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TMI Blog2022 (11) TMI 755X X X X Extracts X X X X X X X X Extracts X X X X ..... e the fact that he after having indulged in criminal activity possessed/ acquired or procured wealth/property with the help and aid of the proceeds of crime, Enforcement Department would have been justified to proceed against bail petitioner under Section 3 and 4 of Prevention of Money Laundering Act, 2002. No doubt, the petitioner is accused of having committed serious offence under Sections 3 and 4 of Prevention of Money Laundering Act, 2002, but guilt if any of the bail petitioner is yet to be established on record by leading cogent and the convincing evidence and as such there appears to be no reason to curtail his freedom for an indefinite period during trial, especially when investigating agency has already taken into custody entire record from the accused and he is in judicial custody for over a month - apprehension expressed by the learned Deputy Solicitor General of India that in the event of petitioner being enlarged on bail, he may flee from justice and tamper with the prosecution evidence can be best met by putting him to stringent conditions. By now, it is well settled that gravity alone cannot be a decisive ground to deny bail, rather competing factors are requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Court at Additional Chief Judicial Magistrate, Una. Besides above, police also shared information with regard to filing of aforesaid FIR No.252 of 2021 and registration of case under Section 120-B IPC with Directorate of Enforcement. 3. Having taken note of the fact that accused named in the aforesaid FIR were also charged with the offence punishable under Section 120-B, of IPC, which is a scheduled offence under PMLA, Directorate of Enforcement with a view to investigate the matter registered Enforcement Case Information Report (hereinafter referred to as 'ECIR') as detailed herein above. During investigation of aforesaid ECIR, police conducted investigation against certain persons named in the FIR bearing No.252 of 2021 and during investigation found involvement of present bail petitioner, as such, while exercising powers under Section 17 of Prevention of Money Laundering Act, 2002, raided his residential premises as well as business premises and allegedly recovered some incriminating documents suggestive the fact that petitioner has indulged in the offence punishable under Sections 3 4 of PMLA. On the basis of aforesaid material collected during raid, Enforcement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 of the PMLA. 6. Lastly, Mr. Chandel, learned Senior Counsel, submitted that medical evidence adduced on record along with the petition clearly reveals that the petitioner is highly diabetic, overweight and has already undergone heart-surgery as a result of which, it is not safe to keep him behind bars because at any time, he may require immediate medical intervention. While inviting attention of this Court to the material placed on record with regard to treatment being given to the bail petitioner, Mr. Chandel argued that the petitioner is also suffering from acute liver cirrhosis of first stage, which requires constant medication. Mr. Chandel further argued that though petitioner deserves to be enlarged on bail on the ground that no case, much less case under Section 3 4 of Prevention of Money Laundering Act, 2002 is made out against the bail petitioner, but even otherwise, this Court having taken note of medical condition of bail petitioner coupled with the fact that he is in judicial custody for over a month now and nothing remains to be recovered from the bail petitioner, may order his enlargement on bail, subject to stringent conditions. 7. Sh. Balram Sharma, learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Prevention of Money Laundering Act. 8. While referring to Section 19 of the Prevention of Money Laundering Act, Mr. Balram Sharma, learned Deputy Solicitor General vehemently argued that on the basis of material collected during investigation, if investigating Officer has reasons to believe that any person is guilty of offence punishable under this Act, he can arrest such person and at that stage he is only required to be informed with regard to reason of his arrest but no material collected in evidence is required to be shared with him. while making his submissions, Mr. Balram Sharma, Deputy Solicitor General also made available one sealed envelop containing therein document allegedly recovered from the premises of the bail petitioner to demonstrate the manner in which, proceeds of the crime have been used. He further invited attention of this Court to Section 45 of the Act to state that bail in cases registered under PMLA cannot be granted mechanically, especially applying the parameters on the basis of which bail is considered/granted by the Court while exercising power under Sections 437, 438 and 439 in the offences punishable under various provisons of Indian Penal Code ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcement found evidence that the present bail petitioner has indulged in the indiscriminate mining in Swan River Una and earned huge money by illegal means and subsequently attempted to project the same as untainted property, it recorded ECIR against him and thereafter for investigation arrested him. As per Enforcement Department, ECIR as detailed herein above has been registered against petitioner under Sections 3 and 4 of Prevention of Money Laundering Act, 2002 , which reads as under:- 3. Offence of money-laundering.-Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime including its concealment, possession, acquisition or use and projecting or claiming it as untainted property shall be guilty of offence of money-laundering. [Explanation.