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Money Laundering - Case Laws
Showing 301 to 320 of 342 Records
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2023 (2) TMI 1031
Provisional Attachment Order - scheduled offences or not - the proceedings against the Petitioner, its directors, and shareholders in the scheduled offense as also the offense under the PMLA have been closed.- HELD THAT:- In Vijay Madanlal Choudhary [2022 (7) TMI 1316 - SUPREME COURT], the Supreme Court has in categorical terms held that for the existence of ‘proceeds of crime’ under Section 2(1)(u) of the PMLA, the existence of a criminal complaint pending enquiry and/or trial would be necessary. Further, if the person in question has been finally discharged or acquitted of the scheduled/predicate offence, there can be no offence of money laundering against the said person.
In Parvathi Kollur v. Enforcement Directorate [2022 (8) TMI 1256 - SC ORDER], the Supreme Court also specifically referred to the paragraph as mentioned above in Vijay Madanlal Choudhary and held that when the accused person has been acquitted in the scheduled offence under the PMLA, the closure of the proceedings under the PMLA against the accused person and persons said to connected to the accused person would be the natural consequence.
The Supreme Court in Indrani Patnaik & Anr. v. Enforcement Directorate and Ors. [2022 (11) TMI 1311 - SUPREME COURT] has recently held that there cannot be any prosecution in relation to an offence for which the accused person has already been discharged.
In view of the settled legal position in Vijay Madanlal Choudhary and the subsequent decisions and orders thereafter, the properties of M/s Omkar Realtors and Developers Pvt. Ltd., which were attached by the impugned PAO, shall be released.
The PAO deserves to be quashed in view of the legal position as held in the above judgments - Petition disposed off.
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2023 (2) TMI 993
Seeking grant of bail - money laundering - proceeds of crime - it is alleged that petitioner was involved in dealing with the proceeds of crime and in transferring of funds of M/s. PACL through various companies and making transactions of purchasing of properties etc. - HELD THAT:- Admittedly the petitioner was a downstream investor of funds hence his submission he did not knowingly became a party to money laundering cannot be brushed aside lightly. Even otherwise he allegedly was a nominee non-executive director since 11.09.2012 in M/s. DDPL and M/s. Unicorn and prior to 11.09.2012 had nothing to do with these companies; further substantial amount received in the companies of petitioner was returned in the manner alleged above and even Gurmeet Singh’s statement would show the petitioner represented the 25 companies were not associated with M/s. PACL. What weigh the statements under Section 50 of PMLA would carry at the end of trial cannot be tested at the stage of bail, more importantly when the intermediary companies were never made an accused in the present ECIR. The ultimate effect of their non-inclusion would be seen at the conclusion of trial.
Further considering the order dated 03.09.2020 wherein all remaining co-accused in this ECIR were admitted to bail, this Court has every reason to say the petitioner has passed the test of broad probabilities. Admittedly twin conditions of Section 45 does not put an absolute restraint on grant of bail or require a positive finding qua guilt.
The petitioner herein is admitted on bail on his executing a personal bond of Rs.25.00 lacs with one surety of like amount to the satisfaction of the learned Trial Court and subject t conditions imposed - bail application allowed.
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2023 (2) TMI 992
Maintainability of petition - appropriate Jurisdiction (Appellate Tribunal) - Validity of Provisional Attachment Order - grievance of the Petitioner is that both the orders have been passed under Section 8(3) of the PMLA, in respect of the same property which was earlier retained and has again been attached - HELD THAT:- Upon a query from the Court it is submitted by Mr. Manish, ld. Counsel that since there is a jurisdictional issue for the orders passed by the Adjudicating Authority, the Petitioner did not approach the Appellate Tribunal constituted under PMLA and has preferred to file the present writ petition.
In the opinion of this Court, in view of the order dated 8th December, 2022, the present writ petition would not be maintainable as the said order clearly dealt with the same impugned orders which are now sought to be impugned in the present writ petition.
Petition dismissed.
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2023 (2) TMI 948
Provisional attachment order - Money Laundering - scheduled offences or not - Petitioner was not arrayed as an accused and was merely a lender to M/s Omkar Realtors and Developers Pvt. Ltd.
HELD THAT:- A perusal of the impugned PAO in the present case shows that the origin of the said PAO is an FIR No. 109/2020 which was registered in the PS: City Chowk, Aurangabad, Maharashtra under Sections 420, 406 and 34 of the Indian Penal Code, 1860 - A perusal of the order dated 18th October, 2022 passed by the Special Court under PMLA, Greater Bombay shows that M/s Omkar Realtors and Developers Private Limited which was arrayed as A-2, to whom the Petitioner had extended credit facility for the construction of the ‘Worli Project’, has also been discharged. Owing to this connection, the assets of the Petitioner were attached.
