TaxTMI 
TaxTMI 
2024 (10) TMI 461
X X X X Extracts X X X X
X X X X Extracts X X X X
.... effect of the FIR dated 30.7.2023 bearing FIR No.196/2023 dated 30.7.2023 u/s 420, 468, 471, 473, 484, 120-B IPC PS Kasna, District Greater Noida, Uttar Pradesh ("Impugned FIR") registered by the Respondent No.1 and all investigations and proceedings emanating therefrom; C. Issue appropriate writ, order or direction to quash the Impugned Letter dated 28.07.2023 along with all consequential actions and proceedings emanating therefrom as being illegal and in contempt of the Orders of the Hon'ble Supreme Court." 2. Criminal Misc. Writ Petition No.6194 of 2024 (Anwar Dhebar vs. State of U.P. & Ors.) has been filed with the following prayers :- "I. Issue appropriate writ, order or direction to quash the FIR dated 30.7.2023 bearing FIR No.196/2023 dated 30.7.2023 u/s 420, 468, 471, 473, 484, 120-B IPC PS Kasna, District Greater Noida, Uttar Pradesh ("Impugned FIR") registered by the Respondent No.3 and all consequential actions/proceedings/ investigations emanating therefrom; II. Issue appropriate writ, order or direction to stay the operation and effect of the FIR dated 30.7.2023 bearing FIR No.196/2023 dated 30.7.2023 u/s 420, 468, 471, 473, 484, 120-....
X X X X Extracts X X X X
X X X X Extracts X X X X
....red by PS Kasna, Greater Noida, Gautam Budh Nagar, Uttar Pradesh with Sec. 467 IPC and Sec. 7 of the Prevention of Corruption Act having been added subsequently ("Impugned FIR") registered by the Respondent No.1 and all investigations and proceedings emanating there from; C. Issue appropriate writ, order or direction to quash the Impugned Letter dated 28.07.2023 along with all consequential actions and proceedings emanating therefrom as being illegal and in contempt of the Orders of the Hon'ble Supreme Court." 5. The question which requires to be answered in the above writ petitions would be - Whether when the prosecution complaint filed by the Enforcement Directorate had been quashed by the Supreme Court, would the statements made under Section 50 of the PML Act, 2002 of various witnesses continue to form the basis of F.I.R. which was to be lodged on the basis of the communication passed on to the State under Section 66(2) of the PML Act. 6. On 26.2.2020, the Income Tax Department carried out certain search and seizure operation on the premises owned by the petitioner Anil Tuteja. On 1.3.2020 statements were recorded by the Income Tax Department of various indiv....
X X X X Extracts X X X X
X X X X Extracts X X X X
....(s) submits that the allegation is about offences under the Income Tax Act so far as the predicated offence is concerned and the cognizance has not been taken by the competent Court. At this stage, he only seeks protection so far as any coercive step is concerned and submits that he has already joined the investigation. No coercive steps be taken against the petitioner(s) till the next date. List on 18th July, 2023." 7. Thereafter on 18.7.2023, when the writ petition of Yash Tuteja was taken up, by that time all the other writ petitions were connected to the writ petition of Yash Tuteja and on that date the Supreme Court further extended the interim order and had also directed that the respondent-Authorities were to stay their hands off in all manner. The order dated 18.7.2023 is being reproduced here as under : "On hearing learned counsel for the parties it transpires that the complaints having been returned, the income tax authorities having taken that to a further Court in appeal and there being any absence of stay, apart from the order already passed of no coercive action, the concerned respondent authorities must stay their hands in all manner. Or....