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Arun Sharma Versus Union of India and others

2016 (9) TMI 265 - PUNJAB AND HARYANA HIGH COURT

Accused of offense under Sections 3 read with section 4 of PMLA - arrest orders - Held that:- Rigors of Section 45(1)(ii) of PMLA would be attracted only while considering the application of an accused for release on bail or his own bond, if he has been arrested by the authorized officer under Section 19 of the PMLA before taking cognizance. - Thus if any person though available was neither arrested during investigation under PMLA, nor produced in custody as envisaged in Section 170 Cr.P.C, .....

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fence under Sections 3 read with section 4 of PMLA, cannot be arrested under Section 19 of PMLA, and such person can be arrested only upon execution of warrant if issued by the Court taking cognizance. - CRWP No. 971 of 2016 - Dated:- 22-7-2016 - MR. M.JEYAPAUL AND MRS. SNEH PRASHAR, JJ. For The Petitioner : Mr. Kanhiya Soni, Advocate M.JEYAPAUL, J. 1. On asking of the Court Mr. V.K. Kaushal, Advocate took notice for Union of India. 2. Heard the submissions made on either side. 3. The petitioner .....

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and Jai Singh Bal, collectively known as Namdhari Group of Sirsa, Haryana. The said ECIR was registered on the basis of Scheduled offences alleged in FIR No. 216 of 2013 registered u/s 120B, 409, 465, 467, 468, 471, 474, 477(A) of IPC inter alia against the said two companies, which was later investigated by Economic Offence Wing, Mumbai by renumbering the same as CR no. 89 of 2013. Charge Sheet and Supplementary Charge Sheets have been filed in the said Scheduled Offence in CR no. 89 of 2013. V .....

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sed persons. He submits that economic offences is worse than murder and therefore Sec. 45(1)(ii) of PMLA imposes twin conditions, which are to be satisfied before release on bail or bond of any person accused of offence under PMLA, and which are similar to those imposed under NDPS Act, TADA, POTA, MCOCCA etc. Consequently, according to him the application of Sec. 45 and Sec.19 of PMLA is not governed in any manner by the fact of filing a Complaint under PMLA or by an order of taking cognizance t .....

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cannot be treated as having any precedent value and shall not be applied in the instant PMLA Case No. 4 of 2015. He submits that these accused have amassed moveable and immoveable assets by resorting to money laundering, and that if they are not arrested under section 19 of PMLA and taken in judicial custody, they are likely to tamper with the evidence and may influence the witnesses. 5. We have adverted to the ratio laid down by the Hon ble Supreme Court in Navinchandra N. Majithia v. State of .....

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mplaint No.4 of 2015. There is no dispute on the fact that during the investigations under PMLA, these accused persons were not arrested by the authorities under section 19 of PMLA. After filing of Complaint, Process was issued by issuing summons to the accused including the aforesaid accused nos. 52 to 55 and 60 to 63 from Sirsa, Haryana, who allegedly committed offence under PMLA within the jurisdiction of this Hon ble Court. 7. At the outset, we may say that we find no merit whatsoever in the .....

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sion of the Petitioner that even at post cognizance stage, any person already arraigned as an accused of offense under Sections 3 read with section 4 of PMLA, can be arrested under Section 19 of PMLA. We are also not impressed by the argument that when a person, who is arraigned as accused in the Complaint for trying him for an offence under Section 3 read with Section 4 of PMLA, appears before the Special Court for PMLA pursuant to issuance of process vide summons or warrant, any consideration .....

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). We also find no merit in the further contention that it is open for the Investigating Agency under PMLA to file a Complaint without completing investigation. Such contention is totally contrary to section 167(2) of CrPC, which requires completion of investigations and filing complaint, if statutory default bail is to be denied. The submission of the petitioner that section 173(8) would apply in PMLA Complaint cases appears to be erroneous, inasmuch as it is not applicable in absence of a repo .....

