Gujarat High Court
Pradeep Nirankarnath Sharma vs Directorate Of Enforcement & on 15 March, 2017
Author: A.J.Desai
Bench: A.J.Desai
R/CR.MA/30674/2016 CAV ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
CRIMINAL MISC.APPLICATION (FOR REGULAR BAIL) NO.30674
of 2016
=========================================
PRADEEP NIRANKARNATH SHARMA....Applicant Versus DIRECTORATE OF ENFORCEMENT & 1....Respondents ========================================= Appearance :
MR Y S LAKHANI, SENIOR ADVOCATE ASSISTED BY MR RJ GOSWAMI, ADVOCATE for the Applicant.
MR DEVANG VYAS, ASSISTANT SOLICITOR GENERAL OF INDIA for the Respondent No.1.
MR MITESH AMIN, PUBLIC PROSECUTOR for the Respondent No.2. ========================================= CORAM : HONOURABLE MR.JUSTICE A.J.DESAI Date : 15/03/2017 CAV ORDER
1. By way of the present application under Section 439 of the Code of Criminal Procedure, 1973 read with Section 45 of the Prevention of Money Laundering Act, 2002 (hereinafter referred to as 'PML Act'), the applicant herein has prayed to release him on regular bail during the pendency of the trial in connection with a complaint being Complaint No.2 of 2016 pending before the Special Court constituted under the provisions of PML Act which arises out of Enforcement Case Information Report (ECIR) / 01 / AZO / 2012 for the offences punishable under Sections 3 and 4 of the PML Act alleging that the applicant has committed parity of scheduled offences i.e. under Sections 467, 471 read with Section 120-B of Indian Penal Code as well as for the offences punishable under Sections 7 and 13 of the Prevention of Corruption Act, 1988.
2. The case put forward by the prosecution is as under :-
2.1 That the applicant, an IAS Officer (now Retired), when was working as Collector at Bhuj of Dist. Kutch, taking undue advantage of his position as District Collector and Chairman of District Land Pricing Committee (DLPC), granted certain Page 1 of 44 HC-NIC Page 1 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER Government land by manipulative acts in gross violation of the norms / guidelines and instructions of State Government to one group of Company, namely, M/s. Welspun India Limited. In the said group of Companies, the wife of the present applicant, namely, Smt. Shyamal P. Sharma was made partner to the extent of 30% in one of the Companies, namely, M/s. Value Packaging Company which was supplying Cardboards to M/s. Welspun. By using his position as Collector, and making his wife partner in such Company, got Crores of rupees transferred into the account of his wife, son or daughter who are in USA, has committed offences punishable under Section 3 of the PML Act. For granting such land and using his position as a Collector and getting profits in which his wife was made 30% partner, several offences were registered against the applicant. One offence was registered with regard to the said transaction being I C.R. No.1 of 2010 with CID Crime, Rajkot and another being I C.R. No.9 of 2010 with CID Crime of Rajkot for the offences punishable under the provisions of Indian Penal Code. Similar type of offences were registered in the year 2011, 2012 and 2014. It is pertinent to note at this stage that the applicant has been enlarged on regular bail in all the other cases except the present one by either the learned Trial Court, this Court or Hon'ble the Supreme Court.
2.2 An inquiry was initiated by the Directorate of Enforcement i.e. respondent No.1 in the year 2012 to find out whether any offence has been committed under the provisions of PML Act. By an order dated 12.3.2012, the Deputy Director as well as Joint Director of the respondents took up the case for investigation. On completion of inquiry, a complaint under Section 45 of the PML Act being PMLA Complaint Case No.2 of 2016 was submitted before the learned Sessions Judge and Designated Judge (PMLA) at Ahmedabad (Rural).
Page 2 of 44
HC-NIC Page 2 of 44 Created On Thu Mar 16 01:39:00 IST 2017
R/CR.MA/30674/2016 CAV ORDER
2.3 The applicant was arrested in other offences
subsequent to the aforesaid order dated 12.3.2012. However, when the applicant apprehended that he is likely to be arrested with regard to an inquiry of the year 2012, he filed an application under Section 438 of the Code of Criminal Procedure, 1973 for releasing him on bail in case of his arrest, before the learned Designated Court, which was rejected by the learned Designated Court on 25.2.2015. Thereafter, the applicant accused preferred an application under Section 438 being Criminal Misc. Application No.4415 of 2015 before this Court. The said application was dismissed by coordinate Bench on 13.4.2015. The applicant approached Hon'ble the Supreme Court by way of filing Special Leave to Appeal (Criminal) No.3351 of 2015. Initially, the Hon'ble Supreme Court granted interim protection and asked the applicant to appear before the Investigating Officer and furnish a personal bond of Rs.10 Lacs. Ultimately, the said Special Leave Petition was rejected by the Hon'ble Supreme Court on 29.7.2016 and interim relief granted in favour of the applicant came to be vacated and, therefore, the applicant came to be arrested in connection with the present offence on 31.7.2016. The respondent filed a complaint before the Designated Special Court under PML Act on 27.9.2016. Summons was issued to the applicant and hearing was fixed on 29.9.2016. All the papers were supplied to the applicant on 29.9.2016 before the concerned Court.
2.4 Thereafter, the applicant filed an application under Section 439 being Criminal Misc. Application No.1991 of 2016 before the Designated Court and prayed to release him on bail during the pendency of the trial on several grounds. The said application came to be dismissed vide order dated 15.11.2016 bey the learned Sessions Judge and Designated Judge (PMLA) at Ahmedabad (Rural). Hence, this application.
Page 3 of 44
HC-NIC Page 3 of 44 Created On Thu Mar 16 01:39:00 IST 2017
R/CR.MA/30674/2016 CAV ORDER
3. Pursuant to the notice issued by this Court, the respondent No.1 has appeared through Mr. Devang Vyas, learned Assistant Solicitor General of India and filed an affidavit dated 9.1.2017 and opposed grant of any relief. Additional affidavit has been filed on behalf of the applicant on 10.1.2017.