-For the removal of doubts, it is hereby clarified that,- (i) a person shall be guilty of offence of money-laundering if such person is found to have directly or indirectly attempted to indulge or knowingly assisted or knowingly is a party or is actually involved in one or more of the following processes or act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d acquisition or use. So to attract aforesaid provision, Investigating Agency either is required to establish that proceeds from the crime were concealed or they were possessed or with the help of the and aid of the same, some property was acquired and same was used for some other purposes. At this stage, it would be apt to take note of definition of 'proceeds of crime' as given under Section 2 (u)which reads as under:- 2(u) Proceeds of crime means any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence or the value of any such property or where such property is taken or held outside the country, then the property equivalent in value held within the country or abroad; Explanation-For the removal of doubts, it is hereby clarified that proceeds of crime including property not only derived or obtained from the scheduled offence but also any property which may directly or indirectly be derived or obtained as a result of any criminal activity relatable to the scheduled offence . 13. Proceeds of crime means any property derived or obtained, directly or indirectly, by any person as a result ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 26. Section 3 of PMLA stipulates money-launderig to be an offence. Section 3 of PMLA states that whosoever directly or indirectly attempts to indulge or knowingly assist or knowingly is a party or is actually involved in any process or activity connected with the proceeds of the crime and projecting it as untained property shall be guilty of the offences of money-laundering. The provisions of PMLA including Section 3 have undergone various amendments. The words in Section 3 with the proceeds of crime and projecting has been amended as proceeds of crime including its concealment, possession, acquisition or use and projecting or claiming by Amendment Act 2 of 2013 (w.e.f. 15-2.2013) . 14. Recently Hon ble Apex Court in case tilted as Vijay Mandal Chaudhary and others versus Union of India and others had an occasion to deal with question of constitutionality and validity of certain provisions of Prevention of Money Laundering Act, 2002, wherein Court after having examined entire Act, while drawing conclusion in para 467, specifically observed that the offence under Section 3 of the 2002 Act is dependent on illegal gain of property as a result of criminal activity re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or ; and being a clarificatory amendment, it would make no difference even if it is introduced by way of Finance Act or otherwise.. (b) Independent of the above, we are clearly of the view that the expression and occurring in Section 3 has to be construed as or , to give full play to the said provision so as to include every process or activity indulged into by anyone. Projecting or claiming the property as untainted property would constitute an offence of money-laundering on its own, being an independent process or activity. (c) The interpretation suggested by the petitioners, that only upon projecting or claiming the property in question as untained property that the offence of section would be complete, stands rejected. (d) The offence under Section 3 of the 2002 Act is dependent on illegal gain of property as a result of criminal activity relating to a scheduled offence. It is concerning the process or activity connected with such property, which constitutes the offence of money-laundering. The Authorities under the 2002 Act cannot prosecute any person on notional basis or on the assumption that a scheduled offence has been committed, unless it is so registered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is aimed at countering and penalising the malaise of wealth and assets acquired as a result of criminal activity. B. It is evident from a reading of the Act that while the commission of a predicate offense is the precipitate step for initiation of proceedings under the Act, the offense of money laundering must be tried and established separately. It is also pertinent to observe that the predicate offense constitutes the very foundation of a charge of money laundering. The entire edifice of a charge of money laundering is raised on an allegation of a predicate offense having been committed, proceeds of crime generated from such activity and a projection of the tainted property as having been legitimately acquired. C. However, once it is found on merits that the accused had not indulged in any criminal activity, the property cannot legally be treated as proceeds of crime or be viewed as property derived or obtained from criminal activity. Since the offense of money laundering is itself premised and founded upon the commission of a crime created under an independent statute, it cannot possibly survive or subsist once the predicate offense is found to be not established and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld come into play only if proceeds of crime are found to have been generated. As this Court reads Section 3 it finds that the offence of money laundering has an enduring and ineffaceable link to proceeds of crime. Absent the commission of a criminal offence, the foundation of proceedings initiated under the Act would undoubtedly fall and self-destruct ... ... 