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s regarding such evidence in the form prescribed; and the provisions of sub-sections (2) to (6) shall, as far as may be, apply in relation to such report or reports as they apply in relation to a report forwarded under sub-section (2). 9. We find that for arresting any person under section 19(1) of PMLA, an authorized officer shall have on the basis of material in his possession, reason to believe, which is to be recorded in writing, that such person has been guilty of an offence punishable unde .....

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appropriate custody or his release on bail or bond. However, section 45 of PMLA creates an embargo on release on bail or on his own bond if such person is accused of an offence punishable for a term of imprisonment of more than three years under Part- A of the Schedule with exception regarding persons mentioned in the first proviso to section 45(1), unless the following two conditions are satisfied- (i) the Public Prosecutor has been given an opportunity to oppose the application for such releas .....

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g by an authorised officer. This insertion of further bar by way of a proviso instead of creating a separate independent section, clearly presupposes consideration of application for release on bail or bond under section 45 of only such a person, who is already arrested and is in custody at a stage prior to stage of taking cognizance upon filing of a complaint. 10. Section 65 of PMLA stipulates that the provisions of the Code of Criminal Procedure, 1973 shall apply, in so far as they are not inc .....

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ial statute, but subject to the inconsistent provisions of such special statutes. We find that after arrest of a person under section 19 of PMLA, he is to be produced before the Court within 24 hours if the investigations could not be completed within that time. Thereafter, if the investigation is not completed even within further period of sixty days from the date of first remand, in such event section 167(2) of the CrPC would directly come in aid of such arrested person. He shall have indefeas .....

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rein are specified the limitations on granting of bail. We must, therefore, look to the corresponding provision in the Code of Criminal Procedure with which Section 37(1)( b ) of the Act can be treated to be inconsistent. In the Code of Criminal Procedure, it is Section 437 and not Section 167 which is the corresponding provision for this purpose. The corresponding limitation on grant of bail in case of non-bailable offences under Section 437 is as follows: (i) such person shall not be so releas .....

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ot guilty of such offence …..… . The requirement of reasonable grounds for belief in the guilt of the accused to refuse bail is more stringent and, therefore, more beneficial to the accused than the requirement of reasonable grounds for the belief that he is not guilty of the offence under Section 37 of the NDPS Act. Under Section 437 CrPC the burden is on the prosecution to show the existence of reasonable grounds for believing that the accused is guilty while under Section 37 of .....

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n bail in Section 437 CrPC is in the nature of a restriction on that power, if reasonable grounds exist for the belief that the accused is guilty. On the other hand, the limitation on this power in Section 37 of the NDPS Act is in the nature of a condition precedent for the exercise of that power, so that, the accused shall not be released on bail unless the court is satisfied that there are reasonable grounds to believe that he is not guilty. Under Section 437 CrPC it is for the prosecution to .....

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n Section 37 to the extent it is inconsistent with Section 437 of the Code of Criminal Procedure supersedes the corresponding provision in the Code and imposes limitations on granting of bail in addition to the limitations under the Code of Criminal Procedure as expressly provided in sub-section (2) of Section 37. These limitations on granting of bail specified in sub-section (1) of Section 37 a re in addition to the limitations under Section 437 of the Code of Criminal Procedure and were enacte .....

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such a conclusion emerged by necessary i mplication. A s shown by us, there is no such provision in the NDPS Act and the scheme of the Act indicates that the total period of custody of the accused permissible during investigation is to be found in Section 167 CrPC which is expressly applied. The absence of any provision inconsistent therewith in this Act is significant. 11. On the same principles, in absence of anything inconsistent in PMLA with section 88 of CrPC, when a person voluntarily appe .....

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e a summons or warrant, is present in such Court, such officer may require such person to execute a bond, with or without sureties, for his appearance in such Court, or any other Court to which the case may be transferred for trial. This Section 88 (corresponding to section 91 of CrPC, 1898) would not apply qua a person whose appearance is not on his volition, but is brought in custody by the authorities as held by the Constitution Bench of the Hon ble Supreme Court in Madhu Limaye v. Ved Murti, .....

