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TMI Blog2017 (9) TMI 852X X X X Extracts X X X X X X X X Extracts X X X X ..... t the petitioner. 2. At the time, when this bail application was filed (i.e. on 15.06.2017), the petitioner had been remanded to E.D custody by the Special Court, PMLA, but no prosecution/complaint was filed qua the petitioner in the Special Court. As such, it was not possible for the petitioner to approach the Special Court, PMLA for bail. The Special Court, PMLA had no record of the petitioner till that time. The prosecution/complaint was filed only on 02.08.2017 during the pendency of this bail application. 3. Mr. Mukul Rohtagi, learned senior counsel appearing for the petitioner, at the outset, submitted that he is seeking bail on the ground of the remand of the petitioner to custody being illegal. Though, if the order of remand is found to be illegal, an accused may be entitled to be released but such order cannot be passed in a bail application and can only be directed in a criminal writ and that also by a Division Bench. 4. Be that as it may, since there is no prayer for release of the petitioner but only for grant of bail on account of infraction of statutory provisions, this petition is being entertained. 5. Certain interesting aspects have been revealed while hearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gation and the petitioner had not cooperated in the investigation of the case thereby preventing the tracking of the money trail of Rs. 10 crores (money trail of around Rs. 41.65 crores had already been tracked), the petitioner was required to be remanded to custody. The Special Court thus remanded the petitioner to E.D custody till 09.06.2017. 13. It may be relevant here to state that after the registration of the FIR No.205.2016 (predicate offence) on 25.12.2016 and registration of ECIR in question on 26.12.2016, co accused Ashish Kumar, Rohit Tandon and Rajkumar Goel were arrested and produced before the Special Court, PMLA and were remanded to E.D custody as and when requested by the E.D. 14. On 23.02.2017 prosecution/complaint under Section 44 of the PMLA was filed before the Special Court against Rohit Tandon, Ashish Kumar, Rajkumar Goel, Dinesh Bhola and Kamal Jain. 15. On 25.02.2017, the Special Court took cognizance of the offence under Section 3, punishable under Section 4 of the PMLA. After taking of cognizance, summons were issued to the two of the accused persons named above namely Dinesh Bhola and Kamal Jain who had not been arrested. 16. As stated above, it was o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the application seeking remand of the petitioner to judicial custody till 11.08.2017 on 08.08.2017, it was stated by the E.D that the investigation under the PMLA in this case is in progress and passing through critical stage where it is certain that new facts and evidences would come on record and that would be required to be interrogated from the petitioner. The application further indicated that there were more leads and money trails to be analyzed in the case and, therefore, judicial custody of the petitioner was needed. 22. On 11.08.2017, when the matter was listed before the Special Court, the Presiding Officer was on leave. The petitioner along with others were produced from judicial custody. Two of the accused persons who were on bail also presented themselves. The matter was adjourned to 31.08.2017. The order reads as hereunder:- "11.8.2017 Ld. P.O is on leave for today. Sh. Vikas Garg, SPP for ED. Accused Rohit Tandon, Raj Kumar Goel, Yogesh Mittal and Ashish Kumar are present from J/C. Accused Dinesh Bhola and Kamal Jain are present on bail with their Counsel. Put up on 31.08.2017 for purpose already fixed. Reader/ 11.08.2017" 23. The order dated 11.08.2017 wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t as the Special Court has been vested with the power of trying the case after prosecution/complaint is lodged under Section 44 of the PMLA. Thus after the filing of the prosecution/complaint on 02.08.2017, there was no way in which the petitioner could have been remanded either to E.D custody or to judicial custody before taking cognizance of the offence. 28. Till date, it has been asserted, no cognizance has been taken against the petitioner in the present case. 29. Apart from this, it has been argued, after the prosecution/complaint having been filed, the petitioner was being remanded for more than 15 days at one go, which is impermissible in law. Curiously, few of the last orders of remand do not even specify that petitioner or the other accused persons were being remanded to custody and such orders have been signed by the Reader of the Special Court. It is thus, it has been urged, a complete violation of the procedural requirements, rendering the remand of the petitioner without any jurisdiction and, therefore, invalid, entitling the petitioner to be released forthwith or granted bail. 30. As opposed to the aforesaid contentions, Mr.Sanjay Jain, learned Additional Solicitor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he words "which may extend to ten years" had been substituted. 