The Supreme Court in Vijay Madanlal Choudhary & Ors. v. UOI & Ors., [[2022 (7) TMI 1316 - SUPREME COURT]], has categorically held that when the accused person has been discharged/acquitted in the scheduled offence or the criminal case against the accused person has been quashed, there can be no offence of money laundering against the accused person. Further, in the said judgement it has also been stated that no offence of money laundering can be made out against any person having property linked to the person accused in the scheduled offence.
Therefore, in the event that the accused person is discharged in the PMLA case itself, the impugned PAO and the attachment of such property linked to the accused person, from the said PAO, deserves to be quashed.
The Supreme Court in Indrani Patnaik & Anr. v. Enforcement Directorate and Ors. [[2022 (11) TMI 1311 - SUPREME COURT]] has recently held that there cannot be any prosecution in relation to an offence for which the accused person has already been discharged.
This position of law in terms of proceedings under the PMLA has been recently considered by this Court in EMTA Coal Limited and Ors. v. The Deputy Director of Directorate of Enforcement, [[2023 (1) TMI 694 - DELHI HIGH COURT]]. In the said judgement it was held that once the closure report in the offences under respective FIRs has been filed, no criminality is ascertainable and the respective PAOs as well as the ECIRs are liable to be quashed.
After hearing all the ld. Counsels for the parties and considering the judgements of the Supreme Court as also this Court, the Court is clearly of the opinion that the impugned PAOs against the properties of Piramal cannot continue as the Petitioner was not arrayed as an accused and was merely a lender to M/s Omkar Realtors and Developers Pvt. Ltd. (ORDPL). Accordingly, the flats which were attached by the ED, as extracted in Table No. 9 extracted above are thus, released.
Petition disposed off.
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2023 (2) TMI 784
Money Laundering - proceeds of crime - provisional attachment of property - gist of the objection raised by the ED is that the present writ petition is not maintainable in the High Court of Jharkhand - HELD THAT:- All that the petitioner-company wants is that its property should be released from attachment on its depositing the amount of “value thereof”. The petitioner-company has not raised any grievance against the investigation or adjudication, or even legality and proprietary of investigation and adjudication proceedings or for that matter against the attachment of other properties of the accused persons. In the present case, the proceeds of crime is in the form of money and in the prosecution complaint and supplementary complaint filed by the ED money-trail has been shown to lead to other properties but not to the subject-property.
The right to property is a Constitutional right under Article 300-A of the Constitution of India and every citizen of the country has a right to deal with his property in whatsoever manner he wants to enjoy the property which shall include sale, lease, transfer, mortgage etc. Therefore the plea urged on behalf of the ED that the petitioner-company is in possession and enjoying the subject-property is not a valid objection and liable to be rejected summerily. The powers under Article 226 of the Constitution of India are plenary in nature and can be exercised by the High Court irrespective of any technical objection raised by the respondent.
The prayer for release of the subject-property is accepted. The respondent no.2 is directed to accept the amount of Rs.12 Lakhs tendered by the petitioner-company through bank draft in the name of Directorate of Enforcement payable at Ranchi which shall be deposited in the interest-bearing account till completion of the trial in ECIR/RSZO/01/2015 - Petition allowed.
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2023 (2) TMI 615
Appropriate forum - Validity of provisional attachment order - petitioner approached this court on account of non-availability of the Appellate Tribunal under the PMLA - HELD THAT:- In the present petition, since the Appellate Tribunal under the PMLA Act has now been constituted, in the opinion of this Court, the entire issue would have to be comprehensively considered by the Appellate Tribunal in the two appeals which are pending before the said tribunal. Therefore, the entertaining of this writ, at this stage, when the Tribunal stands constituted could result in multiplicity of proceedings and also there is a possibility of conflicting rulings, which ought to be avoided.
The appeals challenging the show cause notice dated 13th July, 2021 and the appeal of the ED challenging the order dated 20th June, 2018 passed by the adjudicating authority shall now be considered together by the Appellate Tribunal - The challenges and the grounds raised against the impugned PAO dated 7th June, 2021 as part of this writ petition shall also be considered by the Appellate Tribunal under the PMLA Act. The Petitioner is thus permitted to approach the PMLA to raise its challenge to the impugned PAO dated 7th June 2021. The Appellate Tribunal would then adjudicate the appeals and pass a decision in accordance with law.
Petition disposed off.
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2023 (2) TMI 614
Maintainability of petition - non-constitution of appropriate forum - Validity of provisional attachment order - It is the submission of Respondents that the Appellate Tribunal under the PMLA Act has now been constituted and the Petitioner ought to be relegated to the Appellate Tribunal - HELD THAT:- In the present petitions before the Court, since the Appellate Tribunal under the PMLA Act has now been constituted, in the opinion of this Court, the entire issue would have to be comprehensively considered by the Appellate Tribunal. There are already two pending appeals filed by the ED in respect of the earlier order of the AA. The present PAO is now challenged before this Court. Therefore, the entertaining of this petition, at this stage, when the Tribunal stands constituted could result in multiplicity of proceedings and also there is a possibility of conflicting rulings, which ought to be avoided.