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ip;… Thus, in a situation like this where the accused were not arrested under section 19 of PMLA during investigations and were not produced in custody for taking cognizance, section 88 of CrPC shall apply upon appearance of the accused person on his own volition before the Trial Court to furnish bonds for further appearances. 12. We find that as explained by the Hon ble Supreme Court in Union of India v. Thamisharasi (supra), the embargo under Section 45(1) (ii) of PMLA being similar to .....

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idering a case where the petitioners were summoned to face trial in a Statutory Complaint titled Niranjan Singh, Assistant Director, Directorate of Enforcement, Jalandhar, Government of India Vs. Balshinder Singh and others filed under Section 45 (1) of PMLA. It was an admitted fact that during investigation of the money laundering case, those petitioners were never arrested by the Enforcement Directorate in exercise of its powers under Section 19 of the Act. Since those petitioners showed their .....

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aken by the co-ordinate Bench is also in consonance with the guidelines laid down for criminal courts by the Hon ble Delhi High Court in Court on its own Motion v. State through CBI, 2004 (1) JCC 308 which was again reiterated and relied upon in Sanjay Chaturvedi v. State, (2006) 132 DLT 692 a judgment rendered by Hon ble Justice A.K. Sikri, wherein the following guidelines were laid down inter alia in relation to offences those could be investigated without arrest - 4. In case of Court on its o .....

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sed in custody as referred in Section 170, Cr.P.C the Magistrate or the Court empowered to take cognizance or try the accused shall accept the charge-sheet forthwith and proceed according to the procedure laid down in Section 173, Cr.P.C and exercise the options available to it as discussed in this judgment. In such a case the Magistrate or Court shall invariably issue a process of summons and not warrant of arrest. (ii) In case the Court or Magistrate exercises the discretion of issuing warrant .....

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ced in custody as envisaged in Section 170, Cr.P.C call upon the accused to move a bail application if the accused does not move it on his own and release him on bail as the circumstance of his having not been arrested during investigation or not being produced in custody is itself sufficient to entitle him to be released on bail. Reason is simple. If a person has been at large and free for several years and has not been even arrested during investigation, to send him to jail by refusing bail su .....

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the person will not voluntarily appear in court; or • the police authorities are unable to find the person to serve him with a summon; or • it is considered that the person could harm someone if not placed into custody immediately. 51. In complaint cases, at the first instance, the court should direct serving of the summons along with the copy of the complaint. If the accused seem to be avoiding the summons, the court, in the second instance should issue bailable warrant. In the third .....

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the aforesaid binding precedent of a three judge Bench of Hon ble Supreme Court. It is not necessary to arrest every person during investigations under PMLA. There is no reason to incarcerate such persons in custody after taking cognizance on complaint filed against them, if they were not arrested by the investigating agency though available during investigation. 16. At post cognizance stage, any person already arraigned as an accused of offence under Sections 3 read with section 4 of PMLA, cann .....

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erson was neither arrested during investigation under PMLA, nor produced in custody as envisaged in Section 170, Cr.P.C, upon issuance of process either by summons or warrant, if he appears before Court on his own volition, he would be entitled to forthwith furnish his bonds with or without sureties for further appearances without any incarceration in custody. The Co-ordinate Division Bench of this Court the said Order dated 1.10.2015 in CRM NO. M-28490 of 2015 in Dalip Singh Mann and Ors vs. En .....

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the Statutory Complaint. We say for the reasons that: (i) It is an admitted fact that during investigation of the money laundering case, the petitioners were never arrested by the Enforcement Directorate in exercise of its powers under Section 19 of the Act; (v) It further appears that rigors of Section 45 (1)(ii) of the Act would be attracted only while considering the bail plea of an accused who has been arrested by the E.D. Under Section 19 of the Act; 6) Taking into consideration the totali .....

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