9911796707
TMI Blog2024 (9) TMI 1550X X X X Extracts X X X X X X X X Extracts X X X X ..... , Section 71 of the Act states that the provisions of the Act shall have an overriding effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force. Therefore, the conditions enumerated in Section 45 of the Act have to be complied with even in respect of an application for bail made under Section 439 of Cr. P.C. Consequently, the power to grant bail to a person accused of having committed an offence under the Act is not only subject to the limitations imposed under Section 439 of Cr. P.C., but also subject to the rigour imposed by the twin conditions under sub-section (1) of Section 45 of Act. In Gautam Kundu v. Directorate of Enforcement [ 2015 (12) TMI 1133 - SUPREME COURT ], the Hon ble Supreme Court has held that the compliance of Section 45 of the Act is mandatory to grant bail to an accused person. In Directorate of Enforcement Versus Aditya Tripathi [ 2023 (5) TMI 527 - SUPREME COURT ] the Honourable Supreme Court has held that merely because the chargesheet is filed, it cannot be a ground to release the accused on bail in connection with the scheduled offences under the Act. Investigation for the predicate offences and the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 016-17 is Rs.1,35,87,612/-, Rs.1,52,92,407/- and Rs.87,93,532/-, respectively. These materials, particularly the above cash credits, prima facie lends support to the prosecution allegation against the petitioner regarding layering of the proceeds of the crime. Collectively, these factors prima facie appear to substantiate the prosecution case. In Manish Sisodia s case [ 2024 (8) TMI 614 - SUPREME COURT ], the Honourable Supreme Court granted bail to the appellant in that case, considering the prolonged period of incarceration, the trial in the case had not commenced despite the assurance given by the respondents in the earlier round of litigations and the Trial Court had not followed the directions in paragraphs 28 and 29 of its first order regarding the right of the appellant to speedy trial - In the case on hand, the principles laid down in Manish Sisodia s case are not applicable. Therefore, the petitioner cannot draw analogy or parallels to the precedent set forth in the said case. On a careful analysis of the facts and circumstances of the case, the materials placed on record, the rival submission made across the Bar, and on considering the parameters under Section 45 of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xteenth accused); Kiran.P.P., a member of the Society (presently the ninth accused); Bijoy. A.K, a Commission Agent (presently the first accused) and Reji Anil, the Accountant of the Supermarket for committing the offences under Sections 406, 420, 409 and 465 read with Sec.34 of the Indian Penal Code ( IPC ). Subsequently, the crime was transferred to the Crime Branch by order No. D3- 108924/2021/PHQ dated 21.7.2021 and was re-registered as Crime No.0165/2021. The DYSP-1, Crime Branch, Thrissur, by letter bearing No.289/DY.SP-I/CB/TSR/21 dated 22.9.2021, informed the Deputy Director of Enforcement Directorate, Kochi regarding the details of the accused and the status of the crime. As Section 420 of the IPC is a scheduled offence under the Act, enquiries were initiated against the accused persons after recording the facts of the scheduled offence as ECIR No.KCZO/45/2021 dated 2.8.2021. By committing the above criminal activity, the accused have obtained and possessed the proceeds of crime, layered and projected the proceeds of the crime as untainted money as defined under Sec.2(1)(u) and 2(1) (v) of the Act. The proceeds of the crime generated, acquired, possessed and concealed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The petitioner has unaccounted money from 2015-2016. While examining the audited financial statements of M/s.Devi Financiers, a proprietary concern of the petitioner, submitted by Sanil Kumar C.V, the petitioner s Chartered Accountant, it was noticed that in the Balance Sheet as of 31st March 2016, the capital account stood at Rs.1,49,54,331/. However, in the balance sheet prepared as of 31st March 2017, the opening balance of the capital account is Rs.5,58,19,585/- i.e., an addition of Rs.4,08,65,254/- to the capital. But the same was not reflected in the petitioner s income tax return. In the statements of Sanil Kumar recorded on 04-10-2023 and 09-10-2023, he has, inter alia, stated that he was introduced to the petitioner in 2021. He submitted the petitioner s audited Profit Loss Account and Balance Sheet on 31-03-2017. He also stated that during examining of the books of account of Devi Financiers, he found a cash deficit of Rs.4/- Crore and informed the matter to the petitioner. Then the petitioner submitted a letter of Jayarajan P, stating that he had invested Rs.4/- Crore, in cash, in the petitioner s business. On the petitioner's instructions, an addition of Rs.4/- Cror ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ersons. The Investigating Agency has chosen to arrest only four accused persons, i.e., accused nos.9, 14 (the petitioner), 15 and 16. The petitioner was arrested because the petitioner was unwilling to give statements implicating certain persons and organisations as desired by the Investigating Agency. The petitioner has no role in the subject matter. Although the investigation in the ECIR/KCZO/45/2021 was carried out for about two years and four months, the petitioner was not contacted or questioned even once. He was contacted for the first time on 22.8.2023, when a search was conducted in his house. Thereafter, he was repeatedly called to record his statements. On all the occasions, he has co-operated with the investigation. Even though he was not arrayed as an accused, he was arrested on 4.9.2023 on totally false accusations. The arrest itself is illegal, as a copy of the grounds of arrest was not served on him. In Crime No.650 of 2021 of Irinjalakkuda Police Station, which is the sole basis for registering the ECIR, the petitioner is not an accused. Even after the crime was transferred to the Crime Branch on 21.7.2021, they questioned the Board members, staff of the Bank and se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded that the present loan scam is the biggest bank robbery in the Co- operative banking history in the State of Kerala. The Bank was one of the trustworthy service Co-operative societies till 2010. Since 2012 onwards, persons like petitioner had joined hand in glove with high profile persons, including politicians and police officials, in connivance with the bank officials, to grab the wealth of the Bank and to loot the hard-earned money of its depositors. Persons like Kiran.P.P and other benami borrowers have flouted the bye-laws of the Bank and the provisions of the Kerala Co-operative Societies Act, 1969, by securing illegal loans and acquiring the proceeds of the crime. The investigation has revealed that several persons have availed illegal loans during 2012-2019. Kiran.P.P, who was residing outside the territorial limits of the Bank, was granted membership and loans along with 51 other persons. The practice in the Bank was to disburse the loans in cash. Out of Rs.24.56/- crore availed by the Kiran.P.P, Rs.14/- crore was paid to the petitioner by bank transfer and in cash. The petitioner has admitted to have received Rs.2,15,50,000/- from the loan availed by Kiran.P.P. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .9.2023 his statements were recorded. In the three statements nothing was asked about his involvement with the Bank. On 4.9.2023, the petitioner was again asked to appear before the Investigating Officer and a single line statement was recorded, even though he was detained from 10 a.m. till 10.30 p.m. It was in that statement it was recorded that the petitioner received Rs.2.15/- crore from Kiran, which was recorded only to arrest him. There is no such evidence to substantiate the said allegation. The petitioner was arrested on 4.09.2023, but he was produced before the Court on the following day. Yet, Annexure 11 remand report does not show that his grounds of arrest were informed to him. Even though statements of several witnesses were recorded, including the statements of the petitioner s Chartered Accountant and an NRI business man, none of the statements show that the petitioner is involved in the crime. The petitioner had started a chappal business in 1990 named Novo Plastic . He was making a profit of Rs.1/- crore per year. Thereafter, he started a real estate business which does not come within the purview of the Act. The petitioner started the finance business only in 2015. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e complaint wherein the witnesses and accused have categorically stated the petitioner s involvement in the crime. He contended that the statements of the accused are acceptable in evidence in view of Section 50 of the Act. He relied on the decisions of the Hon ble Supreme Court in Vijay Madhanlal Choudhary v. Union of India [2022 SCC Online SC 929], Nimmagadda Prasad v. CBI [(2013) 7 SCC 466], Y.S Jagan Mohan Reddy v. CBI [(2013) 7 SCC 439], Gautam Kundu v. Directorate of Enforcement [(2015) 16 SCC 1], Rohit Tandon v. Directorate of Enforcement [(2018) 11 SCC 46] and Directorate of Enforcement v. Gopal Reddy [2022 SCC Online SC 1862] to reinforce his submissions. He prayed that the application be dismissed. 