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TMI Blog2024 (9) TMI 1176X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacturing Companies. The Applicant has deep roots in the society and is not a flight risk and has business and professions which are based in India and he is not likely to abscond from the country - Also, the evidence so collected in the ED case is documentary in nature and there is no likelihood of his tampering with the witnesses or influencing the witnesses. Regardless, conditions can be imposed to ensure the Applicant s attendance to face the trial. In the case of Manish Sisodia v. Directorate of Enforcement [ 2024 (8) TMI 614 - SUPREME COURT] the Hon ble Supreme Court observed that prolonged incarceration before being pronounced guilty of an offence should not be permitted to become punishment without trial. It was further observed that fundamental right of liberty provided under Article 21 of the Constitution is superior to statutory restrictions and reiterated the principle that bail is the rule and refusal is an exception . Insofar as the role of the Applicant in the present case is concerned, he stands on a better footing that the other co-accused, who have been recently granted bail - Insofar as the role of the Applicant in the present case is concerned, he stands on a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear 2021-22 and the said Complaint dated 20.07.2022 was conveyed to the Central Bureau of Investigation (CBI) by the Director, Ministry of Home Affairs, Government of India vide O.M. No. 14035/06/2022-Delhi-1 dated 22.07.2022 for necessary enquiry and action. 5. Thereafter, the CBI registered an FIR No. RC0032022A0053 (hereinafter referred to as CBI case ) dated 17.08.2022 under Section 120B of the Indian Penal Code, 1860 read with Sections 7/7A/8 of Prevention of Corruption Act, 1988 at Police Station CBI, ACB, New Delhi against Manish Sisodia and 14 others wherein no allegation wherein were made against the Applicant regarding framing and implementation of the Excise Policy. 6. After five days of registration of the CBI case, the respondent also registered the aforementioned ED case. The Main Prosecution Complaint was filed by the ED on 26.11.2022 against five persons and thereafter 1stSupplementary Prosecution Complaint ( SPC hereinafter) was filed on 06.01.2023 wherein it was alleged that the kickbacks were disguised through the issuance of Credit Notes to retailers with no direct transaction history. 7. The Applicant submits that he was arrested on 01.03.2023 by the ED and was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Further, no recoveries were made from the Applicant; there were no contemporaneous statements recorded involving the Applicant; there is no CCTV footage or audio or any form of record demonstrating the Applicant s involvement and no cash was recovered from the Applicant or his father. The ED conducted raids on 04.07.2023 to 05.07.2023 and recorded Statements under Section 50 PMLA, 2002. The Enforcement Directorate (ED) did not notify the Central Bureau of Investigation (CBI) about the offence until a month later, on 07.08.2023/08.08.2023, which resulted in the FIR being filed on 25.08.2023. Interestingly, the FIR claims there was no delay in its registration, despite the ED s complaint indicating that the searches had occurred about a month and a half earlier, on 04.07.2023. 13. Furthermore, the ED continued to investigate the scheduled offense that became the basis for the FIR without promptly informing the relevant jurisdictional agency. During the investigation, the ED seized certain documents and cash between 04.07.2023-05.07.2023., while the Applicant was in their custody. It is submitted that given this timeline and the lack of supporting evidence, it is evident that the char ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Crl. Appeal No. 1198/2023; Benoy Baby v. Directorate of Enforcement SLP (Crl,) No. 11644-11655/2023; Abhishek Boinpally v. Directorate of Enforcement SLP (Crim.) No. 9038/2023 and Manish Sisodia v. Directorate of Enforcement SLP (Crl.) No. 8188/2023. 19. It is submitted that the purpose of pre-trial incarceration is not punitive and it is trite law that continued incarceration militates against the fundamental doctrine of presumption of innocence . Further, several co-accused persons have been enlarged on a bail and therefore, on parity, the Applicant is entitled to bail. Reliance for the same is placed on Orders of the coordinate bench of this Hon ble Court in C.P. Khandelwal Vs. ED [Bail Application 2470/2022], Dr. Bindu Rana Vs. SFIO [Bail Application 3643/2022] and Ashish Mittal Vs. SFIO [Bail Application 251/2023] as well as Ramesh Manglani Vs. ED [Bail Application 3611/2022]. 