2023 (8) TMI 476 - HC - Money Laundering

Seeking grant of bail - Money Laundering - Scheduled Offence - confiscation of proceeds of crime - involvement in acquisition use possession and concealment of proceeds of crime with the assistance of other accused persons and entities - HELD THAT - The petitioner was in no way associated with the West Bengal Board of Primary Education. However her husband Manik Bhattacharya was the President of West Bengal Board of Primary Education. Section 2 (u) of the PMLA Act includes within its ambit proceeds of crime which relate to any property derived or obtained directly or indirectly by any person as a result of criminal activity relating to a schedule offence and Section 3 of the PMLA Act which defines the offences of money laundering includes within its ambit the persons who directly or indirectly indulge or knowingly assists or is a party or is actually involved in any process or activity connected along with the concealment possession acquisition and use of proceeds of crime. Thus a distinction has been created in the statute itself regarding a person who is involved in the criminal activity or generation of ill-gotten money and the person who conceals possesses acquires or uses the same from the person who generates it although both are offences. Having regard to the fact that the high officials of the Enforcement Directorate did not exercise their powers of arrest at any point of time when the investigation continued till the submission of the complaint a distinction has already been created between the person who was in office and had the capacity to generate the money by illegal means and the person who concealed or possessed or used the property which was acquired by that means. Further there was no prayer before the learned trial court when the complaint was filed under Section 87 of the Code of Criminal Procedure that the warrant be issued at the first instance. What was prayed before the learned special court was for issuance of process. There was no allegation also in the prayer of the complaint that there is any possibility of the present petitioner absconding or fleeing away from justice. Petitioner also in response to the summons appeared on the first day before the court and prayed for bail. Learned court under Section 45 of the PMLA took cognizance of the offence but did not decide the issue of bail and also did not take the petitioner in custody - the court while dealing with the application for grant of bail need not delve deep into the merits of the case and the consideration must on broad probabilities. It has been reiterated by the Hon ble Supreme Court that the word guilt appearing in Section 45 of the PMLA is not to be considered as the finding of guilt or acquittal at the end of the trial after the evidence is adduced before the court. Having considered the nature of blame worthiness or culpability of the present petitioner and the fact that she appeared in response to the summons before the learned special court/trial court and that she is in custody for more than 5 months it is opined that further detention of the petitioner is unwarranted in the facts and circumstances of the present case. The prayer for bail of the petitioner is allowed - Bail application allowed subject to conditions imposed.

Summary

Issues Involved:
1. Allegations under the Prevention of Money Laundering Act, 2002 (PMLA).
2. Legality of the bail application process.
3. Consideration of bail under Section 439 of the Code of Criminal Procedure.
4. Exercise of powers under Section 19 of the PMLA Act, 2002.

Summary:

Allegations under the Prevention of Money Laundering Act, 2002 (PMLA):
The petitioner, Smt. Satarupa Bhattacharya, is accused of assisting her husband, Shri Manik Bhattacharya, in laundering proceeds of crime acquired through criminal activity. The investigation revealed that they conspired to open multiple joint bank accounts without informing the other account holders of the purpose, including accounts with a deceased person. The petitioner, a housewife dependent on her husband, allegedly used these accounts to conceal and use the proceeds of crime, thus committing an offence under Section 3 of the PMLA, punishable under Section 4.

Legality of the Bail Application Process:
The petitioner appeared in response to a summons and applied for bail, which was initially delayed for the Enforcement Directorate (ED) to file objections. The Special Court allowed her to return home but later rejected her bail application, citing a strong prima facie case and the seriousness of the offence. The petitioner argued that the process followed was flawed, as the court did not immediately decide on her bail status.

Consideration of Bail under Section 439 of the Code of Criminal Procedure:
The court noted that the petitioner had no direct evidence against her of accepting money for recruitment purposes and that she had appeared in response to the summons. The court referenced the Supreme Court's guidelines on bail, emphasizing that the court need not delve deeply into the merits but should consider broad probabilities. The court found that further detention was unwarranted given the petitioner's circumstances and granted her bail.

Exercise of Powers under Section 19 of the PMLA Act, 2002:
The court discussed the constitutional validity and safeguards of Section 19, which allows high-ranking officials to arrest individuals involved in money laundering. The court noted that the ED had not exercised this power against the petitioner during the investigation, indicating a distinction between her and those directly involved in generating illicit funds. The court found that the ED's failure to arrest the petitioner during the investigation supported her case for bail.

Conclusion:
The court granted the petitioner bail, noting that she had been in custody for over five months and that her further detention was unwarranted. She was released on a bond of Rs. 1,00,000 with two sureties and required to surrender her passport. The court emphasized the need for a fair and reasonable application of the law, considering the petitioner's specific circumstances and the lack of direct evidence against her.