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2024 (9) TMI 1497 - SC - Money LaunderingRejection of bail application - Money Laundering - collection of large amounts by promising job opportunities to several persons in various positions in the Transport Department - offences u/s 120B, 419, 420, 467 and 471 of the Indian Penal Code and Sections 7, 12, 13(2) read with Section 13 (1) (d) of the Prevention of Corruption Act, 1988 - main document relied upon by the ED showing incriminatory material against the appellant is a part of the pen drive seized by the State police from the appellant's premises in connection with scheduled offences. HELD THAT - There is also prima facie material to show a deposit of cash amount of Rs. 1.34 crores in the appellant's bank account. At this stage, the contention of the appellant regarding the deposit of remuneration received as MLA and agriculture income cannot be accepted in the absence of any prima facie evidence to show the existence of the appellant's cash income as MLA and the appellant's agriculture income. Therefore, at this stage, it will be very difficult to hold that there is no prima facie case against the appellant in the complaint under Section 44 (1) (b) of the PMLA and material relied upon therein. Effect of delay in disposal of cases - HELD THAT - In the offence under the PMLA, the charge has not been framed. In view of Clause (d) of sub section (1) of Section 44 of PMLA, the procedure for sessions trial will have to be followed for the prosecution of an offence punishable under Section 4 of the PMLA. In view of clause (c) of sub section (1) of Section 44, it is possible to transfer the trial of the scheduled offences to the Special Court under the PMLA. The existence of a scheduled offence is sine qua non for alleging the existence of proceeds of crime. A property derived or obtained, directly or indirectly, by a person as a result of the criminal activity relating to a scheduled offence constitutes proceeds of crime. The existence of proceeds of crime at the time of the trial of the offence under Section 3 of PMLA can be proved only if the scheduled offence is established in the prosecution of the scheduled offence. Therefore, even if the trial of the case under the PMLA proceeds, it cannot be finally decided unless the trial of scheduled offences concludes. In the facts of the case, there is no possibility of the trial of the scheduled offences commencing in the near future - there are no possibility of both trials concluding within a few years. There are a few penal statutes that make a departure from the provisions of Sections 437, 438, and 439 of the Code of Criminal Procedure, 1973. A higher threshold is provided in these statutes for the grant of bail - reference made to Section 45 (1) (ii) of PMLA, proviso to Section 43D (5) of the Unlawful Activities (Prevention) Act, 1967 and Section 37 of the Narcotic Drugs and Psychotropic Substances Act, 1985. The provisions regarding bail in some of such statutes start with a non obstante clause for overriding the provisions of Sections 437 to 439 of the CrPC. The legislature has done so to secure the object of making the penal provisions in such enactments. For example, the PMLA provides for Section 45 (1) (ii) as money laundering poses a serious threat not only to the country's financial system but also to its integrity and sovereignty. Considering the gravity of the offences in such statutes, expeditious disposal of trials for the crimes under these statutes is contemplated. Moreover, such statutes contain provisions laying down higher threshold for the grant of bail. The expeditious disposal of the trial is also warranted considering the higher threshold set for the grant of bail - It is a well-settled principle of our criminal jurisprudence that bail is the rule, and jail is the exception. These stringent provisions regarding the grant of bail, such as Section 45 (1) (iii) of the PMLA, cannot become a tool which can be used to incarcerate the accused without trial for an unreasonably long time. 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. The appellant shall be enlarged on bail subject to fulfilment of conditions imposed - appeal allowed.
Issues Involved
1. Rejection of bail application under Section 439 of the Code of Criminal Procedure, 1973. 2. Alleged offence under Section 3 of the Prevention of Money Laundering Act, 2002 (PMLA), punishable under Section 4. 3. Allegations of corruption and job racket scam. 4. Evidence and material relied upon by the Enforcement Directorate (ED). 5. Delay in the disposal of cases. 6. Right to speedy trial and liberty under Article 21 of the Constitution of India. 7. Conditions for granting bail. Issue-wise Detailed Analysis 1. Rejection of Bail Application under Section 439 of the Code of Criminal Procedure, 1973 The appellant's bail application was rejected by a learned Single Judge of the High Court of Judicature at Madras. The rejection was in connection with an alleged offence under Section 3 of the PMLA, punishable under Section 4. The appellant had filed the bail application under Section 439 of the Code of Criminal Procedure, 1973. 2. Alleged Offence under Section 3 of the Prevention of Money Laundering Act, 2002 (PMLA), Punishable under Section 4 The appellant was accused of money laundering, with the Enforcement Directorate (ED) registering an Enforcement Case Information Report (ECIR) bearing ECIR No. MDSZO/21/2021. The alleged offence involved the appellant, during his tenure as Transport Minister, collecting large amounts of money by promising job opportunities in the Transport Department. The appellant was arrested on 14th June 2023 and remanded to judicial custody. A complaint was filed under Section 3 of the PMLA, punishable under Section 4, on 12th August 2023, naming the appellant as the only accused. 3. Allegations of Corruption and Job Racket Scam The allegations against the appellant include collecting money for job opportunities in various positions within the Transport Department. Three FIRs were registered against the appellant and others, citing offences under Sections 120B, 419, 420, 467, and 471 of the Indian Penal Code, and Sections 7, 12, 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988. These offences are scheduled offences under Section 2(y) of the PMLA. 4. Evidence and Material Relied Upon by the Enforcement Directorate (ED) The ED relied on material collected by investigating agencies, including a pen drive seized during a search on 6th February 2020. The pen drive allegedly contained a file named CS AC, detailing amounts received for job positions. However, the Tamil Nadu Forensic Science Laboratory (TNFSL) analysis showed a file named csac.xlsx instead. The appellant's counsel argued that the cash deposit of Rs. 1.34 crores in the appellant's bank account represented income from remuneration as an MLA and agricultural income. The ED countered this by pointing out discrepancies in the appellant's claims and highlighting other incriminating evidence. 5. Delay in the Disposal of Cases The appellant has been incarcerated for more than 15 months. The trial of the scheduled offences involves more than 2000 accused and over 600 witnesses, making it unlikely that the trial will conclude within a reasonable time. The Supreme Court noted that even if the trials are expedited, the process of framing charges and examining witnesses would take several years. 6. Right to Speedy Trial and Liberty under Article 21 of the Constitution of India The Supreme Court emphasized the right to a speedy trial and the right to liberty as sacrosanct rights under Article 21 of the Constitution. Prolonged incarceration without trial violates these rights. The Court referred to previous judgments, including K.A. Najeeb and Manish Sisodia, to highlight that statutory restrictions on bail do not override constitutional rights when there is no likelihood of trial being completed within a reasonable time. 7. Conditions for Granting Bail The Supreme Court allowed the appeal and granted bail to the appellant, imposing several stringent conditions to address concerns about tampering with evidence and influencing witnesses. The conditions include furnishing bail bonds, marking attendance at specified intervals, surrendering the passport, and cooperating with the trial courts. Conclusion The Supreme Court allowed the appeal and granted bail to the appellant, emphasizing the right to a speedy trial and liberty under Article 21 of the Constitution. The Court imposed stringent conditions to ensure the appellant does not influence witnesses or tamper with evidence, and highlighted the importance of expeditious disposal of trials in cases involving stringent bail provisions.
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