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TMI Blog2024 (7) TMI 1318X X X X Extracts X X X X X X X X Extracts X X X X ..... pprover Dinesh Arora ..................18 Statement of Witness Raman Chawla ..................20 Statements of Harinder Singh Narula and Earla Chandan Reddy ..................20 Call Detail Location Chart Analysis ..................21 Role of Applicant in 2020-21 Delhi Liquor Policy ..................22 II. WHETHER THE APPLICANT IS ENTITLED TO BAIL ON THE GROUND THAT HE IS NOT AN ACCUSED IN THE SCHEDULED OFFENCE? ..................24 III. ADMISSIBILITY AND AN EVIDENTIARY VALUE OF STATEMENTS RECORDED UNDER SECTION 50 OF PMLA ..................28 IV. FINDING REGARDING ARGUMENT OF DISREGARDING APPROVER‟S STATEMENT AT THIS STAGE ..................30 Law on the Evidence of Approver ..................31 Consideration of Approver‟s Statement In This Case ..................33 V. THE COURT IS BOUND BY LAW, AND CANNOT BE INFLUENCED BY THE POSITION OF ANY PETITIONER ..................38 CONCLUSION ..................39 SWARANA KANTA SHARMA, J. 1. By way of present application under Section 439 of the Code of Criminal Procedure, 1973 ('Cr.P.C.') read with Sections 45 and 65 of the Prevention of Money Laundering Act, 2002 ('PMLA'), the applicant Sh. Sanjay Sing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a result of criminal conspiracy, a cartel was formed between three components of the said policy, i.e. liquor manufacturers, wholesalers and retailers, by violating provisions and the spirit of liquor policy, and all the conspirators had played an active role to achieve the illegal objectives of the said criminal conspiracy, result in huge losses to the Government exchequer and undue pecuniary benefits to the public servants and other accused involved in the said conspiracy. 3. The present ECIR No. ECIR/HIU-II/14/2022 was registered, as offences under Section 120B and Section 7 of the PC Act are scheduled offences under PMLA. The first prosecution complaint by the Directorate of Enforcement was filed on 26.11.2022 and the cognizance was taken by the learned Trial Court on 20.12.2022. Thereafter, Directorate of Enforcement had filed four supplementary prosecution complaints on 06.01.2023, 06.04.2023, 27.04.2023, and 04.05.2023 before the learned Trial Court. 4. However, the present applicant was arrested in relation to the present case on 04.10.2023 and was been produced before the learned Trial Court on 05.10.2023, whereby, he was remanded to custody of Directorate of Enforcem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was in his tenth and eleventh statement that the approver Dinesh Arora had levelled such allegations, which were also recorded after he had been arrested by the Directorate of Enforcement. Thus, it is clear that the present applicant has been implicated only after Dinesh Arora was arrested in July, 2023 and such statements have been made under an arrangement with the Directorate of Enforcement. 8. It is further argued that the false and frivolous allegation levelled regarding Rs. 2 crores being handed over to the applicant or „his persons‟ has not been mentioned in the predicate offence and in absence of the same in the predicate offence, it cannot be said that the said amount is proceeds of crime. Further, it is argued that the story of prosecution even to this effect does not find any corroboration from the statements of concerned co--accused Sameer Mahandru and Abhishek Boinpally, from whom the above amounts of Rs. 1 crore each are being alleged to have been originated or were part of the amounts paid by them to or collected by the approver Dinesh Arora through some other persons. It is argued that even the exact quantum of alleged proceeds of crime was neither iden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is no recovery from the applicant of any proceeds of crime or other incriminating article or substance that has been effected from his possession or his residence by the respondent. Therefore, it is prayed that the applicant be granted regular bail. SUBMISSIONS ON BEHALF OF RESPONDENT 12. On the other hand, Sh. S.V. Raju, learned Additional Solicitor General (ASG), appearing on behalf of the Directorate of Enforcement, vehemently opposes the present bail application and argues that grant of bail to an accused in case of money laundering is subject to the bar and rigors in the form of twin conditions laid down in Section 45 of PMLA. If the applicant fails to satisfy the Court that the applicant is not guilty of the offence or that he is not likely to commit any offence while on bail, his application is liable to be dismissed. It is argued that the present applicant is one of the key conspirators in the Delhi Liquor Scam. It is further argued that the applicant herein is closely associated with a number of accused persons including Dinesh Arora and Amit Arora. The applicant has also gained illegal money/kickbacks which are proceeds of crime generated from the Excise Policy 202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s during the investigation, it has been revealed that the present applicant had assured to affect changes through Sh. Manish Sisodia in the proposed Excise Policy of 2020-21 to increase the brand registration criterion for IMFL brands at the behest of Amit Arora and Dinesh Arora. In exchange for this, an associate of the present applicant i.e. Vivek Tyagi had been given stakes in the business concern of Amit Arora i.e. M/s Aralias Hospitality Pvt. Ltd. It is stated that Vivek Tyagi has been a close associate of the applicant for the last 10 years. It is further argued by the learned ASG that as per the disclosure made by the approver Dinesh Arora, one Memorandum of Understanding