TMI Blog2020 (12) TMI 1098X X X X Extracts X X X X X X X X Extracts X X X X ..... Dated:- 9-12-2020 - Hon'ble Dinesh Kumar Singh, J. For the Applicant : Pranshu Agrawal,Manoj Singh,Mohd. Yasir Abbasi For the Opposite Party : Shiv.P.Shukla ORDER Hon'ble Dinesh Kumar Singh, J. 1. This bail application has been filed under Section 439 Code of Criminal Procedure (hereinafter referred to as ''the CrPC') read with Section 45 of the Prevention of Money Laundering Act, 2002 (hereinafter referred to as ''the PMLA') by the accused-applicant, who is Managing Director of Amrapali Group of Companies (fourteen in numbers) after his application for bail got rejected by Special Judge/Sessions Court PMLA, Lucknow vide order dated 15.07.2020 passed in Bail Application No.2458 of 2020 filed in ED Case No.ECIR/06/PMLA/LKZO/2019 under Section 3/4 of the PMLA., Police Station Enforcement Directorate, Lucknow Zone. 2. Learned Special Judge considering the judgment and order dated 23.07.2019 passed by the Supreme Court in Writ Petition (Civil) No.940 of 2017 and, also the nature of accusation, gravity of offence and, punishment provided for the offence and, the fact that the investigation has been going on qua other accused an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere also instituted under the Securitisation and Reconstruction of Financial Assets and Enforcement and Security Interest Act, 2002. The order of NCLT has a direct bearing on the home buyers in projects of Amrapali Group of Companies. All these companies are run by the almost same set of Directors including the accused-applicant and Mr. Shiv Priya. The accused-applicant was the Managing Director of the most of the companies and he is the kingpin in defrauding, cheating, misappropriating and diverting and parking funds in bogus and sham companies including in foreign companies. Some of the flat buyers who had seen no other remedy and light in tunnel to protect and secure their interest, had approached the Supreme Court under Article 32 of the Constitution of India, leading petition being in Writ Petition (Civil) No.940 of 2017: Bikram Chatterjee vs Union of India and others. Thousands of intervention applications were also filed before the Supreme Court. 7. The Supreme Court looking at the plight and distress of the home/flat buyers entertained the petitions filed under Article 32 of the Constitution of India as huge public interest was involved in the matter. The real estate bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the promoters said that they were not able to deposit the amount of ₹ 2764 crores nor they would be able to pay ₹ 250 Crores with UCO Bank as ordered. In view thereof, the Supreme Court directed to freeze the individual bank account of the Directors of all forty companies and their properties to be attached. 9. The Supreme Court vide order dated 18.08.2018, directed the Directors of various companies, including the present accused-applicant, to file affidavits regarding movable and immovable properties and their valuation. The Statutory Auditor, co-accused Anil Mittal was directed to conduct the audit. However, looking at the involvement and culpability of the Statutory Auditor of Amrapali Group of Companies, the Supreme Court vide order dated 06.09.2018 appointed individual auditor, Mr. Ravi Bhatia of M/s. Bhatia Co. and Mr. Pawan Kumar Aggarwal of M/s. Sharp and Tannan Company to conduct the forensic audit of the Amrapali Group of Companies with effect from 2008 till date. Co-accused, Anil Mittal was directed to handover original documents of Amrapali Group of Companies, but he did not hand over the documents required by the Forensic Auditors and the Supreme Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... actual investments made and extent of diversion. Let the estimate and quantities of the bills be also furnished by Amrapali Group to the forensic auditors along with the names of all the suppliers and mode of payment. They may also collect information/documents from suppliers. 10. The Forensic Auditors in their report found that ₹ 140 Crores had been parked with M/s J.P. Morgan. The shares of the Amrapali Zodiac were purchased for ₹ 140 Crores by two sham companies i.e. M/s. Neelkanth and M/s. Rudraksha, whose Directors, were, Chandan Kumar, a peon in the office of co-accused Mr. Anil Mittal and his nephew Vivek Mittal, who was doing petty job for monthly income of ₹ 15,000 only. In respect of this fraud, the Supreme Court had observed as under: As inability was expressed on behalf of M/s. J.P. Morgan as well as other counsel to explain the report dated 23.10.2013 submitted by Mr. Sudit K. Parikh Co., Chartered Accountants. In the circumstances, so as to find out the basis of the valuation, it is necessary to call Mr. Sudit K. Parikh [Address : Ballard House, 2nd Floor, Adi Marzban Path, Ballard Pier, Fort, Mumbai - 400 001] to explain the valuation re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of several statutory prescriptions such as provisions of RERA, FEMA, Uttar Pradesh Apartments (Promotion of Construction, Ownership and Maintenance) Act, 2010, besides their criminal liability under the IPC and PMLA etc. The Supreme Court ultimately to secure the interest of the flat/home buyers appointed NBCC to complete the projects. The present accused-applicant had given details of companies from which funds were transferred to the extent of ₹ 2996 Crores to the different group of companies. The Supreme Court directed the Enforcement Directorate to make investigation in accordance with law and submit reports quarterly to the Supreme Court about the money laundering aspect. In paragraph-154 of the aforesaid judgment, sleeve of directions had been issued, including to the NBCC, Noida and Greater Noida Authorities and Banks etc., which are as follows:- (i) The registration of Amrapali Group of Companies under RERA shall stand cancelled; (ii) The various lease deeds granted in favour of Amrapali Group of Companies by Noida and Greater Noida Authorities for projects in question stand cancelled and rights henceforth, to vest in Court Receiver; (iii) We hold t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n as against leaseholders concerning such similar projects at Noida and Greater Noida and other places in various States, where projects have not been completed. They are further directed to ensure that projects are completed in a time-bound manner as contemplated in RERA and home buyers are not defrauded. (x) We appoint Shri R. Venkataramani, learned Senior Advocate, as the Court Receiver. The right of the lessee shall vest in the Court Receiver and he shall execute through authorized person on his behalf, the tripartite agreement and do all other acts as may be necessary and also to ensure that title is