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TMI Blog2024 (4) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... sued has to be done only by a transparent policy being issued. Shell companies - HELD THAT:- A detailed list has been given in the counter affidavit about the various shell companies which are alleged to have been incorporated by this petitioner - It is also seen that though it is contended that two forensic audits had been conducted and no irregularity had been found, third audit was conducted over the affairs of the companies and the report is not to the advantage of the petitioner. All these aspects require deep investigation. In the instant case, the allegation against the petitioner with respect to diversion and misappropriation of funds is that SPL had borrowed funds of Rs. 1,4945.76 crores and had not even started the 2 X 210 MW power plant at Raichur in Karanataka. The account was also declared as NPA. It is also seen that for construction, SPL had awarded sub-contracts to entities which were, according to the respondent, controlled by the petitioner. Further very specifically shell companies were incorporated and there was only paper transaction reflecting the turn over. The amounts diverted back to the companies showing them as contribution of the petitioner. All these ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... over the affairs of SPL. It was contended that the banks had stopped disbursing loan from June 2013. Thereafter, since no steps was taken to liquidate the assets or to revive the project, the outstanding which was Rs. 1,400 crores increased and finally SPL was subjected to order of liquidation the National Company Law Tribunal, Chennai by order dated 28.01.2019. It had been sated that based on another Forensic Audit Report, the liquidator of SPL had filed an application under Section 66 of IBC 2016 alleging fraud but the said application had been rejected by NCLT. 5. The case of the prosecution is that SPL had awarded contracts to construct the 2 X 210 MW power plant to entities owned and controlled by the petitioner, namely, Vinayaga Infra Ltd., B.K.Power and Machinery, BLS Power Solutions, RR Tools Pvt. Ltd. However, this allegation had been very emphatically denied by the petitioner. It had been stated that the suppliers / contractors were BHEL and other contractors and not the aforementioned companies. 6. It is the further allegation of the prosecution that the petitioner had incorporated several shell companies and there was only paper transactions without actual movement of g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Karnataka with 25 MW captive power plant. 11 . In the counter affidavit, specific details had been given with respect to the transactions with various companies which were alleged to be under the control of the petitioner. It was also stated that a number of dummy companies were incorporated by the petitioner and in these companies only paper transactions were made. It was also stated that the petitioner had diverted the funds from Surana group of companies to the dummy companies and later the amounts were brought back to the Surana group of companies but in the process, misappropriation of funds had taken place. The specific details about the nature of the transactions had been given in the counter. The method in which the money was laundered by manipulating the accounts was also stated. 12. It was very specifically stated that the petitioner arranged funds through three shell companies which were also named. It was stated that during the course of investigation, movables and immovable properties to a total value of 249 crores alone had been secured and attached. It had been stated that the petitioner is an accused in Special C.C.No. 9 of 2022, Special C.C.No. 10 of 2022 and Spec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the affairs of the companies and the report is not to the advantage of the petitioner. All these aspects require deep investigation. 16. In 2023 SCC OnLine SC 645 [Y.Balaji Vs. Karthik Desari Anr. Etc.,] the Hon'ble Supreme Court while examining the scope of Section 3 of PML Act had held as follows:- 95. Section 3 of the Act which defines the offence of money- laundering reads as follows: 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 activities connected with proceeds of crime, namely: (a) concealment; or (b) possession; or (c) acquisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e-routed as if they were his contribution to various companies. 20. In AIR 2016 SC 106 [Gautam Kundu V. Manoh Kumar], the Hon'ble Supreme Court had observed as follows:- 33....... We have noted that Section 45 of the PMLA will have overriding effect on the general provisions of the Code of Criminal Procedure in case of conflict between them. As mentioned earlier, Section 45 of the PMLA imposes two conditions for grant of bail, specified under the said Act. We have not missed the proviso to Section 45 of the said Act which indicates that the legislature has carved out an exception for grant of bail by a Special Court when any person is under the age of 16 years or is a woman or is a sick or infirm. Therefore, there is no doubt that the conditions laid down under Section 45A of the PMLA, would bind the High Court as the provisions of special law having overriding effect on the provisions of Section 439 of the Code of Criminal Procedure for grant of bail to any person accused of committing offence punishable under Section 4 of the PMLA, even when the application for bail is considered under Section 439 of the Code of Criminal Procedure. 21 . It is thus seen that the petitioner wil ..... X X X X Extracts X X X X X X X X Extracts X X X X
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