|
Advanced Search Options
Money Laundering - Case Laws
Showing 21 to 40 of 2022 Records
-
2025 (3) TMI 273
Money Laundering - seeking grant of bail - appellants acted in collusion with the main accused and became beneficiaries of the proceeds of crime - HELD THAT:- It is not in dispute that the co-accused have been granted bail. Apart from that, we have taken note of the value of the proceeds of crime that the appellants are alleged to have been involved with. We have also perused the rejoinder affidavit filed on behalf of the appellants which indicates the specific roles played by the coaccused who have been granted bail. Suffice it is to state that the co-accused who have been granted bail are involved with higher amounts of proceeds of crime in comparison to the appellants.
Conclusion - On the grounds of parity, bail is allowed.
Bail application allowed.
-
2025 (3) TMI 272
Money Laundering - involvement in a crime of defalcation of huge sum in the matter of managing the award of tenders to PHED - twin conditions under Section 45 of the PMLA - HELD THAT:- In the case of Manish Sisodia [2024 (8) TMI 614 - SUPREME COURT] the Court has not exercised the powers under Article 142 of the Constitution of India. The Court has held that the twin conditions under Section 45 of the PMLA cannot override the constitutional safeguards, as provided under Article 21 of the Constitution of India. This Court has held that a prolonged incarceration cannot be permitted to be converted pre-trial detention into a sentence without trial. Like in the case of Manish Sisodia [2024 (8) TMI 614 - SUPREME COURT] in the present case also thousands of documents are required to be considered at the stage of trial, so also around 50 witnesses are required to be examined. The main evidence in the present case is documentary in nature, which is already seized by the prosecution agency. As such, there is no possibility of the same being tampered with.
It is further to be noted that the Minister, for whose benefit the alleged transactions have taken place, has also not been implecated as an accused in the present case. The petitioner has already been released on bail in the predicate offences.
SLP disposed off.
-
2025 (3) TMI 271
Money Laundering - predicate offence - direction to remove the attachment made by the 2nd respondent - HELD THAT:- A perusal of the order passed by the appellate Tribunal reveals that when predicate offence does not survive on account of acquittal, then it cannot be presumed that the said attached properties were purchased out of proceeds of crime by way of money laundering. Further, the appellate Tribunal directed the 2nd respondent to release the attached properties of the appellants / affected persons, as V. Kasimayan and the other accused persons are already acquitted in predicate offence under NDPS Act vide judgment of acquittal dated 01.08.2017 in Complaint Case No.52 of 2016.
Since already the appellate Tribunal directed the 2nd respondent to release the attached properties in pursuant to the Complaint Case No.52 of 2016, the attachment made by the 2nd respondent in respect of the subject properties is hereby raised in pursuant to the order passed by the appellate Tribunal dated 14.09.2023. The registering authority is directed to record the same in the book of records in respect of the subject properties forthwith.
Conclusion - i) When an accused is acquitted in a criminal case, the attached properties cannot be presumed to be proceeds of crime through money laundering. ii) The attachment made by the 2nd respondent on the subject properties was raised in accordance with the appellate Tribunal's order, and the registering authority was directed to record the same.
Petition allowed.
-
2025 (3) TMI 127
Money Laundering - Seeking grant of bail - Practicing chartered accountant (CA) - assisting the co-accused to convert the tainted money into untainted money and connived in the laundering thereto - petition dismissed primarily on the ground that the petitioner has failed to meet the threshold of Section 45 of PMLA - it was held by High Court that 'The petitioner is admitted to bail on furnishing personal bond in the sum of Rs. 5 lakhs with a surety of the like amount to the satisfaction of the trial court on the terms and conditions imposed' - HELD THAT:- There are no good ground to interfere with the impugned order passed by the High Court in view of the pendency of trial.
SLP dismissed.
-
2025 (2) TMI 1114
Money Laundering - scheduled offences in Part B of the Schedule - Section 44 of the PMLA - total value involved in the scheduled offences in the complaint subject matter of this appeal is less than Rs.30,00,000/- - HELD THAT:- The impugned judgment is set aside and the complaint bearing Criminal Miscellaneous Case No.295 of 2021 pending before the Special Court, PMLA at Lucknow, Uttar Pradesh is quashed.
Appeal allowed.
-
2025 (2) TMI 1019
Seeking grant of regular bail - Money Laundering - proceeds of crime - scheduled offence - right to speedy trial - evidence against the present applicant is in the form of confessional statements by the other co-accused persons which cannot be relied upon with respect to the prosecution of the present applicant - HELD THAT:- The first complaint filed by the respondent/Enforcement Directorate in the present ECIR was on 04.12.2021, thereafter, it is pointed out that 4 supplementary complaints have been filed, last of which was filed on 06.04.2023. The Hon’ble Supreme Court in V. Senthil Balaji [2024 (9) TMI 1497 - SUPREME COURT] has clearly held that since the existence of a scheduled offence is the sine qua non for alleging existence of proceeds of crime then, the said existence of proceeds of crime at the time of the trial of offence under Section 3 of PMLA can be proved only if the scheduled offence is established in the prosecution of the said offence. In these circumstances, it was held, that trial in the case under PMLA cannot be finally decided unless a trial of scheduled offence concludes.
