9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2024 (2) TMI 772 - HC - Money LaunderingMoney Laundering - scheduled offences - Illegal arrest/detention - Non-application of mind and non-recording of compliance of the conditions/stipulations contained in Section 19 by the Special Court while passing the impugned orders - Illegal detention/wrongful restraint of the petitioners from 04.01.2024 to 08.01.2024 amounting to arrest on 04.01.2024 itself and consequential violations of Section 19 of PMLA read with Section 167 CrPC on account of non-production of petitioners within 24 hours - Violation of the provisions of Section 19(2) of the 2002 Act - Non-compliance of Section 19(1) of the 2002 Act. Non-application of mind and non-recording of the conditions/stipulations contained in section 19 by the Special Court while passing the impugned remand orders - HELD THAT - A perusal of the Section 19 of PMLA would show that the same contains three Sub-Sections. Under Sub-Section 1, the concerned officer who could be the Director, Deputy Director, Assistant Director or any other officer authorized in this behalf by the Central Government, may arrest a person after, on the basis of the material in his possession, he has reason to believe, which belief has to be recorded in writing, that any person is guilty of an offence punishable under the Act. Sub-Section 1 further provides that after the arrest, the person so arrested, is required to be informed about the grounds of such arrest as soon as may be - Sub-Section 3 further provides that the person arrested shall within 24 hours be taken to the Special Court or Judicial Magistrate or a Metropolitan Magistrate, as the case may be having jurisdiction. The Hon'ble Supreme Court in the case of V.Senthil Balaji 2023 (8) TMI 410 - SUPREME COURT had observed that the provisions of Section 19 are mandatory and the compliance of the said provisions is a solemn function of the arresting authority which brooks no exception and that the officer concerned is to strictly comply with the mandate of Section 19 in its letter and spirit, failing which he would be visited with the consequences as have been mentioned under the 2002 Act. It is incumbent upon the Special Court/concerned Court at the time of remanding the accused to the custody of ED, to peruse the order of arrest and to see due compliance of provisions of Section 19 of the 2002 Act and also reflect the same in the order of remand by making a specific observation regarding the same. Whether the Special Court, in the present case, has passed the order of remand in accordance with law and in accordance with the provisions of Section 19? - HELD THAT - Since, the petitioners were produced before the Special Court at Gurugram on 09.01.2024 thus, it was incumbent upon the said Court to consider the material to see as to whether as on 09.01.2024, any cause had arisen so as to produce the petitioners before the said Court and in case any such cause had arisen then to specifically state so in the order of remand. In the instant case, the same has not been done by the Court concerned. Importantly, the Special Court has also not made any observations with respect to the due compliance by the authority of Section 19(1). There is no reference in the order of remand to state that the Court had perused the order, if any, recording the reason to believe that the petitioners are guilty of the offence punishable under the 2002 Act or the grounds of arrest in writing and had satisfied itself that the arresting officer, on the basis of material in his possession, had reason to believe that the petitioners were guilty of the offence punishable under the Act. No such fact has been recorded in the impugned order. On the said aspect, it has only been observed in the impugned order that once ECIR has been registered and during investigation, a prima facie case for the commission of the offence under the 2002 Act has been found, then the Directorate of Enforcement is bound to trace the money for which it required to interrogate the petitioners in custody. The said order is thus, illegal and deserves to be set aside on the said ground alone. Illegal detention/wrongful restraint of the petitioners from 04.01.2024 to 08.01.2024 amounting to arrest on 04.01.2024 itself and consequential violations of section 19 of PMLA read with section 167 CrPC on account of non-production of petitioners within 24 hours - HELD THAT - It is apparent that respondent authorities had illegally confined/unlawfully restrained the petitioners in the premises in question from 04.01.2024 to 08.01.2024 and thus, in effect had arrested the petitioners on 04.01.2024 itself but had not produced the petitioners before the concerned Court within 24 hours from the date of their actual arrest i.e. 04.01.2024 nor had complied with the other conditions mentioned in Section 19(1), 19(2), 19(3) and thus, arrest and all subsequent orders including remand orders are illegal and against law and deserve to be set aside. The judgment of the Single Bench of the Delhi High Court in case of Gautam Thapar (supra) relied upon by the counsel for the respondents would not further the case of the respondents. The facts in the said case were completely different from the facts in the present case inasmuch as the said case was not a case where there was unlawful restraint/illegal detention for a period of more than four days nor there was any averment of the respondent authorities in the said case in the reply as is there in the present case which clearly shows that the petitioners, in the present case, were confined to the four walls of the premises in question from 04.01.2024 to 08.01.2024. The judgments relied upon on behalf of the petitioners, relevant portion of which is reproduced hereinabove, are on the other hand fully applicable to the facts of the present case. The order of arrest and the impugned orders of remand and all the subsequent proceedings arising thereto deserve to be set aside on this ground also. Violation of provisions of section 19(2) of the Act, 2002 - HELD THAT - In paragraph 311 of Vijay Madanlal Chaudhary 2022 (7) TMI 1316 - SUPREME COURT while considering the provisions of Section 5 (2) and 17(2) of the 2002 Act, which also require the competent officer to immediately after attachment under Section 5(1) and after search and seizure under Section 17(1), to forward a copy of the order along with material in his possession to the Adjudicating Authority, the Hon ble Supreme Court of India was pleased to use the term contemporaneously and had observed that the reasons to