TaxTMI 
TaxTMI 
TaxTMI 
2024 (7) TMI 1171
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....AC-III and Insp. S. Kumar in person Mr. Zoheb Hussain, Special Counsel with Mr. Vivek Gugnani, Mr. Baibhav, Mr. Kartik Sabharwal and Mr. Kanishk Maurya, Advocates for ED. JUDGMENT SURESH KUMAR KAIT, J 1. An investigation was carried out by the Directorate of Enforcement ('DoE') under the provisions of Foreign Exchange Management Act, 1999 ('FEMA') against accused Moin Akhtar Qureshi on the allegation that he through his company, namely, India Premier Services Pvt. Ltd. (IPSPL) applied for obtaining Concession Agreement from M/s DIAL (Delhi International Airport Limited) for running lounge services at Terminal-3 at IGI Airport, Delhi. The permission required involvement of various Government agencies for providing various security clearances. The BBM messages and interception indicated that certain Government servants were in close touch with accused Moin Akhtar Qureshi and some other Government servants dealing with the case were providing information to accused Moin Akhtar Qureshi about the movement of the file, and other public servants not connected with the case were persuading the officers in mala fide way to give permission. Some conversations have reference to the....
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....d by service provider Blackberry, Canada, which revealed he had taken huge amount of money from different public persons using corrupt practices, through illegal means. The data so procured, revealed name of Satish Sana. 6. On 12.05.2017, petitioner-Satish Babu Sana received summons under Section 50 of PMLA from respondent No. 1-DoE with direction to appear on 12.05.2017. The petitioner claims to have appeared before the competent authority and his statement under Section 50 of PMLA was recorded on the said date. Petitioner again received summons for appearance on 19.05.2017, 11.07.2017, 13.07.2017 and 14.07.2017. Petitioner claims to have appeared on each and every date before the competent authority and his statement under Section 50 of PMLA was recorded on every dates mentioned above. 7. On 23.10.2017, a complaint/charge-sheet under Section 45 of PMLA was filed by respondent No. 1/DoE before the concerned court wherein petitioner-Satish Babu Sana was cited as prosecution witness No.27 in the list of witnesses attached to the complaint. 8. Thereafter, a supplementary charge-sheet was filed by respondent No. 1-DoE. Petitioner was again summoned under Section 50 of PMLA and was ....
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....ght to be issued to quash the summons dated 19.7.2019 and 25.7.2019. 15. During pendency of the present petition, this Court vide order dated 14.10.2019 had stayed operation of summoning order dated 30.09.2019 passed by the learned Trial Court whereby petitioner-Satish Babu Sana was directed to tender his further statement under Section 50 (2) of the Act, 2002. W.P.(Crl) 384/2019 16. Similarly, during search conducted at various places of Moin Akhtar Qureshi and his companies by the Department of Enforcement and extraction of BBM messages for the period 2011 to 2014 and other incriminating documents, which were authenticated by service provider Blackberry, Canada, it came to knowledge that petitioner-Pradeep Koneru is one of the persons who had given huge amount of money to Moin Akhtar Qureshi, through illegal means. 17. During the course of investigation, the Enforcement Department summoned the petitioner for appearance on 01.05.2017 and his statement under Section 50 of PMLA was recorded. 18. According to petitioner, between the years 2017 till 2018, he was telephonically summoned 4-5 times by the Enforcement Department and he always appeared before the Department. Upon compl....
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....LA is not applicable to a person who has been arrayed as a witness in the complaint. In addition, petitioner has also prayed for quashing of summons dated 19.07.2019 and 25.07.2019 as void, ab initio and quash the proceedings arising out of the ECIR No. 2/2017 being violative of Section 132 of IEA and Articles 14, 20 and 21 of the Constitution of India. 25. Petitioner-Pradeep Koneru has averred that the Directorate of Enforcement, Department of Revenue, while investigating certain violations of the FEMA came to the conclusion that one Moin Akhtar Qureshi was guilty of in connivance with several public servants in exercising influence over the aforesaid public servants through corrupt or illegal means and, therefore, he was booked under the provisions of PC Act and relevant provisions of IPC. On the complaint of DoE to the CBI, an FIR was registered being R.C. 224/2017/A/0001 dated 16.02.2017 at Police Station CBI-AC-VI (SIT), Delhi to investigate into the schedule offences. 26. During pendency of the present petition, this Court vide order dated 14.10.2019 had granted ad interim relief by staying operation of summons dated 30.09.2019 issued to the petitioner. The interim order is....
