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TMI Blog2024 (3) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... ertaining to the same alleged transactions/questions which have formed the basis of impugned proceedings launched by the police as well as the Enforcement Directorate: B. Direct and ensure that:- i. The officers of Respondent No. 6 Enforcement Directorate must remain within the circumscribed limits as mandated under Sub-Section (2) of Section 66 of the Prevention of Money Laundering Act, 2002 and "share the information with the concerned agency for necessary action" in the event of forming opinion "on the basis of information or material in his possession that the provisions of any other law for the time being in force are contravened" and nothing beyond; ii. Prohibit and restrain Respondent No. 6 (Enforcement Directorate) from prompting. compelling, forcing any authority to lodge criminal case(s) against any person or entity as contemplated under Section 2(1)(s) of the Prevention of Money Laundering Act, 2002 as any such act would tantamount to blatant illegality, arbitrariness and thus unconstitutional. C. Quash and set aside the communication F. No. ECIR/GNZO/19/2023/5405 dated 15.1.2024 (received in Police Station Pratap Nagar, District Yamuna Nagar on 17.1.2024), where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Enforcement Directorate, and its analysis would lead to the following outcome. 3. Respondent No. 7-Enforcement Directorate has registered ECIR/GNZO/19/2023 based on the predicate offences, which reads as under: S. No. FIR Schedule Offence 1. 0226 dt. 14.10.2022 Sections 120-B & 420 of Indian Penal Code, 1860 2. 0116 dt. 23.03.2023 Sections 120-B, 411, 420 of Indian Penal Code, 1860 3. 0111 dt. 01.06.2023 Sections 420, 467 & 471 of Indian Penal Code, 1860 4. 0206 dt. 19.09.2022 Section 420 of Indian Penal Code 5. 0216 dt. 30.09.2022 Section 471 of Indian Penal Code, 1860 6. 0204 dt. 14.09.2022 Sections 120-B & 420 of Indian Penal Code, 1860 7. 0033 dt. 10.02.2023 Sections 420, 467 & 471 of Indian Penal Code, 1860 8. 0054 dt. 16.02.2023 Sections 420, 467 & 471 of Indian Penal Code, 1860 4. As per the petition and the arguments addressed, the petitioner's case is that on 19.5.2015, the petitioner claims to form a firm, M/s Mubarikpur Royalty Company, set up with a partner(s). On 19.6.2015, a Letter of Intent [LOI] was issued to the petitioner's firm by the Department of Mines & Geology, Haryana, w.r.t. mining of boulder, sand & grave ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the report of the Monitoring Committee, issued notice & asked the firm to file a reply. Vide order dated 18.11.2022 [P-9], the NGT imposed a penalty on the petitioner's firm. On 13.2.2023, Hon'ble SC in Civil Appeal preferred by the firm has been pleased to issue notice & pass the conditional stay order. The matter is sub-judice before the Hon'ble Supreme Court - the next date of hearing is 12.4.2024. [P10]. 5. After that, the FIRs were registered in the District of Yamuna Nagar against several accused persons, including Dilbagh Singh. Based on the predicate offenses in the said FIRs as Scheduled/Predicate offenses, the Enforcement Directorate [ED] registered ECIR/GNZO/19/2023. 6. On 4.1.2024, ED searched the premises of M/s Mubarikpur Royalty Company and the petitioner's residence & seized certain documents & registers maintained by the firm. [P11 & P-12] 7. Mr. Vikram Chaudhary, Ld. Sr. Advocate submits that on 15.1.2024, respondent No. 7 Joint Director ED sent a communication to the Superintendent of Police [SP], Yamuna Nagar, Jagadhri, to register an FIR for specific offences as desired by the ED, including Mines & Mineral (Regulation of Develo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ering of such money into their personal bank accounts related companies/entities etc. Related persons/entities are involved in money laundering and are in possession of proceeds of crime or records/ property related to money laundering. 7. In view of the above, it is clear that entities namely M/s. Delhi Royalty Company, M/s. Mubarikpur Royalty Company, M/s. Development Strategies (India) Pvt. Ltd, JSM foods Pvt. Ltd and PS Buildtech and persons namely Dilbag Singh, Rajinder Singh, Kulwinder Singh (PS Buildtech), Manoj Kumar Wadhwa, Angad Singh Makkar, Gurpartap Singh Mann, Raman Ojha, Rajesh Chikara, Inderpal Singh, Naseeb Singh, Nirmal Roy, Mukesh Bansal, Ranbir Singh Rana, in connivance with others were involved in rampant illegal and unscientific mining in the mines allotted to them, violating Mines and Minerals (Development and Regulation) Act, damage to the environment in contravention to Sections 6, 7, 8, 15 and 16 of the Environment Protection Act, 1986 and provisions of Section 120-B, 420 of IPC, 1860...." 