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2022 (6) TMI 164 - HC - Money LaunderingGrant of statutory bail under Section 167(2) of the Cr.P.C. - time limitation of 60 days expired - Money Laundering - diversion of large-scale clients funds through shell companies which resulted in huge losses to the investors - misuse of shell companies created by KSBL - HELD THAT - Section 167(2) of the Cr.P.C. obligates the investigative agencies to complete the investigation in a time bound manner. The object behind incorporating a time limit to complete investigation was explained by a full bench of the Supreme Court in M. RAVINDRAN VERSUS THE INTELLIGENCE OFFICER, DIRECTORATE OF REVENUE INTELLIGENCE 2020 (10) TMI 1105 - SUPREME COURT where it was held that Once the accused files an application for bail under the Proviso to Section 167(2) he is deemed to have availed of or enforced his right to be released on default bail, accruing after expiry of the stipulated time limit for investigation. Thus, if the accused applies for bail under Section 167(2), CrPC read with Section 36A (4), NDPS Act upon expiry of 180 days or the extended period, as the case may be, the Court must release him on bail forthwith without any unnecessary delay after getting necessary information from the public prosecutor, as mentioned supra. Such prompt action will restrict the prosecution from frustrating the legislative mandate to release the accused on bail in case of default by the investigative agency. From the above decision, it is clear that a time limit for completing investigation was incorporated in order to ensure that the accused does not languish in jail for the investigative authority s failure to complete investigation. It was held that the right to statutory bail accrues on a person if the charge sheet is not filed within the prescribed period of sixty days. The said right to bail is indefeasible and is interlinked with personal liberty as envisaged under Article 21 of the Constitution of India. The complaint filed under Section 44(1)(b) of the PMLA is similar to a charge sheet/ final report filed under Section 173(2) of Cr.P.C. In other words, similar to a charge sheet under Section 173(2) of Cr.P.C., a complaint under Section 44(1)(b) of the PMLA is filed after completion of investigation, so that the Special Court can take cognizance under Section 167 of the Cr.P.C. It is relevant to note that the filing of the complaint and subsequent cognizance under PMLA is governed by the provisions of the Cr.P.C. in view of Section 65 of the Cr.P.C. - In the present case, the Respondent contended that a complaint under Section 44(1)(b) of the PMLA was already filed on 19.03.2022. Therefore, the Petitioner is not entitled for statutory bail under Section 167(2) of the Cr.P.C. This Court cannot accept the contention of the Respondent as the investigation was not completed when the complaint dated 19.03.2022 was filed. A perusal of the impugned order dated 08.04.2022 indicates that the Designated Court has returned the application dated 31.03.2022 seeking extension of remand and the bail application dated 01.04.2022. According to this Court, the Designated Court has no power to return the said applications. This Court in DIRECTORATE OF ENFORCEMENT REPRESENTED BY ITS ASSISTANT DIRECTOR HYDERABAD ZONAL UNIT VERSUS KAMMA SRINIVASA RAO, KANCHERLA SRIHARI BABU 2022 (2) TMI 1011 - TELANGANA HIGH COURT has held that it is incumbent on the Designated Court to pass a reasoned order and not merely return the applications. Neither the Cr.P.C. nor the PMLA contemplates any provision which empowers the Designated Court to return applications seeking remand or applications seeking bail. The Petitioner herein is entitled for statutory bail under Section 167(2) of the Cr.P.C. - Petition allowed.
Issues Involved:
1. Entitlement to statutory bail under Section 167(2) of the Cr.P.C. 2. Validity of the complaint/charge sheet filed on 19.03.2022. 3. Extension of remand under Section 309 of the Cr.P.C. 4. Powers of the Designated Court to return applications. Issue-Wise Detailed Analysis: 1. Entitlement to Statutory Bail under Section 167(2) of the Cr.P.C.: The primary issue before the Court was whether the Petitioner was entitled to statutory bail under Section 167(2) of the Cr.P.C. The Petitioner argued that the offences alleged against him were not punishable with a term of not less than ten years, death, or life imprisonment, and therefore, he was entitled to statutory bail as the investigation was not completed within sixty days of his remand. The Petitioner contended that the period of sixty days expired on 21.03.2022, and since no valid complaint/charge sheet was filed by then, he was entitled to bail. The Court discussed the object and scope of Section 167(2) of the Cr.P.C., emphasizing that the provision obligates investigative agencies to complete investigations within a time-bound manner to prevent the accused from languishing in jail. The Court cited the Supreme Court's decision in M. Ravindran v. Intelligence Officer, Directorate of Revenue Intelligence, which highlighted the importance of completing investigations promptly to protect the accused's right to personal liberty under Article 21 of the Constitution of India. The Court clarified that the right to statutory bail ceases to exist the moment a charge sheet is filed within the prescribed period of sixty or ninety days. However, the Court found that the complaint dated 19.03.2022 filed by the Respondent was not a final complaint based on which cognizance could be taken, as the investigation was admittedly not completed. 2. Validity of the Complaint/Charge Sheet Filed on 19.03.2022: The Petitioner argued that the complaint filed on 19.03.2022 was in the nature of an interim report and not a final charge sheet as required under Section 173(2) of the Cr.P.C. The Court noted that the Designated Court extended the remand of the accused on 31.03.2022 and 13.04.2022 under Section 167(2) of the Cr.P.C. on the ground that the investigation was pending. This indicated that the complaint dated 19.03.2022 was filed without completing the investigation. The Court referred to the Supreme Court's decisions in Satya Narain Musadi v. State of Bihar and Manu Sharma v. State (NCT of Delhi), which held that a charge sheet could only be filed after the completion of the investigation. The Court also cited the Bombay High Court's decision in Sharadchandra Vinayak Dongre v. State of Maharashtra, which distinguished between completion of investigation and further investigation, holding that an incomplete charge sheet could not be used to circumvent the right to statutory bail. 3. Extension of Remand under Section 309 of the Cr.P.C.: The Respondent contended that the Petitioner was remanded under Section 309 of the Cr.P.C., which allows for the extension of remand for further investigation. However, the Court found this contention to be misconceived, as Section 309 of the Cr.P.C. comes into operation only after cognizance of the offence is taken. Since no cognizance was taken in the present case, the remand could not be extended under Section 309. 4. Powers of the Designated Court to Return Applications: The Court noted that the Designated Court returned the application dated 31.03.2022 seeking extension of remand and the bail application dated 01.04.2022. The Court held that the Designated Court had no power to return such applications. It emphasized that the Court must pass a reasoned order while deciding an application for remand under Section 167(2) of the Cr.P.C. and cannot merely return the applications. Conclusion: The Court concluded that the Petitioner was entitled to statutory bail under Section 167(2) of the Cr.P.C. as the investigation was not completed within the prescribed period of sixty days, and no valid charge sheet was filed. The Court quashed the orders extending the remand of the accused and allowed the Petitioner to file a fresh bail application under Section 167(2) of the Cr.P.C. The Designated Court was directed to consider the application and pass orders in accordance with the law within a week. Order: i) The three Criminal Petitions are allowed. ii) The orders dated 31.03.2022 and 13.04.2022 extending the remand of the accused are quashed. iii) The Petitioner is at liberty to file a fresh bail application under Section 167(2) of the Cr.P.C. before the Metropolitan Sessions Judge – cum – Special Court under the PMLA Act, 2002 at Hyderabad. iv) Miscellaneous petitions pending shall stand closed.
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