Considering that the impugned provisional attachment order by the ED was of 27th November, 2020 and the present writ petition was filed way back in September, 2021. The Supreme Court in M.A. No. 21 of 2022 of Suo Moto Writ Petition (C) No. 3/2020 titled ‘In Re: Cognizance for Extension of Limitation’ [2021 (11) TMI 387 - SC ORDER] had held that the period between 15th March, 2020 to 28th February, 2022 would not be counted for the purpose of limitation.
It is accordingly directed that the present writ petition shall be treated as an appeal challenging the PAO dated 27th November, 2020. This appeal to the PAO shall be considered by the Appellate Tribunal under the PMLA Act in accordance with law along with the two pending appeals filed by the ED. The stay application filed before this Court shall be considered as a stay application before the Appellate Tribunal under the PMLA Act.
Petition disposed off.
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2023 (2) TMI 399
Money Laundering - proceeds of crime - more than 200 accounts were opened in various Banks, to collect the scam money and further route the same, to utilize it for the personal gains, of the scamster/accused - grievance of the petitioner/Enforcement Directorate were to the manner in which the production warrant which was issued on 18.01.2023 by the Learned Special Court was recalled and the accused persons were directed to be set at liberty - HELD THAT:- The interpretation of the learned Senior advocate appearing for the opposite parties that ECIR can be registered only after finality is attained in a criminal proceeding is not acceptable to this Court.
Taking into account the provisions of Section 19(3), Section 45 (Explanation), Section 46, Section 65 and Section 71 of the PMLA Act, 2002 read with paragraph 324 of the judgment of Vijay Madanlal Choudhary [2022 (7) TMI 1316 - SUPREME COURT], it is held that the foundation, finding and conclusion of the order dated 21.01.2023 passed by the Learned Special Judge is bad in law and the same as such is set aside.
Application allowed.
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2023 (2) TMI 398
Seeking grant of regular bail - scheduled offences or not - illegal tapping of phone calls of NSE employees was conducted under the guise of an agreement between NSE and M/s ISEC Services Private Limited - HELD THAT:- As regards section 72 of the IT Act is concerned, the elements of the said offence are not made out in the present case as neither the Applicant nor the NSE was conferred with any powers under the said Act. Moreover, the Applicant or the NSE was not acting in pursuance of the powers conferred under the IT Act or the rules or regulations made therein.
As per the documents placed, it is observed that NSE was recording conversations since 1997 through other vendors and the transactions with ISEC occurred from 2009 to 2017. The Applicant was DMD of NSE till 2010 and JMD till 2013 and MD till 2016. As call recording was done by NSE prior to ISEC’s involvement, it is wrong to allege that the Applicant conspired with ISEC to illegally tap and record calls. Thus, the ingredients of section 120B IPC are not made out in the present case - In the present case, there was no complaint from NSE or any employee of the NSE that the Applicant cheated NSE or its employees. Furthermore, there is no allegation that the Applicant deceived or fraudulently induced NSE to deliver any property to any person.
The documents titled “Periodic Study of Cyber Vulnerabilities” clearly records that M/s ISEC proposes to “continue” its services in the area of “electronic monitoring services at NSE”. Since NSE was at all times aware that the scope of “Periodic Study of Cyber Vulnerabilities” includes electronic monitoring, there is no deception, fraud or dishonest inducement on the part of the Applicant - Pertinently, no victim has been identified by the ED who has suffered a wrongful loss on account of deception or cheating by the Applicant. Except for a vague and bald averment that customers have been cheated, there is no mention of the names of the persons who have been cheated. Thus, the ingredients of section 420 IPC are not made out in the present case - prima facie the ingredients of the scheduled offences under IPC viz., Section 120B read with section 420 IPC are not made out against the Applicant.
There is no evidence placed on record to prove corruption or abuse of position by the Applicant. The consideration received by M/s ISEC is pursuant to a contract entered into with NSE and work orders issued with the approval of Mr. Ravi Narain, the Managing Director. Thus, the ingredients of section 13(1)(d) r/w 13(2) PC Act are not made out against the Applicant. Hence, scheduled offence under section 13 PC Act is not established against the Applicant - prima facie no scheduled offences against the Applicant are established, the provisions of PMLA cannot be attracted to the present case.
In the case of Vijay Madanlal Choudhary [2022 (7) TMI 1316 - SUPREME COURT] the Hon’ble Supreme Court has opined that provisions of PMLA would apply when a person has derived or obtained property as a result of a scheduled offence, and then indulged in any process or activity connected with such property - In the present case there is no allegation that the Applicant has derived or obtained any property or proceeds of crime. Additionally, there is no allegation or evidence produced before me to suggest that the Applicant has concealed, possessed, used, projected or claimed any proceeds of crime as untainted property.
Prima facie there are reasonable grounds to believe that the Applicant is not guilty of the offence and she is not likely to commit any offence while on bail. Opportunity provided to the ED to oppose the bail application thereby satisfying the twin conditions enumerated under 45 PMLA.
The application is allowed and the applicant is granted bail subject to the conditions imposed.
