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IN THE HIGH COURT OF MADHYA PRADESH
Vishal Dhagat, J.
Pushpendra Singh v. Director of Enforcement
Miscellaneous Criminal Case No. 19929 of 2024 (Jabalpur); Decided on 8.7.2024
(1) Prevention of Money Laundering Act, 2002 -- Ss. 3, 4, 70 and 2(1)(u) -- act of accused in dealing with ill-gotten money or property constitutes separate and distinct offence from earlier offence committed to get money. (2022) SCC Online SC 929 followed. [Para 7]
(2) Prevention of Money Laundering Act, 2002 -- S. 19 -- mandatory nature of provision -- most grounds of arrest based on investigation done by CBI and on statement of applicant and other witnesses recorded u/s. 17 -- mentioned in grounds that during recording of statement, applicant did not cooperate, gave evasive answers and suppressed facts -- failed to mention reason to believe guilt of applicant -- reason to believe has to be more than only a prima facie case -- in absence of reference to material on which reason to believe regarding guilt is based, arrest of applicant stands vitiated -- provision of S. 19 is mandatory -- provisions of Act place reverse burden on accused to show that he is not guilty -- there is presumption under law that applicant has committed offence, therefore, provisions are to be strictly followed. (2023) SCC Online SC 1244 referred to. [Para 9]
(3) Prevention of Money Laundering Act, 2002 -- S. 19 -- arrest is discretionary -- discretion is to be exercised wisely -- arrest not required in all cases -- it is to be made when custodial investigation regarding proceeds of crime is to be made or where there are chances that applicant, if remains at large, will cause evidence to disappear or will threaten witnesses or is in a position to hide proceeds of crime -- discretion is to be exercised by investigating agency after complying with S. 19. [Para 9]
(4) Criminal P. C., 1973 -- S. 439 -- Bharatiya Nagarik Suraksha Sanhita, 2023 -- S. 483 -- Prevention of Money Laundering Act, 2002 -- Ss. 19 and 45 -- bail -- arresting officer has to assess material available in charge-sheet of predicate offence and also unearthed during enquiry and investigation -- he must have material on basis of which he forms opinion that accused is guilty of offence under Act -- only then, discretion vested in him to arrest is to be exercised -- authorized officer has to give reasons of belief of guilt and Court has to give reasons of belief of not guilty to exercise power of grant of bail -- reason to believe is sine qua non for exercise of power u/s. 19 by authorized officer and u/s. 45 by Court -- accused will also have proper opportunity if reasons of belief are in writing and clearly spelt out in arrest order -- there is a thread running between S. 19 and S. 45 Act -- right of liberty may be jeopardized if reason of belief of guilt under Act is not in writing in arrest order, as condition for grant of bail is rigorous under Act -- while considering bail application, Court has to see that arrest has been made by complying with provisions of S. 19 of Act. [Para 10]
