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TMI Blog2022 (11) TMI 1221X X X X Extracts X X X X X X X X Extracts X X X X ..... led offences, as is evident from paragraph 8 of Part-A of the Schedule to the PML Act. Any property thus derived as a result of criminal activity relating to offence mentioned in said paragraph 8 of Part-A of the Schedule would certainly be proceeds of crime . In view of the statutory provisions, the transactions of Tahir Hussain in a conspiracy to fraudulently withdraw money from the accounts of certain companies owned or controlled by him through bogus and malafide transactions with bogus entry operators on the strength of fake bills with him being the beneficiary and with intent putting it to use towards riots, then accused Tahir Hussain would be set to be deriving or obtaining property as a result of criminal activity associated with/relatable to scheduled offence as the proceeds of crime and will be guilty of money laundering. In terms of the contents of the complaint and the accompanying documents and statements, it emerges, prima facie, that accused Tahir Hussain, acting in conspiracy, engaged in money laundering, under the provisions of PMLA. The proceeds of crime generated in the conspiracy was put to use for riots. There is sufficient material on record, prima ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ropaganda may be spread at international level that the minorities are being oppressed in India. In furtherance of the conspiracy, Umar Khalid and his associates mobilized women and children on roads at different places in Delhi with intent to commit rioting. In pursuance thereof, firearms, petrol bombs, acid bottles, sling shots and other dangerous articles were stock piled at many houses at different locations in Delhi like Maujpur, Kardampuri, Jafrabad, Chand Bag, Gokulpuri, Shiv Vihar and adjoining areas. The responsibility to mobilise crowd from different places for indulging in rioting was given to Danish, S/o Khalid, a resident of Bhajanpura, Delhi. On 23rd February, 2020, the road beneath Jafrabad metro station was blocked by women and children so that the people residing in the adjoining areas are inconvenienced and there is tension in the area that could lead to riots. On that day, certain schools in the area having minority students were cleared of all students in a pre-planned manner. Funding for riots was done and riots happened accordingly in February 2020. 3.1.2 As per FIR No. 0065/2020 registered by PS Dayalpur, Delhi Police on 25.02.2020, one Ajay Goswami was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... New Delhi. Rahul Kasana and Girish Pal, employees of Tahir Hussain and eyewitnesses have given an account of the incidents leading to the riots on 23.02.2020 and 24.02.2020. In the month of January, 2020, Tahir Hussain went to an office in Shaheen Bagh where he was joined by Sh. Umar Khalid and Sh. Khalid Saifi. In this meeting, the three of them purportedly hatched a plan to incite people against CAA, to organize protests and to create unrest. Khalid Saifi was known to Tahir Hussain and used to frequently visit the office of Tahir Hussain. 3.3 It was argued that as per the complaint, accused Tahir Hussain hatched a conspiracy with his associates to fraudulently withdraw money from the accounts of certain companies i.e. M/s. Show Effect Advertisement Pvt. Ltd. (SEAPL), M/s. Essence Cellcom Pvt. Ltd. (ECPL) and M/s. Essence Global Services Pvt. Ltd. (EGSPL) owned and controlled by him through bogus and malafide transactions with bogus entry operator on the strength of fake bills and he was the ultimate beneficiary of laundered money. Money so obtained as a result of the criminal activity of the offence of criminal conspiracy is the proceeds of crime. The money was put to use d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Ram Wood Products 6 Rs. 6.5 lakh from SEAPL Vasundhara Sainyam Traders C. As per complaint, Meenu Fabrications alias Shri Sai Traders was owned by Sh. Jitender Kumar and controlled by Sh. Roshan Thakur; SP Financial Services Pvt. Ltd. Alias Sanjay Traders which owned by Sh. Pankaj Goswami and controlled by Sh. Yogesh Bansal; Yudhvee Impex alias Vikram Traders was owned by Sh. Ranjit Rabin Mandal and controlled by Sh. Nand Kumar Shukla; Kanhiya Enterprises alias Shree Ram Wood Products was owned by Sh. Vijender and controlled by Sh. S.K. Agarwal @ Shanki; Vasundhra alias Sainyam Traders was owned by Sh. Anita and controlled by Sh. Yogesh Bansal. D. In their statements recorded under Section 50 of the PMLA, the entry operators and others who facilitated/aided these transactions have corroborated the facts and the corresponding money