2024 (10) TMI 681 - HC - Money Laundering

Seeking grant of bail - Money Laundering - scheduled offences - long incarceration under Section 436A of the CrPC - whether twin conditions of Section 45 of the PMLA Act are fulfilled - effect of the twin conditions on the entitlement of the Applicant in getting bail - HELD THAT - It is required to be noted that the Supreme Court in the case of Vijay Madanlal Choudhary 2022 (7) TMI 1316 - SUPREME COURT considered the applicability of Section 436A of the CrPC which is concerning the maximum punishment for which an under trial prisoner can be detained to the offence punishable under PMLA, in view of Section 45 of PMLA imposing twin conditions before considering application of the Accused facing prosecution for the offences under the PMLA. It has been held that Section 436A of the CrPC has come into effect on 23rd June 2006 and the said provision is the subsequent law enacted by the Parliament after enactment of PMLA and Section 436A will prevail and will apply in spite of rigors of Section 45 of the PMLA Act. The Supreme Court in Vijay Madanlal Choudhary vs. Union of India has held that Section 436A of the CrPC will apply even to the offences under the PMLA. Thus, what has been held is that in case of violation of Article 21 of the Constitution of India, the rigors of Section 45 of PMLA can suitably be relaxed. In the present case, the Applicant has been arrested in the scheduled offences on 24th February 2020. The Applicant has been arrested in the PMLA case on 5th March 2021 when he was in custoday in scheduled offences. Thus, the Applicant is behind bar for about 4 years and 8 months. As the Applicant has been arrested in the PMLA case on 5th March 2021 and therefore even if the date of arrest in the PMLA case i.e. 5th March 2021 is taken into consideration then also the Applicant is incarcerated for about 3 years and 7 months which is half of the maximum punishment (i.e. 7 years) prescribed for offence punishable under Section 4 of the PMLA. Thus, case is made for grant of bail to the Applicant on the ground of long incarceration - the Applicant can be enlarged on bail by imposing conditions - bail application allowed.

Issues Involved:

1. Entitlement to bail on the grounds of parity with a co-accused.
2. Entitlement to bail based on merits, including the applicant's role and involvement in the crime.
3. Entitlement to bail due to long incarceration under Section 436A of the CrPC.
4. Applicability of Section 436A of the CrPC in light of Section 45 of the PMLA.

Detailed Analysis:

1. Entitlement to Bail on Grounds of Parity:

The applicant argued for bail on the basis of parity with a co-accused, who had been granted bail in both the scheduled offence and the PMLA offence. The applicant's counsel contended that since the applicant's role was similar to that of the co-accused, bail should be granted on similar grounds. However, the court did not grant bail solely on this basis, as the applicant's involvement and the material on record were also considered.

2. Entitlement to Bail Based on Merits:

The applicant claimed that he was not a beneficiary of the crime and that there was no recovery at his instance, thus warranting bail. However, the prosecution opposed this, presenting witness statements and affidavits that implicated the applicant in serious offences. The court noted that the applicant, as the Chief Executive Officer of the bank, had a duty to prevent illegal activities but instead facilitated them. The court found that the applicant actively participated in the crime, making him ineligible for bail based on merits.

3. Entitlement to Bail Due to Long Incarceration:

The applicant had been incarcerated for over three years and seven months, which is more than half of the maximum punishment of seven years under Section 4 of the PMLA. The court considered the applicant's prolonged detention and the fact that the trial had not commenced. The court acknowledged the applicant's right to a speedy trial under Article 21 of the Constitution and found no material evidence that the applicant was responsible for delaying the trial. Therefore, the court granted bail on the grounds of long incarceration.

4. Applicability of Section 436A of the CrPC in Light of Section 45 of the PMLA:

The court discussed the interplay between Section 436A of the CrPC and Section 45 of the PMLA, referencing the Supreme Court's decision in Vijay Madanlal Choudhary v. Union of India. It was noted that Section 436A, which allows for bail after half of the maximum sentence is served, applies even to PMLA offences despite the stringent conditions of Section 45. The court emphasized that Section 436A is a statutory bail provision that upholds the constitutional right to a speedy trial. As the applicant had served more than half of the maximum sentence and the trial was delayed without his fault, the court found grounds to relax the rigors of Section 45 and grant bail.

Conclusion:

The applicant was granted bail on the basis of long incarceration, with specific conditions imposed to ensure compliance with the trial process and prevent interference with the prosecution. The court ordered the applicant to furnish a personal bond, report monthly to the investigating office, and refrain from tampering with evidence or influencing witnesses. The trial court was instructed to decide the case on its merits, uninfluenced by the observations made in the bail order.

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