(5) Criminal P. C., 1973 -- S. 439 -- Bharatiya Nagarik Suraksha Sanhita, 2023 -- S. 483 -- Prevention of Money Laundering Act, 2002 -- Ss. 3, 4, 70, 19, 50 and 45 -- bail -- provisions of S. 19 of Act not complied with -- total sum said to have been diverted is Rs. 10.93 crores according to CBI, though allegations were made of about Rs. 14,93,67,500/- -- Enforcement Department is making allegation of Rs. 4,377.94 lacs -- search has been conducted -- mentioned in complaint that applicant did not cooperate and tried to hide facts therefore he was arrested, but reason for belief of guilt under Act not stated in complaint or arrest order -- assets and properties of applicant have been seized -- applicant is in jail and his custodial investigation may not be required -- no application by investigating agency for further interrogation of applicant in custody of Court -- nothing brought on record to support apprehensions that applicant is likely to commit any offence in future if released on bail -- any noncompliance of mandate of S. 19 of Act would enure to benefit of person arrested -- bail application allowed. (2024) 3 SCC 51 followed. [Paras 10 to 13]
¼1½ /ku 'kks/ku fuokj.k vf/kfu;e] 2002 & /kkjk 3] 4] 70 rFkk 2¼1½¼1½ & csbZekuh ls çkIr /ku ;k laifÙk ls lacaf/kr vfHk;qä ds —R; ls] /ku çkIr djus ds fy, fd, x, iwoZrj vijk/k ls i`Fkd~ vkSj lqfHkUu vijk/k xfBr gksrk gSA ¼2022½ ,llhlh v‚uykbu ,llh 929 vuqlfjrA ¼iSjk 7½
¼2½ /ku 'kks/ku fuokj.k vf/kfu;e] 2002 & /kkjk 19 & mica/k dh vkKkid ç—fr & fxjrkjh ds vf/kdrj vk/kkj dsaæh; vUos"k.k C;wjks }kjk fd, x, vUos"k.k ij rFkk /kkjk 17 ds v/khu vfHkfyf[kr vkosnd vkSj vU; lkf{k;ksa ds dFkuksa ij vk/kkfjr & vk/kkjksa esa mfYyf[kr fd dFku ds vfHkys[ku ds nkSjku vkosnd us lg;ksx ugha fd;k] xksyeksy mÙkj fn, rFkk rF;ksa dks fNik;k & vkosnd ds nks"k dk fo'okl djus ds dkj.k dk mYys[k ugha fd;k & fo'okl djus dk dkj.k çFke –"V;k ekeys ek= ls vf/kd gksuk gksrk gS & nks"k ds laca/k esa fo'okl djus dk dkj.k ftl lkexzh ij vk/kkfjr gS mlds funsZ'k ds vHkko esa vkosnd dh fxjrkjh nwf"kr gks tkrh gS & /kkjk 19 dk mica/k vkKkid gS & vfèkfu;e ds mica/kksa esa vfHk;qä ij ;g n'kkZus dk foijhr Hkkj Mkyk x;k gS fd og nks"kh ugha & fof/k esa mi/kkj.kk gS fd vkosnd us vijk/k fd;k gS- vr% micaèkksa dk vfrfu;efu"B vuqlj.k fd;k tkuk gksrk gSA ¼2023½ ,llhlh v‚uykbu ,llh 1244 fufnZ"VA ¼iSjk 9½
¼3½ /ku 'kks/ku fuokj.k vf/kfu;e] 2002 & /kkjk 19 & fxjrkjh oSosfdd gS & foosd dk ç;ksx çKk ls fd;k tkuk gksrk gS & lHkh ekeyksa esa fxjrkjh vko';d ugha & og rc dh tkuk gksrh gS tc vijk/k ds vkxe ds ckjs esa vfHkj{kk esa vUos"k.k fd;k tkuk gks vFkok tg‚a laHkkouk gS fd vkosnd ;fn eqä jgk rks] lk{; u"V dj nsxk ;k lkf{k;ksa dks /kedk,xk ;k og vijk/k ds vkxe fNikus dh fLFkfr esa gS & vUos"k.k vfHkdj.k }kjk foosd dk ç;ksx /kkjk 19 dk vuqikyu djus ds i'pkr~ fd;k tkuk gksrk gSA ¼iSjk 9½
