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TMI Blog2021 (6) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... Court in Nikesh Tarachand Shah's case would render the twin conditions prescribed in Section 45(1) of the PMLA for release of an accused on bail to be void in toto; such conditions have to be disregarded of any legal force from its inception; they cease to be law; the same are rendered inoperative and that they are to be regarded as if they had never been enacted. That being so, the twin conditions for grant of bail under Section 45(1) of the PMLA as are now sought to be pressed into service by the ED cannot be considered to have revived or resurrected only on the prospective substitution of the words punishable for a term of imprisonment of more than three years under Part A of the Schedule with the words under this Act especially without there being any amendment with regard to the twin conditions for grant of bail which had specifically been declared to be unconstitutional as also in the absence of any validating law in this regard with retrospective effect. This Court has no hesitation to hold that as on date the twin conditions for grant of bail, as sought to be pressed by the learned ASG, are liable to be ignored and that the present petitions are required to be co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the grant of a licence under the 1975 Act for developing a residential colony. Thereafter, on 28.03.2008, Chintels and QVC Realty Company Limited (for short QVC), the assignors of the aforesaid land, entered into an agreement with Sobha Limited (for short Sobha) for developing the aforesaid land on a salable area sharing basis and in support of the aforesaid application for the grant of licence, filed such agreement before the DTCP. On favourable consideration of the application, on 22.11.2008, Chintels and DTCP entered into an agreement on the basis of which a licence bearing No.190/2008 dated 24.11.2008 was issued in favour of Chintels. As per the relevant term of the agreement, on which the licence was based, Chintels was required to reserve 25% of the developed residential plots on a 'No Profit No Loss' (for short NPNL) basis. It was further agreed between the parties that 75% of the NPNL plots would be allotted to registered applicants through a draw of lots (if so required) and the remaining 25% would be allotted to Non Resident Indians against Foreign Exchange; land owners whose land had been purchased by Chintels for setting up the colony; plots falling in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eking therein to prosecute the accused only under Section 10 of the 1975 Act. Since the accused in the FIR lodged by the Haryana police were no longer being prosecuted under Section 420 IPC, which was the only scheduled offence under the PMLA of which the petitioners were accused of, Chintels knocked the doors of the Delhi High Court through WP (CRL) 979-2020 - M/s Chintels India Limited vs. Union of India seeking therein quashing of the ECIR. Such petition was disposed of on 07.08.2020 with a direction that since at that stage the impugned ECIR was sans any scheduled offence under the PMLA the same be treated as closed. However, liberty was granted to the ED to revive the ECIR in case on the filing of a supplementary charge sheet and/ or framing of a charge against the accused they are sought to be prosecuted for any scheduled offence(s) under the PMLA. On 20.08.2020 the Haryana Police filed a supplementary charge sheet under Section 173(8) Cr.P.C. through which it was inter-alia alleged that qua licences Nos. 58/2013 and 79/2014 Chintels had not obtained any permission from the DTCP for change in beneficiary interest/ joint development rights and since for seeking such perm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrespondingly inflated the cost of the construction to reach at the final sale price which was equivalent to or even higher than the price of Villas sold under the general category. It is further the case of the prosecution that on 25.05.2012, Sobha and Chintels entered into 59 agreements to sell through which they agreed to sell 59 NPNL plots to LLPs created by Sobha at the price determined by the DTCP for sale of NPNL plots. On these agreements petitioner - Jagadish Nangineni appended his signatures on behalf of Chintels and Sobha. The sale consideration of ₹ 48 lakhs for each of the plots was agreed to be paid within 24 months from the date of execution of the agreement. Within three weeks from the date of the aforesaid agreement, the LLPs created by Sobha, through 59 agreements to sell, all dated 15.06.2012, further agreed to sell the NPNL plots to Eunomia Developers (for short Eunomia), which was another LLP created by Sobha. This time the agreed sale consideration for each plot was a little less than ₹ 50 lakhs and the payment was to be made on or before 24 months from the date of execution of the agreement. Thereafter, through separate agreements dated 22.7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Haryana Police, the only allegation contained therein was that the accused had breached the terms of the agreement/ licence and therefore they be proceeded against under Section 10 of the 1975 Act; contravention of