4. Mr. Y. S. Lakhani, learned Senior Counsel assisted by Mr. R.J. Goswami appearing for the applicant has vehemently submitted that the applicant has wrongly been arraigned as an accused allegedly having committed offence under Section 3 of PML Act since for the same accusations, he has been enlarged on bail with regard to the offences registered at other Police Station. He would submit that though the report is of the year 2012, the complaint came to be filed in the year 2016 and has been arrested after more than period of four years i.e. in the month of July, 2016. He would submit that the allegations made in the complaint about the transaction having referred in complaint, of the bank account of foreign countries, are of those bank accounts which are opened in the joint name of applicant either with his wife, son or daughter who are residing in United States of America from last number of years. He would submit that wife of the applicant is working in USA and she might have her own transactions which are relied upon by the Investigating Agency, though the inquiry does not disclose any material that at his instance, transactions have taken place in the account of his wife, son or daughter who are independently earning their livelihood in USA. He would submit that some of the transactions referred in the complaint have taken place in those accounts when the applicant was in judicial custody.
He would submit that the statements recorded during the inquiry did not complete the chain of so-called Hawala transactions, since those persons who have alleged to have been, finally, transferred the amount in the account of his family Page 4 of 44 HC-NIC Page 4 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER members are not available. He would submit that the statement of witnesses have been recorded in the year 2015 and those witnesses are also not sure how they had received the amount before two to three years, which were ultimately paid to the family members of the applicant.
4.1 He would further submit that the applicant along with his family members had visited USA in the year 1992 to 1994 for educational purposes and at that time, initially he had opened a bank account jointly in the name of his wife and accordingly Credit Card was issued. The details supplied by the Investigating Agency only discloses that Credit Card was used at USA. However, there is no material that any amount was paid by the applicant for the said transactions. He would submit that a transaction of US $ 50,000/- with regard to personal loan availed by his wife from one Mr. Junjunwala is concerned, the loan has already been repaid by his wife and applicant was nowhere concerned with the transaction. He, therefore, would submit that no offence as alleged to have been committed by the applicant. He would submit that in absence of any material, the Agency has miserably failed to establish that he was involved in process or actively connected with proceeds of crime and has projected the transaction taken place in the account of his wife as an untented property. The transactions which have been relied upon by the Agency are of his wife and applicant is not connected with the transactions which have taken place in USA. Therefore, he cannot be said to have committed any offence under the PML Act. Mr. Lakhani would further submitted that the applicant is, therefore, required to be ordered to be released on bail only on the ground that he is able to establish even at this stage that the transactions, whichever have taken place in the account of his wife and children are untainted property and the applicant is not connected at all. He would submit that applicant has established his innocence and, therefore, he may be released Page 5 of 44 HC-NIC Page 5 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER on bail.
4.2 Mr. Lakhani would further submit that if the Court is not satisfied with regard to the innocence of the applicant, he may be released by considering as if the present application has been filed as a regular bail application under Section 439 of the Code since scheduled offences with which the applicant is charged were included in part B of the Schedule of PML Act, before Amendment of 2013. He would submit that when the PML Act, 2002 was introduced in the year 2003, a schedule was incorporated under Section 2 (x) and it was defined as under 2 (y) of the Act. Three parts, namely, Part A, B and C were made in the said Schedule incorporative various types of offences. The offences were included in different parts to the Schedule as per the severity and gravity of offence. The offences like waging or attempting to wage war, conspiracy to commit offences of waging war, counterfeiting currency notes etc. of Indian Penal Code, certain serious offences under the provisions of Narcotic Drugs and Psychotropic Substances Act, 1985, offences punishable under Explosive Substances Act, 1908, offences punishable under the Unlawful Activities (Prevention) Act, 1967 etc. were made part A of the Schedule. However, offences punishable under Section 120-B, 255, 302, 304, 412, 467, 471 etc. and offences punishable under the Arms Act, under the Wildlife (Protection) Act, under Immoral Trafficking Act (Prevention) Act, 1956, under the Prevention of Corruption Act, 1988 etc. were made Part A of the Schedule. The applicant is alleged to have committed offences punishable under Sections 467, 471 etc. of Indian Penal Code and offences punishable under the Prevention of Corruption Act, were included in Part B of the Schedule. Therefore, when a person is arrested for having committed offences under the PML Act, having committed any offence of Part B of the Schedule and arrested for the same and when he comes with a prayer to release him on bail, his application Page 6 of 44 HC-NIC Page 6 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER was being considered under Section 439 of the Code read with Section 45 of the PML Act. If the allegations have been made against an accused of PML Act that he has committed any offence of Part B to the Schedule, the rigor of Section 45 were not applicable since non-obstante clause was applicable only when the applicant has committed offences punishable under Part A of the Schedule.
4.3 Mr. Lakhani would further submit that a Bill was introduced by the Government and the object of introducing the same was putting all offences listed in Part A and B of the Schedule to only one Part A so that the provisions of monetary threshold does not apply to the offences. However, all the offences which were listed in Part B were included in Part A without clarifying the same and, therefore, the Courts are treating all the cases of accused having committed an offence of Part A with applicability of Section 45 of the PML Act, when applicants request for bail. He would submit that the said issue was raised before the Hon'ble Punjab and Haryana High Court about the above aspect. The Division Bench of the Hon'ble Punjab and Haryana High Court by a decision dated 11.5.2016 rendered in the case of Gorav Kathuria v. Union of India and others, Criminal Writ Petition No.595 of 2016 held that though an accused is charged with the offences alleged to have been committed under Part A, his case is required to be dealt with as per the unamended provisions which were introduced in the year 2002. He would submit that by elaborate judgment, two substantial questions of law for general importance were raised by the Division Bench for decision of the Hon'ble Supreme Court. The Hon'ble Supreme Court confirmed the decision of the Division Bench by passing an order on 8.12.2016 in Criminal Appeal No.737 of 2016. Therefore, the ratio laid down by the Hon'ble Division Bench of the Punjab and Haryana High Court is confirmed by the Hon'ble Supreme Court and, therefore, the Page 7 of 44 HC-NIC Page 7 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER applicant alleged to have been committed offences which were included in Part B prior to the amendment, the application is required to be considered as if the same has been filed under Section 439 of the Code and rigors of Section 45 of PML Act would not be applicable, since applicant is facing charges of having committed those offences which were made Part B of Schedule prior to amendment.