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2023 (2) TMI 374
Seeking grant of bail - financial irregularity and siphoning of funds in relation to credit facilities obtained by SBFL from a consortium of banks led by the SBI and thereby causing a loss of Rs. 3269.42 crores - Applicant not named in FIR - compliance with the twin conditions of Section 45 of PMLA - HELD THAT:- The three Judge Bench decision of the Hon’ble Supreme Court in its recent decision in the case of Vijay Madanlal Chaudhary [[2022 (7) TMI 1316 - SUPREME COURT]] and connected matters, has upheld the mandatory twin conditions u/s 45 of the PMLA.
The twin conditions, are independent of each other and require the Court to weigh each one of them and adjudicate on the potential guilt of the offender based on the material relied upon by the accused and the opposition made to the same by the prosecution - Hence the Hon'ble Court is not required to render a finding of guilt or acquittal at this stage, nor is it required to conduct a mini trial or meticulously examine the evidence but rather is to examine whether the applicant has made out reasonable grounds for believing that he is not guilty.
Prima Facie no reasonable grounds for believing that the applicant is guilty - HELD THAT:- The applicant is not named in the FIR. The applicant is also not named as an accused in the ECIR registered by the ED, as the same is simply a replica of the FIR registered by the CBI - the role assigned to the Applicant is that since he was an Internal Auditor of SBFL and statutory auditor of several sister concerns of SBFL, it was through his aid and assistance that Shakti Bhog Foods Limited, borrowed, layered and siphoned off the loan funds using the platform of about 24 known group companies and several shell entities.
It is clear from timeline of the applicant with SBFL, that the applicant was not the statutory auditor at the time of the commission of offence i.e., the period between 2013 and 2017.
The ED has alleged that the applicant was the mastermind of the whole operation and to prove the same the ED has produced evidence in form of some emails and statements of management and employees of SBFL given u/s 50 of the PMLA - the documents do not support the contention of the ED that the applicant is guilty. Heavy reliance has been placed on section 50 of PMLA statements made by the employees of the SBFL. The only relevant document remaining that prima facie may establish the guilt are the statements u/s 50 of the PMLA. The investigation of the ED is hinged on the statements made u/s 50 of the employees of the SBFL.
Reliability of retracted statements - HELD THAT:- In the present case as well, the question is not regarding the admissibility but the reliability. The statements had concretely named the applicant. However, in their subsequent retraction the reliability of the statements themselves become doubtful. Statements of Employees of SBFL, Accommodation Entry Operators (Devki Nandan Garg & Ashok Kumar Goel) are a cut copy paste job with even the punctation marks of commas, full stops not differing - Prima facie in view of the retraction, the reliability of these statements is questionable. The retracted statements cannot form the basis of the guilt of the applicant of the offences as alleged. Prima facie, it is found difficult to place the guilt of the offence under PMLA on the applicant, based on these statements. Further, the questions as to why the statements were retracted are questions of trial.
In the present case, there is no relevant document to support the allegations. Admittedly the applicant has the 15-year association with SBFL, but despite the allegation that he was the mastermind of the whole operation the ED has relied on 5 documents to show the applicant’s complicity. For the reasons as noted, the documents do not show that the applicant is guilty of offences as alleged against him. In addition, there is not satisfactory explanation given by the ED for the lack of documents that directly point to the applicant as the “mastermind.”
Delay in filing chargesheet - Investigating still continuing - HELD THAT:- In the present case, out of a possible 7-year sentence, the applicant in case has already served more than 17 months of pre-trial detention (as of 23.01.2023). It is also important to state that the applicant has been interrogated only once on 13.11.2021 in entire judicial custody of more than 1 year - there can be no arguments on framing charges or initiation of a trial because the investigation is still ongoing. The ED has listed 109 witnesses till date and the Prosecution Complaints run into lakhs of pages in multiple trunks. Without a completion of investigation, no charges can be framed nor can trial cannot begin. In the light of this, the court cannot let the applicant undergo long period of detention. If this court allows the continuing pre-trial incarceration, the same will amount to deprivation of personal liberty as well as travesty of justice as the same is equivalent to punishment without trial.
In the present case, although the applicant, has not undergone half of the period, the offence with which the applicant is charged with is punishable with imprisonment upto 7 years but not with life or death. There are no criminal antecedents reported against the applicant. Out of this sentence, the applicant has already undergone 17 months of incarceration - Even though the allegations are serious but the chargesheet is yet to be filed. Assuming that the applicant was the mastermind, the respondent did not name him in the original FIR. The applicant had conducted audit of the company and had certified the fictitious accounting entries in the books of accounts of the company to inflate financials of SBFL, even then during his entire custody he has been interrogated only on one occasion on 13.11.2021.
The period of incarceration as well as the delay in investigation along with any reliable material which directly involved the Applicant justifies a prima facie release on bail. The only substantial evidence which is produced are the statements u/s 50 PMLA which too have been retracted - The standing counsel for the ED has been given the opportunity to oppose the bail. Hence the twin conditions as enumerated u/s 45 of PMLA have been met.