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....rt of this, two public persons/ witnesses Satish Sana and Pradeep Koneru came forward and recorded their statements under Section 50 PMLA to the effect that they had paid crores of rupees to Moin Qureshi to help them in getting relief from investigating agency, CBI. The persons apart from Satish Sana and Pradeep Keneru who had paid money to Moin Qureshi, are under investigation. XXXX 7. During the course of ED investigations Sh. Satish Sabna and Sh. Pradeep Kneru in their statement under 50 PMLA have confirmed that they delivered crores of rupees to Moin Akhtar Qureshi through his employee Sh. Aditya Sharma for obtaining illegal favour from govt. servant after using his influence. Aditya Sharma who has been confronted with the facts and evidences on record, had confirmed the transactions received by him. The same were also found in tandem with the contents of BBM messages (Retrieved by forensics lab, CERT-In). XXXXX 65. That, from the facts and circumstances enumerated above, it is apparent that the aforementioned movable and immovable assets acquired by Moin Akhtar Qureshi in his names or in companies names or in the name of his family members are nothing but proceeds of c....
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....o. 34. In the said complaint, petitioner-Satish Babu Sana complained that he paid amount of Rs. One Crore to Manoj Prasad in his office in Dubai and thereafter, on the asking of Somesh Prasad, gave Rs. 1.95 crores to Sunil Mittal on 13.12.2017 in New Delhi. The petitioner also alleged that he was informed that the said amount was given to Rakesh Asthana, in lieu of taking care of case against him. However, petitioner was short of money and Manoj Prasad asked him to pay balance of Rs. Two Crores. Again, he was summoned by the CBI on 19.02.2018 and on 21.02.2018 for questioning and interrogation. Thereafter, he flew to Dubai to meet Manoj Prasad. Petitioner again received notice for appearance in CBI office on 09.06.2018, after making a request to the Investigating Officer, he did not go. 35. On 25.09.2018, when petitioner was leaving for Paris with his family, he was apprehended at Hyderabad Airport pursuant to Look Out Circular issued against him and he was directed to appear before SP, CBI, New Delhi on the next day i.e. 26.09.2018. The petitioner claims to have appeared in CBI office on 01.10.2018 and 03.10.2018, when he was directed and to submit his handwritten statement expl....
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....ld that not confessing cannot be considered same as not co-operating. Mr. Singh also expressed his apprehension regarding possibility of accused interfering with the investigation/ tampering with the evidence. There is nothing on record to show that accused did interfere with the investigation all this time in any manner except for the allegation that he did not co-operate in the investigation. In view of the facts as they are since accused Moiin Akhtar Qureshi has already been granted bail and the role of applicant is no graver than his role in the case, the application of accused Satish Babu Sana seeking grant of bail is allowed. The applicant is admitted to bail on furnishing personal bond in the sum of Rs.5 lakh with one surety of like amount." 40. The petitioner-Satish Babu Sana has, by way of this petition, challenged his arrest on the ground that statement recorded under Section 50 of PMLA is a substantive piece of evidence as against the statement recorded under Section 161 Cr.P.C., which is admissible under Section 193 read with Section 228 of the IPC. 41. During the course of hearing, learned senior counsel appearing on behalf of petitioner submitted that based upon....
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....ed that prior to filing of the complaint, petitioner attended the Bureau as many as seven times as and when telephonically called and summoned by the Investigation Officer; he had given similar version in all his statements recorded under Section 50 of the Act and respondent has not been able to show any new fact or allegation to summon him in the garb of investigation. Learned senior counsel further submitted that statement recorded under Section 50 PMLA is equivalent to statements recorded under Sections 193 and 228 of the IPC in judicial proceedings and so, his 'status' acquired after recording of statement under Section 50 PMLA cannot be changed unless exceptionally unusual or subsequent facts emerge on record. 47. Learned senior counsel for petitioner submitted that respondent No. 1 cannot change acquired status of a "witness" to an "accused" when the investigation qua the petitioner stood concluded, especially when in his version, the petitioner has helped the prosecution case and therefore, has been cited as a "witness". 48. Also submitted that the main accused in the present FIR are Ex Directors of CBI and Moin Akhtar Qureshi and since the version putforth by the petition....
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.... allowed to be taken once a person acquainted with the facts of a case has been accorded a status of a witness. 52. Learned senior counsel for petitioner vehemently submitted that O.M. No. 25016/31/2010-IMM dated 27.10.2010 issuing the guidelines for issuance of Look Out Circular Notices cannot be said to be procedure established by Law and ought to be struck down as unconstitutional being violative of Article 21 of the Constitution. Also submitted that to challenge the 2010 Notification under which an LoC is issued, is different from challenging the issuance of LoC itself in a particular fact scenario. It is averred on behalf of the petitioner-Pradeep Koneru that the 2010 instructions being administrative (and at best executive) in nature, cannot be a source of power in absence of any Legislation/delegated Legislation providing for deprivation of such liberty. 53. Learned senior counsel submitted that if the allegations against a person, to be investigated before ED or CBI, are identical, which ever agency investigates later would be violating rights of a citizen available to him under Articles 20 and 21 of the Constitution of India. If an investigating agency has investigated a....
