2025 (7) TMI 1645 - HC - Money Laundering

Seeking Anticipatory Bail u/s 406/420/120-B of the Indian Penal Code 1860 - investigation into the FIR relates to FDI transactions in the year 2018 and is completely documentary in nature - only allegation that may be attributed to the Applicant is that he is at present a Director in PNSPL. HELD THAT - Admittedly the cases got registered in 2020 but even in the predicate offence the investigations have not been concluded nor any Charge-Sheet filed. No Complaint has got filed. There is also nothing on record to suggest that the Applicant has been called since 2021 ever to join the investigations. The Applicant is a Director/Editor of the Company and is responsible for writing news articles and creating videos for the newsclick.com platform of the company. The evidence is essentially documentary in nature and there is no likelihood of tampering with the evidence or of influencing the witnesses. Considering the prolonged investigations and in view of the aforesaid circumstances it is directed that in the event of arrest the Applicant/Accused shall be admitted to Anticipatory Bail by the Investigating Officer/Arresting Officer subject to be following conditions - (i) The Applicant/Accused shall furnish a personal bond in the sum of Rs. 25, 000/- with one surety in the like amount to the satisfaction of the Investigating Officer/Arresting Officer. (ii) The Petitioner/Accused shall join the investigations as and when called by the Investigating Officer and shall co-operate during the investigations. (iii) The Applicant/Accused shall furnish his cellphone number to the Investigating Officer on which he may be contacted at any time and shall ensure that the number is kept active and switched-on at all times. (iv) The Applicant/Accused shall not contact nor visit nor offer any inducement threat or promise to any of the prosecution witnesses or other persons acquainted with the facts of case. (v) The Applicant/Accused shall not tamper with evidence nor otherwise indulge in any act or omission that is unlawful or that would prejudice the proceedings in the pending trial.

Summary

ISSUES:

Whether anticipatory bail under Section 438 Cr.P.C. should be granted in the context of FIR alleging offences under Sections 406, 420, 120B IPC and investigation under the Prevention of Money Laundering Act, 2002 (PMLA).Whether the Applicant, being a Director and Editor of the Company, can be held vicariously liable for alleged offences committed by the Company without specific role attribution.Whether the FIR discloses commission of any offence warranting investigation by the Economic Offences Wing (EOW) and the Directorate of Enforcement (ED), particularly in light of alleged violations under FEMA and FDI policy.Whether the investigation and issuance of notice under Section 41-A Cr.P.C. to the Applicant amount to misuse of the process of law and infringe the right to freedom of speech and expression.Whether the Applicant satisfies the "Triple Test" criteria for grant of anticipatory bail, i.e., risk of flight, tampering with evidence, or influencing witnesses.Whether arrest of the Applicant would serve any useful purpose considering the nature of evidence and stage of investigation.

RULINGS / HOLDINGS:

Anticipatory bail under Section 438 Cr.P.C. is granted to the Applicant subject to conditions, as the investigation is prolonged and the evidence is documentary in nature with no likelihood of tampering or influencing witnesses.The Court held that a Director of a Company cannot be made vicariously liable for offences committed by the Company "unless a specific role is attributed to such Director," referencing settled law.The FIR does not disclose commission of any offence against the Applicant, who is not named therein, and the allegations primarily relate to possible FEMA violations which are outside the jurisdiction of the EOW, thus raising a "legal bar" to the investigation by EOW.The issuance of notice under Section 41-A Cr.P.C. to the Applicant after filing of writ petitions was noted, but the Court did not find sufficient grounds to deny anticipatory bail, recognizing the Applicant's willingness to cooperate and absence of non-cooperation allegations.The Applicant meets the "Triple Test" for grant of bail: there is no flight risk, no evidence of tampering with evidence, and no influence over witnesses.Remanding the Applicant to custody would not serve any useful purpose given the documentary nature of evidence and ongoing investigation; hence, anticipatory bail is appropriate.

RATIONALE:

The Court applied the statutory provisions of Sections 406, 420, 120B IPC, Section 438 and 41-A Cr.P.C., and the Prevention of Money Laundering Act, 2002.Precedents cited include the principle that vicarious liability of a Director requires specific attribution of role (Sunil Bharti Mittal vs. CBI; Maksud Saiyed vs. State of Gujarat), and the test for anticipatory bail involving flight risk, tampering, and influencing witnesses.The Court recognized the legal bar on EOW investigation into alleged FEMA violations, noting judicial interpretation that such bar is "absolute" and fatal to investigation.The Court considered the right to freedom of speech and expression, referencing the chilling effect of investigation on journalistic activity, relying on precedent from Arnab Manoranjan Goswami vs. State of Maharashtra.The Court noted the prolonged nature of investigation without charge-sheet or complaint and absence of coercive steps against the Applicant, influencing the decision to grant anticipatory bail with conditions.No dissent or doctrinal shift was indicated; the judgment follows established legal principles and procedural safeguards for anticipatory bail in economic offence investigations.