In the present case, as pointed out by the learned counsel for the applicant, in the scheduled offence wherein the charge-sheet has also been filed, the trial has not yet commenced and the charges have not been framed so far.
The role of the present applicant as per the case of the prosecution was for providing entries in order to assist the main accused in laundering the proceeds of crime. The said allegation is sought to be proved by the prosecution on basis of statements made by the other co-accused persons as well as the present applicant. The statements made under Section 50 of the PMLA, no doubt is admissible in evidence, however, the veracity and sanctity of the same has to be tested during the course of the trial - The trial has not even commenced. The present applicant who is accused in a case of money-laundering cannot be considered to be a threat to the society without any material to demonstrate the same. The continued incarceration of the applicant with no possibility of trial being completed in near future, cannot be ignored and in case of conflict with a restrictive statutory provision like Section 45 of PMLA, the latter would not come in way ensuring the right to liberty and speedy trial under Article 21 of the Constitution of India.
In the present case, the applicant was arrested on 12.10.2021 and has been in custody for a period of 3 years and 4 months approximately. The trial in the present complaint, is yet to commence and would take time to conclude. Apart from expressing apprehension of the applicant being a flight risk, no material has been shown to demonstrate the same. The evidence in the present case is primarily documentary in nature which is already in possession of the prosecution.
The applicant is directed to be released on bail upon his furnishing a personal bond in the sum of Rs. 1,00,000/- alongwith one surety of like amount to the satisfaction of the learned Trial Court/Link Court, further subject to the fulfilment of conditions imposed.
Conclusion - The right to a speedy trial is paramount and cannot be compromised by statutory conditions for bail. It establishes that prolonged pre-trial detention without a foreseeable trial conclusion infringes on constitutional rights. The applicant should be granted bail due to the prolonged detention and lack of trial progress.
Bail application allowed.
-
2025 (2) TMI 959
Seeking release of petitioner - illegality in the arrest of the petitioner or not - whether petitioner was not produced before the learned Special Court within 24 hours of his arrest as mandated in law? - HELD THAT:- There are no ground to interfere with the impugned order passed by the High Court. However, it is made clear that the impugned judgment will not stand in the way of the petitioner raising all the contentions while seeking an appropriate remedy in the manner known to law.
The regular bail application of the petitioner is pending before the High Court. The petitioner is at liberty to proceed with the bail application, notwithstanding the impugned order passed. The High Court is requested to expedite the hearing in the pending bail application.
SLP dismissed.
-
2025 (2) TMI 958
Seeking grant of Regular bail - Money Laundering - extortion of a huge amount of cash - Section 483 of the Bhartiya Nagrik Suraksha Sanhita, 2023 - HELD THAT:- It is pertinent to mention here that the applicant has nowhere stated in the bail petition regarding source of amount i.e. Rs. 6,44,38,000/- cash seized by the Income Tax, gold jewellery worth Rs. 3,24,61,655/- as also Rs. 52,35,000/- which was recovered from applicant’s and his wife locker which clearly shows that the ACB/EOW has collected certain material against the applicant. The prosecution has collected the material against the applicant that he has purchased properties in the name of his family members and relatives but not disclosed the source from where it has been purchased. Thus, from perusal of FIR and the material available in the case diary, involvement of the applicant in commission of offence under Sections 7, 7A & 12 of the PC Act, which is economic offence, is prima facie reflected.
Hon’ble the Supreme Court while considering the gravity of economic offence in case of P. Chidambaram Vs. Directorate of Enforcement, [2019 (9) TMI 286 - SUPREME COURT] has held that 'Grant of anticipatory bail at the stage of investigation may frustrate the investigating agency in interrogating the accused and in collecting the useful information and also the materials which might have been concealed. Success in such interrogation would elude if the accused knows that he is protected by the order of the court. Grant of anticipatory bail, particularly in economic offences would definitely hamper the effective investigation. Having regard to the materials said to have been collected by the respondent-Enforcement Directorate and considering the stage of the investigation, we are of the view that it is not a fit case to grant anticipatory bail.'
Considering the FIR and other material placed on record, it prima facie shows involvement of the applicant in crime in question. As such, this is not a fit case where the applicant should be granted regular bail.
Conclusion - i) The economic offences, due to their deliberate nature and impact on national interests, require careful consideration in bail applications. ii) This is not a fit case where the applicant should be granted regular bail.
The instant bail application filed under Section 483 of the Bhartiya Nagrik Suraksha Sanhita, 2023 is liable to be and is hereby rejected.
-
2025 (2) TMI 904
Money Laundering - offence under Section 3 of the Prevention of Money Laundering Act, 2002 - appellant had been in custody for over a year with the trial not likely to conclude within a reasonable time - there are 225 witnesses cited, out of which only 1 has been examined - HELD THAT:- Reliance placed in the decision of this Court in the case of V.Senthil Balaji v. Deputy Director, Directorate of Enforcement [2024 (9) TMI 1497 - SUPREME COURT] where it was held that 'the appellant has been incarcerated for 15 months or more for the offence punishable under the PMLA. In the facts of the case, the trial of the scheduled offences and, consequently, the PMLA offence is not likely to be completed in three to four years or even more. If the appellant's detention is continued, it will amount to an infringement of his fundamental right under Article 21 of the Constitution of India of speedy trial.'
