the aspect of the alleged inconsistent statements made by Mr Sachin Waze before the other forums including Justice Chandiwal Commission of Enquiry, where Mr. Sachin Waze, allegedly disowned everything, in my view, the aforesaid material, prima facie, renders it unsafe to place reliance on the statement of Mr. Sachin Waze, a co-accused, that cash amount was collected and delivered to Mr. Kundan Shinde at the instructions of the Applica....
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....esaid proviso to Section 45 of PMLA appears to have been inserted by the legislature to mollify the rigour of the restrictions envisaged by the main part of sub-section (1) of Section 45 of PMLA. It is pertinent to note that such a provision is not to be found in other statutes which contain identical restrictions like MCOCA, NDPS and UAPA. The intent of the legislature to vest discretion in the Court to grant bail despite the existence of the bar in the main part of sub-section (1) of Section 45 is required to be given effect to. In my view, the proviso is required to be construed in such a manner that effect can be given to main part of Section 45(1) as well as the discretion which the proviso vests in the Court. 81. As a general rule, the proper function of a proviso is that it qualifies the generality of enacting part by providing an exception and takes out, from the main enactment, a portion which, but for the proviso, would fall within the ambit of the enacting part. Normally a proviso is not construed in such fashion as to completely nullify the main enactment. If it is held that the proviso can be resorted to only after the accused fully satisfies the twin conditions, th....
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....g from such a disease which cannot be treated at prison hospital and, therefore, the Applicant does not deserve to be enlarged on bail on medical grounds. Reliance was placed on the judgments of the Supreme Court in the cases of State of Uttar Pradesh V/s. Gayatri Prasad Prajapati 2020 SCC online SC 843 and Pawan @ Tamatar V/s. Ram Prakash Pandey and Anr. (2002) 9 SCC 166 to bolster up the aforesaid submission. 87. Evidently, the exercise of discretion on medical ground is rooted in facts of a given case. In the case at hand, the Court has considered the entitlement of the Applicant for bail on merits as well, and found a prima facie case for exercise of discretion is made out. As the proviso empowers the Court to exercise the discretion in favour of an accused who is otherwise sick or infirm, the Court has considered the material on record and finds, in the totality of the circumstances, a case for exercise of the discretion under the proviso as well. 88. The Applicant appears to have roots in society. The possibility of fleeing away from justice seems remote. The apprehension on the part of the prosecution of tampering with evidence and threatening the witnesses can be take....