Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2019 Supreme(Del) 2445

IN THE HIGH COURT OF DELHI AT NEW DELHI
SURESH KUMAR KAIT, J.
P. Chidambaram - Petitioner
Versus
Directorate of Enforcement - Respondent
Bail Appln. 2718 of 2019
Decided On : 15-11-2019

Advocates Appeared:
For the Petitioner: Mr. Kapil Sibal, Dr. Abhishek Manu Singhvi, Mr. Hari Haran, Mr. Dayan Krishnan, Sr. Advs. with Mr. Arshdeep Singh Khurana, Mr. Amit Bhandari, Mr. Hitesh Rai, Mr. Akshat Gupta, Mr. Ayush Agarwal & Mr. Sanjeevi Sheshadari, Advs.
For the Respondent: Mr. Tushar Mehta, Solicitor General with Mrs. Sonia Mathur, Sr. Adv. with Mr. Vikramjeet Banerjee, ASG, Mr. Amit Mahajan, CGSC, Mr. Rajat Nair, SPP, Mr. Kanu Agrawal, SPP with Mr. Shantanu Sharma, Ms. Mallika Hiremath, Mr. Bhuvan Kapoor and Mr. Varun Chugh, Advs.

The gravity of economic offences, the role of the accused, and the impact on the society at large are crucial factors in determining bail applications in such cases.

Headnote:
PMLA - Bail Application - Section 439 of Cr.P.C. - Sections 120-B, 420 of IPC, Section 8 and Section 13(2) read with Section 13(l)(d) of PC Act - [PMLA, 2005, Cr.P.C., IPC, PC Act]
Fact of the Case:

The petitioner, P. Chidambaram, filed a bail application under section 439 of the Code of Criminal Procedure seeking grant of bail in the ECIR bearing F.No. ECIR/7/HIU/2017 dated 18.05.2017 under the Prevention of Money Laundering Act, 2005 (PMLA). The allegations in the subject FIR pertain to the grant of an FIPB approval in 2007-08, for which the subject FIR came to be registered after a period of almost 10 years based on alleged 'oral source' information. The petitioner was arrested by the CBI and is currently in judicial custody.
Finding of the Court:

The court dismissed the bail application, considering the serious nature of the allegations and the active and key role played by the petitioner in the case. The court emphasized that economic offences affect the very fabric of democratic governance and probity in public life, and granting bail in such cases would send a wrong message to the public at large.
Issues: The key issues revolved around the seriousness of the allegations, the role of the petitioner in the case, and the impact of economic offences on the society at large.
Ratio Decidendi: The court considered the gravity of the offences, the active and key role played by the petitioner, and the impact of economic offences on the society at large in denying the bail application.
Final Decision: The bail application was dismissed, and the observations made in the order were clarified to be only in dealing with the bail application, without prejudicing the case of the petitioner in any manner.

Judgement Key Points

Key Points: - (!) The court emphasizes gravity of economic offences, accused’s active and key role, and societal impact as crucial factors in bail decisions. - (!) The court treats money laundering under PMLA as a standalone/offence distinct from predicate offences, allowing separate investigation and potential separate remand/arrest. - (!) The court denies bail citing serious allegations, active role of the petitioner, risk of influencing witnesses, and the potential threat to public trust in governance.

What is the standard for granting bail in money laundering (PMLA) cases involving an accused with high-profile positions and alleged proceeds of crime?

What is the court’s stance on whether PMLA offences are standalone and can be tried separately from predicate offences in a single proceeding?

What considerations justify denying bail on grounds of gravity of offence, active role, and potential tampering with witnesses or evidence in a money laundering case?

JUDGMENT :

1. The present bail application is filed under section 439 of Code of Criminal Procedure (hereinafter referred to as Cr.P.C.) on behalf of the accused/P. Chidambaram whereby seeking grant of bail in the ECIR bearing F.No. ECIR/7/HIU/2017 dated 18.05.2017 under the Prevention of Money Laundering Act, 2005 (hereinafter referred to as “PMLA”) who is presently in judicial custody.

2. The brief facts of the case are as made out in the present petition that on 15.05.2017, the Central Bureau of Investigation (hereinafter referred to as the "CBI") registered the First Information Report (hereinafter referred to as the “FIR”) bearing no. RC-2202017-E-0011 (hereinafter referred to as the "subject FIR"), under Sections 120-B read with 420 of the Indian Penal Code, 1860 (hereinafter referred to as the "IPC") and Section 8 and Section 13(2) read with Section 13(l)(d) of the Prevention of Corruption Act, 1988 (hereinafter referred to as the "PC Act"). The allegations in the subject FIR pertain to the grant of an FIPB approval in 2007-08, for which the subject FIR came to be registered after a period of almost 10 years based on alleged 'oral source' information. M/s INX Media, the Petitioner's son Sh. Karti P. Chidambaram, "unknown officials of the Ministry of Finance, Government of India" and others were named as accused persons in the subject FIR, whereas, Petitioner is neither named as an accused nor as a suspect. On 18.05.2017, solely based on the subject FIR registered by the CBI, Respondent ED registered the captioned ECIR under Section 3 of the PMLA punishable under Section 4 of PMLA. The said ECIR is production of the subject FIR and the Petitioner is neither named as an accused nor as a suspect therein. On 23.07.2018, apprehending his arrest by the Respondent ED, the Petitioner was constrained to prefer a petition (being BAIL APPLN. No. 1713/2018) before this Court under Section 438 Cr.P.C. seeking grant of anticipatory bail. Vide order dated 25.07.2018, this Court was pleased to issue notice and directed that no coercive steps shall be taken against the Petitioner till the next date of hearing and the said interim order continued for a period of over 15 months. During the pendency of the abovementioned anticipatory bail application, the Respondent ED summoned the Petitioner on 4 (Four) occasions viz. 19.12.2018, 07.01.2019, 21.01.2019 and 08.02.2019 and the Petitioner duly appeared on each such date and answered all questions to the best of his ability, knowledge and recollection. Pertinently, the Petitioner was not summoned thereafter. However, on 20.08.2019, this Court dismissed the Petitioner's abovementioned anticipatory bail Application. On 21.08.2019, the Petitioner approached the Hon'ble Supreme Court vide SLP (Crl.) No. 7523/2019 impugning the common Order dated 20.08.2019. Despite the pendency of the abovementioned SLP, the CBI, arrested the Petitioner on 21.08.2019. The Petitioner was in CBI custody till 05.09.2019 and is currently in judicial custody. However, on 05.09.2019, the Hon'ble Supreme Court dismissed the SLP (Crl.) No. 7523/2019 and on the same day, the Trial Court remanded the Petitioner to judicial custody until19.09.2019 which was extended from time to time and is continuing till date.

3. Mr. Kapil Sibal and Mr. Abhishek Manu Singhvi, learned senior advocate appeared on behalf of the petitioner and submitted that on 05.09.2019 itself, the Petitioner who was physically present before the Trial Court preferred an Application (hereinafter referred to as the "Surrender Application") praying to surrender before the Trial Court in the captioned ECIR. The Trial Court issued notice on the said application and directed the Respondent ED to file its reply. Accordingly, Respondent ED filed reply to the Surrender Application. In the said Reply, it was inter alia stated that while the Respondent ED does have reasons to believe to arrest the Petitioner under section 19 PMLA, it wishes to conduct certain background

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