TaxTMI 
TaxTMI 
2025 (2) TMI 632
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....u of Investigation ('CBI'), EO-I, New Delhi for offences punishable under Sections 120-B read with 420 of the Indian Penal Code, 1860 (for short 'IPC') and Section 3 of the Prevention of Money Laundering Act, 2002 (for short 'PMLA'). There are in all 36 accused in the matter and Applicants before me are arraigned as Accused Nos.9 and 10 in the crime incarcerated since 14.05.2020 i.e. almost 4 years 9 months. Since facts are common as also charges qua both accused arising out of the same ECIR, both Applications are disposed of by this common order. 3. Briefly stated on 07.03.2020 CBI filed FIR bearing No. RC 219 of 2020 E0004 for offences under Sections 120-B read with 420 of the IPC and on the basis of that FIR, on the same date i.e. 07.03.2020 Directorate of Enforcement ('ED') registered ECIR/MBZO-I/03/2020 under Section 3 of the PMLA. On 14.05.2020, Applicants were arrested by the ED in connection with ECIR/MBZO-I/03/2020. 3.1. On 13.07.2020 Applicants filed Applications for default bail under Section 167(2) of the Cr.P.C. before the Special Court established under the PMLA (hereinafter referred to as 'PMLA Court') and on the same date ED filed 1st supplementary prosecution....
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.... Supreme Court in the case of Vijay Madanlal Choudhary Vs. Union of India 2022 SCC OnLine 929. 4.1. Next Mr. Desai would submit that the PMLA Court has completely ignored the intent behind the incorporation of Section 436-A of CrPC and applied the proviso to the said Section to deny the statutory relief to present Applicants when the trial has not commenced. He would submit that the PMLA Court ought to have considered the decisions of the Supreme Court in the case of Vijay Madanlal Choudhary (supra) and this Court in the case of Sarang Wadhawan @ Rakesh Kumar Wadhawan Bail Application Nos.3377/2023 and 3867/2023 in its true essence and granted bail to the present Applicants. 4.2. Lastly on the count of delay on part of present Applicants, he would submit that admittedly as per the 3rd supplementary prosecution complaint dated 05.08.2022 filed by ED investigation is still pending and till date there is no statement or intimation made by ED that investigation is completed. He would therefore submit it is the responsibility of the investigating agency and the state machinery to ensure that the trial commences expeditiously. He would submit that the PMLA Court in order dated 26.0....
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....er 691which reads thus:- "9. It is also provided under Section 436-A of the Code that no person shall in any case be detained during the period of investigation inquiry or trial for more than the maximum period of imprisonment provided for the said offence under that law. In computing the period of detention under this section for granting bail, the period of detention passed due to delay in proceeding caused by the accused shall be excluded. Yet, as per the first proviso to section 436-A, the court may order continued detention of a person for a period longer than one-half of the said period or release him on bail, instead of the personal bond with or without sureties, after hearing the Public Prosecutor, and for reason to be recorded by the court in writing." 5.1. He would submit that the provision of Section 436-A do not provide an absolute right of bail like default bail under Section 167 of CrPC and the Court adjudicating Bail Application based on the ground of Section 436-A reserves the authority to deny the relief if trial is being delayed at the instance of Applicant himself. In support of this submissions he would refer to and rely on the decision of the Suprem....
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....on will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations." 5.2. Next, he has referred to and relied upon the decision of the Supreme Court in the case of State of Gujarat Vs. Mohanlal Jitamalji Porwal (1987) 2 SCC 364 wherein the Supreme Court while considering the long term ramifications of economic offences laid down basis for distinct treatment of such offender. Paragraph No. 5 therein reads thus:- "5. ..... The entire community is aggrieved if the economic offenders who ruin the economy of the State are not brought to book. A murder may be committed in the heat of moment upon passions being aroused. An economic offence is committed with cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the community. A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the community in the system to administer justice in....
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....Applications. 7. The relevant applicable statutory provision in the present case i.e. Section 436-A of CrPC reads thus:- "436-A. Maximum period for which an undertrial prisoner can be detained - Where a person has, during the period of investigation, inquiry or trial under this Code of an offence under any law (not being an offence for which the punishment of death has been specified as one of the punishments under that law) undergone detention for a period extending up to one-half of the maximum period of imprisonment specified for that offence under that law, he shall be released by the Court on his personal bond with or without sureties; Provided that the Court may, after hearing the Public Prosecutor and for reasons to be recorded by it in writing, order the continued detention of such person for a period longer than one-half of the said period or release him on bail instead of the personal bond with or without sureties; Provided further that no such person shall in any case be detained during the period of investigation inquiry or trial for more than the maximum period of imprisonment provided for the said offence under that law." 8. A....