Section 10 of the 1975 Act is bailable as it entails a punishment for imprisonment which may extend to three years along with fine; in the supplementary charge sheet filed by the Haryana police the petitioners are sought to be prosecuted under Section 420 IPC only on the ground that qua licence Nos. 58/2013 and 79/2014 Chintels had not obtained prior permission from the DTCP for change in beneficiary interest/ joint development rights which had caused financial loss to the government which permission has since been taken; for the delay in taking such permission the applicable administrative charges, in terms of the order of the DTCP dated 01.04.2016, have already been deposited by Chintels and thus there was no wrongful loss caused by the petitioners to any person/ authority; there is no complainant, including the DTCP, who/ which even alleges that the petitioners have played any fraud; the prayer made by the ED seeking police remand has been repeatedly rejected by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sonment of more than three years under Part A of the Schedule has been substituted with under this Act ; in view of the afore amendment the twin conditions prescribed under Section 45(1) of the PMLA stood revived; the amended Section 45(1) of the PMLA has not been challenged by the petitioners and therefore the petitioners as also this Court was bound by the aforesaid twin conditions prescribed therein; in terms of the law laid down by the Supreme Court in Nagaland Senior Government Employees Welfare Association and others vs. State of Nagaland and others, (2010) 7 SCC 643 a statute is deemed to be constitutionally valid till struck down by a competent Court; in Molar Mal (dead) through L.Rs. v. M/s. Kay Iron Works (Pvt.) Ltd., (2000) 4 SCC 285 the Supreme Court had held that where the constitutional validity of a provision was not under challenge such provision would bind the Court; in Ashutosh Gupta vs. State of Rajasthan (2002) 4 SCC 34 the Supreme Court has opined that where the challenge is made to a statutory provision allegations in the petition should be specific, clear and unambiguous and that there is a presumption in favour of the constitutionality of an enactment with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid agreement the LLPs created by Sobha, through 59 agreements to sell, all dated 15.06.2012, further agreed to sell the NPNL plots to Eunomia, which was another LLP created by Sobha; this time the agreed sale consideration for each plot was a little less than ₹ 50 lakhs and the payment was to be made on or before 24 months from the date of execution of the agreement; thereafter, through separate agreements Eunomia and Sobha agreed to jointly develop 59 NPNL plots with a further agreement to share the revenue in the ratio 17:83; this agreement was also signed by the petitioner Jagadish Nangineni on behalf of Sobha and Chintels; after construction of the Villas on all the NPNL plots they were put to sale for a price which was equivalent to or higher than the Villas sold under the general category and the conveyance deed with the purchaser of such Villas was not between Eunomia and the purchaser but between Sobha/ Chintels on one hand and the purchaser on the other; on the conveyance deed also the petitioner Jagadish Nangineni appended his signatures on behalf of Sobha and Chintels; the sale consideration for each of the Villas, as per the conveyance deed, was ₹ 3.56 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non- bailable.- (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), no person accused of an offence punishable for a term of imprisonment of more than three years under Part A of the Schedule shall be released on bail or on his own bond unless- (i) the Public Prosecutor has been given a 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, may be released on bail, if the Special Court so directs: Provided further that the Special Court shall not take cognizance of any offence punishable under Section 4 except upon a complaint in writing made by- (i) the Director; or (ii) any officer of the Central Government or a State Government authorised in writing in this behalf by the Central Government by a general or special order made in this behalf by that Government. The af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39;s case (supra) were substituted with the words under this Act . As per learned ASG, after such amendment, the defect on the basis of which the Supreme Court had declared Section 45(1) of the PMLA to be unconstitutional was cured and consequently the twin conditions prescribed in Section 45(1) stood revived. The declaration by the Supreme Court in Nikesh Tarachand Shah's case (supra) would render the twin conditions prescribed in Section 45(1) of the PMLA for release of an accused on bail to be void in toto; such conditions have to be disregarded of any legal force from its inception; they cease to be law; the same are rendered inoperative and that they are to be regarded as if they had never been enacted. That being so, the twin conditions for grant of bail under Section 45(1) of the PMLA as are now sought to be pressed into service by the ED cannot be considered to have revived or resurrected only on the prospective substitution of