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TMI Blog2023 (10) TMI 681X X X X Extracts X X X X X X X X Extracts X X X X ..... ney Laundering Act, 2002 ('PMLA'), and for directing the release of petitioner. 2. In the present case, an FIR bearing no. 807/2021 was registered on 05.12.2021 at Police Station Kalkaji, New Delhi under Sections 417/420/120B of Indian Penal Code, 1860 ('IPC') and another FIR bearing no. 190/2021 was registered under Sections 417/420/468/471/120B of IPC, against one M/s. Grand Prospect International Communication Pvt. Ltd. ('GPICPL') on the basis of a complaint lodged by the Ministry of Corporate Affairs ('MCA'). 3. In brief, the allegations in the said FIR are that certain Chinese shareholders of GPICPL had used forged identification documents and falsified addresses, while projecting itself to be a subsidiary company of Vivo, China. It is alleged that the company GPICPL had been incorporated by Zhengshen Ou and Zhang Jie, both Chinese nationals, with the help of one Chartered Accountant namely Nitin Garg who had facilitated the incorporation of the company by witnessing their signatures and their documents. During enquiry conducted by MCA, it was found that the said company had been incorporated to conduct fraudulent businesses. It is also alleged that the certifying profession ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o search whatsoever was ever conducted on any premises of the petitioner. It is also his case that he had been called to join investigation in September, 2022, wherein he had duly appeared before the investigating agency and joined investigation. Thereafter, he was called to join investigation only on 09.10.2023 when he had duly appeared before the agency, however, he was interrogated only for half an hour by asking routine questions, and he was arrested immediately. It is stated that he was arrested on 09.10.2023 itself whereas his arrest memo was prepared showing his arrest at 2:40 AM on 10.10.2023. 7. Learned Senior Counsel for the petitioner argues that the arrest of the petitioner has been carried out in a malafide manner and against the mandate of Section 19 of PMLA and such arrest is illegal and in violation of rights and protections available to the petitioner under law. It is stated that as per Section 19, it is necessary that the investigating officer should have a belief that the person being so arrested has been guilty of an offence punishable under this Act, and it is argued by learned Senior Counsel that the said ingredient of Section 19 is missing in the present cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petition and prays that the same needs to be dismissed at the threshold. It is argued that the learned Sessions Court in the remand order impugned before this Court had specifically inquired from each accused as to whether they had been supplied written grounds of arrest and the answer received was affirmative. It is also argued that the learned Sessions Court had categorically recorded a finding that there was no prima facie violation of Section 19 of PMLA and that the investigating officer had reason to believe that the petitioner and other accused persons were guilty of commission of offence under PMLA. It is also argued that the present petition is an abuse of process of law and that the petitioner has neither challenged the ground of arrest nor challenged the arrest order or arrest memo, rather has only challenged the consequential proceeding post arrest i.e. the remand order. It is stated that the judgment in case of Pankaj Bansal (supra) relates to setting aside of arrest orders and memos and the consequential proceedings arising therefrom vide which the accused therein had been remanded to the custody of Directorate of Enforcement. It is therefore argued that there are no g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ross India having Chinese nationals as their Directors and shareholders and these companies had been used to control the complete supply chain of Vivo mobiles in India. It was also discovered that these companies and their officials used to communicate through various Chinese applications and despite them operating in India, their data was not maintained in India, rather maintained in the servers in China. Further, investigation was also conducted on the aspects of commission of scheduled offences by Vivo India and its state distributor companies by way of using forged and fabricated driving licenses on the basis of which the directors had obtained the DIN and had opened accounts with HDFC Bank. 12. Investigation was also conducted to unearth the criminal conspiracy qua the real ownership of the companies and it was found that Coinmen Consultants LLP had carried out incorporation work for 18 entities of Vivo Group apart from the main company, including GPICPL, and all these companies were centrally controlled from China by 'Vivo Mobile Communication Company Limited, China' through its employees namely Andrew Kuang i.e. the petitioner, Ray Xu, Ye Liao, etc. and all these employees ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ised the whole process and communicated with the concerned entities regarding any difficulty or statutory issues faced by any of the state distributor companies for the purpose of incorporation. g. 17 out of 20 companies had provided the email-id of the present petitioner in the FC-GPR filings before RBI which proves that he was well-aware about the mesh of companies being incorporated throughout the country. h. He was a part of larger criminal conspiracy and was therefore prima facie connected with the proceeds of crime acquired by Vivo Mobile India Private Limited and its state distributor companies through commission of various schedule offences. 14. This Court has also examined the contents of the grounds of arrest supplied to the petitioner herein at the time of his arrest which also contains the details of the investigation conducted under PMLA in respect of the FIR as well as the role of the present petitioner. It is significant to note that under the heading 'Role of Andrew Kuang', investigating officer had given details of as to how the present petitioner was one of the main conspirators who, in collusion with other Chinese individuals, had helped in creating a web of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision of Hon'ble Apex Court in case of Pankaj Bansal (supra) and has perused the remand order impugned before this Court. This Court is of the opinion that the impugned order takes note of the allegations leveled against the accused persons in the FIR as well as the investigation conducted so far by Directorate of Enforcement. The learned Sessions Court had also perused the written grounds of arrest placed on record and had also taken note of the fact that the grounds of arrest in writing had been supplied to the accused persons in compliance of judgment of the Hon'ble Apex Court in case of Pankaj Bansal (supra). After perusing the records of the case, the learned Sessions Court has categorically recorded that prima facie there was no violation of Section 19 of PMLA since the investigating officer, from the material and investigation conducted so far, had formed an opinion that the accused persons were guilty of offence of money laundering and had affected their arrest accordingly. 18. The impugned order also mentions that the custody of the accused persons was sought not only due to their non-cooperation and evasive replies, but also due to the deliberate attempts to evade/mislea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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