4.4 Mr. Lakhani would further submit that relying upon the decision of the Punjab and Haryana High Court, the coordinate Bench of this Court in an unreported decision dated 1710.2016 in the case of Kiran Mala Jayantilal v. State of Gujarat, rendered in Criminal Misc. Application No.395 of 2016 with Criminal Misc. Application No.3991 of 2016, has held that application is required to be considered as if the same has been filed under Section 439 of the Code and rigors of Section 45 of the PML Act would not be applicable. He, therefore, would submit that considering the gravity of offence and the maximum punishment which can be imposed at the end of trial is of seven years as well as the fact that the applicant has been enlarged on bail in all cases either by learned Trial Court, this Court or the Hon'ble Supreme Court, he may be released on appropriate terms and conditions.
5. Mr. Devang Vyas, learned Assistant Solicitor General of India appearing for the respondent No.1 would submit that the applicant, a retired IAS officer by taking advantage of his position as Collector of Kachchh, Bhuj has committed the offences as stated in the complaint. He would submit that crores of rupees have been transferred in the bank accounts of either his wife, and/or children in USA. He would further submit that though the report is of 2012, the complaint came to be filed in the year 2016, only after collecting several material from the Bank situated in United States of America and after recording several statements of number of Page 8 of 44 HC-NIC Page 8 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER witnesses of Kachchh (Gujarat), Mumbai etc. He would submit that as per Section 57 of PML Act, an application was made by the Investigating Agency to the Special Court to call for the details from the USA as well as UAE to supply the details about certain transactions taken place at USA in Bank of America wherein the name of the applicant, with his family which were opened and operated by the applicant, his wife or his children. The Principal District and Sessions Judge, Ahmedabad (Rural) by communication dated 10.10.2014 and 9.12.2014, requested the concerned authorities of USA and UAE respectively to supply details about the monetary transactions which have taken place in USA or in Dubai. He would submit that reminders were sent by Principal District Judge for supply of the information. However, the Investigating Agency received information from USA only and is awaiting further details from UAE. He, therefore, would submit that only after receiving sufficient material having come to conclusion that the petitioner has laundered money by different modes, a complaint came to be filed in the year 2016. He would further submit that Investigating Agency was not sitting idle or was waiting for release of the applicant from other offences as alleged by the applicant. He, however, would submit that the manner and method adopted by the applicant for transferring Crores of rupees through different countries that too after committing scheduled offences, prima facie, suggests that the amount transferred is proceeds of crime defined under Section 2 (u) of the PML Act. By taking me through the complaint itself, he would submit that around US $ 57,520 were transferred in the account of his wife that comes to around Rs.38 Lacs in Indian currency. He would further submit that the Credit Cards in the name of applicant were used by his wife in USA from the Bank account of the applicant. He would further submit that in the account of his wife, several Havala entries have been made through Dubai which comes to around US $ 66,217 i.e. approximately Rs.55 Lacs. By taking me through the statements of Page 9 of 44 HC-NIC Page 9 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER one Shri Ravin Junjunwala recorded under Section 50 of the PML Act on 16.10.2014, it suggests that an amount of US $ 35,950 was transferred in the account of Mrs. Shyamal Sharma i.e. wife of the present applicant. However, subsequently, said amount has been returned to the witness as if some loan was availed by his wife. He has taken me through the statement of Hujefa Chinchinwala, resident of Mumbai who has stated that he has made some Havala entries through other persons at the instance of the present applicant. Similar are the statements recorded of Mr. Sahay Raj son of Savarimuthu, Saifuddin Bhuriya etc. Mr. Saifuddin Bhuriya has specifically stated that he had visited residence of Mr. Sahay Raj who had paid an amount of Rs.10 Lacs on behalf of the applicant, which was sent outside India. He has taken me through various entries made in the accounts of wife of the applicant and submitted that Crores of rupees have been transferred in the bank account of the wife of the applicant. He, therefore, would submit that there is a prima facie case against the applicant having committed offence under Section 3 of PML Act and it is difficult to believe that the applicant is an innocent person and not guilty of having committed offence under PML Act. He would submit that as per the provisions of Section 24 of PML Act, burden to prove the proceeds of crime are untainted property lies on accused, which in the present case, the applicant has miserably failed in establishing the same.
5.1 As far as the submissions made by learned Senior advocate appearing for the applicant with regard to inclusion of the offences which were earlier in Part B to part A and the decision of the Punjab and Haryana High Court referred above, Mr. Vyas would submit that the decision rendered by the Division Bench of the Punjab and Haryana High Court is not applicable in the present case since the observations made in the said judgment are in connection with the prayers made by the applicant of that petition Page 10 of 44 HC-NIC Page 10 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER and with regard to the constitutional validity of Section 45 or compounding of the offences in Part A. He would submit that a writ petition was filed before this Court raising similar contentions with regard to the object of a Bill for amendment as well as validity of Section 45 was challenged. However, the Division Bench of this Court has dismissed the petition by upholding the validity of the rigors of Section 45 of the PML Act. He would further submit that one Rakesh M. Kothari and others, accused charged for the offences punishable under the provisions of PML Act and offences related to earlier part B of the Schedule challenged the validity of Section 45 by way of filing Special Criminal Application No.4496 of 2014 with Special Criminal Application No.4672 of 2014. By decision dated 16.1.2015, the Division Bench has upheld the validity of the provisions of Section 45 dealing with the submissions of learned advocate about the Bill and object of the amendment Act by which offences of Part B were included in Part A. He would submit that the said order has been challenged by the accused and the petition is pending before the Hon'ble Supreme Court.
5.2 Mr. Vyas would further submit that the Hon'ble Supreme Court in the case of Gautam Kundu v. Manoj Kumar, Assistant Director, Eastern Region, Directorate of Enforcement, AIR 2016 SC 106, has held that PML Act is a Special statute enacted by Parliament dealing with money lanudering and, therefore, Section 45 of the Act which starts with non obstante clause, indicates that the provisions laid down in Section 45 of the PMLA will have overriding effect on the general provisions of of the Code of Criminal Procedure and rigors of Section 45 would be applicable. He would further submit that before the Division Bench of the Punjab and Haryana High Court, a petition was filed by an advocate seeking direction that the inclusion of Section 131 of Page 11 of 44 HC-NIC Page 11 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER Customs Act in Part B by the amendment in the year 2015 could have been included in Part A since there is evasion of custom duties worth Crores of Rupees since the offenders are being enlarged on bail, in absence of non-applicability of rigor of Section 45 of the PML Act.
