TaxTMI 
TaxTMI 
2025 (6) TMI 458
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....Bank, Sonipat ['PNB'] against M/s Sunstar Overseas Ltd. ['SOL'] and its Directors. As per the FIR, accounts of five banks, namely, PNB, ICICI Bank, IDBI Bank and State Bank of India were declared Non-Performing Assets ['NPAs']. It was alleged that SOL had availed various credit facilities from consortium of nine lender banks and had diverted /siphoned off the said loan amount, thereby failing to repay the said loan amounts to the banks. It was also alleged that the accused company had violated the terms and conditions of the loan agreements in respect of the hypothecated goods as the said goods were disposed of without depositing sale proceeds in the cash credit accounts. The case of CBI is that SOL, through its Directors/Promoters/employees and others had committed fraud by siphoning off and diverting funds, criminal misappropriation, criminal breach of trust, cheating, fraud etc., thereby causing wrongful loss of approximately Rs. 951.88 crores to the consortium of nine lenders banks. It has been alleged that SOL, after July 2017 failed to submit stock report to the consortium of lender banks, and subsequently, the said loan accounts of SOL were declared NPAs with effect from 31.....
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....directors/promoters of SOL were used as mode for diversion of stocks of rice from SOL and its fictitious debtor company. It was revealed that 'proceeds of crime' to the tune of Rs.1.35 crores was possessed and diverted from SGMV to Shivakriti through a fictitious seller/buyer firm M/s Aastha Enterprise under the garb of sham trade transactions. It has been further alleged that Rs.146 crores were diverted through Shivakriti during the period commencing from 24.09.2019 to 20.03.2020 under the garb of sham instrument i.e Facility Agreement dated 30.09.2019 with intent to take over the assets of SOL. The ex-directors/promoters of SOL were thus able to regain the actual control of SOL indirectly through Umaiza, of which applicant is the partner, whereby wrongful loss was caused to the consortium of lender banks. SUBMISSIONS ON BEHALF OF THE PARTIES 6. Mr. Mohit Mathur, learned Senior Counsel for the applicant, submits that the applicant is not named in the FIR (RCHG2020A0021) and ECIR/GNZO/09/2021, or the CBI charge sheet filed on 20.11.2013, and no allegations have been made against the present applicant in the investigation which revolves around SOL and its promoters/directors. ....
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....firmed the principle in Pankaj Bansal Vs. Union of India, 2023, SCC OnLine SC 1244 that the grounds of arrest must be communicated in writing. The Court also held that the non-arrest on similarly placed co-accused is a relevant consideration and that the 'doctrine of parity' is applicable. 10. On merits, it has been submitted that Umaiza Infracon LLP, of which the applicant is a partner, is the successful resolution applicant of SOL, and which has taken over SOL by due process of law under the aegis of the NCLT and thus Umaiza Infracon LLP is now the lawful owner of SOL, whose resolution plan has been approved by NCLT. It is submitted that the entire case against the applicant is premised upon the existence of the alleged Facility Agreement dated 30.09.2019 between Shivakriti Agro Pvt. Ltd and Umaiza Infracon LLP, which the prosecution states is a sham document purportedly executed to give back the control of SOL to its erstwhile promoters. It is stated that even the applicant case is that the said Facility Agreement is not the agreement/document signed by the applicant for the purpose of availing loan from Shivakriti Agro Pvt. Ltd.; secondly the Facility Agreement was never sig....
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....pacity and domain knowledge to independently propose the resolution plan and relied on diverted funds to do so. Investigation revealed his deep involvement with ex-directors/promoters well before the CIRP, as he participated in bank meetings and helped manage finances of the corporate debtor. It is thus submitted that applicant and its entities are not protected under Section 32A of the IBC 2016 and are guilty of money laundering under Section 3 read with Section 70(1) and are thus punishable under Section 4 of PMLA 2002. 14. The learned counsel further submits that applicant fails to satisfy the twin conditions under Section 45 (1) of the PMLA, 2002, as there exists no reasonable grounds to believe he is not guilty or unlikely to commit the offence again. It is submitted that applicant played a key role in a deep rooted conspiracy involving diversion and laundering of public funds, with material evidence prevailing during investigation, his active involvement in acquiring SOL using 'proceeds of crime' routed through sham entities. The respondent relies on the decision in the case of Vijay Madanlal Choudhary & Ors. Vs. Union of India & Ors. (2022) SCC OnLine SC 929; Directorate ....
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....cused was possessed of the requisite mens rea. The court is not required to record a positive finding that the accused had not committed an offence under the act. The court ought to maintain a delicate balance between a judgment of acquittal and conviction and an order granting bail much before commencement of trial. The duty of the court at this stage is not to weigh the evidence meticulously but to arrive at a finding on the basis of broad probabilities. Further, the court is required to record a finding as to the possibility of the accused committing a crime which is an offence under the Act after grant of bail. ∗∗∗ 401. We are in agreement with the observation made by the court in Ranjitsing Brahmajeetsing Sharma case [Ranjitsing Brahmajeetsing Sharma v. State of Maharashtra, (2005) 5 SCC 294 : 2005 SCC (Cri) 1057]. 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 weigh the evidence to find the guilt of the accused which is, of course, the work of trial court. The court is only req....