Attention is invited to a decision of a coordinate Bench in the case of Union of India through the Assistant Director v. Kanhaiya Prasad [2025 (2) TMI 563 - SUPREME COURT]. After having perused the judgment, it is found that this was a case where the decisions of this Court in the case of Union of India v. K.A.Najeeb [2021 (2) TMI 1212 - SUPREME COURT] and in the case of V.Senthil Balaji were not applicable on facts. Perhaps that is the reason why these decisions were not placed before the coordinate Bench.
The appellant shall be produced before the Special Court within a maximum period of one week from today. The Special Court shall enlarge the appellant on bail on appropriate terms and conditions including the condition of regularly and punctually attending the Special Court and cooperating with the Special Court for early disposal of the case.
Conclusion - The principles laid down in previous cases were not applicable in that specific case, leading to the cancellation of bail. The appellant is directed to be produced before the Special Court within a week for bail to be granted on appropriate terms and conditions, including surrendering any passport and cooperating with the court for the early disposal of the case.
Appeal allowed.
-
2025 (2) TMI 903
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.
-
2025 (2) TMI 852
Money Laundering - challenge to order taking cognizance - HELD THAT:- As of today, the position is that though complaint was filed on 5th October 2024, an order taking cognizance is not in existence. The respondent has acted upon order dated 7th February, 2025 by making application dated 7th February, 2025 before the Special Court, requesting the Court to take cognizance. Now, the Special Court will have to examine the case again. As there is a sanction, the issue to be considered will be whether the sanction is valid. All this will have to be examined by the Special Court.
Appellant is in custody from 8th August, 2024. Order taking cognizance passed by the Special Court has been set aside by the High Court and by acting upon the order of the High Court, a fresh application has been moved by the respondent for taking cognizance. The said application is yet to be heard by the Special Court.
In view of these peculiar facts, custody of the appellant cannot be continued. As there are serious allegations against the appellant, appropriate stringent terms and conditions can be imposed by the Special Court - the respondent are directed to produce the appellant before the Special Court within a period of one week from today.
The appeal stands allowed.
-
2025 (2) TMI 851
Challenge to order of provisional attachment of the property of the appellant - High Court has declined to entertain the writ petition under Article 226 of the Constitution of India - HELD THAT:- The High Court ought not to have rejected the petition on the ground that the statutory period provided under sub-Section (5) of Section 5 of the Prevention of Money-laundering Act, 2002 had not expired before the writ petition was filed. The High Court ought to have noticed that there was no statutory remedy available to the appellant to challenge the order of provisional attachment. Therefore, the impugned order is set aside and Civil Writ Petition restored to the file of the Punjab and Haryana High Court at Chandigarh. The restored petition shall be listed before the roster Bench of the High Court on 21st February, 2025 in the morning. The appellant and the respondents shall be under an obligation to appear before the roster Bench on that day. No further notice shall be served upon them.
The Appeal is partly allowed.
-
2025 (2) TMI 748
Seeking grant of discharge/bail - Money Laundering - proceeds of crime - Resolution Professional is a public servant under Prevention of Corruption Act, 1988 or not - demand of bribe - all the conditions as stipulated under Section 3 of the PML Act, 2002 read with Section 2 (1) (u) of the PML Act, 2002 are satisfied or not - HELD THAT:- The “proceeds of crime” means any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence or the value of any such property or where such property is taken or held outside the country, then the property equivalent in value held within the country or abroad - In the explanation it has been referred that for removal of doubts, it is hereby clarified that "proceeds of crime" include property not only derived or obtained from the scheduled offence but also any property which may directly or indirectly be derived or obtained as a result of any criminal activity relatable to the scheduled offence. The explanation has been inserted in the statute book by way of Act 23 of 2019.
The reason for giving explanation under Section 2 (1) (u) is by way of clarification to the effect that whether as per the substantive provision of Section 2 (1) (u), the property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence or the value of any such property or where such property is taken or held outside the country but by way of explanation the proceeds of crime has been given broader implication by including property not only derived or obtained from the scheduled offence but also any property which may directly or indirectly be derived or obtained as a result of any criminal activity relatable to the scheduled offence.
It is settled connotation of law that at the stage of framing of charge, the probable defence of the accused is not to be considered and the materials, which are relevant for consideration, are the allegations made in the First Information Report/complaint, the statement of the witnesses recorded in course of investigation, the documents on which the prosecution relies and the report of investigation submitted by the prosecuting agency. The probative value of the defence is to be tested at the stage of trial and not at the stage of framing of charge and at the stage of framing of charge minute scrutiny of the evidence is not to be made and even on a very strong suspicion charges can be framed.
The Hon'ble Apex Court in the case of Palwinder Singh Vs. Balvinder Singh & others [2008 (10) TMI 742 - SUPREME COURT] has been pleased to hold that charges can also be framed on the basis of strong suspicion. Marshaling and appreciation of the evidence is not in the domain of the court at that point of time.