trail. Tahir Hussain, in his statements recorded under Section 50 of the PMLA, has also confirmed that he had taken cash against GST/VAT bills from Sh.Amit Gupta; that Sh. Amit Gupta did not provide any goods or services against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and gave him money for use in anti-CAA protests/gathering people/any kind of nuisance or uproar and asked him to make complete arrangements. He also met a woman named Gul at Jafrabad, where another CAA protest was going on, handed over money to her and told her to do similar things as Suleiman Siddiqui. His active role in North East Delhi riots is highlighted by the fact that there was a sudden surge of persons in his office a few days before the riots and he conducted several meetings with them. Some such people were identified as Arshad Pradhan, Irshad Ahmed, Aabid Khan etc who were arrested by the Delhi Police/Crime Branch for instigating riots. The conspiracy hatched by Tahir Hussain with his associates to fund and organize anti-CAA protests and the North East Delhi riots was the result of his conspiracy to fraudulently withdraw money through bogus and malafide transactions. Tahir Hussain entered into a criminal conspiracy with other persons to fraudulently transfer money from the accounts of companies owned/controlled by him. The money so obtained by Tahir Hussain as a result of criminal activity relating to the offence of criminal conspiracy qualifies as proceeds of crim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IPC . Section 120-B IPC has to be read in relation to this charge-sheet and not the charge-sheet in other IPCs offences. Moreover, also there is no FIR for cheating under Section 420 IPC. There is no commonality of accused in this case and predicate offence. Accused Tahir Hussain, also, cannot conspire with himself in view of the pardon granted to Amit Gupta. 4.3 It was further argued that the complainant has relied upon the FIR and not the charge-sheet in those FIRs. Investigation in predicate offences has not been relied upon by the Directorate of Enforcement. Moreover, no provisional attachment order of any property of accused has been issued so far nor matter forwarded to the authority as there exist no proceeds of crime. For the purpose of proceeds of crime, it has to relate to a scheduled offence. 4.4 Accused has a genuine business and in fact, even, he had taken bank loan. Moreover, as per the best case of prosecution, accused has committed a GST violation and GST is not a scheduled offence for the purpose of PMLA. Ld. Counsel for accused had argued that the period of October 2019 to January 2020 being investigated cannot be the basis for investigation and transact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and he is in custody for the last two years. These arguments are not relevant on the question of charge. 7. 7.1 As per the case of the complainant/Directorate of Enforcement, FIR No. 59/2020, FIR No. 65/2020 FIR No. 88/2020 were registered by Delhi Police in connection with riots in February 2020 in North-East Delhi against Tahir Hussain and Others under various sections including Section 120-B IPC, 302 IPC, 307 IPC 385 IPC. Based upon the said scheduled offence, inquiries were initiated under the PMLA Act after recording the brief facts of the scheduled offence in ECIR No. ECIR/05-STF-2020 dated 09.03.2020 by the Directorate of Enforcement. 7.2 As per the prosecution, there was a conspiracy for riots and FIR No. 59/2020 was registered at Crime Branch and investigated by Special Cell, Delhi Police. The said file was also summoned for the perusal. Charge-sheet in the said case has already been filed and cognizance has also been taken of the offences under Section 13/16/17/18 Unlawful Activities (Prevention) Act, 1967, 120-B IPC, 109/114/124A/ 153A/109/147/ 148/149/153A/186/201/212/295/302/307/341/353/395/420/427/435/436/452 /454/468/471/34 IPC 25/27 Arms Act 3/, 4 PDP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r for the offence of money laundering. 7.4 Moreover, the fact that other co- accused was not an accused in other FIRs i.e. FIR No. 59/20, FIR No. 65/20 FIR No. 88/20, does not mean that he cannot be an accused in the present matter since both IPC and PMLA are different statutes to deal with different kinds of offences and both operate in their own spheres. The predicate offence and the predicate case is required for initiation of complaint by the Directorate of Enforcement, which then has to investigate into the aspect of money laundering which is in its domain. 