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....ed after forming reasons to believe that the said persons has committed an offence punishable under the Act and till the conclusion of investigation, role and status of the persons involved may modify on the basis of facts being unravelled in the subsequent investigation. 57. Learned ASG pointed out that upon scrutiny of the BBM messages it has transpired that Moin Akhtar Qureshi had taken huge amount of money from different public persons for obtaining undue favours from public servants at the extant time after exercising his personal influence over them using corrupt practices, through illegal means, thereby influencing them. It is submitted that in the present case, Proceeds of Crime at the time of filing of prosecution complaint were calculated at Rs. 11.09 Crores whereas thereafter rose to Rs. 12.79 Crores and so, the new facts have emerged during the investigation. 58. Learned ASG further submitted that Section 132 of the Evidence Act would be applicable to the witness from recording a self incriminating statement in evidence before the Court and not at the stage of tendering a statement under the summons. To attract the provisions of Section 132 of Evidence Act, it is a pr....
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....sions of Section 8 of PC Act, reliance was placed upon decisions of Hon'ble Supreme Court in Upendra Rai Vs. Central Bureau of Investigation 2018 SCC OnLine Del 12856; decision dated 05.02.2014 in Central Bureau of Investigation Vs. Jitender Kumar Singh (Crl. Appeal No. 943 of 2008 with Criminal Appeal No. 161 of 2011) and Babji Vs. State of Andhra Pradesh (2018) 17 SCC 732. Reliance was also placed upon decision dated 19.12.2019 of High Court of Chattisgarh at Bilaspur in B.L. Aggarwal Vs. Central Bureau of Investigation and Ors. 64. With regard to applicability of provisions of Section 120B IPC, reliance was also placed upon decisions in Yogesh alias Sachin Jagdish Joshi Vs. State of Maharashtra (2008) 10 SCC 394. 65. Further, reliance was placed upon decisions in Union of India Vs. Prakash P. Hinduja and Anr. (2003) 6 SCC 195; P. Chidambram Vs. Directorate of Enforcement (2019) 9 SCC 24; Kaptan Singh Vs. Stae of Uttar Pradesh & Ors. (2021) 9 SCC 35 and Jitul Jentilal Kotecha Vs. State of Gujarat & ors. 2021 SCC OnLine SC 1045 by learned Special Public Prosecutor appearing on behalf of CBI. 66. Learned counsel appearing on behalf of ED also similarly stated that investigation ....
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.... summoned person is required to give truthful statement and is not absolved from speaking truth on the ground that such statement is admissible in evidence and could be used against him. Next submitted that a statement recorded pursuant to Section 50 (3) and Section 50 (4) of the PMLA is at a stage of investigation to determine the facts in a particular case and summoning as per Section 50 of the Act, is not an act of prosecution. 69. It was submitted that investigation in this case was initiated under PMLA, 2002 subsequent to registration of FIR u/s 120 (B) IPG & PC Act, 1988-Section 8, 9, 12 & 13 (2) r/w 13(1) (d) by CBI. 70. Lastly, it was submitted that in view of the nature and complexity of the transactions involved, the investigation may continue until the entire money trail can be identified, attached and made available for eventual confiscation. During such investigative process, new facts may emerge leading to a change in the position/facts presented earlier before the appropriate Court/Authority. Merely because a person has been cited as a witness in earlier proceedings does not place him in any exalted position. 71. In rebuttal, the averment of learned senior counsel....
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....ealed that Satish Babu Sana had paid amount of Rs. 5,00,000 to Moin Akhtar Qureshi by way of claimed investment in M/S Great Heights Infratch Private Limited and as per Forensic Extraction Report in respect of hard disk of mobile numbers 9810035614 and 9711305614 of Moin Akhtar Qureshi, BBM messages retracted, amount of Rs. 12,69,00,000/- was paid by Satish Babu Sana to Moin Akhtar Qureshi . 77. The provisions of Section 3 of PMLA provide as under:- "Whosoever directly or indirectly attempts to indulge or knowingly assist or knowingly is a party or is actually involve in any process of activity connected (Proceeds of Crime including concealment, possession, acquisition, or use or projecting or claiming) untainted property shall be guilty of an offence under money laundering." 78. Section 2 (u) of the Prevention of Money laundering Act, 2002 defines, "Proceeds of crime" as under:- "Section 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 any such property [or where such property is taken or held outside the country, then the property equival....
