Sanjay Singh vs Directorate of Enforcement

Headnote Court Copy Facts Arguments Court observation Judicial Analysis Case Map Category Hierarchy Table of Content

2024 Supreme(Del) 283

IN THE HIGH COURT OF DELHI AT NEW DELHI
Swarana Kanta Sharma, J.
Sanjay Singh - Appellant
Versus
Directorate Of Enforcement - Respondent
Bail Application. No. 76 of 2024
Decided On : 07-02-2024

Important Points

The court emphasized that for bail under PMLA, satisfaction of twin conditions is mandatory, confirming the need for reasonable grounds against guilt and potential for re-offense. Balancing the severity of money laundering offenses, bail was denied.

Subject

Criminal Law - Money Laundering

Act Referred

CONSTITUTION OF INDIA: Art.20(3)
CRIMINAL PROCEDURE CODE: S.161, S.164, S.164(5), S.439
EVIDENCE ACT: S.114(b)
INDIAN PENAL CODE: S.120(b), S.384, S.385, S.386, S.387, S.388, S.389, S.447(a)
NARCOTIC DRUGS AND PSYCHOTROPIC SUBSTANCES ACT: S.67
PREVENTION OF CORRUPTION ACT: S.7
PREVENTION OF MONEY LAUNDERING ACT: S.19, S.3, S.4, S.45, S.50, S.65, S.66, S.71

Headnote

(A) Code of Criminal Procedure, 1973 - Section 439 - Prevention of Money Laundering Act, 2002 - Sections 3, 4, and 45 - Bail application dismissed - The applicant has been in judicial custody since 04.10.2023, alleged to be involved in money laundering related to a larger conspiracy tied to liquor policy irregularities where significant kickbacks were paid - The prosecution alleges strong evidence against the applicant, including statements from an approver and various witnesses - The applicant's arguments regarding contradictory witness statements and lack of independent evidence were rejected - The court determined that the mandatory twin conditions for bail under PMLA were not satisfied as there are reasonable grounds to believe the applicant is not innocent and may commit further offenses if released. (Paras 1-3, 68-74)

Advocates appeared:
Mr. Mohit Mathur, Sr. Advocate along with Mr. Rajat Bhardwaj, Mohd. Irshad, Mr. Harsh Gautam, Ms. Ankita M. Bhardwaj, Mr. Kanishk Raj and Mr. Kaustubh Khanna, Advocates, for the Petitioner; Mr. S.V. Raju, ASG along with Mr. Zoheb Hossain, Special counsel for ED along with Mr. Vivek Gurnani, Mr. Samrat Goswami, Mr. Kartik Sabharwal, Mr. Pranjal Tripathi, Ms. Madhumita, Ms. Sonali Sharma, Mr. Hitharth and Mr. Kanishk Maurya, Advocates for ED, for the Respondent.

Table of Content
1. overview of the case's factual background. (Para 1 , 2 , 3 , 4 , 5)
2. applicant's arguments against bail. (Para 6 , 7 , 8 , 9 , 10 , 11)
3. respondent's opposition and arguments. (Para 12 , 13 , 14 , 15 , 16)
4. court's observations on prosecution's evidence. (Para 17)
5. legal framework for bail under pmla. (Para 18 , 19)
6. legal standards for granting bail. (Para 20 , 38 , 39)
7. evidence involving the approver's statements. (Para 21 , 22 , 23 , 24 , 25)
8. background on the involvement in previous liquor policies. (Para 29 , 30 , 31 , 32)
9. discussion on the applicant's non-inclusion in scheduled offence. (Para 33 , 34 , 35 , 36)
10. evaluating admissibility of statements under section 50 of pmla. (Para 40 , 41 , 42 , 43 , 44)
11. insights into evidence of accomplices. (Para 45 , 46 , 47 , 48)
12. conclusion on bail application and trial expedite. (Para 68 , 69 , 70 , 72 , 73)
13. final conclusions on bail application. (Para 75)

JUDGMENT

Swarana Kanta Sharma, J. - By way of present application under Section 4 39 of the Code of Criminal Procedure, 1973 ('Cr.P.C.') read with Sections 4 5 and 65 of the Prevention of Money Laundering Act, 2002 ('PMLA'), the applicant Sh. Sanjay Singh seeks grant of regular bail in case arising out of ECIR No. ECIR/HIU-II/14/2022, registered under Sections 3 and 4 of PMLA.

BACKGROUND OF THE CASE

2. The present case has been registered by the Directorate of Enforcement in relation to the predicate offence case registered by the Central Bureau of Investigation ('CBI'). On 17.08.2022, an FIR i.e. RC0032022A0053 had been registered by the CBI for offences punishable under Section 120B read with Section 447A of the INDIAN PENAL CODE , 1860 ('IPC') and Section 7 of Prevention of Corruption Act, 1988, ('PC Act') on the basis of a complaint dated 20.07.2022 made by the Lieutenant Governor, GNCTD and the directions of competent authority conveyed by Director, Ministry of Home Affairs ('MHA'), Government of India, through letter dated 22.07.2022 and also based on some sourced information, in relation to the irregularities committed in framing and implementation of excise policy of GNCTD for the year 2021-2022. The CBI had filed a chargesheet dated 25.11.2022, cognizance of which was taken by the learned Trial Court on 15.12.2022. Thereafter, on 25.04.2023 and 08.07.2023, two supplementary chargesheets had also been filed before the learned Trial Court respectively, against a total of 16 accused persons. It is the case of CBI that while the excise policy of GNCTD was at the stage of formulation or drafting, the accused persons had hatched a criminal conspiracy, in furtherance of which some loopholes had intentionally been left or created in the policy, which were meant to be utilized or exploited later on. Further, huge amount of money was paid as kickbacks in advance to the public servants involved in the commission of alleged offences and in exchange of undue pecuniary benefits to the conspirators involved in the liquor trade. As alleged, kickbacks of around Rs. 20-30 crores in advance were paid to accused Vijay Nair, Sh. Manish Sisodia and some other persons belonging to the ruling political party in Delhi, and the other public servants involved in conspiracy by some persons in the liquor business from South India and these kickbacks were found to have been returned back to them subsequently out of the profit margins of wholesalers holding L-l licenses and also through the credit notes issued by the L-l licensees to the retail zone licensees (L-7Z) related to the South liquor lobby. It is further alleged that 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 pecun