34. The power of arrest of an accused has been provided in Section 19 of the PMLA which clearly envisages that the authorized officer, on his satisfaction that a person has been guilty of an offence punishable under the Act, may arrest such person and as soon as possible inform him the grounds of such arrest. This section specifically states that after the arrest, a copy of the order of the arrest along with the materials in the possession of the Arresting Officer has to be forwarded to the Adjudicating Authority in a sealed envelope in the manner as may be prescribed and the Adjudicating Authority shall keep such order and materials for such period, as may be prescribed. 35. Sub Section (3) of Section 19 further emphasizes that every person arrested under Section 19(1) of the Act, shall within 24 hours, be taken to a Magistrate or a Metropolitan Magistrate, as the case may be, having jurisdiction and the period of 24 hours shall exclude the time necessary for journey from the place of arrest to the Magistrate's Court. 36. For the purposes of trying offences under the PMLA, Special Courts have been constituted under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thorized in this behalf, take cognizance of offence under Section 3, without the accused being committed to it for trial and that the Special Court shall hold trial in accordance with the provisions of Cr.P.C, 1973 as it applies to a trial before a Court of Sessions. Sub clause (2) of Section 44 further clarifies that nothing shall affect the special powers of the High Court regarding bail under Section 439 of the Code of Criminal Procedure, 1973 and the High Court may exercise such powers including the power under clause (b) of sub-section (1) of that section as if the reference to "Magistrate" in that section includes also a reference to a "Special Court" designated under section 43 of the Act. 38. Section 45 of the Act makes the offences under the PMLA to be cognizable and non-bailable. 39. Under the PMLA, the provisions of Cr.P.C have been made applicable to the proceedings before the Special Court. A special reference of Section 65 of the Act is necessary. Section 65 of the PMLA reads as hereunder:- "65. Code of Criminal Procedure, 1973 to apply.-The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) shall apply, insofar as they are not inconsistent with the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ders further detention unnecessary, he may order the accused to be forwarded to a Magistrate having such jurisdiction: Provided that- (a) the Magistrate may authorize the detention of the accused person, otherwise than in custody of the police, beyond the period of fifteen days, if he is satisfied that adequate grounds exist for doing so, but no Magistrate shall authorize the detention of the accused person in custody under this paragraph for a total period exceeding- (i) ninety days, where the investigation relates to an offence punishable with death, imprisonment for life or imprisonment for a term of not less than ten years; (ii) sixty days, where the investigation relates to any other offence, and, on the expiry of the said period of ninety days, or sixty days, as the case may be, the accused person shall be released on bail if he is prepared to and does furnish bail, and every person released on bail under this sub-section shall be deemed to be so released under the provisions of Chapter XXXIII for the purposes of that Chapter; (b) no Magistrate shall authorize detention of the accused in custody of the police under this section unless the accused is produced before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istrate under this sub-section, shall be taken into account in computing the period specified in paragraph (a) of the proviso to sub-section (2): Provided that before the expiry of the period aforesaid, the Executive Magistrate shall transmit to the nearest Judicial Magistrate the records of the case together with a copy of the entries in the diary relating to the case which was transmitted to him by the officer in charge of the police station or the police officer making the investigation, as the case may be. (3) A Magistrate authorising under this section detention in the custody of the police shall record his reasons for so doing. (4) Any Magistrate other than the Chief Judicial Magistrate making such order shall forward a copy of his order, with his reasons for making it, to the Chief Judicial Magistrate. (5) If in any case triable by a Magistrate as a summons-case, the investigation is not concluded within a period of six months from the date on which the accused was arrested, the Magistrate shall make an order stopping further investigation into the offence unless the officer making the investigation satisfies the Magistrate that for special reasons and in the interests o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a report forwarded under this section that the accused has been released on his bond, the Magistrate shall make such order for the discharge of such bond or otherwise as he thinks fit. (5) When such report is in respect of a case to which section 170 applies, the police officer shall forward to the Magistrate along with the report- (a) all documents or relevant extracts thereof on which the prosecution proposes to rely other than those already sent