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2024 (11) TMI 997 - HC - Money LaunderingSeeking grant of regular bail - Money Laundering - conspiracy to fraudulently set up Vivo group of companies in India without revealing their true beneficial ownership and carried out mis-declarations before government bodies - concealment of Chinese ownership - Section 45 of the PMLA - HELD THAT - Since the offence pertains to money laundering, apart from the usual considerations, it would have to be seen whether the twin conditions stipulated in Section 45 of the PMLA are met. A plain reading of Section 45 of the PMLA shows that the public prosecutor must be given an opportunity to oppose the application and the Court should have reasonable grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail. The twin conditions though restricts the right of accused to be released on bail but do not impose absolute restraint and the discretion vests in the Court. Section 45 of the PMLA while imposing additional conditions to be met for granting bail, does not create an absolute prohibition on the grant of bail. When there is no possibility of trial being concluded in a reasonable time and the accused is incarcerated for a long time, depending on the nature of allegations, the conditions under Section 45 of the PMLA would have to give way to the constitutional mandate of Article 21. What is a reasonable period for completion of trial would have to be seen in light of the minimum and maximum sentences provided for the offence, whether there are any stringent conditions which have been provided, etc. It would also have to be seen whether the delay in trial is attributable to the accused. In Senthil 2024 (9) TMI 1497 - SUPREME COURT , the Supreme Court while reiterating the ratio enunciated in Union of India v. K.A. Najeeb (Three Judge bench) 2021 (2) TMI 1212 - SUPREME COURT , also held that if the Constitutional Court comes to the conclusion that the trial would not be able to be completed in a reasonable time, the power of granting bail could be exercised on the grounds of violation of Part III of the Constitution of India notwithstanding the statutory provisions. The issue of long incarceration and right of speedy trial also cropped up in Manish Sisodia v Directorate of Enforcement, Manish Sisodia v Directorate of Enforcement, 2024 (8) TMI 614 - SUPREME COURT wherein it has been held by the Supreme Court that the right to bail in cases of delay in trial, coupled with long period of incarceration would have to be read into the Section 439 CrPC as well as Section 45 of PMLA while interpreting the said provisions. Prem Prakash v. Union of India through the Directorate of Enforcement, Prem Prakash v. Union of India through the Directorate of Enforcement, 2024 (8) TMI 1412 - SUPREME COURT is another recent decision where it has been reiterated that the fundamental right enshrined under Article 21 cannot be arbitrarily subjugated to the statutory bar in Section 45 of the Act and the constitutional mandate being the higher law, the right to speedy trial must be ensured and if the trial is being delayed for reasons not attributable to the accused, his incarceration should not be prolonged on that account. The right to speedy trial was also upheld and other special legislations where provisions akin to Section 45 PMLA exist. It is noted that the investigation was initiated in the year 2022 and the Prosecution Complaint has named 48 accused persons and cited 527 witnesses. There are 80,000 pages of documents which need to be analysed. A supplementary Prosecution Complaint dated 19 - In a situation such as the present case, where there are multiple accused persons, thousands of pages of evidence to assess, scores of witnesses to be examined and the trial is not expected to end anytime in the near future and the delay is not attributable to the accused, keeping the accused in custody by using Section 45 PMLA a tool for incarceration or as a shackle is not permissible - The accused in a money laundering case cannot be equated with those punishable with death, imprisonment for life, ten years or more like offences under the Narcotic Drugs and Psychotropic Substances Act, 1985, murder, cases of rape, dacoity, etc. As held in the catena of judgements discussed herein above, Constitutional Courts have the power to grant bails on the grounds of violation of Part III of the Constitution and Section 45 does not act as a hindrance to the same. The sacrosanct right to liberty and fair trial is to be protected even in cases of stringent provisions present in special legislations - The applicant has been in custody since 10.10.2023 and the trial is at the stage supply of documents under Section 207 Cr.P.C. and charges are yet to be framed. Out of the 7 accused persons who were arrested, arrest of 3 persons was declared illegal by the Trial Court vide order dated 30.12.2023 and the other three, as noted above, have already been released on bail. The fact that the twin conditions under Section 45 of PMLA stand satisfied, the fact that the all the other accused persons who were arrested are out on bail, the period of custody undergone, the trial is at nascent stage of supply of documents under Section 207 Cr.P.C., keeping in mind the import of the catena of decisions of Supreme Court discussed herein above, it is directed that the applicant be released on regular bail subject to him furnishing personal bond in the sum of Rs.1,00,000/- with one surety of the like amount each to the satisfaction of the concerned Jail Superintendent/Trial Court/Duty J.M./link J.M. and subject to fulfilment of further conditions imposed - The bail application is disposed of.
Issues Involved:
1. Allegations of money laundering and fraudulent activities by Vivo India and its associated companies. 2. Applicant's alleged involvement in setting up a network of companies and financial transactions with Labquest. 3. Allegations of issuing invitation letters to Chinese nationals and involvement in visa-related illegalities. 4. Applicant's constitutional right to life and liberty due to prolonged trial and incarceration. 5. Satisfaction of the twin conditions under Section 45 of the Prevention of Money Laundering Act (PMLA). Issue-Wise Detailed Analysis: 1. Allegations of Money Laundering: The prosecution alleged that Vivo Mobile India Private Limited, controlled by Vivo Mobile Communication Co. Ltd, China, engaged in money laundering by creating an elaborate network of companies in India under a corporate veil. It was alleged that Vivo India remitted significant funds outside India and acquired proceeds of crime, which were then siphoned off to overseas companies controlled by Vivo China. The prosecution complaint included allegations of using forged documents to facilitate these activities. 2. Applicant's Alleged Involvement: The applicant, the Managing Director of Lava International Ltd., was accused of inviting Chinese nationals to India to help set up companies by concealing true ownership and circumventing FDI norms. It was alleged that he transferred Rs. 3.17 Crores to Labquest Engineering Pvt. Ltd. to assist Vivo China in establishing a network of companies. The applicant argued that these funds were loans repaid with interest before the alleged offences occurred, and no evidence was presented to show receipt of proceeds of crime in overseas entities. 3. Issuing Invitation Letters and Visa Illegalities: The applicant was accused of issuing invitation letters to Chinese nationals who later committed offences using forged documents. However, it was noted that the invitations were issued before the period of the alleged offences, and no evidence linked the applicant to the visas granted to those accused of committing the offences. The applicant contended that the mere issuance of invitation letters did not imply mens rea for the subsequent offences. 4. Right to Life and Liberty: The applicant argued that his right to life and liberty under Article 21 of the Constitution was affected due to the slow pace of trial, with numerous accused, witnesses, and documents involved. The court acknowledged that the right to a speedy trial is a constitutional mandate, and prolonged incarceration without trial could not be justified. It was noted that the applicant had been in custody for a significant period, and the trial was still at an early stage. 5. Satisfaction of Twin Conditions under Section 45 PMLA: The court examined whether the twin conditions under Section 45 of the PMLA were satisfied, which required reasonable grounds to believe that the applicant was not guilty and not likely to commit any offence while on bail. It was concluded that the prosecution failed to provide sufficient evidence to establish the applicant's guilt or likelihood of committing further offences. The court noted the applicant's prolonged custody and the unlikelihood of the trial concluding soon, which warranted granting bail. Conclusion: The court granted bail to the applicant, emphasizing the constitutional right to liberty and a fair trial. It directed the applicant to furnish a personal bond and adhere to specific conditions, including not leaving Delhi/NCR without permission, providing contact details, and not tampering with evidence. The court clarified that the observations made were only for the purpose of the bail application and did not reflect on the merits of the case.
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