passed on to home buyers and possession is handed over to them. (xi) We also direct Noida and Greater Noida Authorities to execute the tripartite agreement within one month concerning the projects where homebuyers are residing and issue completion certificate notwithstanding that the dues are to be recovered under this order by the sale of the other attached properties. Registered conveyance deed shall also be executed in favour of homebuyers, they are to be placed in the possession and they shall continue to do so in future on completion of projects or in part as the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Supreme Court's intervention and undertaking painful and strenuous exercise to secure and protect the interest of innocent home/flat buyers, the fraud played by the accused-applicant and other accused in cheating and defrauding thousands innocent home/flat buyers of their hard earned money, could not have been unearthed. The Supreme Court is monitoring the investigation. The Supreme Court had been in pain to note the conduct of the accused-applicant and other accused. They had even violated the Supreme Court orders and did not comply the directions issued on several occasions. The forensic auditors appointed by the Supreme Court had meticulously flagged the fraud and cheating by the accused-applicant and other co-accused in creating bogus and sham companies and diversion of funds of the flat buyers money and creating assets etc. 17. PMLA is a special statute enacted by Parliament for dealing with money laundering. Section 5 of the Cr.P.C. clearly lays down that the provisions of Cr.P.C. will not affect any special statute or any local law. In other words, the provisions of the special statute will prevail over the general provisions of the Cr.P.C. in case of any conflict ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , inter alia, observed as under: (SCC p. 371, para 5) 5. ... The entire community is aggrieved if the economic offenders who ruin the economy of the State are not brought to book. A murder may be committed in the heat of moment upon passions being aroused. An economic offence is committed with cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the community. A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the community in the system to administer justice in an even-handed manner without fear of criticism from the quarters which view white-collar crimes with a permissive eye unmindful of the damage done to the national economy and national interest. 24. While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lating to property and land to the tune of ₹ 2.57 crores were recovered besides ₹ 20 lakhs in cash. In addition to this, allegedly a large number of written answer sheets of various students, letterheads and rubber stamps of several authorities, admit cards, illegal firearm, etc. were found which establishes a prima facie case against the respondent. The allegations against the respondent are very serious in nature, which are reflected from the excerpts of the case diary. We are also conscious of the fact that the offences alleged, if proved, may jeopardise the credibility of the education system of the State of Bihar. 22. Further, the aforesaid view has been reiterated in the case of Rohit Tandon vs Directorate of enforcement (2018) 11 SSC 46. Paras 21 and 22 of the aforesaid judgement read as under:- 21. The consistent view taken by this Court is that economic offences having deep-rooted conspiracies and involving huge loss of public funds need to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country. Further, when attempt is made to projec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inent to refer to the following observations of this Court in Y.S. Jagan Mohan Reddy [Y.S. Jagan Mohan Reddy v. CBI, (2013) 7 SCC 439 : (2013) 3 SCC (Cri) 552] : (SCC p. 449, paras 34-35) 34. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offences having deep-rooted conspiracies and involving huge loss of public funds need to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country. 35. While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations. This Court has adopted this position in several decisions, including Gautam Kundu v. Directorate of Enforcement [Gautam K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant of bail to any persons accused of an offence punishable for a term of imprisonment of more than three years under Part A of the Schedule to PMLA: (i) That the prosecutor must be given an opportunity to oppose the application for bail; and (ii) That the court must be satisfied that there are reasonable grounds for believing that the accused persons is not guilty of such offence and that he is not likely to commit any offence while on bail. 25. The Supreme Court in the case of Gautam Kundu Vs. Directorate of Enforcement (Prevention of Money Laundering Act), Government of India, (2015) 16 SCC 1 in paragraphs 28, 29 and 30 while dealing with the provisions of bail under Section 45 of the PMLA held as under :- 28. Before dealing with the application for bail on merit, it is to be considered whether the provisions of Section 45 of PMLA are binding on the High Court while considering the application for bail under Section 439 of the Code of Criminal Procedure. There is no doubt that PMLA deals with the offence of money-laundering and Parliament has enacted this law as per commitment of the country to the United Nations General Assembly. PMLA is a special statute enac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unconstitutional. Subsequently, Section 45 has been amended by Amendment Act 13 of 2018. The words imprisonment for a term of imprisonment of more than three years under Part A of the Schedule has been substituted with accused of an offence under this Act... . Section 45 prior to Nikesh Tarachand (supra) and post Nikesh Tarachand (supra) reads as under: Section 45 -- Prior to Nikesh Tarachand Shah Section 45 -- Post Nikesh Tarachand Shah 45. Offences to be cognizable and non-bailable.--(1) Notwithstanding contained in the Code of Criminal Procedure, 1973 (2 of 1974), no person accused of an offence punishable for a term of imprisonment of more than three years under Part A of the Schedule shall be released on bail or on his own bond unless-- 45. Offences to be cognizable and non-bailable.--(2) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), no person accused of an offence under this Act shall be released on bail or on his own bond unless-- (i) the Public Prosecutor has been given an opportunity to oppose the application for such release; and (ii) where the Public Prosecutor opposes the application, the court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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