believe were required to be recorded in writing and contemporaneously forwarded to the Adjudicating Authority along with the material in possession in the sealed envelope. In the present case, admittedly, the compliance of Section 19(2) was not done till 09.01.2024, and the orders of remand dated 09.01.2024 of both the petitioners do not even remotely show that the Special Court had observed anything regarding its compliance. Even the order dated 16.01.2024 passed by the Special Court extending the remand of both the petitioners does not even remotely mention that there was any compliance of Section 19(2). It is apparent that compliance of Section 19 including Section 19(2) is mandatory and brooks no exception. Accordingly, in view of the facts and circumstances, it is held that there is violation of the provisions of Section 19(2) of the 2002 Act on account of which also the impugned action is bad in law and is liable to be set aside. Non-compliance of section 19(1) of Act, 2002 - HELD THAT - In the present case it is the admitted case of the parties that both the petitioners are not accused till date in the 8 FIRs which have been reproduced in the grounds of arrest of both the petitioners. It is further the admitted case of the parties that no notice under Section 50 which empowers the competent authority to summon any person and also to produce the documents as required, has been issued to either of the two petitioners. From the discussion made hereinabove, it is also clear that the petitioners were in the premises where the search was being conducted from 04.01.2024 to 08.01.2024. A perusal of the grounds of arrest of both the petitioners would show that although it has been stated by the competent officer that the petitioners have adopted an attitude of non-cooperation by evading the queries and by giving misleading answers but no specific instance regarding the same has been mentioned. By filing the said additional reply dated 29.01.2024, respondent no.2 has tried to show the sequence of events in order to explain the delay in compliance of Section 19(2) but a closer perusal of the said paragraph would show that in case the preliminary scrutiny of documents had been done on 10.01.2024, subsequent to 08.01.2024 when the petitioners were arrested, then the question of the arresting officer having formed the reason to believe in writing that the petitioners were guilty of an offence under the 2002 Act on the basis of the material in his possession, becomes highly doubtful. Moreover, no reference has been made in the sequence of events as to when the reasons to believe as required under Section 19(1) of the 2002 Act were reduced into writing. The argument raised on behalf of the petitioners to the effect that such vague grounds of arrest violate the fundamental right of the petitioners as it is very difficult for the petitioners to prepare their defence in view of the provisions of Section 45 of the 2002 Act is also weighty. In the said circumstances, it cannot be said that respondent no.2 has rendered full compliance of the mandatory provisions of Section 19(1) of the Act. Since in the present case, the order of arrest, arrest memo and the remand order dated 09.01.2024 are held to be illegal and against law, thus, the subsequent order of remand and other consequential orders are also liable to be set aside. Moreover, this Court is of the view that even the order dated 16.01.2024 is illegal and thus, deserves to be set aside. Petition allowed.
Issues Involved:
1. Non-application of mind and non-recording of compliance of the conditions/stipulations contained in Section 19 by the Special Court while passing the impugned orders. 2. Illegal detention/wrongful restraint of the petitioners from 04.01.2024 to 08.01.2024 amounting to arrest on 04.01.2024 itself and consequential violations of Section 19 of PMLA read with Section 167 CrPC on account of non-production of petitioners within 24 hours. 3. Violation of the provisions of Section 19(2) of the 2002 Act. 4. Non-compliance of Section 19(1) of the 2002 Act. Summary: Non-application of Mind and Non-recording of Compliance: The Court found that the Special Court failed to apply its mind and record compliance with the conditions contained in Section 19 of the 2002 Act while passing the remand orders. The orders did not mention whether the Court had satisfied itself that the officer concerned had forwarded the copy of the order along with the material in his possession to the Adjudicating Authority in a sealed envelope. The Court noted that the remand orders lacked any reference to the compliance of Section 19(2) and Section 19(3) of the 2002 Act, making the orders illegal. Illegal Detention/Wrongful Restraint: The Court observed that the petitioners were illegally detained from 04.01.2024 to 08.01.2024, amounting to their arrest on 04.01.2024 itself. This detention violated Section 19 of PMLA read with Section 167 CrPC, as the petitioners were not produced before the concerned Court within 24 hours of their actual arrest. The Court relied on the panchnama and other documents which indicated that the petitioners were not allowed to leave their premises during the search, thus amounting to illegal detention. Violation of Provisions of Section 19(2): The Court held that there was a clear violation of Section 19(2) of the 2002 Act, as the compliance of forwarding the copy of the order along with the material to the Adjudicating Authority was not done immediately after the arrest. The Court emphasized that the term "immediately" signifies a higher degree of urgency and should be done prior to presenting the accused before the Court for the first time. The Court found that the delay in compliance rendered the arrest and subsequent proceedings illegal. Non-compliance of Section 19(1): The Court found that there was non-compliance with Section 19(1) of the 2002 Act, as the arresting officer did not record the reasons for the belief that the petitioners were guilty of an offence under the Act in writing. The grounds of arrest were vague and did not provide specific instances or concrete material linking the petitioners to the alleged offences. The Court noted that the grounds of arrest violated the fundamental rights of the petitioners and made it difficult for them to prepare their defense. Conclusion/Relief: The Court allowed both petitions and set aside the impugned arrest orders, arrest memos, remand orders, and all consequential orders. The petitioners were ordered to be released forthwith unless their incarceration was required in connection with any other case.
|