5.3 He would further submit that the Division Bench of the Punjab and Haryana High Court has not declared the provisions of Section 45 of the PML Act, ultra-vires to the Constitution of India. He would submit that the certificate was issued to the petitioner by framing two questions by the Division Bench of Punjab and Haryana High Court. When the petition was disposed of at admission stage, the Union of India was not heard and the appeal was dismissed.
5.4 He would further submit that the decision of the Punjab and Haryana High Court, in the case of Gorav Kathuria (Supra) does not lay down any proposition of law, whereas the decision of the Division Bench of this Court in the case of Rakesh Manekchand Kothari v. Union of India and others, has specifically laid down a law confirming the validity of the provisions of Section 45 of the PML Act. In support of his submissions, Mr. Vyas has relied upon the decision of the Hon'ble Supreme Court in the case of Poonam v. State of Uttar Pradesh, 2016 (2) SCC 779 wherein the Hon'ble Supreme Court has held that every judgment must be read as applicable to the particular facts proved or assumed to be proved, but governed and qualified by the particular facts of the case which was dealt by the Trial Court. He would submit that when the Criminal Appeal was disposed of by the Hon'ble Apex Court in connection with the judgment of the Division Bench of Punjab and Haryana High Court, the Union of India was not heard and, therefore, as held by the Hon'ble Supreme Court in the case of Kunhayammed and others v. State of Kerala, (2000) 6 SCC Page 12 of 44 HC-NIC Page 12 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER 539, the question of merger of the judgment would apply only when the matter is disposed of, if the Hon'ble Supreme Court has considered a case in exercise of its jurisdiction as an Appellate or Revisional jurisdiction, have exercised jurisdiction after issuance of notice and after full hearing in presence of all the parties. In the present case, when the appeal was disposed of by the Punjab and Haryana High Court in the case of Gorav Kathuria, Union of India was not heard. In none of the decisions, either the Punjab and Haryana High Court or any other High Courts or the Hon'ble Supreme Court, it has been held that the provisions of Section 45 of the PML Act and inclusion of the offences of Part B into Part A are unconstitutional and, therefore, the rigors would apply if the accused is found having committed offence which is included in Part A of the Schedule.
5.5 Mr. Vyas has also relied upon the decision of the coordinate Bench of this Court in the case of Afroz Mohmad Hasanfatta v. Deputy Director, 2015 JX (Gujarat) 805 wherein this Court has dealt with the rigors of Section 45 as well as the provisions of Section 50 of the PML Act under which the statements of the witnesses have been recorded. He would submit that the statement of applicant - accused have also been recorded, but he has not cooperated with the Investigating Officer. However, the Agency has independently investigated the case and could collect material against him through various leagl modes.
5.6 Mr. Vyas would further submit that as per Section 24 of the PML Act, burden of proof lies on an accused to prove that he is not involved in an offence of money laundering under Section 3 of the Act. The applicant has miserably failed in even prima facie establishing his case that the Court would be satisfied that there are reasonable grounds for believing that the applicant is not guilty of offences allegedly committed by him. He would further submit Page 13 of 44 HC-NIC Page 13 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER that in view of the provisions of Section 45 of the PML Act, a person accused of an offence punishable under Part A of the Schedule shall be released on bail unless the Public Prosecutor has been given an opportunity to oppose the application for such release and when the Public Prosecutor opposes such application and the Court is satisfied that there are reasonable grounds for believing that he is not guilty of such offences and he is not likely to commit any such offence while on bail, a person can be released on bail. He would further submit that the authority has collected ample material and is in process of collecting information from UAE with regard to Havala transactions and trying to find out the persons through whom the transactions had taken place. Therefore, there is no reason to believe that the applicant is not guilty of having committed any offence and, therefore, he cannot be released on bail and hence, the present application may be rejected.
6. I have heard learned advocates appearing for the respective parties. Firstly, I would like to deal with the contention raised by Senior Counsel Mr. Yogesh Lakhani whether the rigors of Section 45 of the PML Act would be applicable in view of the decision dated 11.5.2016 of the Punjab and Haryana High Court in the case of Gorav Kathuria v. Union of India and others, rendered in CRWP No.595 of 2016. Section 45 of the PML Act as on today, reads as under :-
"45. Offences to be cognizable and non- bailable :-
(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), no person accused of an offence punishable for a term of imprisonment of more than three years under Part A of the Schedule shall be released on bail or on his own bond unless -Page 14 of 44
HC-NIC Page 14 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER
(i) the Public Prosecutor has been given an 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, 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 State Government authorized in writing in this behalf by the Central Government by a general or a special order made in this behalf by that Government.
(1-A) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), or any other provisions of this Act, no police officer shall investigate into an offence under this Act unless specifically authorized, by the Central Government by a general or special order, and subject to such conditions as may be prescribed.
(2) The limitation on granting of bail specified in sub-section (1) is in addition to the limitations under the Code of Criminal Procedure, 1973 (2 of 1974) or any other law for the time being in force on granting of bail."
7. I have gone through the judgment of the Punjab and Haryana High Court wherein Division Bench has dealt with several aspects of PML Act including provisions of Section 45. The said writ petition was filed by one Gorav Kathuria who is a practising lawyer who raised several issues including that in Punjab and Page 15 of 44 HC-NIC Page 15 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER Haryana, there is huge custom duty evasion with regard to import of Heavy Melting Scrap classifiable under Customs Tariff Heading at Ludhiana and the accused are laundering the proceeds of crime so generated and, therefore, the amendment made by Section 145 (2) of the Finance Act, 2015 enhancing the monetary threshold for the offences specified under Part B of the Schedule from the total value involved in offences from Rs.30 Lacs or more to Rs.1 Crore or more as well as insertion of Section 132 of the Customs Act, 1962 in Part B of the Schedule of PML Act vide Section 151 of the said Finance Act, 2015 are contrary to the constitutional provisions. By raising several contentions by the petitioner, following prayers were made by him in the said petition :-
"(I) Issue appropriate writ, order or direction in the Petitioner's challenge to the vires qua criminal cases, of firstly the sub-clause (ii) of clause (y) of section 2 of PMLA, and secondly, the insertion of Part-B in the Schedule in PMLA, as amended vide section 145(ii) and section 151 of the Finance Act, 2015, with effect from 14.05.2015, for declaring these provisions of PMLA as unconstitutional and ultra vires as the same are contrary to the objects of PMLA warranting stringent conditions for grant of bail vide Section 45(1) in criminal cases under PMLA, and are unconstitutional and/or
ii) to issue appropriate writ, order or directions while reading down these provisions for criminal cases, so as to make them constitutional by construing criminal offence under Part B of the Schedule inserted in PMLA w.e.f. 14.5.2015, to be amongst the offiences listed in Part-A of the Schedule, so as to apply the stringent pre-conditions for grant of bail vide Section 45(1) in the matters of money laundering irrespective of the magnitude of gravity of the said scheduled offences;
iii) to hold that a private criminal complaint by the petitioner would be maintainable for setting the criminal law into motion and to seek any direction for investigation of offence under Section 3 r/w 4 of PMLA along with the offence under Part Page 16 of 44 HC-NIC Page 16 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER B of the Schedule inserted in PMLA w.e.f.
