2018 (12) TMI 442 - HC - Money Laundering

Offence under PMLA - Held that - As per prosecution case, petitioner and Raman Kumar Garg were involved in paper transactions and fake documentation in order to cheat State exchequer. Petitioner is the beneficiary of the act of fake companies. ECIR proceedings and the prosecution in FIR are two distinct mechanism. Fictitious export firm had claimed VAT refund of ₹ 1.56 crores from the Government. In the enquiry, it was confirmed that all the shipping bills and documents produced by the said firm were forged and fabricated. VAT refund of ₹ 1,56,76,190/- on the basis of forged and fabricated documents from the Excise and Taxation Department, Ludhiana was transferred through RTGS in different accounts of the proprietors. Petitioner is one of the proprietors along with Smt. Sangeeta Garg, Umesh Garg, Seema Garg and Saiyarh Garg. Direction to videograph the proceedings of interrogation - Held that - Petitioner was summoned on various occasions for making necessary arrangement for videography. Petitioner did not appear on any of the occasion intentionally and he did not comply with the directions. Petitioner deliberately avoided the investigation in order to escape from the proceedings. Summons were issued to the petitioner on nine occasions, but he did not turn up. All these facts were noticed in the earlier petition while declining the prayer for grant of anticipatory bail vide order dated 11.05.2017. Those proceedings were conspicuously concealed in the earlier petition as the rigor of non-appearance in the investigation would definitely go against the petitioner. Only a reference was made in para no.5 of aforesaid petition that a civil writ petition was filed by the petition which was disposed on 22.12.2015. A review petition is pending. Owing to the conduct of the petitioner, this Court did not grant any indulgence in the earlier petition. The case of Umesh Garg cannot be considered to be on parity with that of the petitioner, as the conduct of petitioner was earlier deprecated with reference to his conduct in not joining the investigation despite directions issued by the High Court for doing videography of the proceedings of the investigation. The petitioner was summoned on various occasions for making necessary arrangement for the videography, but he intentionally did not appear. The summons were issued to the petitioner on nine occasions, but despite service he did not turn up. Those proceedings were concealed in the earlier petition i.e. CRM-M No.12008 of 2017 in a very conspicuous manner so as to avoid rigor of non-appearance in the investigation. No such overt act was attributed to co- accused Umesh, therefore, the case of petitioner stands on different footings where his complicity was noticed in the petition with reference to facts on record. For the reasons recorded hereinabove, extra-ordinary relief of anticipatory bail cannot be granted to the petitioner. However, petitioner would be at liberty to seek regular bail in accordance with law. Consequently, this petition is dismissed.

Summary

Issues:
1. Anticipatory bail application in a money laundering case involving forged documents and tax evasion.

Analysis:
The petitioner filed for anticipatory bail in a case registered under Sections 3 and 4 of the Prevention of Money Laundering Act, 2002. This was the petitioner's 3rd attempt for anticipatory bail, with previous attempts being declined by the court. The petitioner cited changed circumstances for the new application, referring to similar cases where bail was granted to co-accused individuals. The petitioner was accused of involvement in a VAT refund scam through forged documents and fake transactions to cheat the state exchequer.

The prosecution alleged that the petitioner and others engaged in paper transactions and fake documentation to defraud the government. The firm in question claimed a VAT refund of ?1.56 crores based on forged documents, with the amount being transferred to different accounts. The petitioner was one of the beneficiaries of this fraudulent activity. Despite being summoned multiple times for investigation and videography of proceedings, the petitioner intentionally avoided appearing, leading to the denial of bail in previous attempts.

The court noted that the petitioner's conduct of evading investigation and non-cooperation was a significant factor in denying anticipatory bail. The court differentiated the petitioner's case from that of a co-accused, emphasizing the petitioner's deliberate avoidance of investigation despite repeated summons. The court concluded that due to the petitioner's conduct and involvement in the scam, anticipatory bail could not be granted. The petitioner was advised to seek regular bail in accordance with the law, and the petition for anticipatory bail was dismissed. The judgment clarified that the decision did not reflect an opinion on the merits of the case.