2020 (1) TMI 557 - HC - Money Laundering

Cancellation of granted Bail - offences punishable u/s 120-B r/w 420 of IPC and Sections 7,8,9,12, 13(2) r/w 13(l)(d) of Prevention of Corruption Act, 1988 - scheduled offences - proceeds of crime - the learned Additional Solicitor General argued that investigation in the present case is still going on - HELD THAT - It is settled that once bail granted should not be cancelled in a mechanical manner without considering any supervening circumstances which is not conducive to fair trial. It cannot be cancelled on a request from the side of the complainant/investigating agency unless and until it is established that the same is being misused and it is no longer conducive in the interest of justice to allow the accused any further to remain on bail. No doubt, the bail can be cancelled only in those discerning few cases where it is established that a person to whom the concession of bail has been granted is misusing the same. However, all those facts are missing in the present case. It is also not in dispute that in the present case out of 46 accused, only 5 accused have been arrested and four accused are on bail. Only accused 35 Christian Michel James is in judicial custody who was extradited from abroad - It is pertinent to mention here that learned Solicitor General during arguments handed over some documents, however, not in the sealed cover and without furnishing the same to the counsel for the respondent. Since these documents are not in sealed cover and not furnished to the counsel for the respondent, therefore, this Court has not perused the same and not relied upon. There is no ground made in the present petition to interfere with the impugned order whereby learned Special Judge has granted bail to the respondent - petition dismissed.

Issues Involved:
1. Legality of the order granting bail to the respondent.
2. Applicability of Section 45 of the Prevention of Money Laundering Act (PMLA).
3. Respondent's alleged involvement in money laundering.
4. Respondent's conduct during the investigation.
5. Potential for the respondent to tamper with evidence or influence witnesses.

Detailed Analysis:

1. Legality of the Order Granting Bail to the Respondent:
The petitioner sought to set aside the order dated 02.12.2019 passed by the Ld. Special Judge, PMLA, which granted bail to the respondent. The petitioner argued that the Ld. Special Judge erred in granting bail by not considering the gravity of the offense and the respondent's potential to influence witnesses and tamper with evidence. The petitioner emphasized that the twin conditions of Section 45 PMLA, which impose stringent conditions for bail, were not properly applied by the Ld. Special Judge.

2. Applicability of Section 45 of the Prevention of Money Laundering Act (PMLA):
The petitioner contended that the Ld. Special Judge failed to appreciate the object of the PMLA and the non-applicability of Section 45 of PMLA was misplaced, especially in light of the 2018 and 2019 amendments. The petitioner argued that the amendments brought the PMLA in consonance with other statutes imposing similar twin conditions for bail, thereby upholding the constitutionality of such provisions.

3. Respondent's Alleged Involvement in Money Laundering:
The case involved the unethical dealings of M/s Finmeccanica, Italy, and the payment of kickbacks to influence the contract for procurement of 12 VVIP/VIP helicopters by the Indian Air Force. The respondent's role surfaced after the deportation of Rajiv Saxena and the arrest of Sushen Mohan Gupta. The respondent was alleged to have received proceeds of crime through shell companies and was a key link in the money laundering chain. The petitioner's investigation revealed that the respondent made attempts to influence witnesses and destroy evidence.

4. Respondent's Conduct During the Investigation:
The petitioner highlighted that the respondent evaded the investigation process, became untraceable, and failed to comply with summons. Despite being granted interim protection from arrest, the respondent did not cooperate with the investigation and was eventually arrested. The petitioner argued that the respondent's conduct demonstrated a blatant evasion of the legal process and attempts to thwart the investigation.

5. Potential for the Respondent to Tamper with Evidence or Influence Witnesses:
The petitioner argued that the respondent's release on bail would adversely affect the ongoing investigation, given the respondent's past conduct of influencing witnesses and destroying evidence. The petitioner emphasized that the investigation was at a crucial stage, and the respondent's release could lead to tampering with evidence and hindering the investigation.

Respondent's Defense:
The respondent, represented by senior advocates, argued that he had cooperated with the investigation, provided necessary documents, and answered all questions posed by the petitioner. The respondent contended that the statements of witnesses recorded under Section 50 of PMLA were not credible evidence to deny bail. The respondent also argued that the twin conditions of Section 45 PMLA were struck down by the Supreme Court in "Nikesh Tarachand Shah's case," making them inapplicable. The respondent emphasized his roots in society, lack of flight risk, and the absence of any likelihood of tampering with evidence or influencing witnesses.

Court's Decision:
The court noted that the respondent had undergone around 100 days in judicial custody and had been interrogated substantially. The court emphasized that bail once granted should not be canceled in a mechanical manner without considering any supervening circumstances. The court found no grounds to interfere with the impugned order granting bail to the respondent, as there was no evidence of the respondent misusing the bail or posing a threat to a fair trial.

Conclusion:
The petition to set aside the bail order was dismissed, and the court upheld the Ld. Special Judge's decision to grant bail to the respondent. The court reiterated that the cancellation of bail should only occur in discerning cases where the bail is being misused, which was not established in this case.

← Previous Next →