2024 (3) TMI 644 - HC - Money Laundering

Seeking grant of anticipatory bail - Money Laundering - applicant though not named in the FIR, prosecution complaint filed by the Income Tax Department nor named in the ECIR submitted by the Enforcement Directorate, can be involved in the commission of offence under the PMLA or not - twin conditions for grant of bail under Section 45 of the PMLA, 2002 are available on record to release the applicant by granting anticipatory bail or not. Whether the applicant though not named in the FIR, prosecution complaint filed by the Income Tax Department nor named in the ECIR submitted by the Enforcement Directorate, can be involved in the commission of offence under the PMLA? - HELD THAT - The applicant can be subjected to prosecution under the PMLA, 2002 if it can be established that the applicant has prima facie committed an offence under Section 3 of the PMLA, 2002 - From the statement recorded as reflected in the ECIR that there is evidence to suggest that the applicant had knowledge that the money he has received was derived from criminal activity related to a scheduled offence and did he knowingly assist accused Laxmikant Tiwari in concealing or transferring illicit proceeds of crime which is essential to constitute an offense under Section 3 of the PMLA, 2002. Therefore, the money obtained by the applicant is deemed to proceed of crime and as such, he has prima facie committed the crime under Section 3 of the PMLA, 2002 - Question is answered against the present applicant. Whether the twin conditions for grant of bail under Section 45 of the PMLA, 2002 are available on record to release the applicant by granting anticipatory bail? - HELD THAT - The material so collected by the investigation prima facie reflects that many hand written entries in the diaries, name of the present applicant exist. Thus, he was knowingly and actively obtained the proceeds of crime and committed the offence under Section 3 of the PMLA, 2002 - material collected by the Enforcement Directorate, prima facie, involvement of the applicant is reflected. The material collected by the Enforcement Directorate has not been rebutted which also prima facie reflects about involvement of the applicant. The record of the case would further demonstrate that the applicant is unable to fulfill the twin conditions which are required for grant of bail under the PMLA, 2002, is equally applicable for grant of anticipatory bail, which has not been satisfied by the present applicant - considering the fact that the applicant is unable to satisfy twin conditions of Section 45 of PMLA, 2002 for grant of anticipatory bail, the anticipatory bail cannot be granted - question also answered against the present applicant. The bail application filed under Section 438 of the Cr.P.C. is liable to be and is hereby rejected.

Summary

Issues Involved:
1. Whether the applicant, though not named in the FIR, prosecution complaint, or ECIR, can be involved in the commission of the offence under the PMLA, 2002.
2. Whether the twin conditions for grant of bail under Section 45 of the PMLA, 2002 are available on record to release the applicant by granting anticipatory bail.

Summary:

Point No. 1:
The court examined whether the applicant, not named in the FIR, prosecution complaint, or ECIR, could be involved in the commission of the offence under the PMLA, 2002. Section 3 of the PMLA, 2002, deals with money laundering, stating that anyone directly or indirectly involved in any process or activity connected with proceeds of crime shall be guilty of money laundering. The court referred to various legal precedents, including the Supreme Court's interpretation in Pavana Dibbur Vs. The Directorate of Enforcement, which established that an offence under Section 3 can occur subsequent to the commission of a scheduled offence. Even if an individual is not directly connected to the scheduled offence, they can still be prosecuted under Section 3 if they knowingly assist in concealing the proceeds of crime. The court concluded that the applicant could be subjected to prosecution under the PMLA, 2002, if it can be established that the applicant has prima facie committed an offence under Section 3.

Point No. 2:
The court considered whether the twin conditions for grant of bail under Section 45 of the PMLA, 2002, were satisfied. Section 45 stipulates that no person accused of an offence under this Act shall be released on bail unless the Public Prosecutor has been given an opportunity to oppose the application and the court is satisfied that there are reasonable grounds for believing that the accused is not guilty and is not likely to commit any offence while on bail. The court referred to the Supreme Court's judgments in M. Gopal Reddy Vs. Enforcement Directorate and Y. S. Jagan Mohan Reddy Vs. Central Bureau of Investigation, emphasizing the gravity of economic offences and the necessity of stringent conditions for granting bail. The court found that the applicant failed to fulfill the twin conditions required for bail under Section 45 of the PMLA, 2002, and noted the potential for tampering with witnesses and the investigation.

Conclusion:
The court rejected the bail application filed under Section 438 of the Cr.P.C., stating that the applicant did not satisfy the twin conditions of Section 45 of the PMLA, 2002. The observations made in the judgment were clarified to be only for the disposal of the present bail application and would not influence the trial court on the merits of the case.