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ng the investigation." 9. Thereafter on 21.8.2023 when the case was taken up before the Supreme Court then it had only continued the order dated 7.8.2023 till the next date of listing. 10. In the meantime, the ED on 4.7.2023 had already filed its prosecution complaint against 7 persons namely Anwar Dhebar, Arun Pati Tripathi, Trilok Singh Dhillol, Nitesh Purohit, Arvind Singh and M/s. Petrosun Bio Refinery Pvt. Ltd. One more legal entity was roped in and it was known by the name of M/s. Dhillon City Mall Pvt. Ltd. When thereafter the writ petitions of Yash Tuteja, Siddharth Singhania, Anwar Dhebar and Arun Pati Tripathi were finally heard by the Supreme Court, the latter by its judgment and order dated 8.4.2024 disposed of Writ Petition No.153 of 2023 and Writ Petition No.217 of 2023 with no specific order or direction as in both the writ petitions no prosecution complaint had been filed by the ED. So far as the ECIR-11 was concerned viz.-a-viz. Anwar Dhebar and Arun Pati Tripathi, the prosecution complaint pursuant to the ECIR-11 stood quashed. The ground taken by the Supreme Court was that since there was no scheduled offence on the basis of which the ECIR-11 had been filed....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ime No.04/2024 at Chhatisgarh. This FIR was also lodged on the basis of an information of the ED sent on 11.7.2023. A writ petition had been filed, it has been informed by means of the Supplementary Affidavit, which was dismissed on 20.8.2024 by the Chhatisgarh High Court. It has also been informed that against the order dated 20.8.2024 passed by the Chhattisgarh High Court, a Special Leave Petition being SLP No.11790 of 2024 has been filed before the Supreme Court. This SLP is still pending. 13. Sri Siddharth Dave, learned Senior Counsel assisted by Sri Saksham Srivastava and Sri Vinayak Mithal, learned counsel appearing for the petitioners has made the following submissions while challenging the FIR dated 30.7.2023 and the communication of the ED dated 28.7.2023 :- (i) The ECIR-11 when was initiated, certain statements were recorded under Section 50 of the PML Act, 2002. When the communication dated 28.07.2023 was sent by the ED for State of Uttar Pradesh on the basis of which the FIR No. 196 of 2023 on 30.07.2023 was lodged, the statements were in existence but thereafter when the prosecution complaint dated 04.07.2023 as was filed by the ED was quashed by the Suprem....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Act is available or not, may have to be considered on case-to-case basis being rule of evidence." (Emphasis supplied) 25. This Court in Vijay Madanlal Choudhary (supra) anticipated the myriad situations that may arise in the recording of the Section 50 statement and discussed the parameters for dealing with them. In Rajaram Jaiswal vs. State of Bihar, AIR 1964 SC 828, a judgment quoted in extenso in Vijay Madanlal Choudhary (supra), this Court observed that the expression "police officer" in Section 25 of the Evidence Act is not confined to persons who are members of the regularly constituted police force. Further, setting out the test for determining whether an officer is a "police officer" for the purpose of Section 25 of the Evidence Act, this Court in Rajaram Jaiswal (supra) held (quoted from para 165 of Vijay Madanlal Choudhary (supra) "165(ii) It may well be that a statute confers powers and imposes duties on a public servant, some of which are analogous to those of a police officer. But by the reason of the nature of other duties which he is required to perform he may be exercising various other powers also. It is argued on behalf of the State that where su....
