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TMI Blog2022 (6) TMI 617X X X X Extracts X X X X X X X X Extracts X X X X ..... irectors in M/s Durga Apparels Pvt Ltd ("DAPL"), having its registered office at L-93, Chanakaya Place Part 2, New Delhi- 110059. The said company is involved in the business of export/import of garments and carpets. (ii) A prosecution complaint was filed against the applicant by the Directorate of Revenue Intelligence (hereinafter "DRI") on 23rd April 2018, alleging commission of predicate offences under Sections 132 and 135 of the Customs Act, 1962, during 20102011 with respect to disbursal of duty drawback on the overvalued exports subsequently leading to extra duty drawbacks to the tune of Rs.32.25 Crores. (iii) After investigating the case for almost 7 years, DRI registered the abovementioned ECIR on 23rd December 2019 on twin allegations:- - that Low value invoices were submitted by Representative of foreign buyer for obtaining the Certificate of Origin of goods from Delhi Chamber of Commerce. - and that Full Exports proceeds received against value of goods were arranged by foreign buyer and sent through Bank to India. (iv) The complaint was forwarded by DRI to Directorate of Enforcement (hereinafter "ED") on 19th November 2019 and on 23rd December 2019, an ECIR bearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other benefits into cash through entry operators. e. The applicant used the services of Mr. Deep Chand Singhal, Ghanshyam Das Gupta and Rajeev Goel to get fund reintroduced into the banking channels and then utilized the same for purchasing assets and in this regard relevant bank account statements, registry documents and statements were recorded. f. The applicant also got prepared forged documents of the property at Sainik Enclave to depict the purchase of subject property in the year 2006, so as to dissociate the purchase made in the year 2011 from the proceeds of crime. The roles of individuals and firms were also recorded who knowingly indulged in the said activity. g. The main issue before the Court was whether the twin conditions as envisaged under Section 45 of the PMLA are applicable even after amendment the stage of bail or not. The latest position before the Hon'ble Supreme Court on 4th January 2021 was that the mandate of Section 45 has to be dealt before deciding the anticipatory bail. This is equally applicable for deciding regular bail when the accused is in custody. h. No prima facie case was made out and therefore, because of embargo under Section 45 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d is in no way involved in the conduct of the business by the other four companies/firms. Apart from few isolated transactions the applicant never conducted any business with them. Moreover, none of these companies/firms or any of the persons engaged in the conduct of these business are arraigned as an accused in the present case. 7. Learned senior counsel for the applicant submitted that the arrest effected on 25th September 2021 at 4:15 AM is manifestly arbitrary not only on the ground and for the reason that, in the predicate offence the investigating authorities of DRI have already placed the prosecution complaint on record on 23rd April 2018 before the designated trial Court without arresting the applicant but also on the ground that the cognizance of offence and summoning order qua the applicant had already been passed. It would be pertinent to mention here that in the predicate offence, the liberty of the applicant was never curtailed and he has been charge sheeted without arrest. Therefore, the very arrest of the applicant ex-facie is needless and does not subserve the cause of justice. 8. Learned senior counsel further submitted that the allegations in the complaint suff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f bail would apply. 12. It is submitted on behalf of the applicant that the Court below rejected the first bail application of the applicant on 9th December 2021 on the ground of seriousness of allegation and nature of offence, while as the second bail application was rejected on the ground of moratorium of twin conditions of Section 45 of the PMLA due to order of the Hon'ble Supreme Court in the case of Assistant Director, Directorate of Enforcement vs Dr. V.C Mohan, 2022 SCC OnLine SC 452. The order rejecting bail has been passed ignoring the fact that applicant's matter is about 10 years old, that he is already on bail in the scheduled offence and that there is no scope of him repeating the offence and even twin conditions have already been declared ultra vires by the Hon'ble Supreme Court in the case of Nikesh Tarachand Shah Vs. UOI, 2018 (11) SCC 1. Therefore, the order of the Hon'ble Supreme Court in the case of Dr. V.C. Mohan (Supra) does not over-ride the judgment of Nikesh Tarachand Shah (Supra). In view of the above law settled, the applicant is entitled to bail. 13. The law qua PMLA, specifically Section 45, stands well settled that the twin conditions for the purposes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is a travesty of justice and amounts to a complete misuse of investigative powers. 17. It is submitted that the Hon'ble Supreme Court of India in the landmark judgment of Arnesh Kumar vs. State of Bihar (2014) 8 SCC 273 very clearly held that where the concerned Court/Magistrate before whom an accused is produced post arrest, finds that the arrest is in violation of law, he is bound to release the accused forthwith. As the very intent of the legislature has been violated in the present case, the investigating authorities have blatantly violated the solemn and sacrosanct principle of presumption of innocence in favour of the applicant in the present case. Learned senior counsel for the applicant, on instructions, undertakes that the applicant would not tamper with evidence and would always make himself available before the learned Trial Court during the course of trial, except when he is exempted with the prior permission of learned Trial Court. The applicant also undertakes to join the further investigation being conducted by the respondent and that the applicant has no criminal antecedents. 