dated 18.06.2020 was also prepared to this effect by the applicant. The said MoU concerned the previous excise policy, but the same had been prepared and sought to be executed to influence the subsequent excise liquor policy of the year 2021-22 also, which is under investigation and is the subject matter of present prosecution. It is argued that the above MoU was recovered during the investigation and though it could not be executed due to certain reasons, but there is sufficient oral evidence in the form ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de 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 a 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, or is accused either on his own or along with other co-accused of money-laundering a sum of less than one crore rupees 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 a State Government authorised in writing in this behalf by the Central Government by a general or special order made in this behalf by that Government. (1A) Notwithstanding anything contained in the Code of Crim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elieving that the Accused is not guilty of offence of money-laundering and that he is not likely to commit any offence while on bail. Considering the purposes and objects of the legislation in the form of 2002 Act and the background in which it had been enacted owing to the commitment made to the international bodies and on their recommendations, it is plainly clear that it is a special legislation to deal with the subject of money-laundering activities having transnational impact on the financial systems including sovereignty and integrity of the countries. This is not an ordinary offence. To deal with such serious offence, stringent measures are provided in the 2002 Act for prevention of money-laundering and combating menace of money-laundering, including for attachment and confiscation of proceeds of crime and to prosecute persons involved in the process or activity connected with the proceeds of crime. In view of the gravity of the fallout of money-laundering activities having transnational impact, a special procedural law for prevention and regulation, including to prosecute the person involved, has been enacted, grouping the offenders involved in the process or activity conne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sume unless the contrary is proved, that in any proceedings relating to proceeds of crime under the Act, in the case of a person charged with the offence of money laundering under Section 3, such proceeds of crime are involved in money laundering. Such conditions enumerated in Section 45 of PML Act will have to be complied with even in respect of an application for bail made under Section 439 Cr. P.C. in view of the overriding effect given to the PML Act over the other law for the time being in force, under Section 71 of the PML Act." (Emphasis Supplied) 21. Thus, at the stage of consideration of bail of a person who is accused of commission of offence of money laundering under PMLA, the Court is not required to conduct a mini trial for the purpose of returning a finding of guilt, rather the material on record is to be examined to reach a conclusion as to whether there are reasonable grounds to believe that the accused is guilty of offence under PMLA. ANALYSIS & FINDINGS I. EVIDENCE AGAINST THE PRESENT APPLICANT Statement of Approver Dinesh Arora 22. This Court notes that in the present case, the statement of Sh. Dinesh Arora was recorded under Section 50 of PMLA on 14.08.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to Dinesh Arora's statement, he had coordinated with one Chandan Reddy, who assisted Abhishek Boinpally in these transactions. Dinesh Arora had personally collected Rs. 2 crores from Abhishek Boinpally's office, while another Rs. 2 crores were collected by one Harinder Singh Narula on his behalf. Out of this sum, Harinder Narula had delivered Rs. 3 crores at Vijay Nair's residence, and an amount of Rs. 1 crore was given to Sarvesh Mishra, through Raman Chawla, for the present applicant Sh. Sanjay Singh. Statement of Witness Raman Chawla 25. The statement of the employee of Dinesh Arora i.e. Raman Chawla was recorded under Section 50 of PMLA on 16.08.2023 in which he had disclosed that he had collected Rs. 1 crore from the office of IndoSpirits in Okhla, Delhi, which is owned by co-accused Sameer Mahendru. This cash was received by him on instructions of Dinesh Arora and thereafter, acting on his directions, Raman Chawla had delivered Rs. 1 crore to Sarvesh Mishra at the official residence of the present applicant Sh. Sanjay Singh, located in North Avenue, New Delhi in August, 2021. He had disclosed that on reaching the residence of Sh. Sanjay Singh, he had contacted S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orate of Enforcement has mentioned at length, in its reply, the role of the present applicant in formulation of the earlier excise policy i.e. policy for the year 2020-2021, a detailed discussion on the same is not necessary while deciding the present bail application. Nevertheless, since the present case essentially revolves around hatching of conspiracy among the accused persons for generation of proceeds of crime through formulation of new excise policy, it will be relevant to take a brief overview of the allegations against the applicant qua the liquor policy of 2020-21. 