¼4½ naM çfØ;k lafgrk] 1973 & /kkjk 439 & Hkkjrh; ukxfjd lqj{kk lafgrk] 2023 & /kkjk 483 & /ku 'kks/ku fuokj.k vf/kfu;e] 2002 & /kkjk 19 rFkk 45 & tekur & fxjrkj djus okys vf/kdkjh dks LFkkfir vijk/k ds vkjksii= esa miyC/k rFkk tk¡p vkSj vUos"k.k ds nkSjku [kkst dj ikbZ xbZ lkexzh dk Hkh ewY;kadu djuk gksrk gS & mlds ikl ,slh lkexzh gksuk gh pkfg, ftlds vk/kkj ij og jk; xfBr djs fd vfHk;qä vf/kfu;e ds v/khu vijk/k dk nks"kh gS & dsoy rc] mlesa fufgr fxjrkjh dk foosdkf/kdkj ç;qä fd;k tkuk gksrk gS & çkf/k—r vf/kdkjh dks nks"k ds fo'okl ds dkj.k nsuk gksrs gSa rFkk U;k;ky; dks tekur eatwj djus dh 'kfä ç;qä djus ds fy, nks"kh ugha gksus ds fo'okl ds dkj.k nsuk gksrs gSa & çkf/k—r vf/kdkjh }kjk /kkjk 19 ds v/khu rFkk U;k;ky; }kjk /kkjk 45 ds v/khu 'kfä ds ç;ksx ds fy, fo'okl djus dk dkj.k vfuok;Z gS
& ;fn fxjrkjh vkns'k esa fo'okl ds dkj.k fyf[kr vkSj lqLi"V gksa rks vfHk;qä dks Hkh mfpr volj çkIr gksxk & vf/kfu;e dh /kkjk 19 vkSj /kkjk 45 ds e/; ,d lw= pyrk gS & ;fn fxjrkjh vkns'k esa vf/kfu;e ds v/khu nks"k dk fo'okl djus dk dkj.k fyf[kr ugha gS rks Lora=rk dk vf/kdkj ladVxzLr gks ldrk gS D;ksafd vf/kfu;e ds v/khu tekur dh eatwjh dh 'krZ dBksj gS & tekur vkosnu ij fopkj djrs le; U;k;ky; dks ns[kuk gksrk gS fd fxjrkjh vf/kfu;e dh /kkjk 19 ds mica/kksa dk vuqikyu djds dh xbZ gSA ¼iSjk 10½
¼5½ naM çfØ;k lafgrk] 1973 & /kkjk 439 & Hkkjrh; ukxfjd lqj{kk lafgrk] 2023 & /kkjk 483 & /ku 'kks/ku fuokj.k vf/kfu;e] 2002 & /kkjk 3] 4] 70] 19] 50 rFkk 45 & tekur & vf/kfu;e dh /kkjk 19 ds mica/kksa dk vuqikyu ugha fd;k x;k & dsaæh; vUos"k.k C;wjks ds vuqlkj dqy vi;ksftr jkf'k :i;s 10-93 djksM+ dfFkr gS] tcfd vfHkdFku yxHkx :i;s 14]93]67]500@& ds fd, x, Fks & çorZu foHkkx :i;s 4-377-94 yk[k dk vfHkdFku dj jgk gS & ryk'kh dh tk pqdh gS & ifjokn esa mfYyf[kr fd vkosnd us lg;ksx ugha fd;k vkSj rF; fNikus dk ç;Ru fd;k blfy, mls fxjrkj fd;k x;k] ijarq ifjokn ;k fxjrkjh vkns'k esa vfèkfu;e ds v/khu nks"k ds fo'okl dk dkj.k crk;k ugha x;k & vkosnd dh vkfLr;k¡ vkSj laifÙk vfHkx`ghr dj yh xbZ gSa & vkosnd tsy esa gS vkSj vfHkj{kk esa mlds vUos"k.k dh vko';drk ugha gksxh & U;k;ky; dh vfHkj{kk esa vkosnd ls vkxs ifjç'u djus ds fy, vUos"k.k vfHkdj.k }kjk dksbZ vkosnu ugha & bl vk'kadk ds leFkZu esa vfHkys[k ij dqN ugha yk;k x;k fd vkosnd dks tekur ij NksM+k x;k rks og Hkfo"; esa dksbZ vijk/k dj ldrk gS & vf/kfu;e dh /kkjk 19 dh vkKk dk dksbZ Hkh vuuqikyu fxjrkj O;fä ds Qk;ns ds fy, ço`Ùk gksxk & tekur vkosnu eatwjA ¼2024½ 3 ,llhlh 51 vuqlfjrA ¼iSjk 10 ls 13½
ORDER
1. This is the first bail application filed by applicant under section 439 of Cr.P.C. (Now section 483 of the Bhartiya Nagrik Surksha Sanhita, 2023) for grant of regular bail relating to FIR/ECIR No. ECIR/AMZO/17/2020, registered at Directorate of Enforcement, Bhopal, District Bhopal (M.P.) for the offence under sections 3, 4 and 70 of Prevention of Money Laundering Act, 2002.