Further it is pertinent to mention here that power to discharge an accused was designed to prevent harassment to an innocent person by the arduous trial or the ordeal of prosecution. How that intention is to be achieved is reasonably clear in the section itself. The power has been entrusted to the Sessions Judge who brings to bear his knowledge and experience in criminal trials. Besides, he has the assistance of counsel for the accused and Public Prosecutor. He is required to hear both sides before framing any charge against the accused or for discharging him.
Whether the evidence which has been collected in course of investigation and has been brought on record, as would be available in the impugned order prima facie case against the petitioner is made out or not? - HELD THAT:- Sub-section (v) of Section 2(c) of the Prevention of Corruption Act defines public servant. Further it is the nature of a duty, not an individual’s position, that discloses whether or not the person carrying it out is a public servant. Under the Prevention of Corruption Act the concept was to replace the notion of conventionally recognized public officials with those who carry out public duties - Further it is evident from the record that earlier the petitioner had preferred the Criminal Miscellaneous Petition being Cr.M.P. No. 1048 of 2021 for quashing of entire criminal proceeding arising out of the instant case, instituted against the petitioner including the F.I.R. being R.C.1(A)/2020-D, CBI, ACB, Dhanbad for the offence under Section 7 of Prevention of Corruption Act, 1988 by raising the similar ground which has been raised herein that petitioner is not a public servant within the meaning of Section 2(c) of the Prevention of Corruption Act, 1988 or under Section 21 of the IPC therefore charges under Prevention of Corruption Act cannot be alleged against him.
The learned Single Judge of this Court has categorically held that Resolution Professional is made during the resolution process before the Company Law Tribunal with its approval, he will be a public servant under Section 2(c)(v) of the P.C. Act - This Court is of the view that since the duties performed by RP are public in nature, they are public servants and Sec 2(c) of Prevention of Corruption Act is pretty clear that an individual who performs public duties are public servants for the purpose of the Act and hence, the legislature would have felt that there are no explicit provisions are required.
The ‘Resolution Professional’ will not come within the meaning of ‘Public Servant’ under Section 2 (c) of the PC Act is not tenable in the eyes of law.
Discharge application - HELD THAT:- The expression “money-laundering”, ordinarily, means the process or activity of placement, layering and finally integrating the tainted property in the formal economy of the country. However, Section 3 has a wider reach. The offence, as defined, captures every process and activity in dealing with the proceeds of crime, directly or indirectly, and not limited to the happening of the final act of integration of tainted property in the formal economy to constitute an act of money-laundering. This is amply clear from the original provision, which has been further clarified by insertion of Explanation vide Finance (No. 2) Act, 2019, Section 3, as amended.
The law regarding the approach to be adopted by the court while considering an application for discharge of the accused persons under Section 227 and approach while framing charges under Section 228 of the Code, is that while considering an application for discharge of the accused under Section 227 of the Code, the Court has to form a definite opinion, upon consideration of the record of the case and the documents submitted therewith, that there is not sufficient ground for proceeding against the accused. However, while framing charges, the Court is not required to form a definite opinion that the accused is guilty of committing an offence. The truth of the matter will come out when evidence is led during the trial. Once the facts and ingredients of the Section exist, the court would presume that there is ground to proceed against the accused and frame the charge accordingly and the Court would not doubt the case of the prosecution.
It appears that the complaint contains material evidences for prosecution, thus, the petitioner has to prove her innocence by undergoing the trial therefore, the aforesaid contention of the learned counsel for the petitioner that the alleged money which has been allegedly trapped from this petitioner was under deemed custody of CBI (ACB), and the petitioner was never put in possession of the alleged cash, which is said to have been recovered from the possession of the petitioner, therefore alleged offence is not made out, cannot be adjudicated herein in the light of aforesaid discussion and settled position of law - there is no reason to believe by this Court that the petitioner is not involved in the alleged offence.
This Court is of the view, that in such a grave nature of offence, which is available on the face of the material, applying the principle of discharge wherein the principle of having prima facie case is to be followed, the nature of allegation since is grave and as such, it is not a fit case to allow the application for discharge.
Conclusion - i) A Resolution Professional, due to the nature of their duties, qualifies as a "public servant" under the Prevention of Corruption Act, 1988. ii) The petitioner's actions, as alleged, constituted money laundering under Section 3 of the PMLA, given the acquisition and possession of proceeds of crime. iii) At the discharge stage, the court must assume the prosecution's evidence to be true and determine if a prima facie case exists, without delving into the probative value of the evidence.
The petitioner's application for discharge dismissed.
-
2025 (2) TMI 747
Money Laundering - proceeds of crime - alleged transfer of public funds, by way of fraudulent transactions - Appellant Bank, as a victim of fraud, has a legitimate claim over the attached properties that were mortgaged to it by Vijay Kumar Kushwaha and others or not - HELD THAT:- The properties which have been attached by the Respondent Directorate in exercise of powers under section 5 of the PMLA, 2002 were, admittedly, already under mortgage with the appellant bank. The Appellant Bank has argued that it is the victim of a fraud and has the first charge over the property. As such, it is entitled to appropriate the properties in view of the charge created on the properties in its favour. The Appellant has inter alia placed reliance on the judgement titled Deputy Director, Directorate of Enforcement. Delhi v. Axis Bank [2019 (4) TMI 250 - DELHI HIGH COURT].
