2023 (4) TMI 478 - HC - Money Laundering

Seeking grant of Regular Bail - Money Laundering - scheduled offence - proceeds of crime - illegal mining activities and ferrying through ships/ferry in Sahebganj - income from legitimate source or not - HELD THAT - There is a prima facie case about the large-scale illegal mining activities being carried out in the district of Sahebganj over the Rajmahal Hills. The scheduled offences are being investigated by the state police and in two of them on the basis of which the ECIR registered the petitioner has been absolved of the charges. Investigation in several other cases are in progress for offences of illegal mining loading charges under sections 414 of the IPC Minor Mineral Concession Rule 2004 Mines and Minerals(Development and Regulation) Act 1957 Jharkhand Mineral (Prevention of Illegal Mining Transportation and Storag) Rules 2017 Explosive Substance Act 1908. Offences under sections 411 and 414 IPC along with the offences under sections 3 4 5 of the Explosive Substance Act, 1908 into the matter of illegal mining are schedule offences under PMLA. Offence of money-laundering being continuous in nature the curtain has not been rung down with final form submitted in two of the cases as the cases of illegal mining activities are still in the process of being investigated. The investigation is not confined to 83 lakhs so far seized in the account of the petitioner but it has revealed larger transactions that took place from his account and therefore the plea of bail for the crime proceeds being less than one crore under section 45(1) of PMLA is not sustainable in the eyes of law. With regard to the health condition of the petitioner the jail authorities are directed to provide medical facilities and treatment as per the Jail Manual. However there does not exist any special ground for grant of bail on health grounds at this stage. The prayer for regular bail is rejected.

Summary

Issues Involved:
1. Legality of ECIR registration based on FIRs.
2. Existence of predicate offences.
3. Allegations of illegal mining and money laundering.
4. Health grounds for bail.
5. Comparison with co-accused's bail status.

Detailed Analysis:

1. Legality of ECIR Registration Based on FIRs:
The petitioner argued that the ECIR was registered based on FIR No.85 of 2020, in which he was not sent up for trial, and FIR No.146 of 2021, which was found to be false. The petitioner cited the case of Vijay Madanlal Choudhary and Ors. vs Union of India and Ors., emphasizing that prosecution under the PMLA cannot proceed if the predicate offence is not established. The petitioner also referenced Indrani Patnaik & Anr. vs. Enforcement Directorate & Ors., and Directorate of Enforcement v. Gagandeep Singh, to support the argument that without a scheduled offence, the PMLA charges cannot stand.

2. Existence of Predicate Offences:
The Enforcement Directorate (ED) countered that the ECIR was not solely based on the two FIRs but on a range of illegal mining activities in Sahibganj, involving multiple offences under IPC, Arms Act, SC/ST Act, and Explosive Substance Act. The ED emphasized that the scheduled offences are still under investigation, and the petitioner's involvement in illegal mining and money laundering activities is substantial.

3. Allegations of Illegal Mining and Money Laundering:
The prosecution outlined extensive illegal mining activities controlled by the petitioner, resulting in significant financial transactions and proceeds of crime. The investigation revealed large-scale illegal mining, extortion, and control over tolls to facilitate illegal activities. The ED conducted multiple searches, seizing cash, bank balances, and assets linked to the petitioner. The petitioner's financial transactions with associates and control over illegal mining operations were highlighted as evidence of money laundering.

4. Health Grounds for Bail:
The petitioner sought bail on health grounds, citing Type-2 Diabetes and other medical conditions. The court directed jail authorities to provide necessary medical treatment as per the Jail Manual but found no special ground for bail based on health conditions at this stage.

5. Comparison with Co-Accused's Bail Status:
The petitioner argued that his case differed from co-accused Prem Prakash, whose bail was rejected, as no cash was seized from him, and his bank deposits were from legitimate sources. The ED maintained that the petitioner's political influence and ongoing illegal activities justified the denial of bail.

Conclusion:
The court, after considering the submissions and materials on record, found a prima facie case of large-scale illegal mining and money laundering against the petitioner. The investigation into various offences, including those under PMLA, is ongoing, and the petitioner's involvement is substantial. The court rejected the petitioner's plea for bail, considering the gravity of the offence and the nature of allegations. The court also directed the jail authorities to provide necessary medical treatment to the petitioner.