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.... despite rigours of Section 45 of the PMLA. Paragraphs Nos. 316 to 322 read thus:- "316. As a result, we have no hesitation in observing that in whatever form the relief is couched including the nature of proceedings, be it under Section 438 of the 1973 Code or for that matter, by invoking the jurisdiction of the constitutional court, the underlying principles and rigours of Section 45 of the 2002 Act must come into play and without exception ought to be reckoned to uphold the objectives of the 2002 Act, which is a special legislation providing for stringent regulatory measures for combating the menace of money laundering. 317. There is, however, an exception carved out to the strict compliance of the twin conditions in the form of Section 436-A of the 1973 Code, which has come into being on 23-6-2006 vide Act 25 of 2005. This, being the subsequent law enacted by Parliament, must prevail. Section 436-A of the 1973 Code reads as under: "[Inserted by Act 25 of 2005, Section 36 (w.e.f. 23-6-2006).] [436-A. Maximum period for which an undertrial prisoner can be detained.-Where a person has, during the period of investigation, inquiry or trial under this Code ....
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....so as to provide them with a remedy in case of unjustified detention. 320. In Supreme Court Legal Aid Committee Representing Undertrial Prisoners v. Union of India [Supreme Court Legal Aid Committee Representing Undertrial Prisoners v. Union of India, (1994) 6 SCC 731 : 1995 SCC (Cri) 39], the Court, relying on Hussainara Khatoon [Hussainara Khatoon v. State of Bihar, (1980) 1 SCC 98 : 1980 SCC (Cri) 40], directed the release of prisoners charged under the Narcotic Drugs and Psychotropic Substances Act after completion of one-half of the maximum term prescribed under the Act. The Court issued such direction after taking into account the non obstante provision of Section 37 of the NDPS Act, which imposed the rigours of twin conditions for release on bail. It was observed : (Supreme Court Legal Aid Committee Representing Undertrial Prisoners case [Supreme Court Legal Aid Committee Representing Undertrial Prisoners v. Union of India, (1994) 6 SCC 731 : 1995 SCC (Cri) 39] , SCC pp. 747-48, para 15) "15. ... We are conscious of the statutory provision finding place in Section 37 of the Act prescribing the conditions which have to be satisfied before a person accused of....
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.... Act. However, Section 436-A of the 1973 Code, does not provide for an absolute right of bail as in the case of default bail under Section 167 of the 1973 Code. For, in the fact situation of a case, the court may still deny the relief owing to ground, such as where the trial was delayed at the instance of the accused himself. 322. Be that as it may, in our opinion, this provision is comparable with the statutory bail provision or, so to say, the default bail, to be granted in terms of Section 167 of the 1973 Code consequent to failure of the investigating agency to file the charge-sheet within the statutory period and, in the context of the 2002 Act, complaint within the specified period after arrest of the person concerned. In the case of Section 167 of the 1973 Code, an indefeasible right is triggered in favour of the accused the moment the investigating agency commits default in filing the charge-sheet/complaint within the statutory period. The provision in the form of Section 436-A of the 1973 Code, as has now come into being is in recognition of the constitutional right of the accused regarding speedy trial under Article 21 of the Constitution. For, it is a sanguine h....
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....at said case, it held that legislature has given the High Court and the Court of Session discretion unfettered by any limitation other than that which controls all discretionary powers vested in a Judge, viz. that the discretion must be exercised judiciously. The Court has given primacy to the fact that accused person if granted bail will be in a much better position to defend himself. In this very case, it was delineated that grant of Bail is the Rule and refusal is an exception. Justice Mukerji writing the judgment for himself and on behalf of Justice Boys in paragraph No.9 of the aforesaid decision observed thus:- "9. Speaking for myself, I think it very unwise to make an attempt to lay down any particular rules for the guidance of the High Court, having regard to the fact that the legislature itself left the discretion of the Court entirely unfettered. The reason for this action on the part of the legislature is not far to seek. The High Court might be safely trusted in this matter and it goes without saying that it would act in the best interests of justice whether it decides in favour of the prosecution or the defence. The variety of cases that may arise from time to....
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....other factors. 8. Similarly, an appeal or revision shall also be construed as a facet of trial when it comes to the consideration of bail on suspension of sentence. Definition of bail 9. The term "bail" has not been defined in the Code, though is used very often. A bail is nothing but a surety inclusive of a personal bond from the accused. It means the release of an accused person either by the orders of the court or by the police or by the investigating agency. 10. It is a set of pre-trial restrictions imposed on a suspect while enabling any interference in the judicial process. Thus, it is a conditional release on the solemn undertaking by the suspect that he would cooperate both with the investigation and the trial. The word "bail" has been defined in Black's Law Dictionary, 9th Edn., p. 160 as: "A security such as cash or a bond; esp., security required by a court for the release of a prisoner who must appear in court at a future time." 11. Wharton's Law Lexicon, 14th Edn., p. 105 defines "bail" as: "to set at liberty a person arrested or imprisoned, on security being taken for his appearance on a day and at....
