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2013 (2) TMI 792 - BOMBAY HIGH COURT

2013 (2) TMI 792 - BOMBAY HIGH COURT - TMI - Criminal Bail Application 71 of 2013 - Dated:- 4-2-2013 - R.C. CHAVAN, J. Mr. Aney, Senior Counsel alongwith Mr. S. Kantawala a/w Mr. Yogesh Rohira, for the Applicant. Mr. D. J. Khambata, Advocate General along with Mrs. Revani Mohite Dere, Public Prosecutor a/w Mrs. P. P. Shinde, for Enforcement Directorate Mr. S. R. Shinde and Mr. H. S. Venegaonkar, APP for the Respondents. ORDER 1. This is an application for bail by a person, who has been arrested .....

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arned Public Prosecutor for the State, the learned Judge of the said Court has extended the custody till 6th February, 2013. The applicant seeks bail on the ground that he had been arrested by a person who had no authority to effect arrest and that the procedure prescribed under the law had not been followed resulting in violation of his rights under Articles 21 and 22 of the Constitution. 2. It was submitted that since the arrest itself was violative of fundamental rights, applicant s detention .....

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and the amount involved is more than ₹ 500 crores. It was also stated that total 42 F.I.Rs have been filed with police authorities at various places in various States, for the offence of cheating and criminal conspiracy. It was pointed out that investigation revealed that more than one lac investors spread all over country have been duped into parting with large sums and the adjudicating authority has confirmed provisional attachment of properties worth ₹ 108 crores. It was also sta .....

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al in the arrest of the applicant or his detention in custody and inference that his liberty has been curtailed otherwise than by following procedure established by law is not warranted. 4. I had an advantage of listening to illuminating arguments by the learned Senior Counsel for the applicant as well as learned Advocate General. 5. Both of them unfolded all aspects of provisions of the Act and the Rules thereunder, with reference to the facts of the case at hand. Learned counsel for the applic .....

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the Central Government may appoint such person as it thinks fit to be authorities for the purpose of this Act. Therefore, according to learned counsel, there has to be a notification by the Central Government, appointing the person to be Assistant Director or Deputy Director since these terms have been defined in section 2(1)(c), (j)and (k) of the Act, to mean persons appointed under Sub Section (1) of Section 49 of the Act. Therefore, according to learned counsel for the applicant, it would no .....

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he purpose of this Act. Learned counsel for the applicant submitted that the officer who effected arrest is not shown to have been the Assistant Director under FEMA and therefore, the Officer who effected arrest was not one who could be said to be appointed under the Notification dated 13th September, 2005. 7. It is pointed out that there is notification dated 21st April, 2010, issued by the Ministry of Finance(Department of Revenue), in the exercise of powers conferred under sub section (1) of .....

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e purpose of this Act. (2) Without prejudice to the provisions of sub-section (1), the Central Government may authorise the Director of Enforcement or an Additional Director of Enforcement or a Special Director of Enforcement or a Deputy Director of Enforcement to appoint officers of Enforcement below the rank of an Assistant Director of Enforcement. (3) Subject to such conditions and limitations as the Central Government may impose, an Officer of Enforcement may exercise the powers and discharg .....

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office immediately before 1st July, 2005 under FEMA, or could be a person who is successor in the office of such Assistant Director. Since the notification refers to the office of the Assistant Director and not any individual person, as rightly pointed out by the learned Advocate General, in view of provisions of Section 18 and 19 of the General Clauses Act, the successor would also be the person who has been authorised and referred to by his official title. Therefore, the argument that notifica .....

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the Assistant Director for the purpose of the Act, 2002, there may be a vacuum. 10. Learned counsel for the applicant next argued that the power of arrest under Section 19 of the Act, has to be exercised in accordance with the Rules. Reliance was placed on the definition of Arresting Officer under the Prevention of Money Laundering (The Forms and The Manner of Forwarding a Copy of Order of Arrest of a Person Along with The Material to The Adjudicating Authority and Its Period Of Retention) Rule .....

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19 of the Act, which may be reproduced for ready reference as under. 19. Power to arrest - (1) If the Director, Deputy Director, Assistant Director, or any other officer authorised in this behalf by the Central Government by general or special order, has on the basis of material in his possession reason to believe (the reason for such belief to be recorded in writing) that any person has been guilty of an offence punishable under this act, he may arrest such person and shall, as soon as may be, .....

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not be curtailed under rule making power of the executive by specifying that such Assistant Director had to be additionally authorised by the Central Government by general or special order. 13. I have considered these arguments. First the rules which have been relied on have been framed in exercise of powers under clauses (a) and (p) of Sub-section (2) of Section 73 of the Act. These clauses (a) and (p) of Section 73(2) read as under: 73. (2) (a) the form in which records referred to in this ac .....

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uent comma, (,) after the words, or any other officer , may be an error of the draftsman. In any case it is not necessary to go into that question since definition is only for the purpose of rules which have been framed for the restricted purpose of clauses (a) & (p) of sub-section (2) of section 73 of the Act. Therefore, definition of arresting officer in these rules cannot be held to control the provisions of Section 19 of the Act or to require that the Central Government has to issue noti .....

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entral Government would be required. Thus, there is no substance in the contention that the Assistant Director who effected arrest lacked the authority to arrest. Therefore, there is no violation of any procedural safeguards which the applicant had and he cannot be said to have suffered by any eclipse of his rights by not following the procedure established by law in effecting his arrest. 15. The observations of the Supreme Court in Shri. Gurbaksh Singh Sibbia and ors -vs- State of Punjab, repor .....

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vernment exclusively upon the Director of the Enforcement Directorate. He drew my attention to the notification dated 1st July, 2005, which has been extensively reproduced in ground (a) (v) of the application. {SR 441 (E) DT. 1.7.2005}. In exercise of the powers conferred by sub-section (1) of Section 49 of the Prevention of Money laundering Act, 2002 (15 of 2003), the Central Government hereby appoints, with effect from the 1st day of July, 2005, the Director of Enforcement holding office immed .....

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section 39, section 40, section 41, section 42, section 48, section 49, section 66 and section 69 of the aforesaid Act. 17. As rightly submitted by the learned Advocate General, the words used in the notification do not show that the Director was to have powers under Section 5, 8, 17, 18, 19, 20, 21, 26, 28 of the Act, to the exclusion of all other officers. It only shows that the Director has the exclusive power but not necessarily to the exclusion of others, who have been empowered under the .....

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at the applicant is shown to have been involved only in offences under part B to the schedule of the Act. Section 45 of the Act, imposes additional limitations on the power of granting bail to person who are involved in offences under part A of the schedule. It was submitted that since the applicant is not a person who is alleged to have committed offence under part A of the Schedule, restrictions under Section 45 would not apply and therefore, the case of the applicant would have to be dealt wi .....

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ral days justifying further detention of the applicant in custody. Therefore, relying on the observations of the Supreme Court in para 16 and 18 of the judgment in Gurcharan Singh and ors -vs- State (Delhi Administration) reported in (1978) 1 SCC 118, learned counsel submitted that the applicant may be admitted to bail. 20. Learned Advocate General pointed out that the Assistant Director in his affidavit-in-reply, has stated about the gravity of offence for which, applicant has been arrested. He .....

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