20. The Applicant submits that there are reasonable grounds to believe that he is not guilty of the offence. The grounds of arrest were never furnished to the Applicant and therefore, he is entitled to be enlarged on Bail. 21. It is submitted that M/s Brindco had nothing to gain from the change in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and were involved in making the Policy jointly with leaders of AAP. Thus, WhatsApp chats and statements recorded by the ED show that the Applicant was not the sole recipient of the draft Policy which was already in the public domain. 25. It is also alleged that the Applicant used/destroyed/changed 4 phones in the span of two years. However, detailed answers for the same have been provided by the Applicant to the ED vide statement dated 17.11.2022 and various emails. The Applicant states that he had changed his phone in June 2021 on account of damaged camera; in October 2021 he had upgraded to the latest iPhone 13, subsequently in June 2022 phone was changed on account of screen damage and in 2022 the Applicant changed his phone to an iPhone 11 since the CBI had seized his phone. 26. The Applicant submits that ED s allegation that M/s Brindco got profits worth Rs. 179.3 Crore as a result of conspiracy by the Applicant, Vijay Nair and the South Group, is wholly misconceived as profits worth Rs. 93.64 Crore out of Rs. 179.3 Crore is profits from sale of foreign liquor which is not even stated to have accrued to the Applicant or his Company as there was no 12% margin on foreign liquor. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to note that the incentive offer was approved and funded by the manufacturer UBL and not issued at the instance of M/s Brindco. Further, UBL issued Credit Notes worth Rs. 14.72 Crore, and M/s Brindco distributed these as instructed thus, M/s Brindco merely passed on the Credit Notes from the manufacturer to the retailers per instructions from UBL. Moreover, if as alleged, such Credit Notes are alleged to not have been received by the 4 Retailers in question, then no cash would have been generated from such Credit Notes. It is submitted that the Applicant has furnished documentary evidence that the concerned retailers concerned themselves have acknowledged receipt. 31. The Applicant submits that the ED merely relies on statements under Section 50 PMLA, 2002 of the co-accused which are essentially inadmissible and are not substantive pieces of evidence without corroboration. Reliance for the same is placed on Sanjay Jain v. ED (supra); Ram Kishan v. Harmeet Kaur and Anr. (1972) 3 SCC 280 and Baijnath Sah v. State of Bihar (2010) 6 SCC 736. 32. It is further submitted that admissible evidence is not ipso facto reliable evidence and veracity of such statements are the matters of tria ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Applicant of evading the process of law if enlarged on bail cannot be ruled out. While personal liberty is of paramount importance, the same is not absolute but subject to reasonable restrictions, including the interest of the State and public. Reliance has been placed on behalf of the respondent on the decisions in Vijay Madanlal Choudhary, (supra), State of Kerala vs. Rajesh, (2020) 12 SCC 122 and Rohit Tandon vs. Directorate of Enforcement, (2018) 11 SCC 46. 40. It is submitted that that the Applicant has prior criminal antecedents as the Applicant along with his father have indulged in the bribing of middleman to save themselves from being prosecuted in the present case. It is submitted that as per the evidence collected during the course of the investigations, statements recorded u/s 17 and 50 of the PMLA, 2002, digital evidence of CCTV footage etc. reveal that the Applicant alone gave Rs. 5 Crore to Mr. Praveen Vats (chartered Accountant) to arrange help from ED in respect of the ongoing case, which establishes a prima facie case against the Applicant. 41. It is submitted that the Applicant was involved in the formation of the Policy which is evident from the fact that he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s submitted that in light of the active involvement of the Applicant with the South Group in the formulation of the Excise Policy and his active role in conspiracy of kickbacks, the Applicant is not entitled to grant of bail. 48. Learned Senior Advocate on behalf of the Applicant has argued in detail and has also filed the Written Submissions where it is asserted that the Applicant had no role in the formulation of the Excise Policy. The Ld. Counsel submits that while it is claimed by the ED that M/s Brindco got profits worth Rs. 179.3 Crore as a result of conspiracy by the Applicant, Vijay Nair and the South Group the same is incorrect as profits worth Rs. 93.64 Crore out of Rs. 179.3 Cr were profits from sale of foreign liquor and there was no 12% margin on foreign liquor. It is further argued that ED s allegation Rs. 4.9 Crore in excess credit notes was baseless as the issuance of Credit Notes inter se the parties is a valid business practice in the liquor industry. 