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TMI Blog2024 (4) TMI 375X X X X Extracts X X X X X X X X Extracts X X X X ..... ming of charge. Such issue may also arise when there are counter cases against each other. Both these cases also need to be tried separately even though it may be by the same Judge. By inserting this provision, the Legislatures want to suggest that the trial of scheduled offences and trial of PMLA offences will have to be conducted independently though by the same Judge. As per Section 3 of the PML Act, anyone involved in the process of proceeds of crime, it is an offence. The scheduled offences are the offences laid down as per the schedules. The scheme of the Act does not suggest that there can be an investigation for PMLA offences only when there is a conviction in a trial involving the scheduled offences . A person accused of PMLA offence may contend that unless it is proved that the proceeds alleged by the Enforcement Directorate were derived from the criminal activity is proved, they cannot be convicted. When the trial of PMLA offences in this case will be started? - HELD THAT:- A draft charge is already filed on behalf of the E.D. It is true that yet the Special Court has not proceeded further after framing of charge, that is to say, hearing the Prosecution and hearing the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ense Counsels have also a role to play. On one hand, they have got every right to protect the interest of their clients and at the same time, they have to come forward for early disposal of the case. Because, they are also part and parcel of the system. And the system must work. Defence Counsels are also part of the same Society for betterment of which system is created. Bail application allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... ocedure, 1973 ("Cr. P.C./Code"). (b) Filing Bail Application / other Applications do not amount to delaying the conduct of trial and as such, the disqualification mentioned in that Section cannot be used against the Applicants, And (c) There is no death penalty prescribed for this offence. 5. Whereas, learned Advocate Shri. Venegavkar for E.D., opposed the bail on following grounds:- (a) There is no absolute right recognized as per Section 436-A of Cr. P.C. (b) The seriousness of the allegations and severity of punishment need to be considered prior to exercising discretion as per Section 436-A of the Code. (c) There is difference in between 'right to default bail' under Section 167 of the Code on one hand and under Section 436-A of the Code on the other hand. (d) The order refusing bail passed by the trial Court records all the circumstances which have resulted into delaying the conduct of the trial. Punishment prescribed 6. These Applicants are accused of committing the offence under Section 3 of PML Act. The punishment prescribed under Section 4 is as follows:- (i) There will be minimum sentence for 3 (three) years, (ii) Maximum sentence will be 7 (seven) ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also. Order dated 4th October, 2023:- (A) The Learned Special Judge has dealt with the issues and given findings as follows :- (a) The date of arrest for both the Applicants is 17th October 2019. Accused No. 1 - Rakesh Kumar Wadhawan filed Application on 30th March 2023. It means, the Applicant was behind bar for 3 years, 5 months and 13 days on the date of Application. On the basis of said Application, the Applicant was held not entitled to the benefit. (Para 10). (b) Accused No. 2 - Sarang Wadhawan filed Application on 4th May 2023. At that time, the period undergone was 3 years, 6 months and 17 days. (Para No. 11). Admittedly, when these Applications are filed before this Court, both the Applicants are behind bar for more than half of the punishment. (c) In Para No. 12:- The trial Court has noted filing of the main complaint and filing of two subsequent complaints and still, the investigation is going on. The trial Court observed:- As per explanation (ii) to Section 44 of PML Act, yet total proceeds of crime are to be ascertained finally. (Subsequent complaint by way of legal fiction is included in the first complaint as per the said explanation). The trial Court also n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'ble Supreme Court in case of Vijay Madanlal Choudhary v/s. Union of India 2022 SCC OnLine SC 929 (Paragraph Nos. 144 to 149). (In Para No. 15 of the order and reiterated them in Para No. 20). That is why, learned Special Judge observed:- Proceeds of crime of Rs. 6,117.93 Crores are generated by the criminal activity relating to 'scheduled offence.' The trial Court noted, both these Applicants have failed before this Court on merits. (B) The materials collected dissuaded the trial Court to grant the benefit under Section 436-A of the Code of Criminal Procedure. 11. As learned Advocate Shri. Venegavkar emphasized on going through the reasons given by the trial Court, I have narrated them in detail. I will give my findings about the conduct of the Applicants in filing separate Applications and its effect on 'right to bail under Section 436-A of the Code' later on. Nature of other orders brought to my notice 12. Learned Senior Advocate Shri. Ponda and learned Advocate Shri. Nimbalkar as well as Mr. Venegavkar have placed before me few of the orders passed by the learned Special Judge. They want to show how the Applicants have indulged into dilatory tactics and as to how the Pros ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etion of formalities for reply and hearing. There is a reference of directions for producing the Accused through V.C., in view of the Covid situation. (dated 16th March, 2020). (f) The grievances were made on account of health. Hence, directions were given to the Jail Authorities and to J.J. Hospital. Even, on some occasion, the doctors from G.T. Hospital are present. A request was made also by Applicant - Rakesh Kumar for shifting him to a private hospital (28th