10. Mr. Vikram Chaudhary, Ld. Sr. Advocate argued that the ED officer himself becomes the complainant in the FIR and directs the Police explicitly to register oᤙ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances could the Police record an FIR. 11. It shall be appropriate to refer the relevant provision of the Prevention of Money Laundering Act, 2002 [PMLA], reads as follows: [2(u)] "proceeds of crime" means any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence or the value of any such property or where such property is taken or held outside the country, then the property equivalent in value held within the country or abroad; Explanation.-For the removal of doubts, it is hereby clarified that "proceeds of crime" include property not only derived or obtained from the scheduled offence but also any property which may directly or indirectly be derived or obtained as a result of any criminal activity relatable to the scheduled offence; [2(y)] "scheduled offence" means- (i) the offences specified under Part A of the Schedule; or (ii) the offences specified under Part B of the Schedule if the total value involved in such offences is one crore rupees or more; or (iii) the offences specified under Part C of the Schedule. [3]. Offence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons under that law. (2) If the Director or other authority specified under sub-section (1) is of the opinion, on the basis of information or material in his possession, that the provisions of any other law for the time being in force are contravened, then the Director or such other authority shall share the information with the concerned agency for necessary action. 12. An analysis of this argument ignores the material aspect that the primary offenses registered in the above captioned FIR are under 120-B & 420 IPC, which are cognizable. In addition to the offenses of 420 IPC being cognizable, it does not even require any prior sanction in the case of the petitioner, who is not a public servant. There is no violation of Section 66 of PMLA. Thus, despite a lengthy submission, the fundamental point is short, and the petitioner fails to make out any case based on these submissions. 13. The petitioner's first prayer is for the issuance of directions to ensure that the respondents do not violate the spirit and sanctity of the proceedings pending before the Hon'ble Supreme Court in Civil Appeal No. 7382 of 2023 (supra). 14. The first prayer is to enforce the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mal Roy, Mukesh Bansal, Ranbir Singh Rana, in connivance with others were involved in rampant illegal and unscientific mining in the mines allotted to them, violating Mines and Minerals (Development and Regulation) Act, damage to the environment in contravention to Sections 6, 7, 8, 15 and 16 of the Environment Protection Act, 1986 and provisions of Section 120-B, 420 of IPC, 1860 8. The above information is being shared with you under Section 66(2) of the PMLA, 2002 for necessary action at your end. Encl. As above. Sd/- Navneet Agrawal, Joint Director, Gurugram Zonal Office, Enforcement Directorate." Copy of FIR 0021 dated 19.1.2024 is annexed as ANNEXURE P-15. Attack on petitioner's family and threat of extortion by gangsters." 17. Senior counsel appearing for the petitioner has argued that the communications made by the Joint Director of Enforcement Directorate are illegal, arbitrary, and unsustainable. He submits that in the garb of Section 66(2) of the PMLA Act, the Joint Director has virtually directed and dictated the police adopt the course of action and has ensured that offenses under Section 420 and 120-B IPC are also added so that Enfo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... una Nagar District, for the mining of boulders, gravel and sand. The lease period was for eight years. The mining order started its production at site on 11.08.2016. Mubarikpur Company was allotted 28 hectares at Bailgarh village in Chhachhrauli Tehsil, Yamuna Nagar District, for a period of nine years. The mining lease order started its production at the site on 09.12.2016. Based on the observations of the Monitoring Committee established the Hon'ble NGT, the Hon'ble Tribunal has passed an order dated 18.11.2022 (copy enclosed) in respect of Delhi Royalty Company, Mubarikpur Royalty Company and M/s Development Strategies (India) Pvt. Ltd, as under: "6. We find it appropriate to accept the report as there is no meaningful objection against the same. Thus, it is clear that as Respondent No. 11 is concerned, apart from violating the requirement of undertaking replenishment study, not developing green belt, not implementing progressive mine closure plan, not installing CCTV cameras and not having GPS system, diversion of river flow, illegal instream mining, not providing weigh bridge at the entry of the mining lease area are clear violations. With regard Respondent No. 12, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in order to gather further evidence of persons involved in money laundering and record of proceeds of crime, Searches u/s 17 of PMLA were conducted on 04.01.2024 on the premises of M/s. Delhi Royalty Company, M/s. Mubarikpur Royalty Company, M/s. Development Strategies (India) Pvt. Ltd, JSM foods Pvt. Ltd and PS Buildtech and its partners and directors. 