30. In his statement recorded under section 50 PMLA as well as statement under Section 164 (5) of Cr.P.C., Dinesh Arora has given the background as to how he had met the present applicant Sh. Sanjay Singh in connection with the old Excise policy of 2020-2021 which clearly mentions that he had met Sh. Sanjay Singh at his residence and had specifically narrated the meeting which had taken place at the residence of Sh. Sanjay Singh alongwith Amit Arora, Sarvesh Mishra, Vivek Tyagi etc. In the said meeting with Sh. Sanjay Singh, Amit Arora had explained his business plan of liquor and a clause he wanted to change ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 22.12.2023 whereby the learned Sessions Court, after considering various judicial precedents on the issue, observed that it is not a prerequisite for an individual to be named as an accused in the scheduled offence case to establish his involvement in a money laundering case. Rather, what is essential is that a scheduled offence must have been committed, and proceeds of crime in connection to that offence must have been generated to invoke the applicability of Section 3 of PMLA. The Sessions Court also noted that while the registration of a case under PMLA necessitates the commission of a scheduled offence, it is not always mandatory for an individual accused of money laundering to also be an accused in the scheduled offence. This Court concurs with the findings of the learned Sessions Court, as they align with the judicial precedents of the Hon‟ble Apex Court. 35. In Vijay Madanlal Choudhary (supra), the Hon‟ble Apex Court had observed that the offence of money laundering is an independent offence and has nothing to do with the criminal activities relating to a scheduled offence, except the proceeds of crime derived or obtained as a result of that crime; and that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eiterating the aforesaid ratio, the Hon‟ble Apex Court in case of Tarun Kumar (supra) has also held as under: "15. ...Further, as held in Vijay Madanlal (supra), the offence of money laundering under Section 3 of the Act is an independent offence regarding the process or activity connected with the proceeds of crime which had been derived or obtained as a result of criminal activity relating to or in relation to a scheduled offence. The offence of money laundering is not dependent or linked to the date on which the scheduled offence or predicate offence has been committed. The relevant date is the date on which the person indulges in the process or activity connected with the proceeds of crime. Thus, the involvement of the person in any of the criminal activities like concealment, possession, acquisition, use of proceeds of crime as much as projecting it as untainted property or claiming it to be so, would constitute the offence of money laundering under Section 3 of the Act." 37. Recently, in case of Pavana Dibbur v. Enforcement Directorate 2023 SCC OnLine SC 1586, the Hon‟ble Apex Court has held that it is not necessary that a person against whom the offence under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edings of the scheduled offence. However, an accused in the PMLA case who comes into the picture after the scheduled offence is committed by assisting in the concealment or use of proceeds of crime need not be an accused in the scheduled offence. Such an accused can still be prosecuted under PMLA so long as the scheduled offence exists. Thus, the second contention raised by the learned senior counsel appearing for the appellant on the ground that the appellant was not shown as an accused in the chargesheets filed in the scheduled offences deserves to be rejected." ( Emphasis Supplied ) 38. Furthermore, during the course of arguments, learned ASG representing the respondent had pointed out that the Directorate of Enforcement had already communicated and shared, via a letter dated 13.11.2023, under Section 66(2) of PMLA, information about the investigation regarding the facts of this case with the CBI. Further, the CBI had also written a letter dated 22.12.2023 to the ED, stating that the information shared by them has been taken on record for further investigation in the predicate offence case. 39. Therefore, at this stage, this Court finds no merit in the argument that applican ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt stage of deciding the bail application of the accused, when the trial has yet not commenced, this Court would be required to take into consideration the material collected by the investigating agency including statements of witnesses recorded under Section 50 of PMLA, and has held by the Hon‟ble Apex Court, statements under Section 50 of PMLA can make out a formidable case of money laundering against an accused. IV. FINDING REGARDING ARGUMENT OF DISREGARDING APPROVER'S STATEMENT AT THIS STAGE 45. The argument of learned counsel for the applicant that the statement of the approver is the only evidence available and rather created by Directorate of Enforcement to falsely implicate the petitioner cannot be dealt with, without referring to the law regarding the statement of the approver, who is otherwise a co-accused, later granted pardon after he turns approver. In this regard, this Court refers to the law regarding approver. Law on the Evidence of Approver 46. For the purpose of analysing the concept of approver and the evidentiary value of approver‟s testimony, it will be necessary to first examine the statutory provisions of law, dealing with the said issue. Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rding to the former, which is a Rule of law, an accomplice is competent to give evidence and according to the latter, which is a Rule of practice it is almost always unsafe to convict upon his testimony alone. Therefore, though the conviction of an accused on the testimony of an accomplice cannot be said to be illegal yet the courts will, as a matter of practice, not accept the evidence of such a witness without corroboration in material particulars." 