The underlying issue is squarely covered by the judgement of this Appellate Tribunal in the case of JM Financial Asset Reconstruction Company Ltd. [2024 (4) TMI 1228 - APPELLATE TRIBUNAL UNDER SAFEMA AT NEW DELHI] where it was held that 'the interference in the order of the attachment order, on a challenge by the financial institution, should not be persuaded by the sentiments and only on the ground that once there is a mortgage of the property, it should go to the financial institution.'
Conclusion - The attachment under PMLA is lawful and does not transfer title unless the property is confiscated. The rights of financial institutions are protected under Section 8(8), and they may pursue their claims in accordance with the provisions of PMLA.
Appeal dismissed.
-
2025 (2) TMI 746
Money Laundering - proceeds of crime - challenge to Provisional Attachment Order - mala fide intention to misappropriate the fund - withdrawing and utilizing funds without knowing the actual source and without receiving confirmation from the Council - non-recording of satisfaction by the respective authorities - Properties purchased much before the alleged predicate offence - Amount in question had been utilized fully by the appellant in the month of April 2008 itself for the purposes of their business, more particularly, for payment of vehicle loan, overdraft facility, payment to labourers etc.
Non-recording of satisfaction by the respective authorities - violation of sections 5 and 8 of PMLA - HELD THAT:- The authority has merely repeated the language of the statute and has not arrived at any independent satisfaction to the fact that the offence of money laundering has been committed under section 3 and if the property was not attached immediately, the proceedings under the Act will be frustrated. The decisions of the Hon'ble Punjab and Haryana High Court in Seema Garg v. Deputy Director, Directorate of Enforcement [2020 (3) TMI 460 - PUNJAB & HARYANA HIGH COURT], and the judgment of the Hon'ble Delhi High Court in J. Sekar v. Union of India & Ors. [2018 (1) TMI 535 - DELHI HIGH COURT] are relied upon. It is also contended that though the judgment in the latter case has been stayed by the Hon‟ble Supreme Court, as per the settled legal position, its ratio would continue to apply.
There are no substance in the contention of the appellants that the condition u/s 5(1) of recording the reasons was not met. It is found that detailed reasons for the action initiated under the provision have been recorded by the respondents before initiating the action. As regards, the reasons under section 8, it is seen that the language of the said provision is different insofar as section 8 does not specifically lay down that the reasons to believe are to be recorded or that there should be any material in possession, other than the original complaint filed by the Directorate under section 5(5). Nor does the provision specifically necessitate recording of the reasons in writing.
There are no sufficient grounds to hold that the actions taken under sections 5 and 8 were not valid for want of recording of reasons (which were duly recorded) or on account of non-communication of the reasons by the relevant authorities.
Properties purchased much before the alleged predicate offence - HELD THAT:- The Canara Bank was impleaded as respondent in the present case vide an order dated 04.12.2018 based on the finding that the Canara Bank was Defendant No. 7 in the complaint and the subject properties had been mortgaged with the Bank. With its reply on 31.01.2019 the Bank had submitted copies of the title deeds of the properties standing in the name of the appellants herein which had been offered as securities to the Bank. The same were taken on record. In subsequent proceedings, it was submitted on behalf of the Bank that the loan account has since been closed and the Bank has no further interest in the case. Accordingly, there are no issues pending for decision before this Appellate Tribunal in the present case in so for as Respondent No. 2 (Canara Bank) is concerned - thus, the subject properties have been attached by the respondents in the present case as value of proceeds of crime.
Amount in question had been utilized fully by the appellant in the month of April 2008 itself for the purposes of their business, more particularly, for payment of vehicle loan, overdraft facility, payment to labourers etc. - HELD THAT:- The present position is that a charge sheet dated 21.01.2011 stands filed against the two appellants herein along with Shri Depolal Hojai and Shri Dabiruz Jaman, in the Court of Special Judge, CBI, Assam, Guwahati. Though the appellants have moved the Hon‟ble Gauhati High Court for quashing of the Special Case filed against them under Sections 3 and 4 of PMLA, 2002, the said petition of the appellants is still pending before the Hon‟ble High Court. Further, as clarified by both parties in the hearing held on 08.01.2025, prosecution complaint under the PMLA, 2002, also stands filed against the accused persons in this case. Proceedings in the prosecution case under the PMLA, 2002, have been stayed by the Ld. Special Judge following the stay granted by the Hon‟ble Guwahati High Court - at this stage, when the criminal trial of the appellants herein is still pending before a court of competent jurisdiction, even the balance of interests lies in favour of continued attachment of the subject properties. The same by itself does not disturb the ownership title of the appellants and does not deprive them of possession and enjoyment of the same.