4. Apart from above persons, on the basis of information in possession of this office, Searches were also conducted at the residential premises of the Directors of M/s JSM Foods Pvt. Ltd, and business premises of PS Buildtech. During the search, various incriminating documents have been found and seized from the above premises with respect to illegal mining, 5. During the investigation, it has been revealed that above firm a and related persons have violated environmental norms (such as in-stream mining using heavy machinery during the odd hours, diversion the Now of River Yamuna by laying of layer of sand in the lease area extract the more quantity of sand from the lease areas etc.) their involvement in illegal and unscientific mining. It has also been revealed that these entities/persons have issued fake e-rawanas or not i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 14.10.2022 Sections 120-B & 420 of Indian Penal Code, 1860 2. 0116 dt. 23.03.2023 Sections 120-B, 411, 420 of Indian Penal Code, 1860 3. 0111 dt. 01.06.2023 Sections 420, 467 & 471 of Indian Penal Code, 1860 4. 0206 dt. 19.09.2022 Section 420 of Indian Penal Code 5. 0216 dt. 30.09.2022 Section 471 of Indian Penal Code, 1860 6. 0204 dt. 14.09.2022 Sections 120-B & 420 of Indian Penal Code, 1860 7. 0033 dt. 10.02.2023 Sections 420, 467 & 471 of Indian Penal Code, 1860 8. 0054 dt. 16.02.2023 Sections 420, 467 & 471 of Indian Penal Code, 1860 20. As per ED's counsel, after the analysis of the bank accounts of MRC, it is found that Cash deposited to the tune of approximately Rs. 67 Crores in the bank account of MRC, and further it is siphoned off to the various entities/ persons being investigated under the provisions of the Prevention of Money Laundering Act, 2002. The Monitoring Committee established by the Hon'ble Tribunal visited the mining lease area in the river area for surveying respect of Mubarikpur Royalty Company on 01.04.2022 and 23.04.2022, wherein the Monitoring Committee has observed that the mining lease holder has not maint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, cost of restoration and financial capacity of the PPs in view of principles laid down..... 8. Though as per Common Cause, compensation in case of illegal mining can be equal to the value to the mined material, apart from compensation for violation of environmental norms. we fix the same @ 10% of the lease money ie. Rs. 2.5 crore. Rs. 4.2 crore and Rs. 12 crores in respect of Respondents No. 11 to 13 respectively. The amount may be deposited within one month with the State PCB which is to be utilized for restoration of the environment by preparing and executing an action plan, in consultation with the District Magistrate " 21. As per the instructions supplied by the ED, in furtherance of the PMLA proceedings, based on reasons to believe, a search u/s 17 of the PMLA, 2002 was conducted at multiple premises to investigate the offense of commission of money laundering through illegal mining at large scale in Yamuna Nagar and nearby districts. Two premises of the Petitioner-residence and registered office of M/S Mubarikpur Royalty Company were searched, and multiple incriminating documents, digital devices, and evidence were recovered, which reveals the generation of "procee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elf-incriminate or to remain silent and the protection of Section 25 of Indian Evidence Act until he is formally made as an accused in PMLA case. In the wake of the above, once the petitioner has been made an accused by the ED itself in the FIR, it cannot be countenanced that he will be asked to appear in person in terms of Section 50 PMLA, which contemplates obligation on the person to attend as directed; to state the truth and the proceedings before the ED officer would be a "judicial proceeding." The whole context of Section 50 PMLA would have a different outlook once the ED itself has chosen to arraign the petitioner as an accused in the FIR lodged by themselves. Therefore, the petitioner's fundamental rights under Article 21 of the Constitution of India are grossly violated as the procedure established by law is not followed, and the proceedings launched are grossly actuated with malice in law. 23. Based on the crimes mentioned in para No. 3 (supra), the Enforcement Directorate was also prosecuting him for proceeds of crime. During such enquiry, the Joint Director of Enforcement Directorate, got to know about commission of other offences and thus he rightly exerci ..... X X X X Extracts X X X X X X X X Extracts X X X X
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