2. As per prosecution story, FIR was registered on 7.4.2017 by Central Bureau Investigation, on the basis of complainant made by one Surendranath Sahoo, Deputy General Manager of Canara Bank. Case was registered against K.D. Dubey, Branch Manager, Canara Bank, SME Branch, Jabalpur and M/s Jagdamba AMW Automatives Pvt. Ltd. (JAAPL) and other Directors. It is alleged that there was wrongful sanction of 50 loans. Loan amount was availed but vehicles were not delivered to the borrowers and money was used elsewhere by accused persons. Allegations are made that an amount about Rs.14.93/- crores public money of bank was misappropriated by cheating and forgery. Applicant was granted anticipatory bail on 7.7.2020 in M.Cr.C. No.6644/2020. Thereafter applicant co-operated in investigation. Charge sheet was filed on 18.12.2019 and six persons were charge sheeted. Later on, Enforcement Directorate (hereinafter referred to as 'ED') took over the investigation in respect of offences under sections 3 and 4 of Prevention of Money Laundering Act (in short as 'PMLA, Act'), 2002. ED filed complaint on 13.3.2024.
3. Learned counsel appearing for applicant prays for grant of bail on the ground that mandatory provisions of PMLA, 2002 is not followed by ED. It is submitted that there is non-compliance of section 19 of PMLA, 2002. Reasons were not recorded by prosecution for arrest of applicant. It is further submitted that section 50 of the PMLA, 2002 was also not complied with. No evidence and material was collected by ED. Reliance was placed upon the material which has been collected by CBI. It is submitted that offence under sections 3 and 4 are independent offences and ED ought to have collected material as per procedure prescribed in section 50 and thereafter has to reach satisfaction on reasonable grounds and belief regarding guilt of the accused. Same has not been done and therefore, arrest is illegal and not warranted. It is further submitted that prosecution has given reason that applicant is not co-operating in investigation of case. It is submitted that said reason is not sufficient to make arrest under section 19 of PMLA, 2002. Reliance is placed on the judgment passed by the apex Court in case of Pankaj Bansal v. Union of India, (2023) SCC Online SC 1244, wherein it is held that failure of an accused to respond to the questions put by ED would not be sufficient in itself for investigating officer to form on opinion that he is liable to be arrested under section 19. Reason has to be digged out by the investigating officer. Mere noncooperation will not be a cause for arrest under section 19. Learned counsel for applicant further argued that twin conditions under section 45 will be attracted only when mandatory provisions under sections 19 and 50 has been complied with by ED. On failure to comply with mandatory provisions in section 19 and 50, twin conditions mentioned in section 45 will not apply. In these circumstances, applicant be released on bail.
4. Learned counsel appearing for Enforcement Directorate has filed a detailed reply to the application for grant of bail. It is submitted that twin conditions as mentioned in section 45 of the PMLA, 2002 is to be satisfied before an accused is released on bail. Provision is mandatory in nature. Unless Court comes to satisfaction that there are no reasonable grounds for believing that applicant-accused is guilty and he is not likely to commit any offence only then applicant-accused may be enlarged on bail. It is submitted that voluminous evidence has been collected which shows that applicant is involved in money la
The court held that the applicant failed to satisfy the twin conditions for bail under Section 45 of the PMLA, 2002, due to the serious nature of the allegations and the evidence presented.
The court held that the petitioner is entitled to bail under Section 45 of the Prevention of Money Laundering Act, 2002 as there were no reasonable grounds for believing that she had committed an off....
The court established that non-compliance with the mandatory requirements of Section 19 of the PMLA regarding informing the accused of the grounds for arrest and the court's duty to record reasons fo....
Compliance with Section 19 of PMLA and satisfaction of twin conditions under Section 45 of PMLA are crucial for determining the validity of arrest and granting bail.
The court upheld the legality of the arrest under the Prevention of Money Laundering Act, confirming compliance with statutory requirements, including timely communication of grounds for arrest.
The main legal point established in the judgment is the need for strict compliance with the mandatory provisions of the Prevention of Money Laundering Act (PMLA) in the arrest and bail application pr....
The necessity of providing documented 'reasons to believe' at the time of arrest under Section 19 of PMLA is a statutory requirement that must be adhered to for the arrest to be lawful.
The court upheld that arrest under the Prevention of Money Laundering Act was lawful as procedural requirements of Section 19 were sufficiently met, emphasizing limits of judicial review on subjectiv....
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