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2023 (12) TMI 440 - HC - Money LaunderingSeeking grant of Regular bail - Enforcement Directorate officials have adopted illegal methods during investigation - violation of the twin requirements reason to believe - HELD THAT - The petitioners have been complaining about the misuse of the powers of the Enforcement Directorate and the mode adopted was abuse of power and authority. Having the alleged information about the involvement of the petitioners, the ED authorities have resorted to keeping the petitioners under their control restricting the movements and statements allegedly recorded under Section 50 of the PML Act, 2002 and immediately arrested them. The Ed officials have acted arbitrarily. There is nothing new which was found during the examination of these petitioners, which was not known earlier to the Agency through A2. The evidence collected is circumstantial. Even without a statement under section 50 of the Act, case can be proved against an accused. In Satender Kumar Antil v. Central Bureau of Investigation 2022 (8) TMI 152 - SUPREME COURT , the Honourable Supreme Court held that arrest is not mandatory in every case. Before arrest is made, curtailing the personal liberty on the basis of the relevant facts should be considered. All the transactions are of the year 2011 and it appears that all the transactions are to the knowledge of the Investigating Agency. The transactions are borne by record and the evidence is circumstantial in nature. Complicity or otherwise of the petitioners can be inferred from the transactions during trial, which is unlikely in the near future. Detention cannot be by way of punishment at the stage of investigation. The apprehension of the learned Assistant Solicitor General that the petitioners are at flight risk can be dealt with by imposing conditions. This Court deems it appropriate to grant the relief of Regular Bail to the petitioners-A1 A3 subject to the fulfilment of conditions imposed - petition allowed.
Issues Involved:
1. Legality of the arrest and detention of the petitioners. 2. Compliance with procedural requirements under the PML Act. 3. Prima facie case against the petitioners. 4. Right to bail considering the nature and gravity of the offense. Summary: Legality of the Arrest and Detention: The petitioners, Accused No. 1 (A1) and Accused No. 3 (A3), sought regular bail in connection with ECIR No. ECIR/HYZO/08/2023. They argued that the Enforcement Directorate (ED) adopted illegal methods during the investigation, detained them without basis, and violated the "reason to believe" requirement under the PMLA Act, 2002. They contended that they were illegally taken into custody and served notices under Section 50 of the PMLA Act. The Special Court's remand order was challenged for non-application of mind, as A1 and A3 were not shown as accused in the SEBI complaint. Compliance with Procedural Requirements: The ED argued that the procedure laid down under the PMLA Act, 2002 was scrupulously followed. The agency registered the case based on criminal offenses under the schedule and investigated those involved in generating and handling crime proceeds. The ED's grounds of arrest and remand report indicated the modus operandi adopted by the accused in generating crime proceeds. The ED officials conducted searches and recorded statements under Section 50 of the PMLA Act, 2002, following due procedure. Prima Facie Case Against the Petitioners: The ED's investigation revealed that Taksheel Solutions Limited (TSL) raised Rs. 82.50 crores through an IPO using fraudulent methods, which were considered proceeds of crime. A2, the MD & CEO of TSL, and others created entities in the USA to siphon off IPO proceeds, inflating the market value and misleading facts. The ED identified entities and persons who received the Inter Corporate Deposits (ICD) amount and found that A1 and A3 conspired to inflate TSL's revenue and siphon off IPO proceeds. The petitioners allegedly assisted in transferring proceeds of crime to entities within India and abroad. Right to Bail Considering the Nature and Gravity of the Offense: The court noted that the transactions in question were from 2011, and the evidence was circumstantial. The ED had information about the petitioners' involvement from A2's statements recorded in September. The petitioners argued that their statements were taken under duress and immediately retracted. The court emphasized that detention could not be by way of punishment at the investigation stage and that the apprehension of flight risk could be addressed by imposing conditions. Conclusion: The court granted regular bail to the petitioners, A1 and A3, with conditions including executing personal bonds, surrendering passports, not leaving Hyderabad without permission, and abiding by other conditions under Section 437(3) of Cr.P.C. The court found that the ED acted arbitrarily and that the petitioners' detention was not justified based on the available information.
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