Thus, so long as the source of the money is alleged to be „proceeds of crime‟ within the meaning of the Act, it can be attached by the respondents regardless of whether the appellants herein themselves stood charged of any scheduled offences or the prosecution complaint filed under the PMLA, 1999 or not. In the present case, as already noted, the appellants have been named in the prosecution case filed under the PMLA, 2002. However, even if they were not accused in the PMLA case, the properties could have been attached so long as there was evidence to indicate that alleged proceeds of crime traveled from one or more persons who are so accused.
Conclusion - i) The procedural requirements under sections 5 and 8 of the PMLA, 2002, were met, and the attachment of properties was valid. ii) The properties acquired before the alleged crime can be attached if they represent the value of the proceeds of crime, following the three-limb definition of "proceeds of crime." iii) The retrospective application of the PMLA, 2002, is constitutionally valid, as the attachment is a civil action.
Appeal dismissed.
-
2025 (2) TMI 632
Seeking grant of bail under Section 436-A of the Code of Criminal Procedure (CrPC) - whether the Applicants, who have been in pre-trial detention for approximately 4 years and 9 months, are entitled to bail under Section 436-A of the Code of Criminal Procedure (CrPC), which allows for the release of undertrial prisoners who have served one-half of the maximum sentence for the alleged offence? - HELD THAT:- It is settled law by a plethora of cases passed by the Supreme Court that a Court while deciding a Bail Application has to keep in mind the principal rule of bail which is to ascertain whether the Accused is likely to appear before the Court for trial. Though there would be consideration for the other broad parameters like gravity of offence, likelihood of Accused repeating the offence while on bail, whether he would influence the witnesses and tamper with the evidence which will have to be considered. However juxtaposed that with the fact that almost 4 years 9 months of incarceration and trial having not commenced is required to be seen especially when trial has indeed not commenced.
The Supreme Court in a plethora of judgements have discussed the rights conferred by Article 21 qua grant of bail and that such rights cannot be taken away unless the procedure is reasonable and fair and in cases where there is unreasonable delay in trial it would undoubtedly impact the rights of an undertrial.
In the landmark judgement of Maneka Gandhi Vs. Union of India [1978 (1) TMI 161 - SUPREME COURT], the Supreme Court held that the right to life and personal liberty under Article 21 is not limited to mere animal existence but includes the right to live with dignity. The court emphasized that the procedure established by law must be fair, just, and reasonable, and it cannot be arbitrary, oppressive, or unreasonable.
In the present case it is seen that Applicants have been indicted in the predicate offence under Section 120-B read with 420 of the IPC for which the maximum sentence which can be imposed is imprisonment which may extend to 7 years alongwith fine. Even otherwise as the scheduled offence against Applicants falls under paragraph 1 of part A of the schedule to the PMLA, the maximum period for which the Applicants can be punished with imprisonment of 7 years. Applicants have been in custody in connection with the present offence since 14.05.2020 i.e. for almost 4 years and 9 months which is beyond the one-half of maximum period of imprisonment which can be imposed upon conviction.
It is seen that statutory provisions of Section 436-A of CrPC if seen contain the word “shall” which clearly indicates that gravity of the offence is not relevant for considering bail neither it distinguishes that rigours of Section 45 of PMLA would be applicable. It is plain and simple on interpretation meaning that once the undertrial – accused crosses one-half of the maximum sentence, the rigours of the twin conditions contemplated under Section 45 (1) of PMLA would not apply and applicant will be entitled to be released on bail - Considering the present status of the trial and no possibility of it being concluded in the foreseeable future coupled with the pre-trial incarceration of the Applicants beyond one-half of the maximum period of imprisonment which can be imposed on them upon conviction, Applicants are entitled to bail.
Conclusion - The Applicants were entitled to bail under Section 436-A due to their prolonged pre-trial detention and the lack of progress in the trial.
Both Applicants are directed to be released on bail subject to fulfilment of conditions imposed - bail application allowed.
-
2025 (2) TMI 563
Legality of granting bail - Money Laundering - proceeds of crime - illegal mining and selling of sand without using the departmental pre-paid transportation E-challan - compliance with Section 45 of the PMLA or not - admissibility of statements recorded - HELD THAT:- It is well settled position of law that Section 45 of the PMLA starting with a non-obstante clause has an overriding effect on the general provisions of the Code of Criminal Procedure in case of conflict between them. Section 45 imposes two conditions for the grant of bail to any person, accused of an offence punishable for a term of imprisonment of more than 3 years under Part A of the Schedule. The two conditions are that (i) the prosecutor must be given an opportunity to oppose the application for bail; and (ii) the Court must be satisfied that there are reasonable grounds for believing that the accused person is not guilty of such offence and that he is not liable to commit any offence while on bail. As well settled, these two conditions are mandatory in nature and they need to be complied with before the accused person is released on bail.
It is further required to be noted that Section 65 of PMLA requires that the provisions of Cr.P.C. shall apply insofar as they are not inconsistent with the provisions of the PMLA and Section 71 provides that the provisions of PMLA shall have overriding effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. Hence the conditions enumerated in Section 45 will have to be complied with even in respect of application for bail made under Section 439 of Cr.P.C.