9. The gravamen of the prosecution allegation against the petitioner is that he influenced the Bank and got loans sanctioned to Kiran.P.P, out of which the petitioner took Rs.14/- Crore. The petitioner is maintaining 44 Bank accounts in various Banks. He made cash deposits of Rs.1,35,87,612/-, Rs.1,52,92,407/ and Rs.87,93,532/- in the financial years 2014-15 to 2016-2017 in his ten bank accounts. The statements show that Rs.1.25/- and Rs.3/- crore were again paid to the petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffect on the general provisions of the Code of Criminal Procedure (Cr. P.C). There is a specific embargo to grant of bail to a person accused of an offence under the Act, which are: (i) that the Public Prosecutor must be given an opportunity to oppose the application for bail, and (ii) the Court must be satisfied that there are reasonable grounds for believing that the accused person is not guilty of such offence and that he is not likely to commit any offence while he is on bail. 12. In addition to the above stipulation, Section 65 of the Act mandates that the provisions of the Cr. P.C shall apply in so far as they are not inconsistent with the provisions of the Act. Also, Section 71 of the Act states that the provisions of the Act shall have an overriding effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force. Therefore, the conditions enumerated in Section 45 of the Act have to be complied with even in respect of an application for bail made under Section 439 of Cr. P.C. Consequently, the power to grant bail to a person accused of having committed an offence under the Act is not only subject to the limitations imposed under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urpose of considering an application for grant of bail, although detailed reasons are not necessary to be assigned, the order granting bail must demonstrate application of mind at least in serious cases as to why the applicant has been granted or denied the privilege of bail. 46. The duty of the court at this stage is not to weigh the evidence meticulously but to arrive at a finding on the basis of broad probabilities. However, while dealing with a special statute like MCOCA having regard to the provisions contained in sub-section (4) of Section 21 of the Act, the court may have to probe into the matter deeper so as to enable it to arrive at a finding that the materials collected against the accused during the investigation may not justify a judgment of conviction. The findings recorded by the court while granting or refusing bail undoubtedly would be tentative in nature, which may not have any bearing on the merit of the case and the trial court would, thus, be free to decide the case on the basis of evidence adduced at the trial, without in any manner being prejudiced there by . 401. We are in agreement with the observation made by the Court in Ranjitsing Brahmajeetsing Sharma. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entioned legal principles, I will now examine the specifics of the present case. The petitioner has raised a specific ground that the written grounds of arrest were not served on him. On an appreciation of the materials on record, I find in the arrest order dated 04.09.2023, the Authorised Officer has specifically recorded that he has reason to believe that the petitioner is guilty of an offence under the Act. The grounds of arrest were duly prepared, served, read over and understood by the petitioner at the time of his arrest. Hence, I conclude that the said contention is untenable. 18. Now, coming to the other contentions. The learned Additional Solicitor General has strongly opposed the bail application. Therefore, I will now proceed to decide whether this Court is convinced that there are reasonable grounds for believing that the petitioner is not guilty of the offence alleged against him and he is not likely to commit any offence while he is on bail. 19. The prosecution has cited 82 witnesses and has produced 89 documents along with the complaint. The petitioner s specific role in the crime has been elaborately narrated in paragraph 12.5 of the complaint, which has already bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the prolonged period of incarceration, the trial in the case had not commenced despite the assurance given by the respondents in the earlier round of litigations and the Trial Court had not followed the directions in paragraphs 28 and 29 of its first order regarding the right of the appellant to speedy trial. 22. In the case on hand, the principles laid down in Manish Sisodia s case are not applicable. Therefore, the petitioner cannot draw analogy or parallels to the precedent set forth in the said case. 23. In Himanshu Chandravadan Desai v. State of Gujarat [(2005) 13 SCC 234], which bears similarities to the case on hand, the accused, who were the Directors of a Bank, had siphoned off crores of rupees of the Bank by granting bogus loans, fabricating fictitious letters of credit in the names of their friends, relatives and associates with inadequate security. The Honourable Supreme Court declined to enlarge the accused on bail considering the huge amount involved in the systematic fraud, and apprehending danger of the appellants attempting to tamper with the evidence by pressurising the witnesses. 24. On a careful analysis of the facts and circumstances of the case, the materials ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