14.05.2015, either under Section 156(3) or under Section 155 (2) of the Code of Criminal Procedure, as the case may be, pending grant of sanction requisite for taking 'cognizance' in said Scheduled Offence or under PMLA,
(iv) Issue any other writ, order or directions, which this Hon'ble Court may deem just and fit."
8. It was his argument that the amount of Rs.30 Lacs and more which was in existence till 2012 and raising to Rs.1 Crore and more is ultra-vires since by various means and method, the amount is shown less than Rs.1 Crore of Rupees with regard to custom duties. It was also his argument that by inclusion of Section 132 of Customs Act in Part B to the Schedule of PML Act, the intention of the Legislature to impose rigors of Section 45 would become redundant even if the accused has committed huge fraud under Section 132 of the Customs Act. While dealing with the submissions made by the applicant, the Division Bench of the Punjab and Haryana High Court observed about the object of the Bill of 2013 i.e. of enhancing the monetary aspect of the offence and it has been observed that there was no need to include all the offences into part 1 which were made Part B to the Schedule of PML Act. The following observations were made by the Division Bench of Punjab and Haryana High Court :-
"12.13 We have carefully scanned the "Statement of Objects and Reasons" as incorporated in the Prevention of Money- Laundering (Amendment) Bill, 2011, more specifically paragraph 3(j). It is seen that the limited object and reason behind the said proposed amendment was recorded as follows :-
"3. The Prevention of Money-Laundering (Amendment) Bill, 2011, inter alia, seeks to -
(i) putting all the offences listed in Part A and Part B of the Schedule to the aforesaid Act into Page 17 of 44 HC-NIC Page 17 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER Part A of that Schedule instead of keeping them in two parts so that the provision of monetary threshold does not apply to the offences.
4. The Bill seeks to achieve the above objects.
New Delhi; PRANAB MUKHERJEE The 16th December, 2011"
12.14. All the offences were thus proposed to be put together in the newly proposed Part-A, irrespective of the magnitude or gravity of the scheduled offence. Entire Part B was thus effectively omitted vide the Bill of 2011.
12.15 We have seen that then existing Section 2(y) of the PMLA imposed monetary threshold of Rs.30 lakhs for invocation of PMLA in respect of the offences listed in Part B of the Schedule. Evidently therefore, as clearly recorded in the "Statement of Objects And Reasons" as incorporated in Para 3(j) in the Prevention of Money-Laundering (Amendment) Bill, 2011, the only object for the amendment carried out in 2013 in the Schedule to PMLA was to overcome this monetary threshold limit of Rs.30 Lakhs so that for invocation of PMLA in respect of the laundering of proceeds of crime involved in offences earlier listed under Part B of the Schedule, there is no embargo of minimum value of Rs.30 Lacs.
12.16 In our opinion the presumption of the petitioner that rigors in grant of Bail contained in Section 45(1) of PMLA extends to all the offences mentioned in such amended Part A is neither logical nor intended by the legislation. The offences which were in the earlier Part A of the Schedule (prior to 2013 Amendment) are evidently henious offences such as waging war against the country, offences under NDPS Act and Terrorist activities etc. Other scheduled offences, which prior to 2013 amendment were under Part B of the Schedule, cannot be equated with such heinous offences in the context of Section 45(1) of PMLA.
12.17 Despite the above substantive
Page 18 of 44
HC-NIC Page 18 of 44 Created On Thu Mar 16 01:39:00 IST 2017
R/CR.MA/30674/2016 CAV ORDER
amendment in the Schedule, we find no
corresponding amendment simultaneously
carried out in 2013, in Section 45(1), in respect of application of the limitations in grant of bail to person accused of Schedule offences earlier falling under Part B of the Schedule. We do not find any legislative intent from the perusal of the aforesaid "Statement of Objects and Reasons" as incorporated in the Prevention of Money-
Laundering (Amendment) Bill, 2011 to apply such stringent limitations in grant of bail to person accused of Scheduled offences earlier falling under Part B of the Schedule, but now existing in Part A thereof. On the contrary, the only object sought to be achieved by the said 2013 amendment in Schedule was to overcome this monetary threshold limit of Rs. 30 lakhs so that for invocation of PMLA in respect of the laundering of proceeds of crime involved in offences earlier falling under Part B of the Schedule, there is no embargo of minimum value of Rs. 30 lacs. This 2013 amendment in Schedule carried out as proposed vide the Prevention of Money-Laundering (Amendment) Bill, 2011 was not intended to introduce a substantive amendment for creating an embargo on grant of bail to a person arrested under PMLA in respect of offences earlier falling under Part B of the Schedule. After having perused the "Statement of Objects and Reasons" as incorporated in the Prevention of Money-Laundering (Amendment) Bill, 2011 which led to 2013 amendment in Schedule, we are unable to agree with the petitioner that by necessary corollary of the aforesaid 2013 amendment, the stringent limitations in grant of bail were now made applicable to all scheduled offences which are punishable for more than three years and were put together in the new Part-A. If that interpretation as sought to be given by the petitioner, which is devoid of any support from the objects and reasons available on record in the Prevention of Money-Laundering (Amendment) Bill, 2011, is accepted by us, the provision of Section 45(1) would become unreasonable, harsh, oppressive and unconstitutional. We cannot lose sight of the fact that the offences which were in Part B and were shifted in Part A by 2013 amendment also include offences which are Page 19 of 44 HC-NIC Page 19 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER compoundable and bailable. The framers of PMLA therefore had placed the offences in two different parts Part A and Part B. We see no legislative intent to apply twin limitations in grant of bail under Section 45(1) of PMLA qua all persons arrested on accusation of commission of even such Scheduled Offences which were earlier listed in Part B. 12.18. Therefore, in our opinion the reference to the offences under Part A of the Schedule in the context of Section 45 (1) requires to read down to apply only to those scheduled offences, which existed under the Part A of the Schedule prior to the said 2013 amendment in Schedule. Having arrived at the said opinion, we have also given our anxious consideration to the issue whether we can simply fold our hands and blame the draftsman, or whether we are duty bound to work on the constructive task of finding the intention of Parliament and to iron out the creases to harmonise the law with the prevailing objects sought to be achieved, reasons and concepts and to make it an effective instrument for delivery of justice eschewing the construction which will lead to absurdity. The Hon'ble Constitution Bench in S.P. Gupta v. Union of India, 1981 Supp SCC 87 had observed as follows:-
