TaxTMI 
TaxTMI 
2022 (12) TMI 14
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.... procedure established by law, but also such procedure ensures both fairness and expeditious conclusion of the trial." Therefore, it is apt to begin this judgment by prefacing it with Article 21 of the Constitution of India which states that no person shall be deprived of his right or his personal liberty except according to the procedure established by law. 4. A Constitution Bench of the Hon'ble Supreme Court in land mark case of A.K. Gopalan vrs. State of Madras ; reported in (1950) SCC 228. In paragraph-9 of the judgment has stated that "it cannot be disputed that the Article collected under the captioned (Right to Freedom) have to consider together to appreciate the extent of the fundamental rights. In the first place, it is necessary to notice that there is distinction between the rights given to citizens and persons. This is clear of perusal of the provision of Article 19 on the one hand and Articles 20, 21 and 22 on the other. In order to determine whether the right to abrize or infringe, it is first necessary to determine the extent the right given by Articles and the limitations prescribed in the Articles themselves permitting its curtailment. The inclusion of Article 1....
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.... of the aforesaid judgment. Although the review has been preferred before the Hon'ble Supreme Court against the judgment dated 27.07.2022 in the case of Bijay Madanlal Choudhury and others vrs. Union of India(supra), this Court while considering the present bail application shall have to keep in mind the conclusion as has been reflected in Paragraph-187 of the aforesaid judgment. 7. Reverting back to the facts of the present case, it is imperative to know exact sequence of events by going back in time. From the facts are available on record, it appears that, the petitioner herein is Director of M/s. Sneha Marketing Ltd. And M/s. Deepak Steel and Power Ltd. The gravamen of the complaints against the petitioner arises from the alleged fact that he was illegally raised iron/manganese ores of a higher value than what has been declared from the Ulliburu Mining Lease area apart from the allegation illegally raising mineral from areas adjacent minor mining lease areas and selling such minerals to his own concern thereby causing huge loss of revenue to the State exchequer. 8. Records placed before this Court reveals that initially Balasore Vigilance P.S. Case No. 30 of 2013 was regis....
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....or which the present Petitioner has been constrained to approach this Court vide the present petition seeking anticipatory bail to secure his liberty and freedom as guaranteed under Article 21 of the Constitution of India. 10. It appears, from the materials on record, that for some of the offences for which the Petitioner is charged with in T.R. Case No. 01 of 2014 being "scheduled offences" within the meaning of Section 2 (1)(y) of the PMLA, the Enforcement Directorate registered ECIR No. 01/2014/BSZO on 5.02.2014. Thereafter, the investigation commenced and since the Petitioner was already in judicial custody in Keonjhar in connection with T.R. Case No. 01 of 2014, the Enforcement Directorate filed a petition before the Learned Sessions Judge (Khurdha) at Bhubaneswar with the prayer to take the Petitioner into it's custody for interrogation for a period of fifteen days in Crl. Misc. Case No. 05 of 2014 arising out of ECIR No. 01/2014/BSZO. The said prayer was allowed vide the Learned Sessions Judge (Khurdha)'s order dated 03.07.2014 and the present petitioner with other accused was remanded to custody till 10.07.2014. On 10.07.2014, when the present Petitioner was produced in ....
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....PMLA Act, 2002 and submits that the same has been enacted to combat the menace money laundering having a wide repercussion on the financial system of the country. 14. Mr. Luthra, learned Senior Counsel for the Petitioner contends that the present petition may be allowed inter alia on the following main grounds: a. During his custody in T.R. Case No. 01 of 2014 a production warrant appears to have been issued by virtue of which the Learned Sessions Judge (Khurda) had remanded the Petitioner's custody to the Special Court, PMLA in terms of Section 167 CrPC from 03.07.2014 to 10.07.2014. Upon his subsequent production on 10.07.2014 before the Learned Sessions Judge (Khurda), the Petitioner's custody was remanded to the Enforcement Directorate for ten days. During this period of remand to Enforcement Directorate, the Petitioner was subjected to custodial interrogation and his statement was recorded. When on 24.07.2014, the Enforcement Directorate did not seek his further custody and stated instead that no further interrogation was required, the Petitioner was sent back to the Superintendent, District Jail, Keonjhar for judicial custody in T.R. Case No. 01 of 2014. Therefore....
