2021 (12) TMI 1109 - HC - Money Laundering

Seeking grant of Anticipatory Bail - property relating on the creation of mortgage/security - fake/bogus loans - no assets were created - loan turned bad NPA in the name of non existing/pseudonymous borrowers without adhering to the prescribed norms and guidelines of the Bank and causing wrongful loss - overriding effect of PML Act over other acts - HELD THAT - PML Act, 2002 deals with the offence of money laundering and Parliament enacted this law to deal and curb the activities of money laundering. Being a special enactment it has overriding effect on general law. Section 71 of PML Act specially provides that provisions of PML Act shall have overriding effect on any other law time being in force. Thus, it is very clear that provisions of Code of Criminal Procedure will not be applicable until there is no specific provision is given in PML Act, 2002. In case of UNION OF INDIA VERSUS VARINDER SINGH @ RAJA ANR. 2017 (7) TMI 1056 - SUPREME COURT , Supreme court observed that Section 45 of PML Act imposes conditions for grant of bail. Bail cannot be granted without complying with requirements of section 45 of PML Act. Money Laundering being an offence is economic threat to national interest and it is committed by the white collar offenders who are deeply rooted in society and cannot be traced out easily. These kinds of offence is committed with proper conspiracy, deliberate design with the motive of personal gain regardless of the consequences to the society and economy of Country. Hence, for money-launderers jail is the rule and bail is an exception - Socio-economic criminals are economically sound, therefore, in releasing them on anticipatory bail there is probability of abscondance not only within country but also beyond country. Usually socio-economic offenders abscond to some other country in order to escape themselves from Criminal Prosecution. The status and position of offenders provides opportunity to influence investigation and prosecution. This Court finds no merit in the application under Section 438 Cr.P.C. filed by the applicant. Consequently, the instant anticipatory bail application is rejected.

Summary

Issues Involved
1. Anticipatory Bail Application under Section 438 Cr.P.C.
2. Allegations under Prevention of Money Laundering Act, 2002 (PML Act)
3. Scheduled Offence and Aggregate Value Requirement
4. Prima Facie Accusation and Influence on Witnesses
5. Health and Age Considerations of the Applicant
6. Conditions under Section 45 of PML Act
7. Economic Offences and National Interest

Detailed Analysis

1. Anticipatory Bail Application under Section 438 Cr.P.C.
The applicant sought anticipatory bail under Section 438 Cr.P.C., apprehending arrest in relation to ECIR No.15/PMLA/LZO/2010, under Sections 3/4 of the PML Act. The Sessions Court had previously rejected the bail application, citing prima facie accusations and the potential for influencing witnesses and tampering with evidence.

2. Allegations under Prevention of Money Laundering Act, 2002 (PML Act)
The allegations stemmed from a CBI FIR (No. RC0062007A0008) involving a criminal conspiracy by bank employees and others, resulting in wrongful loss to the Bank of India and corresponding wrongful gain to the accused. The Enforcement Directorate registered an ECIR based on this FIR, initiating an investigation under Section 3 of the PML Act, punishable under Section 4.

3. Scheduled Offence and Aggregate Value Requirement
The applicant contended that the aggregate value of allegations (?28,15,888) did not meet the ?30 lakhs threshold required under Section 2(1)(y) of the PML Act, as amended in 2013. The court noted that the schedule was amended, and the aggregate value requirement must be met for the offence to be considered under the PML Act.

4. Prima Facie Accusation and Influence on Witnesses
The Sessions Court had determined prima facie accusations under Sections 3/4 of the PML Act. The applicant argued that there was no evidence of influencing witnesses or tampering with evidence, relying on the Supreme Court judgment in State of Maharashtra vs. Nainmal Punjaji Shah, which stated that mere apprehension is insufficient without concrete attempts at tampering or absconding.

5. Health and Age Considerations of the Applicant
The applicant, aged around 70 years and suffering from Non-Alcoholic Fatty Liver Disease (NAFLD), argued for anticipatory bail on health grounds. The court considered these factors but emphasized the gravity of the offence and the need for stringent measures in economic offences.

6. Conditions under Section 45 of PML Act
Section 45 of the PML Act imposes twin conditions for granting bail: the Public Prosecutor must be given an opportunity to oppose the application, and the court must be satisfied that there are reasonable grounds for believing that the accused is not guilty and is unlikely to commit any offence while on bail. The court noted that these conditions are mandatory and must be strictly complied with, as reiterated in various Supreme Court judgments.

7. Economic Offences and National Interest
The court highlighted that economic offences pose a significant threat to national interest and are committed with deliberate design for personal gain. The principle that "jail is the rule and bail is an exception" was emphasized, particularly for socio-economic offenders who might abscond or influence the investigation. The court referenced several Supreme Court judgments underscoring the seriousness of economic offences and the need for a different approach in granting bail.

Conclusion
The court found no merit in the anticipatory bail application under Section 438 Cr.P.C., considering the principles established by the Supreme Court and the mandatory conditions under Section 45 of the PML Act. The application was consequently rejected, with observations made exclusively for deciding the anticipatory bail application, not affecting the trial or regular bail application.

Appreciation
The court acknowledged the assistance of the law clerk, Mr. Shashank Dixit, in the research for the judgment.