2016 (12) TMI 816 - HC - Money Laundering

Money Laundering - bail application - Held that - The nature and scope of offences imputed in the present case are entirely different from those covered in the previous case, which was drawn up under the NDPS Act. Here, the basic allegations are overwhelmingly financial in nature and the petitioner is alleged to have indulged in Money Laundering by way of investing/utilizing a huge amount of money allegedly generated by him from illegal activities. His own statements recorded under section 50 of the PMLA at this prima facie stage cannot be simply brushed aside, since the admissibility of the same is not explicitly barred under the law. Furthermore, his failure to explain his income and assets do persuade us to reject his prayer for release on bail at this early stage when apparently the formal trial in the Money Laundering case is yet to commence. Consequently, bail application is dismissed at this stage and the matter thus stands disposed of.

Summary

Issues: Bail application under the Prevention of Money Laundering Act (PMLA) based on allegations of financial crimes and involvement in illegal activities.

Analysis:
1. Background of the Case: The petitioner filed a bail application in Complaint No.3/2016 under the PMLA, 2002, related to FIR No.45 of 2013, involving various provisions of the IPC, Arms Act, and NDPS Act. The petitioner was declared a Proclaimed Offender by Punjab Police Authorities and later detained in connection with the aforementioned FIR.

2. Opposition by the Respondent: The respondent opposed the bail plea, alleging that the petitioner, a Canadian citizen, was involved in receiving drugs in Canada and sending proceeds to India through 'Hawala Channels'. The respondent claimed that the petitioner admitted to sending around ?5 crores earned from drugs to a local drug kingpin, who purchased agricultural land for the petitioner's brother in India. The respondent also highlighted that the petitioner did not file any income tax return, was a habitual offender, and faced charges in another case under the NDPS Act.

3. Comparison with Previous Bail Grant: The petitioner argued that he had been granted bail in the original case related to FIR No.45 of 2013 and should be released on bail in the present PMLA case. However, the court noted that the nature of offenses in the current case, primarily financial and related to money laundering, differed significantly from the previous case under the NDPS Act. The court considered the petitioner's recorded statements under the PMLA and his failure to explain income and assets as reasons to reject the bail application at an early stage of the trial.

4. Decision: The court dismissed the bail application, emphasizing the financial nature of the allegations and the petitioner's involvement in money laundering activities. The court concluded that the petitioner's bail request was premature, given the pending formal trial in the money laundering case.

Conclusion: The judgment denied the petitioner's bail application under the PMLA, citing the serious financial allegations and the need for further trial proceedings to determine the veracity of the charges related to money laundering activities.