"63.............The interpretation of every statutory provision must keep pace with changing concepts and values and it must, to the extent to which its language permits or rather does not prohibit, suffer adjustments through judicial interpretation so as to accord with the requirements of the fast changing society which is undergoing rapid social and economic transformation. The language of a statutory provision is not a static vehicle of ideas and concepts and as ideas and concepts change, as they are bound to do in a country like ours with the establishment of a democratic structure based on egalitarian values and aggressive developmental strategies, so must the meaning and content of the statutory provision undergo a change. It is elementary that law does not operate in a vacuum. It is not an antique to be taken down, dusted, admired and put back on the shelf, but rather it is a powerful instrument Page 20 of 44 HC-NIC Page 20 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER fashioned by society for the purpose of adjusting conflicts and tensions which arise by reason of clash between conflicting interests. It is therefore intended to serve a social purpose and it cannot be interpreted without taking into account the social,economic and political setting in which it is intended to operate. It is here that the Judge is called upon to perform a creative function. He has to inject flesh and blood in the dry skeleton provided by the legislature and by a process of dynamic interpretation, invest it with a meaning which will harmonise the law with the prevailing concepts and values and make it an effective instrument for delivery of justice. We need not therefore be obsessed with the fact that Section 123 is a statutory provision of old vintage or that it has been interpreted in a particular manner some two decades ago. It is not as if it has once spoken and then turned into muted silence. It is an instrument which can speak again and in a different voice in the content of a different milieu. Let us therefore try to understand what voice this statutory provision speaks today in a democratic society wedded to the basic values enshrined in the Constitution".
12.19. .............................
12.20 Guided by the aforesaid principles laid down by the Hon'ble Supreme Court regarding statutory interpretation and the duty of the Court to secure the ends of justice, we have no hesitation in holding that in 2013, Part B of the Schedule was omitted and the Scheduled Offences falling thereunder were incorporated in Part A with the sole object to overcome the monetary threshold limit of Rs.30 lakhs for invocation of PMLA in respect of the laundering of proceeds of crime involved in those offences. No substantive amendment was proposed with express intention to apply limitations on grant of bail as contained in Section 45(1) in respect of persons accused of such offences which were earlier listed in Part B. Therefore, twin limitations in grant of bail contained in Section 45(1) as it stands today, are not applicable qua a person accused of such offences which were earlier listed in Part B. Page 21 of 44 HC-NIC Page 21 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER 12.21 ..............................
12.22 Vide Section 145(ii) and Section 151 of the Finance Act,2015 with effect from 14.05.2015, in sub-clause (ii) of section 2(y) of PMLA, for the words "thirty lakh rupees",the words "one crore rupees" were substituted. Moreover, in the Schedule of PMLA after Part-A, Section 132 of the Customs Act, 1962 was inserted in Part-B. The amendment of 2015, increasing the monetary threshold from Rs.Thirty Lakhs to Rs. One Crore for invocation of PMLA, now shows further shift and liberalisation in the earlier legislative intent of removing the monetary threshold for invoking PMLA. If it is construed that the limitation imposed by Section 45(1) on granting bail would apply to the persons arrested on accusation of offences which were earlier listed under Part B, but not to a person arrested on accusation of offence punishable under Section 132 of the Customs Act, 1962 which is now in Part B, the same would be unreasonable and in violation of Article 14 and 21 of the Constitution of India. We findthat the intelligible differentia in classification of offences in Part A and Part B in the context of Section 45(1) was absolutely reasonable prior to the said 2013 amendment in Schedule. However, it would not be so in respect of all those offences later shifted from Part B to Part A, which was for a limited purpose stated in the "Statement of Objects and Reasons" as incorporated in the Prevention of Money-Laundering (Amendment) Bill, 2011. In this context we may rely on the following observations of the Constitution Bench of the Hon'ble Supreme Court in Kartar Singh v. State of Punjab, (1994) 3 SCC 569 -
"222. As pointed out supra, the persons who are to be tried for offences specified under the provisions of TADA Act are a distinct class of persons and the procedure prescribed for trying them for the aggravated and incensed nature of offences are under different classification distinguishable from the ordinary criminals and procedure. This distinction and classification of grouping of the accused and the offences to be tried under TADA are to achieve the meaningful purpose and object of the Act as reflected from Page 22 of 44 HC-NIC Page 22 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER the preamble as well as the 'Statement of Objects and Reasons' about which we have elaborately dealt with in the preceding part of this judgment."
"244. Therefore, the complaint of incorporation of invidious discrimination in the Act has to be turned down. All that the court has to see is whether the power is used for any extraneous purpose i.e. to say not for achieving the object for which the power is granted and whether the Act (TADA) has been made on grounds which are not germane or relevant to the policy and purpose of this Act and whether it is discriminatory so as to offend Article 14. In our considered opinion, the classification have rational nexus with the object sought to be achieved by the TADA Acts and Special Courts Act and consequently there is no violation of Article 14 of the Constitution."
If limitations in grant of bail under Section 45(1) of PMLA are sought to be applied to all those offences under the amended Part A which were earlier listed in Part B, it would offend Article 14 and 21 and would be contrary to the Statement of Objects and Reasons of the 2013 amendment in Schedule as incorporated in the Prevention of Money-Laundering (Amendment) Bill, 2011.