X X X X Extracts X X X X
X X X X Extracts X X X X
....her investigations in the offing or prosecutions pending on the amplitude of the immunity. "To be witness against oneself" is not confined to particular offence regarding which the questioning is made but extends to other offences about which the accused has reasonable apprehension of implication from his answer. This conclusion also flows from "tendency to be exposed to a criminal charge". "A criminal charge" covers any criminal charge then under investigation or trial or which imminently threatens the accused." (Emphasis supplied) "57. We hold that Section 161 enables the police to examine the accused during investigation. The prohibitive sweep of Article 20(3) goes back to the stage of police interrogation- not, as contended, commencing in court only. In our judgment, the provisions of Article 20(3) and Section 161(1) substantially cover the same area, so far as police investigations are concerned. The ban on self-accusation and the right to silence, while one investigation or trial is under way, goes beyond that case and protects the accused in regard to other offences pending or imminent, which may deter him from voluntary disclosure of criminatory matter. We are disp....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... to have lodged the FIR. (vi) Learned counsel for the petitioner further stated that during the pendency of the ECIR-11, ED had written to the State of Chhattisgarh on 11.07.2023 for the lodging of the FIR and thereafter information was also sent to the State of Uttar Pradesh on 28.7.2023. As per the learned counsel for the petitioners in all probability when under Section 66(2) of the PML Act, 2002, the State of Chhattisgarh had sat over the information sent by the ED then on 28.07.2023 another information was mala fidely sent with regard to the very same facts to State of Uttar Pradesh on 28.7.2023 and that gave rise to the Case Crime No. 196 of 2023 and this FIR was lodged malafidely on 30.07.2023. Learned counsel for the petitioner, therefore, states that the lodging of the FIR was an absolute result of a malicious act of the ED and also of the State of Uttar Pradesh. (vii) Learned Senior Counsel Sri Siddharth Dave further submitted that when the entire ECIR and the subsequent prosecution complaint of the ED were set aside, it did not stand to reason that the statements which were taken of the various witnesses under section 50 of the PML Act, 2002 could be us....
X X X X Extracts X X X X
X X X X Extracts X X X X
....as not an iota of allegation against the accused, Anwar Debhar in the entire FIR. Learned counsel for the petitioner further relying upon the judgments of the Supreme Court in State of Haryana & Ors. vs. Bhajan Lal & Ors. reported in AIR 1992 SC 604 submitted that if the FIR did not disclose any cause of action against any particular accused then the FIR could be quashed. He also relied upon the judgment of the Supreme Court in Lovely Salhotra and Anr. vs. State (NCT) of Delhi & Anr. reported in (2018) 12 SCC 391 and submitted that if there were more than one accused persons in a particular FIR and if against any one particular accused, no definite allegation was there from the reading of the FIR then the FIR could be quashed against that particular person. (x) Sri Shishir Prakash, learned counsel appearing for the petitioner in Criminal Misc. Writ Petition No.6195 of 2024 has submitted that it was wrong on the part of the Police to have said that work was given to the M/s. Prizm Holography and Security Private Limited illegally as the tender which was allotted to the Prizm Holography was challenged before the Chhattisgarh High Court by another firm M/s UFLEX Ltd. but that....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ts of so many other witnesses then those statements could always be utilized for the purposes of lodging of the FIR. Learned Additional Advocate General further relying upon the case in Vijay Madanlal Choudhary (Supra) submitted that the officials under Section 50 of the PML Act, 2002 were not police officers and, therefore, any statement made on oath in their presence were not such admissions which could not be relied upon during trial as per Section 25 of the Evidence Act. Learned Additional Advocate General still further submits that as per Section 66(2) of PML Act, 2002 if the officials of the ED were of the opinion that on the basis of "any" information or on the basis of material in their possession, if the Director or any other official of ED came to know that any law for the time being in force was being contravened then it was the duty of the Director of ED to share that information with the concerned agency for necessary action. Relying upon paragraph 290 of the judgment of Vijay Madanlal Choudhary (Supra), learned Additional Advocate General states that if any incriminating information is there in the possession of the Director of ED then that information should compulso....