2024 (9) TMI 935 - HC - Money Laundering

Money Laundering - proceeds of crime - non-compliance with the provision of section 19(1) of PMLA 2002 at the time of arrest - HED THAT - The petitioner or his learned counsel was not informed of the grounds of his arrest and therefore, the arrest is bad in law. The petitioner has placed reliance on several authorities including Pankaj Bansal 2023 (10) TMI 175 - SUPREME COURT , Arvind Kejriwal 2024 (9) TMI 780 - SUPREME COURT Madhu Limaye 1968 (12) TMI 97 - SUPREME COURT and Prabir Purkayastha 2024 (5) TMI 1104 - SUPREME COURT in this connection. The arrest memo discloses that the petitioner refused to receive the same after going through each page of the grounds of arrest stated therein and conveyed to him. Therefore the plea taken by the petitioner is too weak to stand on its own feet. No illegality or irregularity in the arrest procedure has been made out. It is trite law an accused has a right to make successive applications for grant of bail and the Court entertaining such subsequent applications has a duty to consider the reasons and grounds on which the earlier bail applications were rejected - In the present case, this Court, while turning down the prayer of the petitioner on two occasions has dealt with the matter on merits and has come to a conclusion that there is material to show that the Enforcement Directorate has been able to collect material which would satisfy the presumptions attached to sections 22 and 23 of the 2002 Act and it cannot be held that the petitioner is not guilty of such offence at this stage. True, the conditions laid down in section 45 of the 2002 Act are the guiding factors for grant of bail to an accused under the said Act and the accused has to satisfy the said conditions for earning an order of bail in his favour. In a recent judgment in Manish Sisodia 2024 (8) TMI 614 - SUPREME COURT the Hon ble Court has held that the right to bail in cases of delay coupled with incarceration for a long period should be read into section 439 of the Code of Criminal Procedure and section 45 of the 2002 Act. Section 479 of the Bharatiya Nagarik Suraksha Sanhita, 2023 as it stands after amendment of section 436A of the Code of Criminal Procedure envisages that a first-time offender (who has never been convicted for any offence in the past) shall be released on bond by the Court if he has undergone detention for the period extending up to one-third of the maximum period of imprisonment specified for such offence under that law. The petitioner being in custody for about two years is short of about four months in completing one-third of the maximum period of imprisonment. It is also not in dispute that he has not been convicted of any offence earlier and is therefore a first-time offender. The petitioner shall be released on bail subject to fulfilment of conditions imposed - bail application allowed.

Issues Involved:
1. Compliance with Section 19(1) of the Prevention of Money Laundering Act (PMLA), 2002 during arrest.
2. Validity of the arrest and grounds for bail.
3. Examination of subsequent developments and new evidence.
4. Health and personal circumstances of the petitioner.
5. Right to speedy trial under Article 21 of the Constitution.
6. Applicability of Section 436A of the Code of Criminal Procedure.
7. Conditions for granting bail.

Issue-wise Detailed Analysis:

1. Compliance with Section 19(1) of the Prevention of Money Laundering Act (PMLA), 2002 during arrest:
The petitioner claimed that the provision of Section 19(1) of the PMLA, 2002 was not complied with at the time of his arrest and that neither he nor his learned counsel was informed of the grounds of his arrest. However, the arrest memo disclosed that the petitioner refused to receive the same after going through each page of the grounds of arrest stated therein. The court found the petitioner's plea too weak to stand on its own, concluding that no illegality or irregularity in the arrest procedure had been made out.

2. Validity of the arrest and grounds for bail:
The petitioner argued that his arrest was based on unsubstantiated allegations and statements under Section 50 of the PMLA, 2002. The Enforcement Directorate (ED) opposed the bail, citing the petitioner's influence and the gravity of the offense. The court noted that the petitioner's earlier bail applications were turned down on merits, and the ED had collected material satisfying the presumptions attached to Sections 22 and 23 of the PMLA, 2002. The court referenced the Hon'ble Supreme Court's guidelines on bail considerations, including the nature and gravity of the accusation, the severity of punishment, and the likelihood of the offense being repeated.

3. Examination of subsequent developments and new evidence:
The petitioner renewed his prayer for bail based on subsequent developments, including the alleged non-receipt of all relied-upon documents (RUDs). The court found that the petitioner was in possession of the relevant documents before both his bail applications were considered, as evidenced by a letter from the ED to the Jail Superintendent. The court also noted that the petitioner had filed a prisoner's petition before the trial court, containing similar averments.

4. Health and personal circumstances of the petitioner:
The petitioner cited his health issues and long professional career as grounds for bail. The ED countered by referencing medical journals indicating that the petitioner's health condition did not warrant bail. The court acknowledged the petitioner's health concerns but emphasized the need for stringent conditions to address any apprehensions about influencing witnesses.

5. Right to speedy trial under Article 21 of the Constitution:
The court highlighted the petitioner's right to a speedy trial under Article 21 of the Constitution. It noted that the petitioner had been in custody for nearly two years, with the trial yet to commence. The court referred to the Hon'ble Supreme Court's observations that prolonged incarceration before being pronounced guilty should not become punishment without trial, emphasizing that bail should not be withheld as a punishment.

6. Applicability of Section 436A of the Code of Criminal Procedure:
Section 436A of the Code of Criminal Procedure provides for the release of an accused who has undergone detention for a period extending up to one-half of the maximum period of imprisonment specified for the offense. The court noted that although the petitioner had not undergone one-half of the maximum period of detention, he had completed more than half of the minimum period of imprisonment specified for the offense. The court considered this along with the petitioner's right to liberty under Article 21 of the Constitution.

7. Conditions for granting bail:
The court decided to release the petitioner on bail, subject to stringent conditions to address concerns about influencing witnesses and ensuring the petitioner's attendance at trial. The conditions included surrendering the passport, not leaving the jurisdiction without court permission, appearing at every hearing, not tampering with evidence, not indulging in criminal activity, and providing a mobile number to the court.

Conclusion:
The court granted bail to the petitioner upon furnishing a bond of Rs. 10,00,000/- with two sureties of like amount each, subject to several stringent conditions. The court emphasized that the observations made in the judgment were for the limited purpose of deciding the bail application and should not be construed as an expression of opinion on the merits of the case. The court allowed the petitioner's bail application (C.R.M. (S.B) 72 of 2024) and directed all parties to act on the server copy of the judgment.

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