49. Further, Section 306 of Cr.P.C primarily deals with grant of pardon, with the view to obtaining evidence, by a magistrate at any stage of a trial on the condition that the person being granted pardon shall make full and true disclosure of the whole circumstances within his knowledge, related to the offence and to every other person concerned with it. Consideration of Approver's Statement In This Case 50. The argument of the learned Senior counsel for the applicant primarily rests on the ground that there is nothing on record except the statement of the approver which is also procured under extraneous reasons and circumstances and therefore, there is nothing legal on record which could be even termed as incriminating against the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to him and to his business. This Court notes that in the statements recorded under Section 164(5) of Cr.P.C. before the learned Additional Chief Metropolitan Magistrate on 19.07.2023 and 26.07.2023, approver Dinesh Arora he had also mentioned that he had been threatened by Vijay Nair not to name any political leader and therefore, he had not disclosed their specific names i.e. of the present applicant and the factum of cash transactions which he had disclosed in the statement recorded under Section 50 of PMLA on 14.08.2023. This Court notes that the approver also mentions that after another person Sarath Reddy had turned approver, he had gathered courage to also disclose the truth as despite turning approver, no harm was caused to Sarath Reddy. 54. Therefore, the argument that the approver had disclosed the name of the present applicant under some threat without there being any complaint or retraction of statement by the approver is bound to be rejected. 55. The approver has not come forward to any Court of law to state that the statements so recorded were made under any stress or pressure or threat. The approver and his statements will be put to test of cross-examination and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... confines of enacted law. Thus the argument of the learned counsel regarding the case being based solely on the testimony of the approver and therefore, being devoid of any merit or truth, is attractive at a first glance, however, not legally tenable at the stage of consideration of bail. 61. Whether the statement of the approver suffers from infirmity clearly demonstrable by virtue of bias, pressure, threat, coercion etc. will be clear and proved during trial and at this stage, no finding can be given to give benefit of its lack of evidentiary value or falsehood to grant bail to the accused. 62. The law regarding such admissibility and the stage when such admissibility can be examined and adjudicated has not been carved out by this Court, but by the enactment of the provisions of Code of Criminal Procedure and Indian Evidence Act and catena of judgments of the Hon‟ble Apex Court in this regard. 63. It is also important to note that there are statements of other witnesses, independent of the approver, which corroborate the case of Directorate of Enforcement as well as of the stance of the approver which have been discussed in detail in the preceding paragraphs. Allegations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plicant in his subsequent meeting with Dinesh Arora confirmed receipt of the cash amount. ii. Statement of Raman Chawla, who disclosed delivering two separate amounts of Rs. 1 crore each, in coordination with Sarvesh Mishra, at the official residence of present applicant Sh. Sanjay Singh on instructions from Dinesh Arora, thus, corroborating statement of Dinesh Arora. iii. Corroboration of Raman Chawla‟s statement through call detail records and phone location analysis, indicating alignment with Sarvesh Mishra's location on the same day i.e. 17.08.2021, when Raman Chawla had visited the official residence of the present accused/applicant, to deliver the first installment of Rs. 1 crore in August, 2021. iv. Statements of Harinder Singh Narula and Chandan Reddy, which corroborates Dinesh Arora‟s claim regarding the source of Rs. 1 crore paid to the present applicant, originating from Rs. 4 crores received from Abhishek Boinpally. v. Statements of approver Dinesh Arora, co-accused Amit Arora, and witness Ankit Gupta, recorded under Section 50 of PMLA, along with the recovery of a memorandum of understanding dated 18.06.2020, which indicates the involvement of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidentiary value and the appropriate stage at which it can be admitted or disregarded is not the stage of bail as per judicial precedents. 72. In view of the aforesaid discussion, no ground for grant of bail is made out, at this stage. 73. However, the Hon‟ble Apex Court has already held in Manish Sisodia v. CBI 2023 SCC OnLine SC 1393 while rejecting bail application of a co-accused that the trial may conclude expeditiously once it commences. The accused in this case is entitled to a fair trial, a fundamental principle of justice that must be upheld. In light of this, this Court directs the learned Trial Court to expedite the trial in the present case. It is imperative that the legal process moves swiftly and efficiently to ensure that the accused's rights are protected, and justice is served without undue delay, subject to the condition that neither the counsel for accused(s) nor the prosecution will seek unnecessary adjournments. 74. It is, however, clarified that the observations made hereinabove qua the present case are solely for the purpose of deciding the instant application, and the same shall not be construed as opinion of this Court on the merits of the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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