So far as facts of the present case are concerned, the High Court in a very casual and cavalier manner, without considering the rigours of Section 45 granted bail to the respondent on absolutely extraneous and irrelevant considerations. There is no finding whatsoever recorded in the impugned order that there were reasonable grounds for believing that the respondent was not guilty of the alleged offence under the Act and that he was not likely to commit any offence while on bail. Noncompliance of the mandatory requirement of Section 45 has, on the face of it, made the impugned order unsustainable and untenable in the eye of law.
There are no substance in the submission made by learned Senior Advocate Ranjit Kumar for the respondent that the respondent has not been shown as an accused in the predicate offence. It is no more res integra that the offence of money laundering is an independent offence regarding the process or activity connected with the proceeds of crime, which had been derived or obtained as a result of criminal activity relating to or in relation to a schedule offence. Hence, involvement in any one of such process or activity connected with the Proceeds of Crime would constitute offence of money laundering. This offence otherwise has nothing to do with the criminal activity relating to a schedule offence, except the Proceeds of Crime derived or obtained as a result of that crime.
As well settled, the offence of money laundering is not an ordinary offence. The PMLA has been enacted to deal with the subject of money laundering activities having transnational impact on financial systems including sovereignty and integrity of the countries. The offence of money laundering has been regarded as an aggravated form of crime world over and the offenders involved in the activity connected with the Proceeds of Crime are treated as a separate class from ordinary criminals. Any casual or cursory approach by the Courts while considering the bail application of the offender involved in the offence of money laundering and granting him bail by passing cryptic orders without considering the seriousness of the crime and without considering the rigours of Section 45, cannot be vindicated.
The impugned order passed by the High Court being in teeth of Section 45 of PMLA and also in the teeth of the settled legal position, it is opined that the impugned order deserves to be set aside, and the matter is required to be remanded to the High Court for fresh consideration. Accordingly, the impugned order is set aside, and the matter is remanded to the High Court for consideration afresh with the request to the Chief Justice to place the matter before the Bench other than the Bench which had passed the impugned order.
Conclusion - i) Section 45 of the PMLA imposes mandatory conditions for granting bail, requiring courts to be satisfied of the accused's non-guilt and low likelihood of reoffending. The High Court's failure to adhere to these conditions rendered its bail order unsustainable. ii) Statements recorded under Section 50 of the PMLA are admissible, and Article 20(3) does not apply to investigative processes under this section.
Appeal allowed by way of remand.
-
2025 (2) TMI 562
Money Laundering - seeking grant of bail - signing and approving fabricated invoices - Section 439 of the Code of Criminal Procedure, 1973 - applicability of twin conditions under Section 45 of the PMLA - HELD THAT:- The statutory legal position as applicable is required to be considered and stated. Chapter III of the Constitution of India enumerates the fundamental rights which have been time and again construed to be inherent and any law which abrogates and abridges such fundamental rights would be violative of the basic structure doctrine including right of protection imposed against arrest and detention in certain cases contemplated under Article 22 of the Constitution of India.
In the present case it is seen that on 19.07.2023 Applicant was summoned by ED in connection with the investigation however ED exercised its power under Section 19 (1) of the PMLA arrested Applicant on the same day. It is seen that no grounds of arrest as mandated under Section 50 of Cr.P.C were provided save and expect an arrest memo. It is prima facie seen that Applicant before me has fully co-operated with the investigation and made all disclosures which is evident from the prosecution complaint appended at page No. 54 of the Application. Prosecution Compliant is filed on 15.09.2023.
The sole allegation against the Applicant is that he signed and approved fabricated invoices based on falsified attendance sheets of staff records thereby facilitating alleged fraudulent activities and generation of proceeds of crime. The Applicant held his position for only five months and verified 15 bills / invoices, one of the bill / invoice is appended at page Nos. 494 and 495 of the Application. There is no impediment or provision in EOI guidelines that mandated Dean of Jumbo Covid Centres to physically verify deployment of staff, their attendance or doctor to patient ratio which has been brought to my notice prima facie since that is one of the allegation in the prosecution complainant. Instead, designated staff members performed this duty and reported to the Dean - If at all it is prosecution case that Applicant aided fraudulent activities of M/s. Lifeline Hospital Management Services, prima facie there is no material on record to substantiate this allegation. The chargesheet encloses statements of co-accused which is the sole basis of allegation so as to come to conclusion that illegal proceeds of crime under the contract were routed to the Applicant via his driver once again will be a matter of trial. However, no recovery has been made till date.
When the investigation is completed, can twin conditions under Section 45 of PMLA be applied mechanically despite in absence of prima facie evidence, warranting further incarceration of the Applicant or otherwise? - HELD THAT:- It is seen that Applicant is not made an accused in predicate offence or in the ECIR. Chargesheet has been filed in predicate offence, however charges are yet to be framed. Trial is not likely to commence hence trial in PMLA offence cannot commence. Applicant is incarcerated for 1 year 6 months 25 days after duly co-operating with the investigation.