The applicant should be released on bail. The application is allowed subject to conditions imposed.
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2023 (2) TMI 373
Money Laundering - connivance with the bank officials and private persons entered into a criminal conspiracy to cheat the bank causing huge loss to the bank and corresponding wrongful gain to themselves - HELD THAT:- The petitioner has been enlarged on bail in predicate offences by this Court. The Enforcement Directorate took the investigation in respect of the money laundering. During the course of investigation by the Enforcement Directorate, the role of the petitioner has come in entering into criminal conspiracy with the accused Chandra Prakash Singh and other co-accused. The Enforcement Directorate has found that a Pay Order of Rs.5,10,000/- was issued in favour of the petitioner from Rs.56,40,000/- amount, which was embezzled/misappropriated by Chandra Prakash Singh and other co-accused.
It is stated that learned counsel for the Enforcement Directorate and Sri Manoj Kumar Singh are not in a position to dispute that rigour of Section 45 of PMLA, 2002 would not apply in the facts and circumstances of the case inasmuch as the total amount involved in the present case is less than One Crore.
The present petition is disposed of with liberty to the petitioner to surrender before the concerned PMLA court within a period of ten days from today and applies for regular bail. If he apply for bail within the aforesaid period, his bail application should be considered and decided preferably on the same day keeping in mind that rigour of Section 45 PMLA, 2002 would not apply in the facts and circumstances of the case.
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2023 (2) TMI 236
Money Laundering - scheduled/predicate offence - initiation of crowdfunding campaign through an online crowdfunding platform named “Ketto” and ran three campaigns from April 2020 to September 2021 - whether the trial of the offence of money-laundering should follow the trial of the scheduled/predicate offence or vice versa? - HELD THAT:- The trial of the scheduled offence should take place in the Special Court which has taken cognizance of the offence of money-laundering. In other words, the trial of the scheduled offence, insofar as the question of territorial jurisdiction is concerned, should follow the trial of the offence of money-laundering and not vice versa - Since the Act contemplates the trial of the scheduled offence and the trial of the offence of money-laundering to take place only before the Special Court constituted under Section 43(1), a doubt is prone to arise as to whether all the offences are to be tried together. This doubt is sought to be removed by Explanation (i) to Section 44(1). Explanation (i) clarifies that the trial of both sets of offences by the same Court shall not be construed as joint trial.
It may be seen from the principles culled out from Sections 177 to 184 of the Cr.P.C that almost all contingencies that are likely to arise have been carefully thought out and laid down in these provisions. The only contingency that could not have been provided in the above provisions of the Cr.P.C, is perhaps where the offence of money-laundering is committed. This is why Section 44(1) begins with a non-obstante clause. The whole picture is thus complete with a combined reading of Section 44 of the PMLA and the provisions of Sections 177 to 184 of the Cr.P.C. - Once this combined scheme is understood, it will be clear that in view of the specific mandate of clauses (a) and (c) of subsection (1) of Section 44, it is the Special Court constituted under the PMLA that would have jurisdiction to try even the scheduled offence. Even if the scheduled offence is taken cognizance of by any other Court, that Court shall commit the same, on an application by the concerned authority, to the Special Court which has taken cognizance of the offence of money-laundering.
Whether the Court of the Special Judge, Anti-Corruption, CBI Court No.1, Ghaziabad, can be said to have exercised extra-territorial jurisdiction, even though the offence alleged, was not committed within the jurisdiction of the said Court? - HELD THAT:- A person may (i) acquire proceeds of crime in one place, (ii) keep the same in his possession in another place, (iii) conceal the same in a third place, and (iv) use the same in a fourth place. The area in which each one of these places is located, will be the area in which the offence of money laundering has been committed. To put it differently, the area in which the place of acquisition of the proceeds of crime is located or the place of keeping it in possession is located or the place in which it is concealed is located or the place in which it is used is located, will be the area in which the offence has been committed.
Having seen the legal landscape on the question of jurisdiction, let us now come back to the facts of the case on hand. It is the case of the petitioner that what was attached by the Enforcement Directorate under Section 5 of the Act as proceeds of crime, was the bank account of the petitioner in Navi Mumbai, Maharashtra and that therefore the offence of moneylaundering, even according to the respondent has been committed in Maharashtra.
The question of territorial jurisdiction in this case requires an enquiry into a question of fact as to the place where the alleged proceeds of crime were (i) concealed; or (ii) possessed; or (iii) acquired; or (iv) used. This question of fact will actually depend upon the evidence that unfolds before the Trial Court.
The issue of territorial jurisdiction cannot be decided in a writ petition, especially when there is a serious factual dispute about the place/places of commission of the offence. Hence, this question should be raised by the petitioner before the Special Court, since an answer to the same would depend upon evidence as to the places where any one or more of the processes or activities mentioned in Section 3 were carried out. Therefore, giving liberty to the petitioner to raise the issue of territorial jurisdiction before the Trial Court, this writ petition is dismissed.