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.... ipso facto cause to belatedly arrest the Petitioner. 15. Per contra, Mr. Gopal Agarwal, learned Counsel for the Opp. Party i.e. the Enforcement Directorate submits as follows: f. The Petitioner was remanded to the Enforcement Directorate's custody for interrogation under Section 267 CrPC and not under Section 167 CrPC as alleged by the Petitioner. There is absolutely no material on record to show that the order of remand passed on 03.07.2014 or 10.07.2014 are under Section 167 CrPC. The Petitioner has never been arrested by the Enforcement Directorate in connection with Complaint Case (PMLA) No. 40 of 2018. g. The Petitioner is accused of a serious economic offence and the quantum of punishment for money laundering offences being only 7 years cannot be the basis to undermine the gravity and seriousness of the offence committed by the accused person as the quantum of sentence is a matter of legislative policy. h. The Petitioner's case does not attract any relief in the nature of an anticipatory bail as the Ld. PMLA Court has taken cognizance of the case and the present case does not satisfy the rigors laid down in Section 45 of the PMLA. i. Th....
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....he modern man. It is said to be the delicate fruit of a mature civilization. It is the very quintessence of civilized existence and essential requirement of a modern man." Further the Supreme Court of India in Sanjay Chandra v. CBI, (2012) 1 SCC 40, has observed that: "21. In bail applications, generally, it has been laid down from the earliest times that the object of bail is to secure the appearance of the accused person at his trial by reasonable amount of bail. The object of bail is neither punitive nor preventative. Deprivation of liberty must be considered a punishment, unless it is required to ensure that an accused person will stand his trial when called upon. The courts owe more than verbal respect to the principle that punishment begins after conviction, and that every man is deemed to be innocent until duly tried and duly found guilty. 22. From the earliest times, it was appreciated that detention in custody pending completion of trial could be a cause of great hardship. From time to time, necessity demands that some unconvicted persons should be held in custody pending trial to secure their attendance at the trial but in such cases, "necessity" is t....
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....nal Procedure Code reads as follows: "438. Direction for grant of bail to person apprehending arrest - (1) Where any person has reason to believe that he may be arrested on accusation of having committed a non-bailable offence, he may apply to the High Court or the Court of Sessions for a direction under this section that in the event of such arrest he shall be released on bail; and that Court may, after taking into consideration, inter alia, the following factors, namely- (i) the nature and gravity of the accusation; (ii) the antecedents of the applicant including the fact as to whether he has previously undergone imprisonment on conviction by a Court in respect of any cognizable offences; (iii) the possibility of the applicant to flee from justice; and (iv) where the accusation has been made with the object of injuring or humiliating the applicant by having him so arrested, either reject the application forthwith or issue an interim order for the grant of anticipatory bail" The rest of the provision is not necessary for the purpose of considering the question raised. Upon a plain reading of the aforesaid provision, it is crystal cle....
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....ue consideration should be given to the seriousness and nature of the proposed charges. Furthermore, the Hon'ble Supreme Court laid down guiding principles inter alia being that (i) the applicant must show that he has "reason to believe" that he may be arrested for a non-bailable offence (ii) the High Court or the Sessions Court as the case may be must apply its own mind to the question and decide whether a case is made out for granting such a relief (iii) the filing of a First Information Report ("FIR") is not a condition precedent to the exercise of power under Section 438 (iv) anticipatory bail can be granted even after an FIR is filed, so long as the applicant has not been arrested (v) the provisions of Section 438 cannot be invoked after the arrest of the accused (vi) a blanket order of anticipatory bail should not generally be passed and (vii) the normal rule should not be to limit the operation of the order in relation to a period of time. 22. It is therefore clear that the question of granting an anticipatory bail arises only prior to the arrest or to put it in unambiguous terms, at the stage where the person....