7.5 Ld. Counsel for accused had argued that the commission of the offence of applicant/ accused can, at best, be taken as violation of GST Act and not PMLA; however, this argument is not tenable as even assuming this case, it cannot be said that accused cannot be prosecuted for the offence of money laundering under PMLA if the ingredients of the PMLA are made out. 7.6 There are statements of witnesses and even the accused/applicant recorded under Section 50 of PMLA which are admissible in law. The statements have to be taken at their face value for what it contains. 7.7 Ld. Counsel for accused has also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvices to a bogus entity Meenu Fabrications and that cash amounting to Rs. 60 lakh reached to Tahir Hussain through the entry operators after deduction of their commission amounts. B. Similar modus operandi was adopted in respect of other bogus companies as tabulated below Sl. No. Amount transferred from company Name of bogus company to whom amount was shown to be transferred to in RTGS/NEFT narration Entry operator in whose account amount was actually credited 1 Rs. 60 lakh from ECPL Meenu Fabrication Shri Sai Traders 2 Rs. 32 lakh from ECPL S P Financial Services Sanjay Traders 3 Rs. 20 lakh from EGSPL Meenu Fabrication Shri Sai Traders 4 Rs. 25.65 lakh from SEAPL Yudhvee Impex Vikram Traders 5 Rs. 15.28 lakh from SEAPL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kumar Gupta was the the Director of ECPL and EGSPL. The funds amounting to Rs. 1.12 Crores transferred to firms operated by entry operators from these two companies at the instruction of Tahir Hussain. He did not know about the ultimate beneficiary or the mechanism of cash generation. Also, he did not have any knowledge of the ultimate utilisation of the funds transferred out of his companies. 9.2.2 Mohammed Akram was the Director of ECPL and EGSPL. Funds amounting to Rs. 1.12 Crores transferred to firms operated by entry operators from these two companies at the instruction of Tahir Hussain. He did not know about the ultimate beneficiary or the mechanism of cash generation. Also, he did not have any knowledge of the ultimate utilization of the funds transferred out of his companies. 9.2.3 Roshan Pathak was the accountant of Tahir Hussain. Handled the cash and also the compliance part related to the bills. Worked at the instruction of Tahir Hussain. He did not have any knowledge of the ultimate utilisation of the cash funds generated through entry operator firms/companies. 9.2.4 Usman Ahmed used to supervise all the logistics support required for the production works ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on his motor cycle to get the cheques and RTGS forms signed from Sh. Nitesh Kumar Gupta on the instruction of Sh. Roshan Pathak. The same were handed over back to Sh. Roshan Pathak once they were signed. vi. On being asked, he stated that in the month of January, 2020, on being told by Tahir Hussain he drove him to Shaheen Bagh. On reaching in front of an office, Tahir Hussain asked him to park the vehicle. Tahir Hussain got down from the vehicle and went inside. After sometime, he also saw the entry of Sh. Umar Khalid and Sh. Khalid Saifi in the same office. He further stated that he knew Khalid Saifi for a long time as he used to frequently visit the office of Tahir Hussain and he had seen Umar Khalid in the news and media. vii. He revealed that he saw Tahir Hussain giving money to two persons who were related to the anti-CAA protests/Delhi riots because he drove Tahir Hussain in Chand Bagh area where the protest was going on. Tahir Hussain shouted to somebody to call one Suleiman Siddiqui, that after sometime, a person came and Tahir Hussain handed him over a bundle of money. From their conversation it was revealed that he was Suleiman Siddiqui. Suleiman Siddiqui had cove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nidhi and Kavita to leave early fearing any untoward incident might happen. Gradually, all th office staff left the for their home. He and Rahul Kasana were the last ones to leave the office premises on Rahul Kasana's bike between 1-1.30 PM. He had not gone to the office of SEAPL since then. 9.2.8 Amit Gupta, was an aide of Tahir Hussain who arranged cash in lieu of the RTGS/NEFT from the companies owned/ controlled by Tahir Hussain. He did not have any knowledge of the ultimate utilisation of the cash funds generated through entry operator firms/companies. 9.2.9 Manoj Thakur, was a GST Consultant who helped Amit Gupta in arranging cash for Tahir Hussain in lieu of the RTGS/NEFT from the companies owned/controlled by Tahir Hussain. He did not know Tahir Hussain or had any knowledge of the ultimate utilisation of the cash funds generated through entry operator firms/companies. 