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.... no hard-and-fast rule and no inflexible principle governing the exercise of the discretion conferred by Section 498 and that the only principle which was established was that the discretion should be exercised judiciously. In Emperor v. H.L. Hutchinson [Emperor v. H.L. Hutchinson, 1931 SCC OnLine All 14 : AIR 1931 All 356], AIR p. 358 it was said that it was very unwise to make an attempt to lay down any particular rules which will bind the High Court, having regard to the fact that the legislature itself left the discretion of the court unfettered. According to the High Court, the variety of cases that may arise from time to time cannot be safely classified and it is dangerous to make an attempt to classify the cases and to say that in particular classes a bail may be granted but not in other classes. It was observed that the principle to be deduced from the various sections in the Criminal Procedure Code was that grant of bail is the rule and refusal is the exception. An accused person who enjoys freedom is in a much better position to look after his case and to properly defend himself than if he were in custody. As a presumably innocent person he is therefore entitled to freedo....
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....al Rights Chapter (along with Article 20) that cannot be suspended even in an emergency [see Article 359(1) of the Constitution]. At present, Article 21 is the repository of a vast number of substantive and procedural rights post Maneka Gandhi v. Union of India [Maneka Gandhi v. Union of India, (1978) 1 SCC 248]." 13. Further this Court in Sanjay Chandra v. CBI [Sanjay Chandra v. CBI, (2012) 1 SCC 40 : (2012) 1 SCC (Cri) 26 : (2012) 2 SCC (L&S) 397], has observed that : (SCC p. 52, paras 21-23) "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 c....
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....gment and serve sentence in the event of the court punishing him with imprisonment. In this perspective..." (emphasis supplied) 15. Thereafter the Supreme Court in a plethora of judgements have discussed the rights conferred by Article 21 qua grant of bail and that such rights cannot be taken away unless the procedure is reasonable and fair and in cases where there is unreasonable delay in trial it would undoubtedly impact the rights of an undertrial. Some of the important decisions of the Supreme Court and some of the High Courts are discussed herein under:- 15.1. In the landmark judgement of Maneka Gandhi Vs. Union of India 1978 (1) SCC 248, the Supreme Court held that the right to life and personal liberty under Article 21 is not limited to mere animal existence but includes the right to live with dignity. The court emphasized that the procedure established by law must be fair, just, and reasonable, and it cannot be arbitrary, oppressive, or unreasonable. 15.2. In the case of Hussainara Khatoon Vs. Home Secy., State of Bihar (1980) 1 SCC 81 the Supreme Court held as under:- "Now obviously procedure prescribed by law for depriving a person of liberty cannot "rea....
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....nt bail. An attempt has been made to strike a balance between the appellant's right to lead evidence of its choice and establish the charges beyond any doubt and simultaneously the respondent's rights guaranteed under Part III of our Constitution have been well protected." 16. Applicants in present case are in custody since 4 years 9 months. There is no possibility of the trial commencing in the near future. Detaining an under-trial prisoner for such an extended period further violates his fundamental right to speedy trial flowing from Article 21 of the Constitution. At this juncture I deem it appropriate to list certain observations of the Supreme Court shedding light on concerns underlying the "Right to speedy trial" from the point of view of an accused in custody whose liberty is affected. In the case of Abdul Rehman Antulay & Ors. Vs R.S. Nayak & Anr. 1992 (1) SCC 225 the Supreme Court held as under:- "86. In view of the above discussion, the following propositions emerge, meant to serve as guidelines. We must forewarn that these propositions are not exhaustive. It is difficult to foresee all situations. Nor is it possible to lay down any hard and fast rules....
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....annot be oblivious to the fact that many innocent persons may also be languishing in jails if we recall to mind the percentage of acquittals. Since harsh punishments have been provided for under the Act, the percentage of disposals on plea of guilt is bound to be small; the State Government should, therefore, have realised the need for setting up sufficient number of Special Courts immediately after the amendment of the Act by Amendment Act 2 of 1989. Even after the Division Bench of the Bombay High Court refused to grant en bloc enlargement on bail on 1-2-1993 in Criminal Application No. 3480 of 1992 and B.D. Criminal No. 565 of 1992, no substantial improvement in the pendency is shown since new cases continue to pour in, and, therefore, a one-time exercise has become imperative to place the system on an even keel. We also recommend to the State Government to set up Review Committees headed by a Judicial Officer, preferably a retired High Court Judge, with one or two other members to review the cases of undertrials who have been in jail for long including those released under this order and to recommend to the State Government which of the cases deserve withdrawal. The State Gover....
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....be liable, if convicted is also a significant aspect and therefore both, the seriousness of the charge and the severity of the punishment should be taken into consideration for arriving at decision of grant of bail. It further observed that deprivation of liberty must be considered a punishment unless it is absolutely necessary in the interest of justice and that object of bail is merely to secure appearance of accused at the trial. 22. In the present case it is seen that Applicants have been indicted in the predicate offence under Section 120-B read with 420 of the IPC for which the maximum sentence which can be imposed is imprisonment which may extend to 7 years alongwith fine. Even otherwise as the scheduled offence against Applicants falls under paragraph 1 of part A of the schedule to the PMLA, the maximum period for which the Applicants can be punished with imprisonment of 7 years. Applicants have been in custody in connection with the present offence since 14.05.2020 i.e. for almost 4 years and 9 months which is beyond the one-half of maximum period of imprisonment which can be imposed upon conviction. 23. In so far as the delay in conducting the trial is concerned, Ap....