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on complaint were not in existence, the material which was in possession of the Director and the other officials of the ED and which did not form a scheduled offence, then even that material could have been transmitted to such authority which could take action in pursuance of the material which would be provided by the officials of the ED to such authority. Learned Additional Advocate General submitted that criminal law can be put into motion by just any person and in this regard he refers specifically to paragraph no.6 of the judgment of the Supreme Court in A.R. Antulay vs. R.S. Nayak reported in (1988) 2 SCC 602. Still further, learned Additional Advocate General submitted that even if any evidence is obtained improperly, it would not affect its admissibility if it is otherwise relevant. In this regard, he relied upon the judgments of the Supreme Court in R.M. Malkani vs. State of Maharashtra reported in (1973) 1 SCC 471 and in Magraj Patodia vs. R.K. Birla & Ors. reported in AIR 1971 SC 1295. He further submitted that identical issues were involved in the controversy before the Chhattisgarh High Court wherein the Chhattisgarh High Court dismissed the writ petitions filed for th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....icer 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. 290. As a matter of fact, prior to amendment of 2015, the first proviso acted as an impediment for taking such urgent measure even by the authorised officer, who is no less than the rank of Deputy Director. We must hasten to add that the nuanced distinction must be kept in mind that to initiate "prosecution" for offence under Section 3 of the Act registration of scheduled offence is a prerequisite, but for initiating action of "provisional attachment" under Section 5 there need not be a pre-registered criminal case in connection with scheduled offence. This is because the machinery provisions cannot be construed in a manner which would eventually frustrate the proceedings under the 2002 Act. Such dispensation alone can secure the proceeds of crime including prevent and regulate the commission of offence of money-laundering. The authorised officer would, thus, be expected to and, also in a given case, justified in acting with utmost speed to ensure that the proceeds of crime/property is available for being proceeded with....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nternal document which cannot be quashed and in this regard, he relied upon three judgments of three High Courts namely Jitendra Nath Patnaik vs. Enforcement Directorate, Bhubaneswar reported in CRLMC No. 2891 of 2023 passed by the Orissa High Court at Cuttack dated 02.09.2023, N. Dhanraj Kochar and Ors. vs. Director Directorate of Enforcement and Ors. Reported in 2022 SCC Online Mad 8794 : (2022) 1 LW (Cri) 251 passed by the Madras High Court and Pawan Insaa vs. Directorate of Enforcement, Government of India, Chandigarh Zonal Office, Chandigarh reported in CRM-M No. 6378 of 2023 passed by the High Court of Punjab & Haryana at Chandigarh vide order dated 10.04.2024. 20. Learned counsel for the E.D. further relied upon a judgment dated 04.09.2024 passed by the High Court of Punjab and Hariyana at Chadigarh in M/s IREO Private Limited vs. Union of India and Anr. which had held in paragraph 3.28 that though the ECIR is not an F.I.R., however, the E.D. which is an Investigating Agency constituted to investigate the offences of money laundering, can always continue to investigate and in the process as and when it got information and material can inform the jurisdictional Police whic....
X X X X Extracts X X X X
X X X X Extracts X X X X
....re satisfied and found offence cognizable, as such, the present petition deserves dismissal even on this prayer and related prayers." 22. Similarly, the learned counsel for the ED has relied upon a judgment dated 28.08.2024 passed by the High Court of Punjab and Haryana at Chandigarh in Pritpal Singh vs. State of Punjab reported in CRM-M-32979-2024. He also relied upon a judgment dated 24.11.2023 passed by the High Court of Delhi at New Delhi in Rajinder Singh Chadha vs. Union of India Ministry of Home Affairs through its Chief Secretary & Anr. For a similar proposition he has again relied upon a judgment dated 26.02.2024 passed by the High Court of Punjab and Haryana at Chandigarh in Sikandar Singh vs. Directorate of Enforcement and Anr. reported in CRM-M-51250-2023 (O&M). Learned counsel for the ED has also submitted that such admissions which do not amount to confession, can always be used as evidence. He has relied upon a judgment of Supreme Court in Central Bureau of Investigation vs. V.C. Shukla and Anr. reported in (1998) 3 SCC 410. Since the learned counsel for the ED specifically relied upon paragraph 45 of that judgment, the same is being reproduced here as under :- ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....SC 