to the Magistrate during investigation; (b) the statements recorded under section 161 of all the persons whom the prosecution proposes to examine as its witnesses. (6) If the police officer is of opinion that any part of any such statement is not relevant to the subject-matter of the proceedings or that its disclosure to the accused is not essential in the interests of justice and is inexpedient in the public interest, he shall indicate that part of the statement and append a note requesting the Magistrate to exclude that part from the copies to be granted to the accused and stating his reasons for making such request. (7) Where the police officer investigating the case finds it convenient so to do, he may furnish to the acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se may be. Thereafter, since the prosecution/complaint is in the nature of a report under Section 173, the power of authorizing the detention would only be under Section 309 of the Cr.P.C as there is no commitment proceedings under the PMLA. In cases concerning IPC, there is an intermediate stage which is the stage of Section 209 of the Cr.P.C when the case is committed to the Court of Sessions when the offence is punishable exclusively by it. Though there is no application of Section 209 Cr.P.C under PMLA, but the provisions of Section 209 are being extracted below so as to have a clear understanding of the power of remand. Section 209 reads as follows:- 209. Commitment of case to Court of Session when offence is triable exclusively by it.-When in a case instituted on a police report or otherwise, the accused appears or is brought before the Magistrate and it appears to the Magistrate that the offence is triable exclusively by the Court of Session, he shall- (a) commit, after complying with the provisions of section 207 or section 208, as the case may be, the case to the Court of Session, and subject to the provisions of this Code relating to bail, remand the accused to custody ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 376A, section 376B, section 376C or section 376D of the Indian Penal Code (45 of 1860), the inquiry or trial shall, as far as possible be completed within a period of two months from the date of filing of the charge sheet.] (2) If the Court, after taking cognizance of an offence, or commencement of trial, finds it necessary or advisable to postpone the commencement of, or adjourn, any inquiry or trial, it may, from time to time, for reasons to be recorded, postpone or adjourn the same on such terms as it thinks fit, for such time as it considers reasonable, and may by a warrant remand the accused if in custody: Provided that no Magistrate shall remand an accused person to custody under this section for a term exceeding fifteen days at a time: Provided further that when witnesses are in attendance, no adjournment or postponement shall be granted, without examining them, except for special reasons to be recorded in writing: Provided also that no adjournment shall be granted for the purpose only of enabling the accused person to show cause against the sentence proposed to be imposed on him. Provided also that- (a) no adjournment shall be granted at the request of a party, exce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner and another was therefore, permissible under Section 167 of the Cr.P.C. Thereafter, in the absence of any committal proceedings available under the PMLA, the power of remand of an accused is only to be found in Section 309 of the Cr.P.C, which has been referred to above. For the application of Section 309 of the Cr.P.C it is required that cognizance of the offence ought to have been taken. 50. In the present case, the major contention of the petitioner is that till date cognizance has not been taken. 51. Now, it would be relevant here to understand as to what would amount to taking of cognizance in the present case. 52. In Ajit Kumar Palit vs. State of West Bengal and Anr, AIR 1963 SC 765, the Supreme Court had the occasion to deal with Sections 4 & 5 of the West Bengal Criminal Law Amendment (Special Courts) Act, 1949. It was held by the Supreme Court in the aforesaid case as follows:- "19. The provisions of Section 190(1) being obviously, and on its own terms, inapplicable, the next question to be considered is whether it is the requirement of any principle of general jurisprudence that there should be some additional material to entitle the court to take cognizan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. In R.R.Chari vs. State of U.P, 1951 SC 207, the Supreme Court had ruled that taking cognizance does not involve any formal action or indeed action of any kind but occurs as soon as a Magistrate as such applies his mind to the suspected commission of an offence. The Supreme Court in Tula Ram and Others (Supra) has held as follows:- "It seems to us that there is no special charm or any magical formula in the expression "taking cognizance" which merely means judicial application of the mind of the Magistrate to the facts mentioned in the complaint with a view to taking further action. Thus what Section 190 contemplates is that the Magistrate takes cognizance once he makes himself fully conscious and aware of the allegations made in the