2016 (8) TMI 1539 - HC - Money Laundering

Conspiracy - private persons, who were contractors and builders of a Housing Project - fraudulently and dishonestly caused wrongful loss to the Dena Bank - HELD THAT - It is clearly envisaged under section 45 of the PMLA that no person accused of an offence punishable for a term of imprisonment of more than three years under Part A of the Schedule shall be released on bail or on his own bond unless Public Prosecutor has been given an opportunity to oppose the application for such release and where the Public Prosecutor opposes the application, the Court is satisfied that there are reasonable grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail. Keeping in view the facts and circumstances of the case, applicant should not to be enlarged on bail in the interest of justice, therefore, the bail application is rejected. Application dismissed.

Summary

Issues: Allegations of misuse of official position, money laundering, bail application

Allegations of Misuse of Official Position:
The judgment revolves around allegations against the applicant, a Branch Manager at Dena Bank, for misusing his official position in conspiracy with private individuals involved in a Housing Project. It is claimed that the applicant fraudulently caused wrongful loss to the bank and gained personally by accumulating assets from the crime proceeds. The defense argues that the assets were acquired through personal savings and loans, denying any misuse of official position in loan disbursements.

Money Laundering Allegations:
The defense contends that the Enforcement Directorate erred in lodging the case under the Prevention of Money Laundering Act, as the scheduled offenses under the Act were not applicable during the period of the alleged offense. The prosecution argues that economic offenses like money laundering are distinct from scheduled offenses, emphasizing the seriousness of economic crimes due to their impact on public funds and the economy. Evidence suggests that the applicant accumulated significant assets from the alleged crime proceeds, justifying the application of the PMLA.

Bail Application:
The judgment also addresses the bail application in light of Section 45 of the PMLA, which restricts bail for offenses punishable by imprisonment exceeding three years unless certain conditions are met. Despite arguments from both sides, the court rejects the bail application, citing that releasing the applicant on bail would not serve the interest of justice. However, the trial court is directed to expedite the trial, ideally concluding within six months of the order.

In conclusion, the judgment delves into the complex interplay between allegations of misuse of official position, money laundering, and the stringent bail provisions under the PMLA. The decision to reject the bail application underscores the gravity of economic offenses and the need for a thorough trial process.