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2023 (2) TMI 72
Seeking grant of anticipatory bail - allegations of laundering a massive sum of money in connivance with main accused - petitioner argued that the custodial investigation would serve no purpose whatsoever, and the pre-trial incarceration would cause an irreversible injustice to the petitioner and family.
HELD THAT:- The petitioner is directed to join the investigation as and when called by the Investigator. The petitioner shall be in deemed custody for Section 27 of the Indian Evidence Act. The petitioner shall join the investigation as and when called by the Investigating Officer or any Superior Officer; and shall cooperate with the investigation at all further stages as required. In the event of failure to do so, it will be open for the prosecution to seek cancellation of the bail. Whenever the investigation occurs within the police premises, the petitioner shall not be called before 8 AM, let off before 6 PM, and shall not be subjected to third-degree, indecent language, inhuman treatment, etc. - The petitioner shall not influence, browbeat, pressurize, make any inducement, threat, or promise, directly or indirectly, to the witnesses, the Police officials, or any other person acquainted with the facts and the circumstances of the case, to dissuade them from disclosing such facts to the Police, or the Court, or to tamper with the evidence.
The bail bonds shall remain in force throughout the trial and after that in Section 437-A of the Cr.P.C., if not canceled due to non-appearance or breach of conditions.
Any Advocate for the petitioner and the Officer in whose presence the petitioner puts signatures on personal bonds shall explain all conditions of this bail order in any language that the petitioner understands - If the petitioner finds bail condition(s) as violating fundamental, human, or other rights, or causing difficulty due to any situation, then for modification of such term(s), the petitioner may file a reasoned application before this Court, and after taking cognizance, even to the Court taking cognizance or the trial Court, as the case may be, and such Court shall also be competent to modify or delete any condition.
There would be no need for a certified copy of this order for furnishing bonds, and any Advocate for the Petitioner can download this order along with case status from the official web page of this Court and attest it to be a true copy. In case the attesting officer wants to verify the authenticity, such an officer can also verify its authenticity and may download and use the downloaded copy for attesting bonds.
Petition allowed.
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2023 (2) TMI 43
Seeking grant of bail - money laundering - proceeds of crime - allegation of amassing property and cash - HELD THAT:- After reading the law laid down in Vijay Madanlal Choudhary [2022 (7) TMI 1316 - SUPREME COURT], this Court considers it expedient to reiterate that the Petitioner was acquitted of the criminal case in Barbil P.S. Case No. 58 of 2010 for offence U/Ss. 307/387 of IPC r/w Section 25 and 27 of the Arms Act which are considered to be the predicate offence leading to launching of prosecution under PML Act in the present complaint, but subsequently the property involved in such criminal case had been directed to be restored to the Petitioner in criminal appeal no. 11 of 2012 and whether such order is/was challenged in the higher forum has not been brought to the notice of this Court. No matter a complaint under PML Act has been filed and pending against the petitioner for commission of offence of Money Laundering, but the acquittal of the petitioner for commission of offence under IPC as scheduled offence under PML Act and direction of the Appellate Court for restoration of property to the petitioner relating to such offence of IPC, unless the same are varied or set aside reversing the findings therein, it appears to this Court that these circumstances of acquittal of petitioner and direction for restoration of the property to the petitioner are sufficient to consider about existence of reasonable grounds for believing the petitioner to have prima facie discharged the satisfaction of the rigors of Sec. 45(1) of PML Act, which appears to be logically justified and fortified.
According to Sec. 3 of PML Act, whoever directly or indirectly attempts to indulge or knowingly assist 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. In this case, of course, the Petitioner is facing a proceeding under PML Act for commission of offence of Money Laundering and, therefore, the rival claims of ED and the petitioner with respect to the offence and the property attached or seized by the ED are subject of adjudication and presumption under PML Act but keeping the Petitioner in custody for the purpose of trial or in anticipation of any other complaint or supplementary complaint which is not in existence at present, would be devoid of any sound logic, especially when the petitioner had already been acquitted for commission of scheduled/ predicate offences and the property seized in connection with that case had already been directed to be returned back to the Petitioner, no matter the criminal appeal against such order of acquittal is pending before this Court.
The bail application of the petitioner stands allowed and the petitioner be released on bail by the Court in seisin of the case on such terms and conditions as deem fit and proper and subject to his furnishing a cash surety of Rs. 5,00,000/- which shall be kept in fixed deposit/STDR in any Nationalised Bank, in addition to furnishing of property surety of Rs. 20,00,000/- and bail bonds of Rs. 10 lakhs with two solvent sureties each.
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2023 (2) TMI 42
Seeking grant of Bail - Money Laundering - round tripping of money - proceeds of crime - predicate offences - misappropriation and criminal breach of trust - manipulation of books of accounts through fictitious accounts - retraction of statements - conversion of property against unknown public servants - tampering with the evidences - mens rea - offences punishable under Sections 120-B read with Sections 420, 467, 468 and 471 IPC and Section 13(2) read with Section 13(1)(d) of Prevention of Corruption Act, 1988.