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.... the taking into custody of another person under authority empowered by law, for the purpose of holding or detaining him to answer a criminal charge or of preventing, the commission of a criminal offence. The essential elements to constitute an arrest in the above sense are that there must be an intent to arrest under the authority, accompanied by a seizure or detention of the person in the manner known to law, which so understood by the person arrested. In this connection, a debatable question that arises for our consideration is whether the mere taking into custody of a person by an authority empowered to arrest would amount to 'arrest' of that person and whether the terms 'arrest' and 'custody' are synonymous. xxx 37. For all the discussions made above, we hold that 'custody' and 'arrest' are not synonymous terms. It is true that in every arrest there is a custody, but not vice versa. A custody may amount to an arrest in certain cases but not in all cases but not in all cases. In our view the interpretation that the two terms 'custody' and 'arrest' are synonymous is an ultra legalist interpretation, which if accepted and adopted, would lead to a startling anoma....
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....erson in custody is guilty of the commission of a crime, he is charged of it and thereupon arrested. This principle is reiterated by Pandian, J. in Directorate of Enforcement v. Deepak Mahajan reported in (1994) 3 SCC 440 that a person is in custody no sooner than he surrenders before the police or before the appropriate court. Similar enunciation of the law is also available in Nirmal Jeet Kaur v. State of M.P. reported in (2004) 7 SCC 558; Sunita Devi v. State of Bihar reported in (2005) 1 SCC 608 and Adri Dharan Das v. State of W.B. (2005) 4 SCC 303 all of which are in sync with the view expressed in Niranjan Singh (supra). 27. Moving on, Section 167 of the Cr.P.C. clearly lays down that where investigation cannot be completed within twenty-four hours and the accused is under arrest with police, he has to be produced before the Magistrate for further detention if necessary. This is a salutary provision to safeguard the citizen's liberty so that police cannot illegally detain any citizen. Sub-sections (1) and (2) of Section 167 which are relevant for our purposes read as under: "167. Procedure when investigation cannot be completed in twenty-four hours.-(1) Whenev....
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....t when a person is arrested and detained in custody and it appears that investigation cannot be completed within 24 hours fixed under Section 57 and there are grounds of believing that accusation or information is well founded, the officer in charge of the police station or the police officer making the investigation not below the rank of Sub-Inspector shall produce the accused before the nearest Judicial Magistrate. The mandate of sub-section (1) of Section 167 CrPC is that when it is not possible to complete investigation within 24 hours then it is the duty of the police to produce the accused before the Magistrate. Police cannot detain any person in their custody beyond that period. Therefore, sub-section (1) presupposes that the police should have custody of an accused in relation to certain accusation for which the cognizance has been taken and the matter is under investigation. Sub-section (2) says that if the accused is produced before the Magistrate and if the Magistrate is satisfied looking to accusation then he can remand the suspect/accused to the police for investigation not exceeding 15 days in the whole. But the proviso further gives a discretion to the Magistrate tha....
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....he accused might have committed several offences and the police may arrest him in connection with one or two offences on the basis of the available information and obtain police custody. If during the investigation his complicity in more serious offences during the same occurrence is disclosed that does not authorise the police to ask for police custody for a further period after the expiry of the first fifteen days. If that is permitted then the police can go on adding some offence or the other of a serious nature at various stages and seek further detention in police custody repeatedly, this would defeat the very object underlying Section 167. [But their Lordships put an occasion and added that] limitation shall not apply to a different occurrence in which complicity of the arrested accused is disclosed. That would be a different transaction and if an accused is in judicial custody in connection with one case and to enable the police to complete their investigation of the other case they can require his detention in police custody for the purpose of associating him with the investigation of the other case. In such a situation he must be formally arrested in connection with other ....
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.... to the jurisdictional magistrate for issuance of PT warrant for the production of the accused. When the accused is so produced before the magistrate, the police officer will be entitled to make a request for remand of the accused either in judicial custody or in police custody." 31. In fact, the Hon'ble Madras High Court in the case of State v. K.N. Nehru reported in 2011 SCC OnLine Mad 1984 has succintly summarized the discussion made therein as follows; "42. From the above discussions, the following conclusions emerge: (1) When an Accused is involved in more than one case and has been remanded to judicial custody in connection with one case, there is no legal compulsion for the Investigating Officer in the other case to effect a formal arrest of the Accused. He has got discretion either to arrest or not to arrest the Accused in the latter case. The Police Officer shall not arrest the Accused in a mechanical fashion. He can resort to arrest only if there are grounds and need to arrest. (2) If the Investigating Officer in the latter case decides to arrest the Accused, he can go over to the prison where the Accused is already in judicial remand in conn....