12.23 We, therefore, in light of the "Statement of Objects and Reasons" as incorporated in the Prevention of Money-
Laundering(Amendment) Bill, 2011 and the above discussion and findings, have no hesitation in holding that the reference to the offences under Part A of the Schedule in the context of Section 45(1) has to be necessarily read down to apply only to those persons who are arrested under Section 19 of PMLA on accusation of money laundering, who are accused of commission of scheduled offences which were listed under the Part A of the Schedule existing prior to 2013 amendment. In other words, the limitations in grant of bail under Section 45(1) of PMLA are not applicable to those persons who are arrested under PMLA on accusation of commission of such scheduled offences which were earlier listed under Part B of the Schedule (prior to Page 23 of 44 HC-NIC Page 23 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER amendment in Schedule carried out in 2013).
12.24. Consequently, the provisions containing twin limitations in grant of bail under Section 45(1) would override the normal principles governing bail under Sections 438 and 439 qua the persons arrested on accusation of commission of such Scheduled Offences which were earlier listed under Part A of the Schedule. However, only the normal principles governing bail under Section 438 or 439 of the Code would apply in relation to a person arrested under PMLA on accusation of commission of such scheduled offences, which were earlier listed under Part B of the Schedule. In respect of such persons of latter category, the following observations of the Hon'ble Constitution Bench in Gurbaksh Singh Sibbia v. State of Punjab, (1980) 2 SCC 565, may apply with full force :-
"27. .............It is, however, interesting that as long back as in 1924 it was held by the High Court of Calcutta in Nagendra v. King-Emperor that the object of bail is to secure the attendance of the accused at the trial, that the proper test to be applied in the solution of the question whether bail should be granted or refused is whether it is probable that the party will appear to take his trial and that it is indisputable that bail is not to be withheld as a punishment. In two other cases which, significantly, are the 'Merrut Conspiracy cases' observations are to be found regarding the right to bail which deserve a special mention. In K.N. Joglekar v. Emperor it was observed, while dealing with Section 498 which corresponds to the present Section 439 of the Code, that it conferred upon the Sessions Judge or the High Court wide powers to grant bail which were not handicapped by the restrictions in the preceding Section 497 which corresponds to the present Section 437. It was observed by the court that there was no hard and fast rule and no inflexible principle governing the exercise of the discretion conferred by Section 498 and that the only principle which was established was that the discretion should be exercised judiciously. In Emperor v. Hutchinson it was said that it was very unwise to make an attempt to lay down any particular rules which will bind the High Court, Page 24 of 44 HC-NIC Page 24 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER having regard to the fact that the legislature itself left the discretion of the court unfettered. According to the High Court, the variety of cases that may arise from time to time cannot be safely classified and it is dangerous to make an attempt to classify the cases and to say that in particular classes a bail may be granted but not in other classes. It was observed that the principle to be deduced from the various sections in the Criminal Procedure Code was that grant of bail is the rule and refusal is the exception. An accused person who enjoys freedom in a much better position to look after his case and to properly defend himself than if he were in custody. ..............
30. In AMERICAN JURISPRUDENCE (2nd,Volume 8, p. 806, para 39), it is stated :-
"Where the granting of bail lies within the discretion of the Court, the granting or denial is regulated, to a large extent, by the facts and circumstances of each particular case. Since the object of the detention or imprisonment of the accused is to secure his appearance and submission to the jurisdiction and the judgment of the court, the primary inquiry is whether a recognizance or bond would effect that end."
9. It is important to note that after dealing with the said object, the prayer made by the petitioner challenging the vires of 2015 Amendments have been rejected which reflects in paragraph 12.25 of the said judgment, which reads as under :-
"12.25 Consequently, we find that the basis on which vires of the 2015 amendments has been challenged do not have any merit and the first two prayers in this regard are accordingly rejected."
10. It is true that in paragraph 16.6 of the said decision, the Division Bench of the Punjab and Haryana High Court has considered the case of Gautam Kundu v. Manoj Kumar, Assistant Director, Eastern Region, Directorate of Enforcement (Supra). Therefore, the prayers made by the petitioner to issue Certificate under Article 134A was issued by framing the following substantial Page 25 of 44 HC-NIC Page 25 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER questions of law :-
"a) Whether it would be unreasonable and in violation of Article 14 and 21 of the Constitution of India, if the twin limitations in grant of bail stipulated under Section 45(1) of PMLA would be applied even to those persons arrested under PMLA on accusation of commission of only such scheduled offences, which were listed under Part B of the Schedule omitted in 2013 but only for the limited purpose as specified in the "Statement of Objects and Reasons" in the Prevention of Money-Laundering (Amendment) Bill, 2011.
b) Whether as per the provisions of the Code of Criminal Procedure, 1973 read with the provisions of the PMLA and Rules made thereunder, a private individual can set the criminal law into motion by either seeking registration of case for investigation by the authority under PMLA or by directly approaching the jurisdictional Magistrate for issuance of directions for investigations to the authority under PMLA, when there is neither any report of commission of any Scheduled offence sent under Section 157 of the Code to the Magistrate nor any complaint for taking cognizance of a Scheduled Offence by an officer authorized to investigate such Scheduled Offence."
11. As stated herein above, the prayers for vires of provisions have been rejected by the Division Bench. Per contra, the decision of this Court in the case of Rakesh Kothari has dealt with all these submissions and has upheld the validity of the provisions of Section 45 etc. The prayers made before this Court in the case of Rakesh Manekchand Kothari reads as under :-
"[a] To strike down Section 45 of the Prevention of Money Laundering Act, 2002 [hereinafter referred to as `PMLA'] [as inserted / substituted by Amendment Act 2005 [20 of 2005] dt.
