TMI Blog2023 (2) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... , 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 ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allegations levelled against the said Companies are that credit facilities were extended to those Companies to the tune of several crores at various stages from the year 1998. Later, due to macro-economic conditions, the Companies started facing severe liquidity issues and thereupon, restructure of liabilities was done and similarly short renewal of credit facilities was also made, however, the Companies had defaulted its interest servicing and repayment obligations to member banks and hence, the Companies were classified as Non Performing Asset (NPA) and the loans were recalled and notices were issued for invoking the personal guarantees of Promoters/Guarantors of the Companies and subsequently, the Companies were also liquidated. (iii) Subsequently, Forensic Auditors were appointed to carry out Transaction Audit and they had observed certain unusual indicators/irregularities related to different transactions in their Report as under:- a) Several crores of rupees were given as capital advances to potentially related parties. b) Majority of the trading transactions were executed with the potentially related parties with inadequate documentation, marginal/no collection, set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. Ltd. iii) The petitioner had not approached any Banks seeking financial assistance and cheated the banks and hence, he is not connected with the alleged proceeds of crime and thus, he has not committed any offence under the PML Act. iv) Merely because windmills were acquired by Bell Tower Enterprises LLP through the funds arranged from other entities viz., M/s.Sayso Exim Pvt. Ltd. M/s.Natural Coal Pvt. Ltd., and M/s.Tribhovan Enterprises Pvt. Ltd, which had also been repaid, the petitioner has been falsely implicated in the case of money laundering without proving mens rea on the part of the petitioner. v) The petitioner is not an accused either in the private complaint lodged by the banks, FIRs registered by the CBI nor in the ECIRs registered by the respondent. Merely based on the statements of witnesses, which are subject to trial, the petitioner has been unlawfully detained in judicial custody for about 90 days. vi) The petitioner has not committed an offence under Section 3 and 4 of PML Act as he had never been part of the management of Surana Corporation Limited, which is the prime entity in ECIR No.CEZO-I/42/2020. vii) Even according to the prosecution, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nter narrating the role of the petitioner in the offence and referring to the same, Mr.N.Ramesh, learned Special Public Prosecutor for ED cases would submit his arguments as under:- i) The total amount misappropriated by the three Companies viz., Surana Industries Limited, Surana Corporation Limited and Surana Power Limited is to the tune of Rs.3986.08 Crores. ii) The investigation conducted revealed that the above Companies, through its Directors/Promoters and other officials have indulged in manipulation of book of accounts, indulging in paper transactions with shell companies to inflate the turnover of companies in order to get more credit facilities from the banks and thereafter, siphoning off the funds from the Companies accounts through those shell Companies for personal gains and thus indulged in the offence of money laundering. All the Directors/Partners/Proprietors of all those shell Companies were either the relatives, employees or residents of ancestral village of Rajasthan. iii) The petitioner, a relative of the main accused Shri Dinesh Chand Surana, has been associated with various companies in the capacity of Director/Partner/Proprietor, which had huge transa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and cheques and he had no role in the day to day functioning of the Company and the Companies do not belong to him and he has a meager income and thereby he is not in a position to run such a big business, however, he had retracted from his statements before the Directorate. viii) By way of making such retractions and not revealing the true picture of the diverted proceeds of crime from Surana Group of Companies to the interlinked companies, he did not cooperate in the investigation to identify the proceeds of crime and establish the money trail. ix) By projecting himself as the legal owner of Bell Tower Enterprises LLP, the petitioner is not only trying to protect Shri Dinesh Chand Surana but also to project the properties in the name of Bell Tower Enterprises LLP as untainted properties and thus, it is a classic case of money laundering wherein all ingredients of the offence of money laundering viz., placement , layering i.e., moving of funds to other institutions to conceal origin and integration i.e., funds used to acquire assets. x) During the course of investigation, a number of witnesses have spoken to the effect that the petitioner is a benami of Shri Din ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by Shri Dinesh Chand Surana by appointing namesake Directors including the petitioner. xiv) The three Companies viz., M/s.Sayso Exim Pvt. Ltd., M/s.Thribhovan Enterprises Pvt. Ltd., and M/s.Natural Coal Pvt. Ltd. were used to launder money by Shri.Dinesh Chand Surana by making agreements for purchase of properties with one M/s.Kawarlal Co and later, not registered the said