9.2.10 Roshan Thakur, was an entry operator who controlled the bank account of Shri Sai Traders (Rs. 80 lakhs transferred in it) and helped Manoj Thakur Amit Gupta in arranging cash for Tahir Hussain in lieu of the RTGS/NEFT from the companies owned/controlled by Tahir Hussain. He did not know T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Lokesh Singhal. Did not have any knowledge about the transactions carried out from this account. 9.2.17 Yogesh Bansal, was an entry operator who controlled the bank account of Sanjay traders and Sainyam Traders (Rs. 32 6.5 Lakhs respectively transferred in it from ECPL SEAPL) and helped Manoj Thakur Amit Gupta in arranging cash for Tahir Hussain in lieu of the RTGS/NEFT from the companies owned/controlled by Tahir Hussain. He did not know Tahir Hussain or had any knowledge of the ultimate utilisation of the cash funds generated through entry operator firms/companies. 9.2.18 Pankaj Goswami, was the Proprietor and account holder of Sanjay Traders. The account was actually used and controlled by Shri Yogesh Bansal. Did not have any knowledge about the transactions carried out from this account. 9.2.19 Pankaj Bansal, was an entry operator who arranged cash of Rs. 15.28 Lakhs the bank account of Vikram Traders (Rs. 15.28 Lakhs transferred from SEAPL) and helped Amit Gupta in arranging cash for Tahir Hussain in lieu of the RTGS/NEFT from the companies owned/controlled by Tahir Hussain. He did not know Tahir Hussain or had any knowledge of the ultimate utilisation of the cash ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and referred to the transaction of Rs. 5.71 Lakhs to Yudhvee Impex @ Vikram Traders from M/s. Show Effect Advertisement Pvt. Ltd., as relevant not for this case but for showing the past conduct of the accused. 10. Proceeds of Crime under the PMLA is defined as under :- Section 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 the 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 include 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] Sections 3 and 4 of the PML Act which are the principal sections for the present purposes, are as under: - 3. Offence of money-laundering.- Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sult of any criminal activity relatable (associated with/has to do with) to the scheduled offence. Recently, Hon'ble Supreme Court of India in a case titled as Directorate of Enforcement versus Padmanabhan Kishore, SLP (Crl.) No. 2668/2022 decided on 31.10.2022 on the question of proceeds of crime and money-laundering under PMLA inter alia stated as under :- ......5. As is evident from the quoted portion, the respondent had allegedly handed over a sum of Rs.50,00,000/- (Rupees fifty lakhs only) to a public servant, which transaction and the surrounding circumstances were projected in FIR dated 29.8.2011, leading to registration of crime under Section 120B, Indian Penal Code, 1860 ( IPC , for short) and Sections 7, 12, 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act, 1988 ( PC Act , for short). Later, a case was registered by the Enforcement Directorate against the accused including the respondent under Sections 3 and 4 of the PML Act. 6. The basic submission advanced on behalf of the respondent was that the amount in question, as long as it was in the hands of respondent, could not be said to be tainted money; that it assumed such character on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssession, acquisition or use shall be guilty of offence of money-laundering (emphasis added by us). 16. It is true that so long as the amount is in the hands of a bribe giver, and till it does not get impressed with the requisite intent and is actually handed over as a bribe, it would definitely be untainted money. If the money is handed over without such intent, it would be a mere entrustment. If it is thereafter appropriated by the public servant, the offence would be of misappropriation or species thereof but certainly not of bribe. The crucial part therefore is the requisite intent to hand over the amount as bribe and normally such intent must necessarily be antecedent or prior to the moment the amount is handed over. Thus, the requisite intent would always be at the core before the amount is handed over. Such intent having been entertained well before the amount is actually handed over, the person concerned would certainly be involved in the process or activity connected with proceeds of crime including inter alia, the aspects of possession or acquisition thereof. By handing over money with the intent of giving bribe, such person will be assisting or will knowingly be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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