Whether the petitioner, who is alleged to have abetted the main accused in the offence of money laundering, is entitled for bail or not?
HELD THAT:- If the court finds a prima facie case against the accused, it cannot come to a satisfaction that there are reasonable grounds for believing that the accused is not guilty of such offence and that he is not likely to commit any offence while on bail as specified in Section 45(1)(ii) of the PML Act.
The investigation so far done by the respondent, prima facie, leads to an inference that it is a classic case of money laundering by round tripping of money. Therefore, the stand taken by the respondent that even after commission of the scheduled offence and generatioin of proceeds of crime, different persons could join the main accused either as abettors or conspirators for committing the offence of money laundering by helping him in laundering the proceeds of crime and such persons might not have involved in the original criminal activity that had resulted in the generation of "proceeds of crime" and just because they were not prosecuted for the predicate offence, their prosecution for money laundering cannot be said to be illegal, appears to be a valid one.
No doubt "bail is a rule and jail is an exception" and it has been time and again held by various courts that no person shall be deprived of his life or personal liberty except according to a procedure established by law. But, at the same time, the courts must strike a balance between the interest of the society in general and the right of an accused to personal liberty.
In the case on hand, the petitioner, claiming to be an uneducated or a little educated person, is said to have been deployed to act as Director in various Companies for several years by the main accused, which itself shows the understanding and relationship between them and the mens rea of the petitioner in abetting the offence of the main accused. Therefore, this court cannot brush aside the objection of the respondent that in the event of the petitioner's coming out on bail at this stage, there is every possibility of his continuance in abetting the offence of the main accused in tampering with the evidence and interfering with the further investigation claiming that he does not have the so-called mens rea, by feigning ignorance as if he was a mere puppet at the hands of the main accused and thereby, this court is of the view that the petitioner has not complied with the second condition laid down under Section 45(1) of the Prevention of Money Laundering Act, 2002 for grant of bail.
This court is of the view that the petitioner is not entitled to grant of bail at this stage - Petition dismissed.
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2023 (2) TMI 15
Money Laundering - provisional attachment order - SARFAESI Act will have the primacy/overriding effect over the provisions of the PMLA or not - diversion of funds - HELD THAT:- It has been brought to our notice that all the petitioners have already raised objections both on facts and on law and it has been submitted before the Adjudicating Authority viz., the second respondent. The second respondent is a quasi judicial authority, who can go into both the facts and law while dealing with the objections raised by the petitioners. The provisional attachment order passed u/s.5 of the PMLA has been held to be constitutionally valid by the Apex Court in Vijay Madanlal Choudhary and others v. Union of India and others [2022 (7) TMI 1316 - SUPREME COURT] and hence, the provisional attachment order passed by the first respondent does not suffer from lack of jurisdiction. The provisional attachment order has been placed before the second respondent for confirmation u/s.8(3) of the PMLA.
The alternative remedy is only a self-imposed restriction and it is not an absolute one and in appropriate cases, this Court can exercise its jurisdiction under Article 226 of the Constitution of India in spite of the availability of an alternative remedy. Such exercise of jurisdiction is normally done in cases where the authority has initiated proceedings or passed orders without or in excess of jurisdiction or in cases where there is a serious violation of principles of natural justice or where certain extraordinary/special circumstances exist, which require the exercise of extraordinary power and jurisdiction under Article 226 of the Constitution of India. The law on this issue is too well settled.
In the facts of the present case, it is already held that the provisional attachment order passed by the first respondent does not suffer from any excess or lack of jurisdiction. The petitioners in both the writ petitions have been put on notice by the Adjudicating Authority and the petitioners have also submitted their objections both on facts and on law and hence, it cannot be held that a decision is taken behind the back of the petitioners and there is no violation of principles of natural justice - the petitioners have an effective, alternative and efficacious remedy and hence, we are not inclined to entertain these writ petitions. If any adverse order is passed by the Adjudicating Authority, an appeal is provided u/s.26 of the PMLA to the Tribunal from where there is a further appeal to the High Court u/s.42 of the PMLA.
There are no ground to entertain these writ petitions and we leave it open to the petitioners to raise all the grounds both on facts and on law before the Adjudicating Authority, viz., the second respondent and the same shall be considered on its own merits and in accordance with law - petition dismissed.
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2023 (1) TMI 1467
Money Laundering - seeking quashment of summons issued to the petitioner - proceedings under the Prevention of Money Laundering Act, 2002 (PMLA) can continue after an accused has been acquitted of the predicate offence or not - HELD THAT:- The Apex Court in the case of VIJAY MADANLAL CHOUDHARY & ORS. VERSUS UNION OF INDIA & ORS. [2022 (7) TMI 1316 - SUPREME COURT (LB)], has clearly held that on three circumstances, the proceedings under the Prevention of Money Laundering Act, 2002 cannot continue; one being quashment of the proceedings in 482; the acquittal of the accused in predicate offence that is offences under the Indian Penal Code or Prevention of Corruption Act, 1988 as the case would be and the other; discharge of accused in those proceedings. In the case at hand, the petitioner is acquitted of the offences alleged against him under the Prevention of Corruption Act, 1988 in Spl.C.C.No.189/2013 and the said acquittal in terms of the order of the concerned Court dated 23.12.2022.
