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TMI Blog2021 (6) TMI 424X X X X Extracts X X X X X X X X Extracts X X X X ..... upreme Court in Nikesh Tarachandra Shah [ 2017 (11) TMI 1336 - SUPREME COURT ] had pointed out while invalidating the existing law are not substantially removed by the amendment. The Supreme Court has asserted that, the twin conditions prescribed in Section 45 of the PMLA Act would have no nexus whatsoever with a bail application which concerns itself with the offence of money laundering, for if Section 45 of the PMLA Act is to apply, the Court does not apply its mind to whether the person prosecuted is guilty of the offence of money laundering, but instead applies its mind to whether such person is guilty of the scheduled or predicate offence. It is observed that Section 45 of the PMLA Act is a drastic provision which affects the fundamental right of personal liberty guaranteed by Article 21 of the Constitution of India and turns on its head the presumption of innocence which is fundamental to a person accused of any offence. Burden or proof on the person charged as envisaged in section 24 of PMLA Act - HELD THAT:- In the present case, the applicant is charged with scheduled offences as defined under section 2(u) of the Act. An F.I.R. is registered for the offence under Sections 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 2,70,00,000/-. Accordingly, the applicant was arrested and thereafter the authority, by undertaking necessary exercise in detail and confiscating the necessary papers in connection with the aforesaid offence, had filed the complaint being PMLA Case No. 1 of 2021 before the Principal District and Sessions Judge, Ahmedabad (Rural), Dist. Ahmedabad. An F.I.R. being CR-I/11210048201414/2020 was also registered at Umra Police Station, District Surat for the offence punishable under sections 465, 468, 471, 420 and 120(B) of the Indian Penal Code, 1860 (the I.P.C.). SUBMISSIONS OF THE APPLICANT 4. Learned Senior Advocate Mr. I.H. Syed appearing with Mr. Aniq Kadri, learned advocate appearing for the applicant has submitted that at the most looking to the papers of the investigation and the complaint, it can be said that the Government agencies are cheated to the extent of ₹ 70 Lacs only, whereas the rest of the amount of ₹ 2 Crores pertains to private transactions with private agencies. He has submitted that the Coordinate Bench of this Court, while releasing the applicant on regular bail in connection with the offences punishable under Sections 465, 468, 471, 420 and 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... P. Chidambaram vs. Directorate of Enforcement, 2020 (13) S.C.C. 791. Lastly, he has placed reliance on the judgment of the Kerala High Court dated 25.01.2021 passed in Bail Application No. 7878 of 2020 rendered in the case of M. Sivasankar vs. Union of India, and submitted that even if, prima facie, the complicity of the applicant is established, clause (ii) of subsection 1 of Section 45 of the PMLA Act envisages two eventualities, first being that, the Court must be satisfied that there are reasonable grounds for believing that an accused person is not guilty of such offence and that he is not likely to commit any offence while on bail. It is submitted that even if it is assumed that the twin conditions of section 45 of the PMLA Act are applied then also the applicant is entitled to bail in view of the Proviso attached to section 45 of the PMLA Act, which exempts the accused, who is sick and if the sum of money laundering is less than one crore since as per the case of the E.D., the applicant has allegedly cheated the Government to the tune of ₹ 70,0000/- and rest of the amount of ₹ 2 Crores concerns only the private agencies and not a single private agency has filed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dering and Section 50 of the PMLA Act, which prescribes the production of records, receiving evidence on affidavits, issuing commissions for examination of witnesses and documents, etc. It is submitted by Mr. Vyas that the applicant was given various opportunities to satisfy that he has not gained ₹ 2,70,00,000/- and after threadbare examination of the evidences, including the affairs of the Company, its revenue and expenditures, the Department has arrived at the aforesaid amount. It is also submitted that the contention raised by the applicant with regard to the loss caused to the Government of ₹ 70 lacs will not make any difference since the total amount of illegal gains as per the investigation comes to ₹ 2.70 crores. Mr. Vyas has also placed reference on the decision dated 11.06.2020 of the High Court of judicature at Patna passed in Cr. Misc. No. 7305 of 2019, wherein it is referred that the issue is pending before the Supreme Court in the case of E.D. Vs. Upendra Rai, Criminal Diary No. 5150 of 2020, wherein, the Apex Court has stayed the judgment of the High Court of Delhi rendered in the case of Upendra Rai vs. Directorate of Enforcement. To further fortif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n accused of an offence under this Act shall be released on bail or on his own bond unless: (i) the Public Prosecutor has been given an opportunity to oppose the application for such release; and (ii) where the Public Prosecutor opposes the application, the court is satisfied that there are reasonable grounds, for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail Provided that a person, who, is under the age of sixteen years, or is a woman or is sick or infirm, or is accused either on his own or along with other co-accused of money-laundering a sum of less than one crore rupees may be released on bail, if then Special Court so directs: 10. It is apparent from the aforesaid provisions, that the legislature has not withdrawn the twin conditions from section 45 of the PMLA Act though in the case of Nikesh Tarachand (supra), the Supreme Court has struck down the same as being unconstitutional. I may not deal with all the decisions cited at the Bar since, they are repetitive and not germane and are considered by the Supreme court in the case of Nikesh Tarachand (supra). I may with profit mention a couple of observations made by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d again lead to a manifestly arbitrary, discriminatory and unjust result which would invalidate the section. 