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.... On the other hand, the court in these cases under such special Acts, have to address itself principally on two facts: likely guilt of the accused and the likelihood of them not committing any offence upon release. This court has generally up held such conditions on the ground that liberty of such citizens have to - in cases when accused of offences enacted under special laws - be balanced against the public interest. 20. A plain and literal interpretation of the conditions under Section 37 (i.e. that court should be satisfied that the accused is not guilty and would not commit any offence) would effectively exclude grant of bail altogether, resulting in punitive detention and unsanctioned preventive detention as well. Therefore, the only manner in which such special conditions as enacted under Section 37 can be considered within constitutional parameters is where the court is reasonably satisfied on a prima facie look at the material-on-record (whenever the bail application is made) that the accused is not guilty. Any other interpretation, would result in complete denial of the bail to a person accused of offences such as those enacted under Section 37 of the NDPS Act. ....
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....n the charge sheet filed in the predicate offence. Applicant is the successful resolution applicant of SOL, which has been taken over by the orders of NCLT after the resolution plan of Umaiza Infracon LLP was approved by the NCLT. The Facility Agreement, which is alleged to be a sham agreement, is already a subject matter of arbitration, which is pending adjudication, and therefore, imputations cannot be made till such time the arbitration is decided. 21. In the case of V. Senthil Balaji Vs. State, 2024 SCC OnLine SC 2626, it has been held that the existence of scheduled offence is a sine qua none for alleging existence of proceeds of crime and the existence of proceeds of crime at the time of trial of offence under Section 3 of PMLA can be proved only if the predicate/scheduled offence is established during trial of the said offence. The trial in case under the PMLA cannot be finally decided unless the trial of predicate/scheduled offence concludes. As noted by the Coordinate Bench while granting bail to co-accused Paramjeet in Bail Application No. 4240/2024, the trial in the predicate/scheduled offence has not even started and is at a preliminary stage. The prosecution therein....
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.... sentence is three years, and the maximum is seven years. The minimum sentence is higher when the scheduled offence is under the NDPS Act. When the trial of the complaint under PMLA is likely to prolong beyond reasonable limits, the Constitutional Courts will have to consider exercising their powers to grant bail. The reason is that Section 45 (1) (ii) does not confer power on the State to detain an accused for an unreasonably long time, especially when there is no possibility of trial concluding within a reasonable time. What a reasonable time is will depend on the provisions under which the accused is being tried and other factors. One of the most relevant factor is the duration of the minimum and maximum sentence for the offence. Another important consideration is the higher threshold or stringent conditions which a statute provides for the grant of bail. Even an outer limit provided by the relevant law for the completion of the trial, if any, is also a factor to be considered. The extraordinary powers, as held in the case of K.A. Najeeb, can only be exercised by the Constitutional Courts. The Judges of the Constitutional Courts have vast experience. Based on the facts on record....
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....e prescribed is only 7 years for the offence of money laundering." 23. A Coordinate Bench of this Court in Pankaj Kumar Tiwari & Anr. Vs. Enforcement Directorate, 2024 DHC 8280, has observed and held as under: - "34. Moreover, as repeatedly held, Constitutional Courts can always exercise their powers to grant bail on the grounds of violation of Part III of the Constitution of India and stringent provisions for the grant of bail such as those provided in Section 45 of the PMLA do not take away the power of Constitutional Courts to do so. The right of liberty and speedy trial guaranteed under Article 21 is a sacrosanct right which needs to be protected and duly enforced even in cases where stringent provisions have been made applicable by way of special legislation. The stringent provisions would have to be interpreted with due regard to Article 21 and in case of a conflict, the stringent provisions, such as Section 45 of the PMLA in the instant case, would have to give way. 35. Thus, where it is evident that the trial is not likely to conclude in a reasonable time, Section 45 cannot be allowed to become a shackle which leads to unreasonably long detention of the....
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....seeks is enlargement on bail. 3. Thus, taking note of the aforesaid fact alone, we are inclined to set aside the impugned order by granting bail to the appellant subject to the conditions that may be imposed by the designated Court. We make it clear that it is well open to the designated Court to impose such conditions so as to enable it to proceed with the trial as it is submitted by Mr. S.V. Raju, learned Additional Solicitor General appearing for the respondent that the appellant may be a flight risk." 26. Admittedly, the applicant has joined the investigation and has been in custody for the last about 11 months. In the case of Udhaw Singh Vs. Enforcement Directorate, 2025 SCC OnLine SC 357, the Hon'ble Supreme Court held as under:- "4. In this case, the appellant has undergone incarceration for a period of 1 year a20-23nd 2 months. There are 225 witnesses cited, out of which only 1 has been examined. Therefore, the trial is not likely to be concluded within few years. Hence, decision of this Court in the case of V. Senthil Balaji v. Deputy Director, Directorate of Enforcement will apply. ..... 5. Our attention is invited to a decision of a coordina....
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....nst co-accused Paramjeet, already granted bail, is no lesser than the role of the present applicant. 30. There is nothing on record to indicate the previous criminal antecedents of the applicant, no reasonable apprehension has been raised by the ED to demonstrate that applicant will commit similar offence while on bail. 31. Hence, in the light of above discussion and particularly considering the period of incarceration already undergone by the applicant coupled with the absence of any real likelihood of the trial concluding in near future, the rigors of Section 45 of the PMLA must yield to the constitutional safeguard under Article 21. On this foundational principle, the Court is of the view that the continued detention of the applicant cannot be justified on the sole of ground of statutory bar under Section 45. 32. Hence, considering the entirety of facts and circumstances, the Court is inclined to grant bail to the present applicant. The applicant is therefore directed to be released upon his furnishing a personal bond in the sum of Rs. 1 lakh with two sureties of the like amount each to the satisfaction of learned trial court/Duty Magistrate, subject to following terms ....