Conclusion - In the light of the acquittal of the petitioner in the aforesaid offence, the proceedings under the Prevention of Money Laundering Act, 2002 cannot continue.
The proceedings in ECIR No.BGZO/05/2015 Summons/2790 dated 21.12.2018 stands quashed - petition allowed.
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2023 (1) TMI 1460
Money Laundering - proceeds of crime - provisional attachment order - rights of a secured creditor under SARFAESI Act would prevail over an order of attachment under the PMLA Act, or not - security created in favour of a bonafide lender who has exercised due diligence can be adversely impacted by an order of attachment under the PMLA Act - HELD THAT:- Prima facie, considering the appeal memo and interim application, it does appear that properties of additional respondent no.1 and additional respondent no.2, have been charged / mortgaged to appellant. It is possible that additional respondent nos.1 and 2 may argue that action by respondents under the provisions of PMLA was incorrect or malafide but that is a separate issue and that cannot deny the fact that the property has been secured to appellant.
These are issues which requires consideration. But until these issues are considered, if the property which has been attached under the provisions of PMLA, which are also secured to appellant are not disposed, the property may get wasted or encroached upon and the value would also get eroded. It would be to nobody's benefit. Therefore, purely by way of an interim adhoc arrangement, we pass the following order:
(a) The properties which are mortgaged / charged to appellant may be sold by appellant under the provisions of SARAFESI Act. The sale proceeds shall be deposited with the Registrar, Appellate Side, Bombay, of this court within one week of receiving the sale proceeds to be disbursed in accordance with any final order this court may pass in the appeal.
(b) As and when appellant deposits the money with the Registrar, the registrar shall invest the amount in a fixed deposit with a nationalised bank for a minimum period of 13 months to be renewed for the same period until the disposal of the appeal unless otherwise ordered.
(c) Since this is only an adhoc arrangement, we clarify that we have not expressed any opinion on appellant’s case that they rank higher in priority as compared to respondent.
Interim Application disposed.
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2023 (1) TMI 1420
Money Laundering - Provisional Attachment Order - validity of statements relied upon - denial of opportunity of cross-examination ignoring the fact that same is part of principle of natural justice - HELD THAT:- In the opinion of the Tribunal, the Appellant has failed to give cogent reasons for cross examination of the witnesses who were not even examined before the Adjudicating Authority. In those circumstances, it cannot be persuaded to accept the argument of the learned Counsel on the fact of this case.
The cross examination is part of principle of natural justice but not in all the circumstances therefore it is not required to elaborately discuss the judgment referred by the learned Counsel for the Appellant.
In the instant case, no witness has been examined before the Adjudicating Authority. If any witness would have been examined before the Adjudicating Authority, the prayer for cross examination of that witness could have been sought. Appellant is seeking cross examination of the witnesses who did not appear before the Adjudicating Authority for examination pursuant to the Regulation 21 of the Adjudicating Authority (Procedure) Regulation 2013 - In the instant case, the Appellant has failed to state that if cross examination is not permitted, it will cause serious prejudice to him. The case in hand does not show violation of principle of natural justice when Appellant failed to make statement on the contents of the statement of three persons despite supply of copies of the documents before passing Provisional Attachment Order.
The Appellant did not avail the opportunity to submit explanation to the documents provided to him before passing Provisional Attachment Order and now wants to cross examine the witnesses. The default and failure of the Appellant therein is now sought to be corrected by seeking cross examination of three co-accused. Reference to the Regulation 21 of the Adjudicating Authority (Procedure) Regulation 2013 has been given to indicate powers of the Adjudicating Authority for summoning of the witnesses for examination. It can be exercised when appropriate case is made out - The cross examination can be sought when the witnesses is examined by the Adjudicating Authority and not in reference to statement made before other Authority.
There are no case to cause interference in the order passed by the Adjudicating Authority and accordingly the appeal fails and is dismissed.
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2023 (1) TMI 1413
Money Laundering - Declination to grant bail having regard to the nature and gravity of the alleged offence - HELD THAT:- Having perused the material which has been placed on the record in the counter affidavit filed by the respondents, it is not inclined to entertain the Special Leave Petition, at this stage. However, it is directed that the ED shall take all necessary steps to ensure that it cooperates with the trial Judge in the expedition and early conclusion of the trial.
If no substantial progress is made in the trial by 31 May 2023, the petitioner would be at liberty to apply for bail afresh and such an application, if filed, shall be considered by the trial Judge having due regard to the delay which has taken place in making progress in the trial and the period of custody which has already been undergone.
SLP disposed off.
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