The existence of proceeds of crime at the time of trial of the offence under Section 3 of the PMLA can be proved only if the Scheduled Offence is established in prosecution of the Scheduled Offence. This clearly envisages that even if trial of the case under the PMLA proceeds it cannot be officially tested unless the trial of the Scheduled Offence concludes. In the present case before me in the Scheduled Offence, Chargesheet has been filed but trial is not likely to start in the near foreseeable future. Therefore prima facie, I see no possibility of both trials concluding in the foreseeable future. Applicant before me is in judicial custody pending trial for more than one year.
The Supreme Court in the case of Gudikanti Narasimhulu & Ors. Vs. Public Prosecutor, High Court of Andhra Pradesh [1977 (12) TMI 143 - SUPREME COURT] has reiterated the same principle. Keeping the aforesaid principle in mind and the facts of the present case, it is prima facie seen that the present case would largely depend upon documentary evidence which is already seized by the prosecution and is made part of the Chargesheet. As such there is no possibility of tampering with the evidence.
The present case in hand is restricted to grant of bail on account of incarceration of the under trial accused / Applicant having fully co-operated in the investigation and made all disclosures, it is refrained to comment on any of the merits of the matter. Any comment made above on the merits is cursory and only to the extent of considering the Applicant's case for grant of bail and is not an opinion expressed by the Court so as to influence the trial which may be noted.
Conclusion - Given the incarceration of Applicant and the absence of any foreseeable conclusion of the trial, continued detention would violate the Applicant’s fundamental right under Article 21 of the Constitution, which guarantees a speedy trial and personal liberty. The primary allegation relates to the Applicant’s temporary position which no longer persists, mitigating concerns of tampering with the evidence. Any such apprehension can be addressed through appropriate conditions. Continued incarceration of the Applicant would be unwarranted and would amount to punitive detention prior to the establishment of guilt.
Applicant is granted bail subject to the fulfilment of conditions imposed - bail application allowed.
-
2025 (2) TMI 484
Seeking grant of regular bail under section 483 of the Bhartiya Nagrik Surksha Sanhita, 2023 read with Section 45 of the PMLA 2002 - Money Laundering - proceeds of crime - scheduled offence/predicate offence - no material to corroborate the false statements of the individuals who have been arraigned as co-accused persons in the instant case - HELD THAT:- There is prima facie involvement of the applicant in the crime in question and the charge sheet has been filed. Since, the allegations against the applicant are serious in nature and there was material to infer his involvement in serious crimes. However, the Apex Court has held that the power of ED to arrest must be based on objective and fair consideration of material against a person. Under the PMLA, ED officers can arrest a person if they have reasons to believe based on the material in their possession that the individual is guilty. It has been held by the Apex Court that PMLA allowed arrests on the subjective opinion of ED officer, the court said an officer’s “reasons to believe” that a person was guilty an deserved arrest should not be based on mere suspicion.
The Apex Court in the matter of Directorate of Enforcement Vs. Aditya Tripathi [2023 (5) TMI 527 - SUPREME COURT] has held that the power to arrest under the Prevention of Money-laundering Act (PMLA) cannot be exercised on the “whims and fancies” of Directorate of Enforcement (ED) officers. The court wondered if the ED even had a consistent, uniform and ”one-rule-for-all” policy on when they should arrest people. It said the ED’s power to arrest must be based on objective and fair consideration of material against the accused.
It is prima facie clear that on the one hand, it is claimed that the matter is of a huge economic loss to the State Exchequer and the offence is of highly serious nature and on the other hand, the distillers who are allegedly supplying illegal liquor causing huge financial loss to the State exchequer, have not been made accused despite the fact that their names have been mentioned in the complaint made by the ED as member of the syndicate. Prima facie it appears that the prosecution has adopted an inconsistent stance being both hot and cold in its approach and has acted in a pick and choose manner in investigation.
Conclusion - It has been revealed that in the investigation conducted by the police during the predicate office, the applicant was part of the liquor syndicate and was involved in money-laundering and proceeds of crime along with other co-accused therefore, even if it is presumed that no predicate offence has been levelled against him, therefore, the applicant is entitled to get bail under PMLA, 2002, is not acceptable and deserves to be rejected and also considering the material placed on record, which prima facie shows involvement of the applicant in the crime in question, therefore, considering entirety of the matter, this Court is of the opinion that the applicant is unable to satisfy twin conditions for grant of bail under Section 45 of the PMLA, 2002, as such, it is not a fit case for grant of bail to the applicant for the reasons.
The prayer for bail made by the applicant under Section 483 of the Bhartiya Nagrik Suraksha Sanhita, 2023 (‘BNSS’) read with Section 45 of the PMLA, for the alleged offence punishable under Sections 3 & 4 of the PMLA, 2002 is hereby rejected.
-
2025 (2) TMI 424
Seeking grant of regular bail - Money Laundering - reasons to believe - compliance with the statutory requirements under Section 19 of the PMLA - it was held by High Court that 'This Court is not inclined to release the applicant on bail and the instant application, is, hereby, dismissed.'
HELD THAT:- There are no ground to interfere with the impugned order passed by the High Court. However, the petitioner is granted two days’ time to surrender.
SLP dismissed.
........
|
9911796707