agreements and the proceeds of crime were marked with M/s.Kawarlal Co., and on enquiry, Shri.Ramlal, Proprietor of M/s.Kawarlal Co had admitted that he was selling his properties to Shri Dinesh Chand Surana only, but, received the sale consideration from M/s.Sayso Exim Pvt. Ltd., M/s.Thribhovan Enterprises Pvt. Ltd., and M/s.Natural Coal Pvt. Ltd and the said Shri.Ramlal had some transactions with Bell Tower Enterprises LLP and he had stated that he had taken some unsecured loan as well as given loan to Bell Tower LLP as requested by Shri.Dinesh Chand Surana. xv) The above factual aspects reveal that the petitioner, being a money lender, had abetted Shri Dinesh Chand Surana in exercise of money laundering. xvi) Though the petitioner has been in very active connivance with the main accused in the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mited (SPL) who have made bank borrowings and have been declared as Non Performing Assets (NPA) and are presently under liquidation, Insolvency and Bankruptcy Code, 2016 (IBC). Under IBC, the Liquidator had adjudicated the dues of the SIL, SCL and SPL and assessed a total liability of Rs.10,238 Crores. 8. Investigation into the scam had revealed that the Companies have made various false representations pertaining to revenue generation, share capital contribution and profitability of Surana GOC, based on which, public sector banks have lend monies to SIL, SCL SPL and the total adjudicated financial liability of the three companies is Rs.10,238 Crores. The investigation has revealed various counts of siphoning of funds, diversion of funds and creation of assets utilizing siphoned out funds. The Companies had floated various shell, puppet Companies, Partnerships and Proprietorship by making its own employees as Directors, Partners and Proprietors respectively inside and outside India to siphon off crores of money to cause loss to the lending banks. 9. The investigation had revealed that the petitioner being a benami of the main accused Shri Dinesh Chand Surana had abetted him ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 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- (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 is satisfied that there are reasonable grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail: Provided that a person who is under the age of sixteen years or is a woman or is sick or infirm, may be released on bail, if the special court so directs: Provided further that the Special Court shall not take cognizance of any offence punishable under section 4 except upon a complaint in writing made by- (i) the Director; or (ii) any officer of the Central Government or State Government authorised in writing in this behalf by the Central Government by a general or a special order made in this behalf by that Government. 15. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9.7.2015 20.5.2016 10 Bell Tower Enterprises LLP 10.7.2015 continuing 17. To enlighten this court on the aspect of round-tripping of money, the respondent has furnished, in the counter, the details of transactions the three Companies, from whom the petitioner took financial assistance, had with the Surana Group Companies and other entites, which are reproduced hereunder for ready reference:- (A) M/s.Natural Goal Pvt. Ltd. Sl. No. Date of transaction Debit amount Credit amount Particulars 1 4.4.2015 15,00,00,000 Surana Industries Ltd. 2 4.4.2015 7,25,00,000 Dinesh Chand Surana 3 4.4.2015 7,75,00,000 Dinesh Chand Surana 4 4.4.2015 10,00,00,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd 5 8.10.2015 2,99,99,000 Surana Industries Ltd 6 8.10.2015 2,99,99,500 Surana Corporation Ltd 7 8.10.2015 2,99,99,200 Surana Corporation Ltd 8 8.10.2015 3,00,01,000 To tfr 9 12.10.2015 1,80,00,000 Thribovan 10 12.10.2015 1,20,00,000 Thribovan 11 12.10.2015 1,80,01,000 Surana Corporation Ltd 12 12.10.2015 1,20,00,500 Surana Corporation Ltd 13 13.10.2015 3,00,00,000 Natural Coal Pvt Ltd. 14 13 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Surana Industries Ltd 33 30.12.2014 4,77,50,000 Sri Balaji Khem Products 34 30.12.2014 5,10,00,000 Surana Industries Ltd 35 2.1.2015 5,10,00,000 Sayso Exim 36 2.1.2015 5,10,00,000 Surana Industries Ltd 37 6.7.2016 1,25,63,775 Surana Corporation Ltd 38 6.7.2016 1,20,14,200 Bell Tower Enterprise LLP 39 6.7.2016 10,52,000 Surana Industries Ltd (C) M/s.Thribovan Enterprises Pvt. Ltd. Sl. No. Date of transaction Debit amount Credit amount Particulars 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Natural Coal Pvt Ltd. 20 13.10.2015 5,12,00,000 Surana Corporation 21 13.10.2015 2,15,40,000 Surana Corporation 22 13.10.2015 2,50,10,000 Surana Corporation 23 12.10.2015 1,20,00,000 Surana Corporation 24 12.10.2015 1,20,00,000 Sayso Exim Pvt. Ltd. 25 23.2.2016 1,31,55,500 Vinayaga Infra 26 23.2.2016 1,31,58,000 Surana Industries Ltd 18. Such being the triangular relationship among the parties insofar as the financial transactions are concerned, it is also seen that many witnesses have spoken about the petitioner acting as dummy of the main accused Shri Dinesh Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty may outweigh the right of personal liberty of the individual concerned. 20. 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. 21. Considering the totality of the circumstances, this court is of the view that the petitioner is not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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