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....custody under Section 167(1) of the Code of Criminal Procedure or dismissing the request after recording the reasons. (7) Before the Accused is transmitted and produced before the Court in pursuance of a P.T. Warrant in connection with a latter case, if he has been ordered to be released in connection with the former case, the Jail Authority shall set him at liberty and return the P.T. Warrant to the Magistrate making necessary endorsement and if only the Accused continues to be in judicial custody, in connection with the former case, he can be transmitted in pursuance of P.T. Warrant in connection with the latter case." 32. Upon examining whether it is at all necessary that invariably in all cases such "formal arrest" is required to be effected in prison, when the accused is already lodged in prison in connection with some other case, it is needless to point out that though the police officer has got power to arrest, it does not mean that he has to resort to arresting the accused, irrespective of the need and justification for arrest. The accused persons shall not be arrested in a robotic fashion. Arrest needs to occur only if there are grounds and need to arrest, not ....
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....nless the applicability of the provisions is expressly barred. Moreover, Sections 44 to 46 of the PMLA Act specifically incorporate the provisions of CrPC to the trials under the PMLA Act. Thus, not only that there is no provision in the PMLA Act excluding the applicability of CrPC, on the contrary, provisions of CrPC are incorporated by specific inclusion. Even Section 65 of the PMLA Act itself settles the controversy beyond any doubt in this behalf which reads as under: "65. Code of Criminal Procedure, 1973 to apply.-The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) shall apply, insofar as they are not inconsistent with the provisions of this Act, to arrest, search and seizure, attachment, confiscation, investigation, prosecution and all other proceedings under this Act." 34. In the context of the present case, it would be apt to state here that while considering the present bail application, a detailed examination of the material on record especially touching upon the merits of the case are not required to be undertaken, however, this Court is expected to supply sound reasons while exercising its discretionary power to enlarge the accused on pre arre....
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....roper meaning. 36. Does this statute require that before a person is released on bail, the court, albeit prima facie, must come to the conclusion that he is not guilty of such offence? Is it necessary for the Court to record such a finding? Would there be any machinery available to the Court to ascertain that once the accused is enlarged on bail, he would not commit any offence whatsoever? 37. Such findings are required to be recorded only for the purpose of arriving at an objective finding on the basis of materials on records only for grant of bail and for no other purpose . 38. We are furthermore of the opinion that the restrictions on the power of the Court to grant bail should not be pushed too far. If the Court, having regard to the materials brought on record, is satisfied that in all probability he may not be ultimately convicted, an order granting bail may be passed. The satisfaction of the Court as regards his likelihood of not committing an offence while on bail must be construed to mean an offence under the Act and not any offence whatsoever be it a minor or major offence. ............ 44. The wording of Section 21(4), in our opinion, ....
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....ble Supreme Court even in the case of Vijay Choudhary (supra) has observed as follows: "400. It is important to note that the twin conditions provided under Section 45 of the 2002 Act, though restrict the right of the accused to grant of bail, but it cannot be said that the conditions provided under Section 45 impose absolute restraint on the grant of bail. The discretion vests in the Court which is not arbitrary or irrational but judicial, guided by the principles of law as provided under Section 45 of the 2002 Act. While dealing with a similar provision prescribing twin conditions in MCOCA, this Court in Ranjitsingh Sharma (supra) held as under: 44..... 45..... 46 (extracted above). 401. We are in agreement with the observations made by the Court in Ranjitsing Sharma (supra). The Court while dealing with the application for grant of bail need not delve deep into the merits of the case and only a view of the Court based on available material on record is required. The Court will not weight the evidence to find the guilt of the accused which is, of course, the work of trial Court. The Court is only required to place its view based on pro....
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....he other accused persons performed illegal mining in the Uliburu Iron Ore Mines and in that process amassed and mobilized illegal monies by defrauding the state exchequer and caused loss to it. On that basis an FIR was registered at Balasore Vigilance PS bearing No. 20 of 2013 for alleged offences under sections 13 (2) r/w 13 (1) (c) (d) of the Prevention of Corruption Act 1988, Sections 120-B/420/379/409/411 of IPC, Section 4 and 21 (1) of MMDR Act, 1957 and Section 3 of Forest Conservation Act, 1980. A final charge-sheet bearing number No. 6/2014 was submitted on 24.06.2014 by Vigilance Police, Balasore, Odisha before the Ld. Special Judge, Vigilance Court at Keonjhar. The Opposite Party registered the Enforcement Case Information Report bearing ECIR No. 01/2014/BSZO as some of the offences under the alleged offences mentioned above were coming under "scheduled offences" as defined in the PMLA under Section 2(y) by lodging a complaint under Section 45 of the PMLA. 40. The substratum of the allegation with regard to the predicate offences seems to be one of illegal mining. The allegation is that under valuation has been done with regard to the quantum of material is raised and ....