43. However, the learned Attorney General has argued before us that we must uphold Section 45 as it is part of a complete code under the 2002 Act. According to him, Section 45, when read with Sections 3 and 4, would necessarily lead to the conclusion that the source of the proceeds of crime, being the scheduled offence, and the money laundering offence, would have to be tried together, and the nexus that is provided is because the source of money laundering being as important as money laundering itself, conditions under Section 45 would have to be applied. We are afraid that, for all the reasons given by us earlier in this judgment, we are unable to agree. The learned Attorney General asked us to read down Section 45 in that when the court is satisfied that there are reasonable grounds for believing that a person is not guilty of an offence, it only meant that the court must prima facie come to such a conclusion. Secondly, the fact that he is not likely to commit any offence while on bail would only be restricted to any offence of a like nature. Again, we are afraid that mer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l continue. The insertion of the words under this Act by deleting offence punishable for a term of imprisonment of more than three years under Part-A of the Schedule only makes an ostensible change. The offence of money laundering as stipulated under section 3 of the PMLA Act stems out of the offences prescribed in the Schedules. The defects which the Supreme Court had pointed out while invalidating the existing law are not substantially removed by the amendment. The Supreme Court has asserted that, the twin conditions prescribed in Section 45 of the PMLA Act would have no nexus whatsoever with a bail application which concerns itself with the offence of money laundering, for if Section 45 of the PMLA Act is to apply, the Court does not apply its mind to whether the person prosecuted is guilty of the offence of money laundering, but instead applies its mind to whether such person is guilty of the scheduled or predicate offence. It is observed that Section 45 of the PMLA Act is a drastic provision which affects the fundamental right of personal liberty guaranteed by Article 21 of the Constitution of India and turns on its head the presumption of innocence which is fundamental to a p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding the allegations leveled in the F.I.R. reveal that it appears that the applicant has gained ₹ 70,00,000/-, by cheating the Government and has gained an amount of ₹ 2,00,00000/- by cheating private advertisement agencies. It is also not disputed that no complaint has been filed by the private agencies alleging illegal cheating against the applicant. No private agency has come forward claiming illegal gains by the applicant from their private contracts. Such agencies are also not made co-accused. After the investigation, the properties to the tune of ₹ 4 Crores are also attached. Though, the factum of release on bail in the I.P.C./Scheduled offence cannot be a prime consideration of release for the offence of money laundering under the Act, the conditions imposed in the order of bail which are not adverse to the interest of the State cannot be ignored. The Coordinate Bench of this Court, while granting bail to the applicant for the offence punishable under Section 465, 468, 471, 420, 120B of the IPC has observed in para-5(iv), (vi) thus: 5(iv) It is the case where the applicant allegedly represented over circulation of his publication in order to succeed in gett ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffence under the PMLA Act, has been released on bail under section 439 of the Cr.P.C. by observing that Thus, from cumulative perusal of the judgments cited on either side including the one rendered by the Constitution Bench of this Court, it could be deduced that the basic jurisprudence relating to bail remains the same inasmuch as the grant of bail is the rule and refusal is the exception so as to ensure that the accused has the opportunity of securing fair trial . 15. In the result, the application is allowed and the applicant is ordered to be released on regular bail in connection with ECIR/01/STSZO/2020, on executing a personal bond of ₹ 10,000/- (Rupees Ten Thousand Only) with one local surety of the like amount to the satisfaction of the learned Trial Court and subject to the conditions that he shall; (a) not take undue advantage of liberty or misuse liberty; (b) not act in a manner injurious to the interest of the prosecution; (c) surrender his passport, if any, to the lower court within a week; (d) not leave the State of Gujarat without prior permission of the concerned Trial Court; (e) mark presence before the concerned Police Station on alternate every Monday for i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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