16. In the instant case, it is pertinent to take note of fact that though ECIR, which is subject matter of present case, is claimed to be not made on the basis of FIR 252 of 20221, but as has been discussed herein above entire genesis of the case against petitioner is on the basis of allegation contained in FIR No. 252 of 2021 wherein admittedly petitioner was not made an accused. Even after having completed investigation though police found offence alleged to have been committed by accused named in the FIR Section 120-B but not against the petitioner and as such he was not named even in the final report under Section 173, Cr.P.C. Though, Mr. Balram Sharma, learned Deputy Solicitor General argued that on the basis of information shared by police pursuant to lodging of aforesaid FIR and challan, wherein Section 120-B was als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctivity possessed/ acquired or procured wealth/property with the help and aid of the proceeds of crime, Enforcement Department would have been justified to proceed against bail petitioner under Section 3 and 4 of Prevention of Money Laundering Act, 2002. 17. As per Enforcement Department, petitioner approximately earned Rs.35 crore on account of illegal mining, but interestingly at no point of time Mining Department ever came to be associated nor area was got demarcated by Joint Inspection Committee as has been specifically provided under Mining Mineral Rules, 2015 rather department after having associated some private surveyor arrived at a conclusion that petitioner has extracted mines and minerals from area over and above leased out to him, as a result of which he earned approximately Rs. 35 Crores, so aforesaid amount arrived at by department is all imaginary and presumptive. Even the documents made available in sealed cover to this Court do not support aforesaid claim of the Enforcement Department. Though aforesaid aspects of the matter are to be decided by the Court below in its totality but at this stage this court for the reasons detailed herein above has reasons to presu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as stated to be obese having 153 Kg.wWeight, having erratic hypertension and diabetes was ordered to be enlarged on bail. It would be apt to take note of para-20 and 21 of the aforesaid judgment: 20. A perusal of above reproduced medical report shows that the petitioner is an obese person weighing 153 kilograms having erratic hypertension and diabetes issues. Additionally he is found to be having Coronary Artery Disease(CAD). Though, it appears that he was taken to Civil Hospital, Ambala and was provided treatment, where he also remained admitted but the Doctor, in the aforesaid certificates, has in unambiguous terms opined that the physical health condition of said patient is deteriorating considerably. 21. Obesity, as in the case of the petitioner, who weighs 153 kilograms is not just a symptom but is itself a disease which becomes root-cause of several other diseases. With such co-morbodities, the response, the resistance, the resilience and the capacity of the body to fight ailments and recuperate efficaciously, decreases substantially. The jail doctor or for that matter, a civil hospital may not be fully equipped to handle a patient having multiple ailments who apart fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt of bail. The object of bail is neither punitive nor preventative. The Hon ble Apex Court in Sanjay Chandra versus Central Bureau of Investigation (2012)1 Supreme Court Cases 49; has been held as under:- The object of bail is to secure the appearance of the accused person at his trial by reasonable amount of bail. The object of bail is neither punitive nor preventative. Deprivation of liberty must be considered a punishment, unless it can be required to ensure that an accused person will stand his trial when called upon. The Courts owe more than verbal respect to the principle that punishment begins after conviction, and that every man is deemed to be innocent until duly tried and duly found guilty. Detention in custody pending completion of trial could be a cause of great hardship. From time to time, necessity demands that some unconvicted persons should be held in custody pending trial to secure their attendance at the trial but in such cases, necessity is the operative test. In India , it would be quite contrary to the concept of personal liberty enshrined in the Constitution that any person should be punished in respect of any matter, upon which, he has not been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an accused pending trial or in appeal against conviction is discretionary in nature, it has to be exercised with care and caution by balancing the valuable right of liberty of an individual and the interest of the society in general. It was elucidated that the seriousness of the charge, is no doubt one of the relevant considerations while examining the application of bail but it was not only the test or the factor and that grant or denial of such privilege, is regulated to a large extent by the facts and circumstances of each particular case. That detention in custody of under-trial prisoners for an indefinite period would amount to violation of Article 21 of the Constitution was highlighted. 24. The Apex Court in Prasanta Kumar Sarkar versus Ashis Chatterjee and another (2010) 14 SCC 496 , has laid down the following principles to be kept in mind, while deciding petition for bail: (i) whether there is any prima facie or reasonable ground to believe that the accused had committed the offence; (ii) nature and gravity of the accusation; (iii) severity of the punishment in the event of conviction; (iv) danger of the accused absconding or fleeing, if released on bail; ..... X X X X Extracts X X X X X X X X Extracts X X X X
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