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....rested" by the Enforcement Directorate but has been remanded to their custody for the purposes of investigation. In the said context, the argument advanced before this court by Mr. Agarwal, learned counsel for the E.D. has substance in it. Therefore, it appears to this court that most likely the Enforcement Directorate officials have chosen to not exercise their discretionary power to "formally arrest" the Petitioner, probably because they did not feel the need to do so. Furthermore, since lodging of the ECIR to till date, the E.D. officials never bothered to formally arrest the petitioner and while the petitioner was in custody in connection with the vigilance case, he was taken on remand for interrogation by E.D. officials. After investigation was concluded, probably the necessity of arrest was never felt by E.D. The Petitioner had cooperated with investigation and had recorded his statement before the Enforcement Directorate which had led the Enforcement Directorate to state that they no longer require the custody of the Petitioner for the purposes of investigation. As such Section 167 CrPC which talks about the benefits of default bail when investigation cannot be completed pos....
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....der trial prisoners are detained in jail custody indefinitely, Article 21 of the Constitution stands violated. In matters involving scams it was noted that usually a large number of witnesses are present and the trial usually takes a considerable amount of time to be completed. In such cases once the charge-sheet has been filed, the court may depending on the facts of the case, the court in seisin ought to decide such bail application on its own merits. While holding so it was alive to the fact that in some situations such lengthy trials may even prolong beyond the maximum sentence provided under the relevant law. In that case the punishment for the offence was for a maximum period of imprisonment of seven years. It was held therein that even if the accused had a likelihood of being convicted, the period of detention already undergone during the trial stage would have a great bearing while deciding a bail application and such a factor should also be taken into consideration. 45. The Opposite Party claims that investigation is continuing which necessitates custodial interrogation of the present Petitioner and has pressed upon us some evidence in its present Affidavit. At this jun....
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....f Bhim Singh v. Union of India reported in 2015 SCC 605 on the very same lines. Finally, the Hon'ble Supreme Court has concluded that with regard to category C of cases although the individual and enactments were not discussed individually as each special act has a specific objective behind it, followed by the rigours imposed therein, however, it has been clarified that the general principle governing bail would apply to these categories also. Thus, to make it clear, the provision contained in Section 436A of the Code would apply to the special acts also in the absence of any specific provision. Therefore, this court would unhesitantly conclude that the rigour, as provided under the special acts such as Section 45 of the PMLA Act as in the present case, would not come in the way as the liberty of the individual is paramount under Article 21 of the Constitution of India. 47. The Petitioner has been in the custody of the Enforcement Directorate wherein his statement has been recorded. He has been stated not to be required by the Enforcement Directorate themselves which stands recorded in order dated 24.07.2014 of the Special PMLA Court, Bhubaneswar. All the documentary evidence to....
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....o form a prima facie opinion that, in all probabilities, the Petitioner may not be ultimately convicted especially as none of the other mining leaseholders who were penalised by the Hon'ble Supreme Court in the Common Cause case (supra) have been successfully charged/ convicted of similar predicate offences. 49. Furthermore, the mining operation as well as the mining laws, in the meanwhile, has undergone a drastic change, therefore, prima facie there exists no possibilities of such offences being repeated in the future. The apprehension of Mr. Agarwal that the petitioner might not cooperate with the trial and he may not appear before the trial court on each and every date the matter is posted to can very well be taken care of by imposing conditions while releasing the petitioner on pre arrest bail, further violation of such conditions would draw the penalty of curtailment of liberty granted to the petitioner by virtue of this order. 50. At this juncture, this Court as a constitutional would like to highlight another aspect of the matter. As has been said earlier, initially the Vigilance case was registered in the year 2013. The petitioner was arrested and taken into custody. ....