complaint and decides to examine or test the validity of the said allegations. The Court prescribes several modes in which a complaint can be disposed of after taking cognizance. In the first place, cognizance can be taken, on the basis of three circumstances: (1) upon receiving a complaint of facts which constitute such offence; (2) upon a police report of such facts; and (c) upon information received from any person other than the police off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate taking cognizance of an offence, has himself to proceed further as enjoined by the Code. But, an exception has been made in the case of Chief Judicial Magistrate, may be because he has some administrative functions also to perform. A Magistrate who receives the case on transfer and takes cognizance would not become incompetent to do so merely because the sanction of transfer of the case to his file is not in accordance with law. The power to take cognizance has been conferred on a Magistrate by Section 190(1) of the Code and he would not be denuded of this power because the case has come to his file pursuant to some illegal order of the Chief Judicial Magistrate. The former would be exercising his power of taking cognizance even in such a case, because of his having received a complaint constituting the offence. It would not be material, for this purpose, as to how he came to receive the complaint - directly or on transfer from the Chief Judicial Magistrate." 55. The Supreme Court in State of Karnataka and Anr Vs. Pastor P.Raju, AIR 2006 SC 2825, the Supreme Court has held as follows:- "7. Several provisions in Chapter XIV of the Code of Criminal Procedure use the word "cogn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mplaint and decides to examine or test the validity of the said allegations. The Court then referred to the three situations enumerated in Sub-section (1) of Section 190 upon which a Magistrate could take cognizance. Similar view was expressed in Kishun Singh and Ors. v. State of Bihar MANU/SC/0460/1993 : 1993CriLJ1700 that when the Magistrate takes notice of the accusations and applies his mind to the allegations made in the complaint or police report or information and on being satisfied that the allegations, if proved, would constitute an offence, decides to initiate judicial proceedings against the alleged offender, he is said to have taken cognizance of the offence. In State of West Bengal v. Mohd. Khalid and Ors. MANU/SC/0154/1995 : AIR 1995 SC 785 the Court after taking note of the fact that the expression had not been defined in the Code held: ...In its broad and literal sense, it means taking notice of an offence. This would include the intention of initiating judicial proceedings against the offender in respect of that offence and taking steps to see whether there is any basis for initiating judicial proceedings or for other purposes. The word 'cognizance' indic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng a statutory bail. It was, additionally, argued that the prosecution complaint is in the nature of a report under Section 173 of the Cr.P.C, 1973 and it must conform to the requirements as provided under Section 173 of the Cr.P.C. The report under Section 173 has to contain all the information and materials and it should not be an inchoate report, without conclusive finding that an accused/petitioner is required to be tried for such offence. If the investigation was required to be continued, it was absolutely unnecessary for the prosecution to have filed the prosecution/complaint under Section 44 of the PMLA on 02.08.2017. It has been argued that permitting this would amount to giving imprimatur to something which has been done indirectly and which could have been done directly. 60. On the first blush, this argument appears to be convincing. However, when the facts are analyzed and the provisions of the Cr.P.C and PMLA are scrutinized, the aforesaid argument would not be sustainable. Under the Cr.P.C, there is a provision for further investigation [Section 173(8)] which is not dependent or contingent upon filing of the charge sheet. It matters not if cognizance has been taken in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere fresh material may come to light which would implicate persons not previously accused or absolve persons already accused. When it comes to the notice of the investigating agency that a person already accused of an offence has a good alibi, is it not the duty of that agency to investigate the genuineness of the plea of alibi and submit a report to the Magistrate? After all the investigating agency has greater resources at its command than a private individual. Similarly, where the involvement of persons who are not already accused comes to the notice of the investigating agency, the investigating agency cannot keep quiet and refuse to investigate the fresh information. It is their duty to investigate and submit a report to the Magistrate upon the involvement of the other persons. In either case, it is for the Magistrate to decide upon his future course of action depending upon the stage at which the case is before him. If he has already taken cognizance of the offence, but has not proceeded with the enquiry or