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....dences on record, who confirmed the monetary transactions received by him. The same were also found in tandem with the contents of BBM messages retrieved by forensics lab, CERT-In. These amounts were found to be sent for Hawala Transactions through Delhi based Hawala Operators which reflected in the BBM messages of Aditya Sharma and Ex. CBI Director AP Singh. 81. Petitioner-Satish Babu Sana in his statement under Section 50 of PMLA admitted having invested Rs. 50 Lacs in farmland business in the company M/s. Great Heights Infratech Pvt. Ltd. of Sh. Moin Akhtar Qureshi and also that he had given cash of Rs. 1.5 crores to him. The investigation thus revealed involvement of Satish Babu Sana in acquisition of proceeds of crime by Moin Akhtar Qureshi and that he had paid huge amounts to him to influence the public servants. He projected the payments of Rs. 50 Lacs and Rs. 1.5 crore, as investment in share capital & business expenses respectively, without any cogent reason or explanation for the same, which are sham transactions. 82. Similarly, Pradeep Koneru also in his statement recorded under Section 50 of the Act admitted that he had to pay more that Rs. 5.75 crores to Moin Akhtar ....
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....person whose attendance he considers necessary whether to give evidence or to produce any records during the course of any investigation or proceeding under this Act. (3) All the persons so summoned shall be bound to attend in person or through authorised agents, as such officer may direct, and shall be bound to state the truth upon any subject respecting which they are examined or make statements, and produce such documents as may be required. (4) Every proceeding under sub-sections (2) and (3) shall be deemed to be a judicial proceeding within the meaning of section 193 and section 228 of the Indian Penal Code (45 of 1860). (5) Subject to any rules made in this behalf by the Central Government, any officer referred to in sub-section (2) may impound and retain in his custody for such period, as he thinks fit, any records produced before him in any proceedings under this Act : Provided that an Assistant Director or a Deputy Director shall not- (a) impound any records without recording his reasons for so doing ; or (b) retain in his custody any such records for a period exceeding three months, without obtaining the previous approval of the *Joint Director." XXXX Subs....
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....nce or producing documents. Further, to be a witness is nothing more than to furnish evidence and such evidence can be furnished by different modes. The court went on to observe as follows : "Broadly stated the guarantee in article 20 (3) is against 'testimonial compulsion'. It is suggested that this is confined to the oral evidence of a person standing his trial for an offence when called to the witness-stand. We can see no reason to confine the content of the constitutional guarantee to this barely literal import. So to limit it would be to rob the guarantee of its substantial purpose and to miss the substance for the sound as stated in certain American decisions. The phrase used in article 20 (3) is 'to be a witness'. A person can 'be a witness' not merely by giving oral evidence but also by producing documents or making intelligible gestures as in the case of a dumb witness (see section 119 of the Evidence Act) or the like. 'To be a witness' is nothing more than 'to furnish evidence', and such evidence can be furnished through the lips or by production of a thing or of a document or in other modes. So far as production of documents is c....
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....n'ble Supreme Court in Vijay Madanlal (Supra) further held as under:- "112. Reverting to clause (d) of sub-section (1) of section 44, it postulates that a Special Court while trying the scheduled offence or offence of money-laundering shall hold trial in accordance with the provisions of the 1973 Code as it applies to a trial before a court of sessions. Going by the plain language of this provision, no fault can be found for conducting trial in the respective cases in the same manner as provided in the 1973 Code. However, the grievance is about the insertion of Explanation vide Finance (No. 2) Act, 2019. As a matter of fact, this insertion is only a clarificatory provision, as is evident from the opening statement of the provision which says that "for the removal of doubts, it is clarified that". None of the clauses inserted by this amendment travel beyond the principal provision contained in clause (d). Clause (i) of the Explanation enunciates that the jurisdiction of the Special Court while dealing with the offence being tried under this Act, shall not be dependent upon any orders passed in respect of the scheduled offence, and the trial of both sets of offences by the same cou....
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....conversation as per my knowledge is not related to me". In the same statement on being asked to explain the message dated 22.11.2012 which reads as "Recd 50 L frm Satish" he stated that "I have invested this amount 50 Lakhs in his real estate company M/s. Great Heights Infra Pvt. Ltd. I have paid this amount through cheque I have declared this amount with Income Tax 2012-13. I have purchased 50,00,000 shares for Rs. 1 each." Further in his statement dated 14.07.2017, to the Ques.(27):- Of How much total money was paid to Mr. Moin Akhtar Qureshi, He replied that, "he has paid Rs. 50 Lacs through RTGS to his company account and Rs. 25 Lacs in instalment. For Rs. 50 Lacs paid he gave me a Share Certificate of his Company M/s Great Height Infratech Pvt. Ltd, C-134, Ground Floor, Defence Colony, New Delhi. And Rs. 25 Lacs which was paid to Moin Qureshi was also withdrawn from the bank account of my company". The relevant extracts from his statement dated 27.02.2019 are as below: -, "Q3: How much money have you given to Moin Qureshi in lieu of the business and help he provided to you in getting business mentioned above? Ans: Liquor Business: In 2012 for liquor Business I have spent s....