49. The Counsel for the Applicant submits that ED during the investigation in the present ED case, discovered new leads and made a Complaint dated 07.08.2023 which was received by the CBI on 08.08.2023 and consequent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and also participated in conspiracy of kickbacks, payments of the same and its recoupment. The detailed transactions have been recorded in the ED case about the handling of the proceeds of crime by the Applicant. 58. It is submitted that during the course of arguments, the Applicant has not even argued that the mandatory twin conditions u/s 45 PMLA, 2002 are satisfied on the facts of his case and has merely placed reliance on Manish Sisodia v. CBI 2024 INSC 595; K.Kavitha v. ED 2024 INSC 632 and Vijay Nair v. Directorate of Enforcement in SLP (Crl.) No. 22137/2024 vide order dated 02.09.2024 which do not lay down any thumb rule that bail in PMLA cases has to be granted ignoring all facts and circumstances merely on the ground of long period of incarceration and alleged delay in trial. Therefore, it is submitted that despite the aforesaid Orders of the Hon ble Supreme Court, the present applicant is not entitled to be released on bail in light of the role and conduct of the Applicant in attempting to influence the investigation as stated in the Reply. Further, it is stated that the Delay in trial is directly attributable to the Applicant as held by Ld. Special court vide Orders da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icant was actively involved in the conspiracy of drafting the Delhi Excise Policy 2021-22 and was also actively involved in conspiracy of kickbacks, payments of the same and its recoupment and also that he had undertaken various transactions related to proceeds of crime. 67. The evidence so collected by the respondent is in the nature of statements of the accomplices, witnesses and co-accused persons, many of which have been retracted. 68. It is pertinent to observe that the prosecution Complaint has already been filed against the Applicant in which he has been summoned. The investigations qua the Applicant are complete in the present matter. 69. Moreover, the Applicant is a highly-educated 50-year-old citizen of India who is holding B. Com. (Hons.) from Hindu College, University of Delhi with early training in the U.K. Graduate Honours and certifications from Harvard Business School, Masters of International Management and Stanford School of Business, Enterprise Program for Growing Companies (EPGC). The Applicant along with his family run M/s Brindco Sales Pvt. Ltd. ( M/s Brindco hereinafter), that is engaged in the business of sale and distribution of alcoholic beverages for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ody pending trial or disposal of an appeal is to secure their attendance at trial. 76. The ED case is primarily dependent on documentary evidence which is already seized by the prosecution. Similarly, the apprehension regarding influencing witnesses and that of being a flight risk can be diffused by imposing stringent conditions while granting bail. Therefore, the conditions of triple test are duly satisfied by the Applicant. 77. Considering the above, the Applicant is admitted to bail, on the following terms and conditions: - a. The Applicant is directed to be released forthwith on bail in connection with the ECIR No. ECIR/HIU-II/14/2022dated 22.08.2022, registered by the Directorate of Enforcement, subject to furnishing a bail bond in the sum of Rs. 10,00,000/- with two sureties of the like amount; to the satisfaction of the learned Special Judge/Trial Court. b. The Applicant shall appear before the Court as and when the matter is taken up for hearing. c. The Applicant shall provide mobile number to the IO concerned which shall be kept in working condition at all times and he shall not change the mobile number, without prior intimate to the Investigating Officer concerned. d. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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