The court upheld that evidence's credibility is crucial in determining bail under the Prevention of Money Laundering Act; weakness in predicate offence claims favors granting bail.

JUDGMENT

Vikas Mahajan, J.

1. The present petition has been filed under Section 45 of the Prevention of Money Laundering Act, 2002 read with Section 439 of the Code of Criminal Procedure, 1973 seeking regular bail in connection with ECIR No. DLZO- I/43/2021 dated 20.05.2021 registered by the respondent/ED.

FACTS

2. The Enforcement Case Information Report (hereinafter referred to as 'ECIR') was registered against the petitioner and others on the basis of FIR No. RC221/2021/E0009 dated 17.05.2021 registered by the CBI under Sections 120B read with 420 IPC and Sections 13(2) read with 13(1)(d) of the PC Act, 1988.

3. The summary of the allegations contained in the FIR registered by the CBI are as follows: -

a. Two complaints were forwarded to the CBI against the MD, Indian Farmers Fertilizer Cooperative Limited (hereinafter referred to as 'IFFCO') relating to subsidy fraud in IFFCO by opening Kisan International Trading, exchange of illegal commissions in import of raw materials and fertilizers, manipulation of sales data of fertilizers for claiming higher subsidy etc.

b. During scrutiny and verification of the complaints by the CBI, specific inputs were received from reliable sources alleging serious irregularities committed by the MD, IFFCO and other board members of IFFCO as well as MD, Indian Potash Limited (hereinafter referred to as `IPL') and others resulting in huge losses to both the entities and undue pecuniary gain to them and their family members.

c. It is alleged that the accused persons including the petitioner entered into a criminal conspiracy amongst themselves and during the period from 2007-2014 cheated and defrauded IFFCO, IPL, the general shareholders of these entities, as well as, the Government of India by fraudulently importing fertilizers and other materials at inflated prices and claimed higher subsidy thereby causing loss to the public exchequer. It is alleged that the commission from the supplies was siphoned off and the same was done through a complex web of fake commercial transactions through multiple companies which were owned by the accused persons to camouflage the fraudulent transactions as genuine.

d. It is the case of the respondent that IFFCO set up its 100% subsidiary namely, M/s Kisan International Trading FZE in Jebel Ali, Free Zonal Dubai for importing fertilizers and other raw materials from foreign companies/firms. It is alleged that the modus operandi adopted by the accused persons was that original bills were raised by the foreign manufacturers/suppliers (M/s Uralkali Trading Ltd.) at inflated prices to cover the bribe money which was to be paid to the Managing Directors of IFFCO and IPL. It is further alleged that incentives were paid through intermediaries/hawala operators.

e. The commission was received by the sons of the Managing Directors of IFFCO and IPL, respectively through an individual, namely Rajeev Saxena, who in order to justify the receipt of commission from M/s Urakali Trading Ltd. (hereinafter also referred to as "Uralkali") would execute consultancy agreements without rendering any consultancy services. Subsequently, the commission so received by Rajeev Saxena was transferred by him to the sons of the Managing Directors of IFFCO and IPL as per the instructions of the middleman Pankaj Jain by again executing consultancy agreements with the companies of the