July, 2020). (g) Even, a direction was given to Jail Authorities for recording the statements of these Applicants by the Officer of Serious Fraud Investigation Officer - Ministry of Corporate Affairs. (25th January, 2021). (h) On 23rd July, 2021, the Applications by Applicant Rakesh Kumar and Sarang were dismissed. Whereas, Application by Sarang was withdrawn. The permission was sought to record the statements of all these Applicants and Co-accused - Waryam Singh under Section 50(2) and (3) of PML Act. (4th February 2022). (i) The permission was partly allowed on 8th February 2022 to record the statement of Applicant-Sarang and Co-accused Waryam Singh. The Application for transfer of the Accused in another C.R. (11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the facilities at Jail. (e) Certain time was bound to be consumed for issuing directions about health condition of the Applicants, more specifically Rakesh Kumar Wadhawan. (f) Certain time was bound to be consumed for filing of bail application, reply, hearing and order. Apart from these two Applicants, there are also other Accused persons. Some of them are arrested and some of them are not arrested. However, they were granted bail after they were taken into custody. (g) Certain time was consumed for transferring the Accused for investigation of other offences and for recording the statement by SFIO, Investigation Officer. Findings 16. The Learned Special Judge has held the Applicants are responsible for delaying the hearing for almost three (3) years. No doubt, all the happenings in the case are before the learned Special Judge only. But, he has not elaborated how the three (3) years has elapsed. It is also difficult to inquire the actual reasons, adjournment and by whom, adjournments are sought. Even, it is also difficult for the trial Court to make observation even though the happenings are before him. That is why, before blaming the Applicants for laches, learned Specia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... attention to the extract of a statement recorded of the Applicant Rakesh Kumar under Section 50(2) of the PML Act. He was an Executive Chairman of HDIL and subsidiaries. The subsidiaries of HDIL Company were involved in real estate and construction and slum rehabilitation. He could not repay the loan and fresh loans were obtained from the Bank. Even the overdraft facility was increased. 21. Whereas, the summary of statement of Applicant Sarang Wadhawan is also reproduced in the complaint. The loans were given in his personal name and in the name of the Company. His statement is on the similar lines about the non payment of the loan and again fresh loan. Whereas, HDIL was holding the lands and there is a statement of Darshan Majmudar - Chief Financial Officer - HDIL. 22. The first complaint also refers to summary of facts stated by various witnesses. The Chief Financial Officer of HDIL - Darshan Majmudar has also explained how the loans are obtained by parent Company - HDIL and its subsidiaries and they have been utilized to purchase of the lands. Such companies are 23 in numbers. Even, the business of few of the companies was sold. The statement of close relatives of Applicants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hasized that once the Applicants have fulfilled the requirements of Section 436-A of the Code, they cannot be denied bail just because the allegations are serious. Effect of trial of 'scheduled offences' 25. They drew my attention to one more circumstance. According to them, a case involving 'scheduled offence' is also committed to the Special Court and the Special Court will conduct the trial of case involving 'scheduled offence' and then will proceed with the trial for the present offence. 26. Whereas, Mr. Venegavkar also referred to the judgment in case of Vijay Madanlal Choudhary (supra) and he submitted that the Special Court is established as per the provisions of PML Act and hence, priority has to be given to this case earlier to the case involving the 'scheduled offence'. He referred to the following provisions of the Act:- (a) Section 44(1)(c):- It talks about the power of Special Court to deal with case involving 'scheduled offence' from the stage at which it was committed. (b) The provisions of Cr. P.C., will be applicable toward trial for 'scheduled offence' (clause-d) And (c) As per the explanation jurisdiction of Special Court, does not depend upon any or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acious as tenacious can be." (Para No. 27). (Emphasis supplied) 29. Vijay Madanlal Choudhary and Others v/s. Union of India and Others 2022 SCC OnLine SC 929. (A) Both the sides referred to observations in different paragraphs. The provisions of PML Act were challenged on the ground of validity. The following observations are relied upon by Mr. Ponda and Mr. Nimbalkar. (i) "In the event the person named in the criminal activity relating to a scheduled offence is finally absolved by a Court of competent jurisdiction owing to an order of discharge, acquittal or because of quashing of the criminal case (scheduled offence) against him/her, there can be no action for money-laundering….." (Para No. 253). (B) Mr. Ponda and Mr. Nimbalkar invited my attention to the observations in Para No. 413. While dealing with the applicability of Section 436-A of the Code to the offences under PML Act, it was observed:- (ii) "There is, however, an exception carved out to the strict compliance of the twin conditions in the form of Section 436A of the 1973 Code, which has come into being on 23.6.2006 vide Act 25 of 2005. This, being the subsequent law enacted by the Parliament, must pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. The Supreme Court emphasized:- (vi) On not granting a benefit under Section 436-A of the Code by way of wholesome relief. It cannot be granted mechanically. There is a discretion still reserved for the Court and relief can be considered on case to case basis. Detention