18. It is further submitted that the applicant undertakes to abide by any directions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) wherein it is held that 37 of NDPS, Section 45 of PMLA, Section 212(6) of Companies Act, 43 d (5) of UAPA, POCSO, etc are to be complied before grant of bail. 23. It is also submitted that placing of reliance on various Single Bench decisions of the High Courts in connection with the issue is of no use to the applicant, considering the decision rendered by the Division Bench in Ajay Kumar (Supra) and the recent decisions of the Hon'ble Supreme Court in the case of Directorate of Enforcement vs. Parkash Gurbaxani 2021 SCC OnLine SC 3185 and Dr. V.C. Mohan (Supra). It is further submitted that the economic offences constitute a class apart and bail should not be granted in such cases. In this regard learned counsel has relied upon the judgment of the Hon'ble Supreme Court in the case of Rohit Tandon vs. Directorate of Enforcement (2018) 11 SCC 46. In this case the Hon'ble Supreme Court held as under:- "21. The consistent view taken by this Court is that economic offences having deep-rooted conspiracies and involving huge loss of public funds need to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious thr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Another, (2005) 2 SCC 42. Learned counsel for the respondent vehemently submitted that considering the seriousness and high magnitude of the offence, the period of incarceration in jail should not be a governing factor in the present case. Learned counsel for the respondent submitted that the present application is devoid of any merit and is liable to be dismissed. ANALYSIS AND FINDINGS 25. Heard learned counsel for the parties at length and have also gone through the written submissions which have been placed on record on their behalf. 26. The allegation against the applicant is that he procured goods from various places within India to export the same in the name of different firms/companies by inflating the value by several times and also prepared two sets of invoices bearing the same serial number and dates and on the basis of inflated values, extra duty drawbacks were claimed and obtained Rs. 32.25 Crores. The proceeds were converted from bank accounts to cash through various modes and then reintroduction of cash in banking channels and its utilization. Direct utilization of cash, purchase of assets, documentary evidence as well as statement of witnesses and applicant under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctor; 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. 30. A plain reading of the provision would show the embargo imposed by Section 45(1) PMLA on grant of bail that has taken form of twin conditions - (i) that the Public Prosecutor shall be given an opportunity to oppose the application for release, and (ii) where the Public Prosecutor opposes such application, the Court should be satisfied that there are reasonable grounds for believing that the accused is not guilty of the offence and that he is not likely to commit any offence while on bail. The limitations so imposed are in addition to those imposed under Cr.P.C. and have an overriding effect over the provisions of the Code, in case there occurred any inconsistency between the provisions of the two. Though stringent, they were held by the Supreme Court to be mandatory. In Rohit Tandon (Supra) observed as under:- "18. The argument though attractive at the first blush deserves to be rejected. In our opinion, the order dated 10-8-2017 [Rohit Tandon v. Directorate of Enforceme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hah (Supra), an amendment was made to Section 45 of the PMLA vide the Finance Act, 2018 and brought into effect from 19th April 2018. The new Section 45(1) PMLA reads as follows:- "45. Offences to be cognizable and nonbailable.- (1) [Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), no person 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 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- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the stage of considering the application for grant of bail, shall consider the question from the angle as to whether the accused was possessed of the requisite mens rea. The Court is not required to record a positive finding that the accused had not committed an offence under the Act. The Court ought to maintain a delicate balance between a judgment of acquittal and conviction and an order granting bail much before commencement of trial. The duty of the Court at this stage is not to weigh the evidence meticulously but to arrive at a finding on the basis of broad probabilities. Further, the Court is required to record a finding as to the possibility of the accused committing a crime which is an offence under the Act after grant of bail." 37. In the instant case, the offence is squarely made out against the applicant as DRI has already filed a complaint and cognizance has already been taken by the concerned Court. As per the allegations, the applicant is unique modus operandi to procure the goods from various places within India to export the same in the name of different firms/companies by inflating the value by several times. Two sets of invoices bearing the same serial number a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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