the words punishable for a term of imprisonment of more than three years under Part A of the Schedule with the words under this Act especially without there being any amendment with regard to the twin conditions for grant of bail which had s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brought an amendment to Finance Act, 2018 which has come into effect from 19.04.2018 to Section 45(1) of PMLA thereby inserting words under this Act in Section 45 (1) of the Act. In view of amendment, the original sub- Section (ii) of Section 45(1) which imposes the said twin conditions automatically stands revived and the said condition therefore remain on statute book. The original Section 45(1) (ii) has to be inferred and treated as it still exists on the statute book and holds the field even as of today for deciding application for bail by an accused under PMLA. It was further argued that by inserting words under this Act , the Judgment delivered by Supreme Court in Nikesh Shah (supra) has become in effective. The Court held that the Apex Court in Nikesh Shah (supra) has declared Section 45(1) of PMLA in so far as it imposes two further conditions for release on bail to be unconstitutional as it violates Articles 14 and 21 of Constitution of India. After effecting amendment to Section 45 (1) of PMLA. The words under this Act are added to sub- Section (1) of Section 45 of PMLA. However, the original Section 45(1) (ii) has not been revived or resurrected by Amending Act. Ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be ignored and that the present petitions are required to be considered under Section 438 Cr.P.C. In the light of the above conclusion, this Court considers it unnecessary to delve into the issues raised by the learned ASG with regard to the observations of the Supreme Court in Nikesh Tarachand Shah's case (supra) that Section 45(1) of the PMLA would not apply to anticipatory bails being per incuriam. Learned counsel appearing for the petitioners contended that Section 420 IPC was not attracted to the facts of the present case whereas the learned ASG argued otherwise. Lengthy and elaborate submissions of both the sides on this issue have been referred to in detail in the earlier part of this judgment. In the supplementary charge sheet filed by the Haryana Police in FIR No.291 dated 13.12.2018 registered under Section 10 of the 1975 Act and Section 420 IPC at Police Station Bajghera, District Gurugram the petitioners are sought to be prosecuted both under Section 420 IPC as also under Section 10 of the 1975 Act. There is no challenge by the petitioners to the supplementary charge sheet filed by the Haryana Police. Further, investigation by the ED qua the petitioners is st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ........ 83. Grant of anticipatory bail at the stage of investigation may frustrate the investigating agency in interrogating the accused and in collecting the useful information and also the materials which might have been concealed. Success in such interrogation would elude if the accused knows that he is protected by the order of the court. Grant of anticipatory bail, particularly in economic offences would definitely hamper the effective investigation. Having regard to the materials said to have been collected by the respondent-Enforcement Directorate and considering the stage of the investigation, we are of the view that it is not a fit case to grant anticipatory bail. 84. In a case of money-laundering where it involves many stages of placement , layering i.e. funds moved to other institutions to conceal origin and interrogation i.e. funds used to acquire various assets , it requires systematic and analysed investigation which would be of great advantage. As held in Anil Sharma, success in such interrogation would elude if the accused knows that he is protected by a pre-arrest bail order. Section 438 Cr.P.C. is to be invoked only in exceptional cases where the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he ED, have stated that they have paid ₹ 4.25 crores for the same. The ED alleges that both the petitioners are actively involved in the planning and execution of all the above transactions involving repeated transfer of funds and that since investigations qua the petitioners are still going on this may only be the tip of the iceberg. As per the afore allegations both the petitioners are accused of serious economic offences. The ED is in the midst of analysing the exact role of each of the petitioners qua the offences they are accused of. Grant of anticipatory bail to the petitioners at this stage would certainly result in putting a spoke in the wheel of the investigating agency and dampen their efforts in elucidating the required information from the petitioners. In view of the above discussion no merit is found in the present petitions and resultantly, they are both dismissed. It is clarified that the above observations have been made by this Court to decide the present petitions seeking anticipatory bail in which investigation is still going on and therefore these observations be not construed as opinion on the merits of the case. - - TaxTMI - TMITax - PMLA ..... X X X X Extracts X X X X X X X X Extracts X X X X
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