trial, he may direct the issue of process to persons freshly discovered to be involved and deal with all the accused in a single enquiry or trial. If the case of which he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Section 309(2) refer and relate to an accused who was before the Court when cognizance was taken or when enquiry or trial was being held in respect of him and not to an accused who is subsequently arrested in course of further investigation. So far as the accused in the first category is concerned he can be remanded to judicial custody only in view of Section 309(2), but he who comes under the second category will be governed by Section 167 so long as further investigation continues. That necessarily means that in respect of the latter the Court which had taken cognizance of the offence may exercise its power to detain him in police custody, subject to the fulfillment of the requirements and the limitation of Section 167." (Emphasis provided by this Court) 68. In Union of India vs. Thamisharasi & Ors, (1995) 4 SCC 190, the Supreme Court has stated as hereunder:- "16. It is settled that "the court will have no power of remand of an accused to any custody unless the power is conferred by law". (See Matabar Parida Bisnu Charan Parida Batakrushna Parida Babaji Parida v. State of Orissa [(1975) 2 SCC 220 : 1975 SCC (Cri) 484 : 1975 Supp SCR 137] .) The power must, therefore, be tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered and incorporated under the Companies Act, 1956 on a complaint made by SEBI. Dinesh Dalmia was evading arrest. The Magistrate, on a prayer by the CBI had issued non-bailable warrant of arrest against him. Upon completion of investigation, chargesheet was submitted under Section 173 of the Cr.P.C. In the said chargesheet, the name of the appellant was arraigned in column 1. It was prayed by the CBI that cognizance be taken and process be issued for securing the presence of accused/Dinesh Dalmia so that he may be tried in accordance with law. On such report, cognizance was taken on the basis of the chargesheet. It was noted by the Court that non-bailable warrant of arrest against the appellant was pending. 71. Ultimately, Mr.Dinesh Dalmia was arrested and produced before the Magistrate in Delhi for transit remand to Chennai. When he was produced before the Magistrate at Chennai, an order for police custody was prayed for and was granted for the purposes of brain mapping, polygraph test etc. Dinesh Dalmia was remanded to judicial custody, later, on the plea that further investigation was pending. 72. In the meantime, on completion of 60 days of his arrest, a prayer for statutory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 : (2006) 3 SCC (Cri) 245] 29. The power of a court to direct remand of an accused either in terms of sub-section (2) of Section 167 of the Code or sub-section (2) of Section 309 thereof will depend on the stages of the trial. Whereas sub-section (2) of Section 167 of the Code would be attracted in a case where cognizance has not been taken, sub-section (2) of Section 309 of the Code would be attracted only after cognizance has been taken. (Emphasis supplied by this Court) 74. Thus, in the opinion of this Court, the petitioner was being investigated pursuant to the registration of the FIR 205/2016 dated 25.12.2016 by the Special Branch, Delhi Police and the ECIR No.18/DZO-8/2016 dated 26.12.2016 by the Enforcement Directorate. During the period when the petitioner was being investigated, after his arrest, the Special Court remanded the petitioner under the provisions of Section 167 of the Code of Criminal Procedure. On the presentation of prosecution/complaint against other accused persons under Section 44 of the PMLA, cognizance was taken against them. On the presentation of the prosecution/complaint on 02.08.2017 qua the petitioner and another, the complaint was tagged along ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with a petition of Writ of Habeas Corpus filed by one Ram Narayan Singh on behalf of four others who were the petitioners of the case. Those persons were arrested and were being prosecuted for having defied the order prohibiting meetings and processions in the area in question, which was punishable under Section 188 of the IPC. In the aforesaid case, there were two remand orders; one passed by the Additional District Magistrate, Delhi and the other passed by the trying Magistrate. The Supreme Court, in the aforesaid case, found that the order of remand by the Magistrate did not have a clear endorsement of those persons having been remanded to judicial custody; rather the order of remand merely intimated that the case was being adjourned for a specific date. The Supreme Court, in that case, was of the view that such a clear/specific endorsement was necessary and without that having been recorded, the remand was illegal. The Supreme Court, therefore, released those persons and set them at liberty forthwith. 78. The facts of the present case are different. The petitioner had earlier been remanded to custody with specific endorsement. However, for the fault of the Court, the prosecuti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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