can be continued even longer than one-half of the period, for which, reasons are to be recorded by it in writing and also by imposing such terms and conditions to ensure the availability of the accused during trial. (Emphasis supplied) 30. Satender Kumar Antil v/s. Central Bureau of Investigation and Another (2022) 10 Supreme Court Cases 51. (A) The Hon'ble Supreme Court has dealt with all the aspects of various provisions for bail in the Code of Criminal Procedure, and the obstacles and hurdles and mindset of stakeholders in recognizing such right. The relevant paragraphs in which the provisions of Section 436-A are referred are in paragraph Nos. 63 and 64. The word 'trial' has to be given expanded meaning and it also includes the appeal or admission. The word 'shall' denotes mandatory compliance of this provision. Even, Hon'ble Supreme Court went to the extent of dispensing with the necessity of filing a b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the benefit. Only the factors like the allegations, time required to be taken for conduct of the trial need to be considered. It is but natural for the Prosecution to take sometime for conduct of trial. At the same time, it is but natural that the Accused still remain in jail for a longer period. Ultimately, the Court has to balance in between the rights of both the contesting parties. Conduct of trial 33. In order to buttress his submission, that the trial of 'scheduled offences' will take first and then, trial of PMLA offences, Mr. Ponda relied upon following judgments:- (i) V. Vijay Sai Reddy v/s. Enforcement Directorate 2022 SCC OnLine TS 1606 (ii) Jagati Publication Ltd. v/s. Enforcement Directorate 2022 SCC OnLine TS 1607 (iii) Md. Naushad v/s. State of Bihar and Another 2019 SCC OnLine Pat 552 (iv) Anosh Ekka v/s. State of Jharkhand through Directorate of Enforcement Cr.Rev.No.699 of 2011 : 19th February 2013 : High Court of Jharkhand at Ranchi 34. Whereas, Mr. Venegavkar still insist that trial under PML Act will have to be given preference as the Court is established under the PML Act. He admits that there is no observations upholding his contention by any Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as per the schedules. The scheme of the Act does not suggest that there can be an investigation for PMLA offences only when there is a conviction in a trial involving the 'scheduled offences'. A person accused of PMLA offence may contend that unless it is proved that the proceeds alleged by the Enforcement Directorate were derived from the criminal activity is proved, they cannot be convicted. 39. The issue before this Court is only about grant of bail and not about discharge or quashing. So, I think, the issue need not be far stretched, so that, this Court will give some observation about the interpretation of the provisions of PML Act. It can be done in an appropriate case. For these Bail Applications, the issue is only when the trial of PMLA offences is going to start. When we have read the provisions and even the observations by various High Courts, one can infer that the trial in PMLA offence can be simultaneously with trial of 'scheduled offences' . The first part of Explanation to Section 44 is clear. 40. Now, the question is when the trial of PMLA offences in this case will be started. A 'draft charge' is already filed on behalf of the E.D. It is true that yet the Special ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... through their Advocates have not given any assurance to the Court about likelihood of completion of the trial in near future and how much time it will take for completion. Conclusion 45. It is true that in entire administration of Criminal Law various stake holders are involved. The responsibility on investigating agency and on the Courts is onerous. Firstly, it is the duty of investigating agency to investigate properly and to collect materials and to submit it in the Court. The responsibility of the Court starts later on. It is true that there is time limit fixed for completion of investigation. Even if the charge-sheet/complaint is filed, still depending upon the magnitude of the offence, the trial continues. There are two sides. One is prosecution and another is defence. Court has to hear both of them. And it is bound to take time. The availability of Judges is also important. Disposal also depends on co-operation of defence. But paramount consideration is number of Court dealing with such cases. If it is less, trial is going to take time. It has happened in both these cases also. It is but natural that it will take long time for completion of the cases considering the proce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns. When issues will come before Courts, it is made clear that these observations are restricted to present issues and only made for deciding Bail Applications. Furthermore, it is made clear that even if this order is cited before any Court, the concerned Court is duty bound to deal with the issue of bail considering the nature of allegations and materials placed. General directions 51. At this juncture, I also deem it proper to give certain directions to learned Registrar General of this Court who is supposed to look into issues faced by the trial Court on administrative side in the State of Maharashtra. 52. This Court expects learned Registrar General to take stock of the situation particularly from the City Civil Court about total pendency, staff deputed in that process and number of judges assigned to scheduled offence alongwith PMLA offence. So if the City Civil Court administration is facing with some difficulties, learned Registrar General with all his experience and responsibility can try to solve the problems and he may also seek necessary directions from the Hon'ble Chief Justice. These observations are made only for mitigating problems faced by the prosecuting agency ..... X X X X Extracts X X X X X X X X Extracts X X X X
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