2025 (2) TMI 903 - HC - Money Laundering

Money Laundering - Proceeds of crime - Seeking grant of Regular bail - alleged illegal extortion on Coal Transportation - Sections 3 4 of the Prevention of Money Laundering Act 2002 (PMLA 2002) - fulfilment of twin conditions of Section 45 of the PMLA or not - HELD THAT - From perusal of the ECIR it is prima facie vivid that present applicant with connivance of Saumya Chaurasia Sameer Vishnoi and other senior bureaucrats and politicians hatched a conspiracy of illegal extortion of Rs. 25/- per tonne on Coal which was transported from SECL mines other places and the same was being carried out with the active connivance of State Mining Officials District Officials by using a wide network of agents which were stationed in the coal belt by maintaining a close liaison with the administration. This coal syndicate had extorted illegal levy of Rs. 540 crores approximately from Coal businessmen/ transporters and other sectors from July 2020 to June 2022 - The proceeds of crime generated by this syndicate have been utilized for political funding making bribes to Government Officials purchasing of properties including coal washeries by the co-accused persons Smt. Saumya Chaurasia in the name of their benamidars and members of syndicate their family members. The ECIR further prima facie reveals that the present applicant has played specific role in commission of offence. The investigation revealed that the applicant was actively involved in formation of syndicate arranged meetings with coal businessmen coal transporters etc. collected illegal cash from businessmen distribution of illegal cash to different persons on direction of Suryakant Tiwari - The investigation conducted under PMLA 2002 revealed that the applicant has received cash as salary out of the illegal extortion money as in his statement under Section 50 of PMLA 2002 has stated that apart from salary he also used to receive bonus in cash from Suryakant Tiwari at regular intervals. Hence the applicant is in possession of proceeds of crime which have been utilized by him in purchasing immovable properties on his name and on the name of his wife Smt. Talvinder Chandrakar. Thus he was involved himself in the acquisition of proceeds of crime. The applicant is unable to fulfill twin conditions for grant of bail as per Section 45 of the PMLA 2002 and also considering the submission that the applicant has not prima facie reversed the burden of proof and dislodged the prosecution case which is mandatory requirement to get bail. Hon ble the Supreme Court in case of Directorate of Enforcement Vs. Aditya Tripathi 2023 (5) TMI 527 - SUPREME COURT has held that the High Court has neither considered the rigour of Section 45 of the PML Act 2002 nor has considered the seriousness of the offences alleged against accused for the scheduled offences under the PML Act 2002 and the High Court has not at all considered the fact that the investigation by the Enforcement Directorate for the scheduled offences under the PML Act 2002 is still going on and therefore the impugned orders passed by the High Court enlarging respective respondent No. 1 on bail are unsustainable. Conclusion - Considering the ECIR and other material placed on record which prima facie shows involvement of the applicant in crime in question and also considering the law laid down by Hon ble the Supreme Court it is quite vivid that the applicant is unable to fulfill the twin conditions for grant of bail as provided under Section 45 of the PMLA 2002. Thus the Point is answered against the applicant. The bail application filed under Section 483 of the Bhartiya Nagrik Suraksha Sanhita 2023 is liable to be and is hereby rejected.

Summary

ISSUES PRESENTED and CONSIDERED

The primary issue considered was whether the applicant fulfills the twin conditions of Section 45 of the Prevention of Money Laundering Act, 2002 (PMLA) for the grant of bail. The Court examined whether there are reasonable grounds to believe that the applicant is not guilty of the offense of money laundering and whether he is not likely to commit any offense while on bail.

ISSUE-WISE DETAILED ANALYSIS

Relevant Legal Framework and Precedents

The legal framework primarily involves Section 45 of the PMLA, which stipulates conditions for granting bail in money laundering cases. The section requires that the Public Prosecutor be given an opportunity to oppose bail and that the court be satisfied there are reasonable grounds to believe the accused is not guilty and not likely to commit an offense while on bail. The Court referenced several Supreme Court decisions, including Vijay Madanlal Choudhary & others Vs. Union of India, and Directorate of Enforcement Vs. Aditya Tripathi, which emphasize the seriousness of money laundering offenses and the rigorous application of Section 45.

Court's Interpretation and Reasoning

The Court interpreted Section 45 of the PMLA as imposing stringent conditions for bail due to the serious nature of money laundering offenses, which have significant implications for financial systems and national integrity. The Court noted that economic offenses constitute a separate class of offenses, warranting a cautious approach in granting bail.

Key Evidence and Findings

The evidence against the applicant included his involvement in a coal syndicate that extorted illegal levies on coal transportation, generating proceeds of crime amounting to approximately Rs. 540 crores. The applicant was implicated in coordinating the collection and distribution of illegal cash, maintaining records, and facilitating the acquisition of properties with the proceeds of crime. The Court found that the applicant was actively involved in the syndicate and had not satisfactorily disproven the prosecution's allegations.

Application of Law to Facts

The Court applied Section 45 of the PMLA to the facts, concluding that the applicant did not meet the conditions for bail. The Court found that the applicant had not demonstrated reasonable grounds for believing he was not guilty of money laundering. The evidence suggested his active participation in the syndicate and handling of proceeds of crime, which precluded the possibility of bail under the stringent conditions of Section 45.

Treatment of Competing Arguments

The applicant's counsel argued that the prosecution under the PMLA could not be sustained without a live predicate offense and cited instances where co-accused were granted bail. However, the Court found these arguments unpersuasive, emphasizing the distinct and ongoing nature of the investigation under the PMLA and the applicant's failure to disprove the allegations against him. The Court also dismissed the argument that the applicant's prolonged incarceration warranted bail, noting the absence of evidence attributing trial delays to the prosecution.

Conclusions

The Court concluded that the applicant did not satisfy the twin conditions of Section 45 of the PMLA for bail. The evidence indicated his involvement in the syndicate and handling of proceeds of crime, and he failed to demonstrate reasonable grounds for believing he was not guilty.

SIGNIFICANT HOLDINGS

The Court held that the applicant did not meet the stringent conditions for bail under Section 45 of the PMLA, emphasizing the seriousness of money laundering offenses and the need for a rigorous application of the law. The Court stated: "Considering the ECIR and other material placed on record, which prima facie shows involvement of the applicant in crime in question and also considering the law laid down by Hon'ble the Supreme Court, it is quite vivid that the applicant is unable to fulfill the twin conditions for grant of bail as provided under Section 45 of the PMLA, 2002."

The Court's final determination was to reject the bail application, underscoring the applicant's failure to disprove the prosecution's case and the ongoing nature of the investigation under the PMLA. The Court reiterated that its observations would not influence the trial, which would proceed based on the evidence and material presented.