1850 and a judgment dated 27.08.1971 in Kanda Padayachi alias Kandaswamy vs. State of Tamil Nadu reported in 1971 (2) SCC 641. To bolster his arguments, he relied upon paragraphs 11 and 13 of that judgment and the same are being reproduced here as under :- "11. As held by the Privy Council, a confession has to be a direct acknowledgment of the guilt of the offence in question and such as would be sufficient by itself for conviction. If it falls short of such a plenary acknowledgment of guilt it would not be a confession even though the statement is of some incriminating fact which taken along with other evidence tends to prove his guilt. Such a statement is admission but not confession. Such a definition was brought out by Chandawarkar, J., in R v. Santya Bandhu (supra) by distinguishing a statement giving rise to an inference of guilt and a statement directly admitting the crime in question. 13. It is true that in Queen-Empress v. Nana, the Bombay High Court, following Stephen's definition of confession, held that a statement suggesting the inference that the prisoner had committed the crime would amount to confession. Such a definition would no longer be ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....was very much surviving and, therefore, there was nothing wrong in the communication being sent on 28.7.2023 and in the lodging of the FIR on 30.7.2023. Also if the prosecution complaint had been set aside, there was information available with the ED which had compulsorily to be disclosed to the relevant authority for taking necessary action. In the instant case, if the FIR is perused, then it becomes clear that the Directorate of Enforcement while investigating in a money laundering case under the provisions of PML Act, 2002 had discovered that a company known by the name of M/s. Prizm Holography and Security Films Pvt. Ltd. which was based in Noida was illegally granted a tender to supply holograms to the Excise Department of Chhattisgarh. FIR therefore was registered under sections 420, 468, 471 473, 484 and 120-B IPC. The FIR was lodged by the ED and it had definite information from the statements made by various witnesses under section 50 of the PML Act, 2002 that there was connivance between the company known by the name of M/s. Prizm Holography and Security Films Pvt. Ltd. and senior officials of the State of Chhattisgarh namely Arunpati Tripathi, ITS, Special Secretary, Exc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to be referred to wherein he had stated that no definite role had been assigned to Anwar Dhebar, the petitioner in Criminal Misc. Writ Petition No.6194 of 2024. The argument to begin with impressed us but when we looked into the various investigations which had been undergone after the FIR was lodged on 30.7.2023 and which formed a part of the counter affidavit of the State of Uttar Pradesh, we found that there was a definite complicity of the accused Anwar Dhebar in the crime in question and we cannot shut our eyes to the investigations which had been undergone. As per the judgment of the Supreme Court in State of Haryana & Ors. vs. Bhajan Lal & Ors. (AIR 1992 SC 604), an FIR could be quashed if there was nothing established from the reading of the FIR and from the evidence collected thereafter. In the instant case the evidence gathered after the lodging of the FIR definitely showed complicity of the petitioner Anwar Dhebar with the crime in question. The law with regard to criminal cases stands on a different footing from the law with regard to service law etc. wherein an order cannot be substituted with reasons etc. in the form of subsequent affidavits. In the case at hand, we f....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of Section 25 of the Evidence Act, depends on a case to case basis. Even if the judgment of the Supreme Court in Nandani Satpathy vs. P.L. Dani & Anr. (1978) 2 Supreme Court Cases is seen, we are of the view that the protection under Section 25 of the Evidence Act to an accused is given at the stage when the cases are being tried after they are put to trial. We are of the considered view that when the trial takes place then of course the statements recorded at the time of investigation would not be admissible. When ever the investigating agency has a doubt as to whether the makers of the statement were bringing to light any crime then that information could always be used for initiating an investigation or for the purposes of further forwarding a particular investigation which was already engaging the attention of a particular investigating agency. Thus, it will be very unsafe to accept the arguments of the learned counsel for the petitioners that for all initiation of criminal cases, statements made before the authorities under Section 50 of the PML Act, 2002 could never be used. Such statements which are in the knowledge of an investigating agency can always be used for initiatin....