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2023 (5) TMI 1028 - HC - Money LaunderingSeeking grant of bail - misuse of official position as State Revenue Minister to purchase and claim compensation in respect of the land under survey No.52/2A/2 of Village Bhosari, Taluka Haveli, District Pune - twin condition specified under Section 45 of PMLA or not - bail is sought mainly on the ground that there is no valid predicate offence for the reason that the Anti Corruption Bureau has filed C Summary Report - HELD THAT - It is well settled that the grant of bail is the rule and refusal and exception. In the case of SATENDER KUMAR ANTIL VERSUS CENTRAL BUREAU OF INVESTIGATION ANR. 2022 (8) TMI 152 - SUPREME COURT the Hon ble Supreme Court has reiterated that liberty is one of the most essential requirements of the modern man. It is stated to be the delicate fruit of a mature civilization. It is the very quintessence of civilized exist and the essential requirement of a modern man. The nature of offence and the material in support thereof, possibility of the accused fleeing justice, reasonable apprehension of tampering the evidence or influencing the witnesses are the circumstances which normally weigh with the Court while exercising discretion under Section 439 of Cr.P.C. In P. CHIDAMBARAM VERSUS DIRECTORATE OF ENFORCEMENT 2019 (12) TMI 186 - SUPREME COURT , the Apex Court upon considering the previous decisions has reiterated that the basic jurisprudence relating to bail remains the same in as much as the grant of bail is the rule and refusal is the exception so as to ensure that the accused has the opportunity of securing fair trial, however, while considering the same the gravity of the offence is an aspect which is required to be kept in view by the Court. The gravity for the said purpose will have to be gathered from the facts and circumstances arising in each case. Keeping in view the consequences, that would befall on the society in cases of financial irregularities, it has been held that even economic offences would fall under the category of grave offence and in such circumstances, while considering the application for bail, the Court will have to deal with the same, being sensitive to the nature of allegation made against the accused - the underlining confusion is that irrespective of the nature and gravity of charge, the precedent of another case alone will not be the basis for the grant or refusal of bail, though it may have a bearing on principle. But ultimately, the consideration will have to be on case to case basis on the facts involved therein and securing the presence of the accused to stand trial. The language of Section 3 clearly implies that the money involved in the offence of Money laundering is necessarily the proceeds of crime, arising out of criminal activity in relation to the scheduled offence. In VIJAY MADANLAL CHOUDHARY ORS. VERSUS UNION OF INDIA ORS. 2022 (7) TMI 1316 - SUPREME COURT the Apex Court has observed that the proceeds of crime being the core of the ingredients constituting the offence of money-laundering, that expression needs to be construed strictly. In that, all properties recovered or attached by the investigating agency in connection with the criminal activity relating to a scheduled offence under the general law cannot be regarded as proceeds of crime - In Vijay Chaudhary the Supreme Court has observed that 2002 Act is a special legislation to deal with the subject of money laundering activities having transnational impact on the financial system including sovereignty and integrity of the countries. It is observed that money laundering is not an ordinary offence. It is a separate class of offence requiring effective and stringent measures to combat the menace of money laundering. The records reveal that though in the agreement for sale dated 28/03/2016 the sale consideration was mentioned as Rs.50 Lakhs, the Applicant and the co-accused subsequently purchased the said property vide sale deed dated 28.04.2016 for sale consideration of Rs.3.75 Crores. The Applicant and the co-accused have paid stamp duty of Rs.1,78,16,600/- on the prevailing market rate of the land, which as per the ready reckoner was assessed to be Rs. 22,83,63,300/-. It is thus evident that the Applicant and the co- accused had purchased the said land much below the prevailing market rate. The defence that the land was purchased at a distress sale is a matter to be proved during the trial - The material on record prima facie reveals that the Applicant and the co-accused have acquired the property by means which are not legally approved, and the property acquired by criminal activity is relatable to scheduled offence. Prima facie, a case of criminal misconduct, which is a scheduled offence is made out. It is stated that the closure report has not been accepted and further investigation has been ordered. Hence, at this stage the predicate offence does not cease to exist. The Hon ble Supreme Court, while upholding the validity of Section 19, rejected the grounds pressed into service to declare Section 19 as unconstitutional and held that such a provision has reasonable nexus with the purposes and objects sought to be achieved by the 2002 Act of Prevention of Money Laundering and Confiscation of proceeds of crime involved in money laundering, including to prosecute persons involved in the process or activity involved in the process of crime so as to ensure that the proceeds of crime are not dealt with in any manner which may result in frustrating any proceedings relating to confiscation thereof. In the instant case, it is not the case of the Applicant that the authorized officer has not adhered to the safeguards or the stringent conditions contained in Section 19 of the PMLA, 2002, and has thus failed to demonstrate violation of Article 21 of the Constitution as to entitle him for bail. The Applicant has failed to meet the test of twin condition under Section 45 of PMLA. Moreover, the Applicant is a British citizen and as such the possibility of the Applicant not being available for trial cannot be ruled out - Application disposed off.
Issues Involved:
1. Validity of Predicate Offence 2. Criminal Conspiracy and Misuse of Official Position 3. Money Laundering and Proceeds of Crime 4. Compliance with Section 41A of Cr.P.C. 5. Grant of Bail under Section 45 of PMLA Summary: 1. Validity of Predicate Offence: The Applicant argued that there was no valid predicate offence since the Anti Corruption Bureau had filed a 'C' Summary Report. However, the court noted that the closure report was not accepted, and further investigation was ordered, thus the predicate offence does not cease to exist. 2. Criminal Conspiracy and Misuse of Official Position: The allegations involve the misuse of official position by the co-accused Eknath Khadse, who, as the then Revenue Minister, allegedly conspired to purchase land below the market rate and directed officials to pay compensation or hand over possession to the owner. The court found prima facie evidence of criminal misconduct and noted that holding a meeting to discuss acquisition only in respect of the said land was not to resolve public interest but to achieve personal gain. 3. Money Laundering and Proceeds of Crime: The Applicant and co-accused allegedly received Rs. 4 Crores from M/s. Benchmark Buildcon Pvt. Ltd., a shell company, and routed these funds through various shell companies to purchase the land. The court noted that the Applicant and co-accused had placed, routed, and layered the amount of Rs. 5.53 Crores through shell companies and were involved in activities connected to the proceeds of crime, thereby committing an offence under Section 3 of PMLA. 4. Compliance with Section 41A of Cr.P.C.: The Applicant contended that the Respondent failed to issue a notice under Section 41A of Cr.P.C. The court held that PMLA is a special enactment with distinct procedures, and the safeguards provided in Section 19 of PMLA ensure fairness, objectivity, and accountability. The court found no violation of Article 21 of the Constitution. 5. Grant of Bail under Section 45 of PMLA: The court reiterated that the grant of bail is the rule and refusal is the exception but noted the gravity of the offence of money laundering. The Applicant failed to meet the twin conditions under Section 45 of PMLA, which require the court to be satisfied that the accused is not guilty of the offence and is not likely to commit any offence while on bail. Additionally, the Applicant being a British citizen posed a risk of not being available for trial. Consequently, the bail application was dismissed.
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