21.5.2005, as the said provision does not bear any reasonable and rational nexus with variety of Page 26 of 44 HC-NIC Page 26 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER Scheduled offences mentioned in the Schedule under the Act which may even be noncognizable, bailable and on much lighter pedestal, for being unreasonable and ultra vires, and consequently unconstitutional, illegal, arbitrary, discriminatory, and thus being violative of Articles 14, 19 and 21 of the Constitution of India, and this Hon'ble Court may read down, lay down, expound, interpret and deliberate upon the scope and perspective of Section 45 of PMLA so as to harmonize the same in juxtaposition with various scheduled offences [under amended Part A of the Schedule], [b] To read down, expound, deliberate and interpret the scope and perspective of Section 19 of PMLA in light of section 49(3) read with Rules notified by GSR 446[E] dated 1.7.2005, in consonance and harmony with settled constitutional mandate of Articles 14, 21 and 22 of Constitution of India as also in the context of various provisions under the Code of Criminal Procedure, 1973, as amended from to time and the Guidelines laid down by the Hon'ble Apex Court in D.K.Basu vs State of West Bengal 1997(1) SCC 416, [c] For issuance of an appropriate writ of quo warranto, calling upon Respondent No.3, who being an Assistant Director, Enforcement Directorate, appointed under Foreign Exchange Management Act, 1999, can under Section 54 of PMLA only assist any officer investigating under PMLA, to show cause as to how and under what authority has he exercised the power of arrest under Section 19 of PMLA, while effecting arrest of the Petitioner on 01.09.2014 in ECIR/01/SRT/2014, without producing till date, despite specific objection by the Petitioner -
[i] any authorization conferring upon him by way of any notification or order issued by the Central Government in terms of Section 19 and Section 49 of PMLA, 2002, read with Rules notified by GSR 446(E), dt.1.7.2005, authorizing him to be an "Arresting Officer" and to exercise power to arrest under section 19, [ii] any notification issued by Central Page 27 of 44 HC-NIC Page 27 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER Government for his appointment a Assistant Director under section 49 of PMLA, [iii] any records to show compliance of Rules notified by GSR 446(E) dated 1.7.2005, and [v] any Criminal Proceedings against the Petitioner in the alleged Scheduled offence showing the Petitioner as an accused person; and [d] For issuance of an appropriate writ of Habeas corpus, or order or direction under Article 226 of the Constitution of India, directing forthwith release of the Petitioner from custody, by setting aside the Impugned Arrest Order dated 1.9.2014 and the consequent remand proceedings, as the arrest of the Petitioner is manifestly illegal, without jurisdiction, null and void ab initio, for clear violation of -
[i] The directives of the Hon'ble Apex Court in D. K. Basu vs. State of West Bengal, 1997 (1) SCC 416 [more particularly those prescribed in subpara (2), (9) and (10) of Para 35 thereof], [ii] The provision of PMLA including amongst others of Section 19(1) of PMLA, which mandatorily prescribe the arrest to be made on the basis of such "material in possession", on the basis of which there exists "reason to believe"
that person is "guilty" of an offence under the PMLA; which shall be "recorded in writing"; and pursuant to arrest to inform him of the `Grounds' for such arrest, [iii] Rules notified by Central Government vide GSR 446 [E], dt.1.7.2005, [iv] notification GSR 441(E) dated 1.7.2005 issued by the Central Government appointing Director to exercise the "exclusive" power conferred under section 19 of PMLA [v] Article 14, 21, 22 of the Constitution of India.
[e] At the interim / ad-interim stage -
[i] The proceedings under PMLA against the Petitioner may please be stayed, [ii] The Petitioner may please be released on regular bail Page 28 of 44 HC-NIC Page 28 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER in the above case in ECIR/01/SRT/2014, [ii] The Petitioner may please be released on regular bail in the above case in ECIR/01/SRT/2014, [f] Dispense with filing of affidavit in support to this Petition as the Petitioner is in judicial custody;
[g] For such other or further order/s in the peculiar facts of the case."
12. Having considered similar arguments advanced by learned advocate appearing for the petitioner and various decisions of the Hon'ble Supreme Court, the Division Bench of this Court has dismissed the said petition in the case of Rakesh Kothari upholding the validity of vires of Section 45 of the PML Act.
13. It is true that the decision rendered by the Division Bench of the Punjab and Haryana High Court in the case of Gorav Kathuria was challenged by the petitioner himself before the Hon'ble Supreme Court by preferring Criminal Appeal No.737 of 2016 and the Hon'ble Supreme Court has dismissed the appeal vide order dated 12.8.2016. The order of the Hon'ble Supreme Court reads as under :-
"Though the High Court has granted certificate to appeal, we have heard the learned counsel for some time and are of the opinion that the impugned judgment of the High Court is correct. This appeal is, accordingly, dismissed."
13. It is not denied by the other side that Union of India was ever heard when the said appeal was dismissed by the Hon'ble Supreme Court. Therefore, in my opinion, the ratio laid down by the Hon'ble Supreme Court in the case of Poonam v. State of Uttar Pradesh, 2016 (2) SCC 779 would be applicable in the present Page 29 of 44 HC-NIC Page 29 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER scenario when there are two different decisions by two Division Benches of two different High Courts.
14. The Hon'ble Supreme Court in the case of Poonam v. State of Uttar Pradesh, 2016 (2) SCC 779 made following observations in paragraphs 39,40 and 41 :-
"39. The aforesaid decisions do not lay down as a proposition of law that in every case when a termination is challenged, the affected person has to be made a party. What has been stated is when one challenges a provision as ultra vires the persons who are likely to be affected, some of them should be made parties in a representative capacity. That has been the consistent view of this Court in service jurisprudence. Some other decisions, which have been relied upon are directly connected with regard to the selection and selectees. On a perusal of the analysis made in J.S. Yadav (supra), we are disposed to think that the Court has applied the principle pertaining to the constitutional validity by equating it with the interpretation of a provision, whether it is retrospective or prospective. That apart, the Court, as is evident from paragraph 32 of the judgment, has noted that the prayer made by the appellant only related to the declaratory relief. The said decision has to be understood in the context. A ratio of a decision has to be understood in its own context, regard being had to the factual exposition. If there has been advertence to precedents, the same has to be seen to understand and appreciate the true ratio. The ratiocination in the said decision is basically founded on the interpretation of the statutory provision and the relief claimed. The Court has been guided by the fact that when the interpretation as regards the provision whether it is retrospective or prospective, the selected members are necessary parties.
40. In this regard, we may refer to the rule stated by Lord Halsbury in Quinn v. Leathem, (1901) AC 495, p. 506 :-Page 30 of 44
HC-NIC Page 30 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER "Every judgment must be read as applicable to the particular facts proved or assumed to be proved, since the generality of the expressions which may be found there are not intended to be expositions of the whole law but govern and are qualified by the particular facts of the case in which such expressions are to be found."
41. A three-Judge Bench in Union of India and others v. Dhanwanti Devi and others (1996) 6 SCC 44 while discussing about the precedent under Article 141 of the Constitution, held that :-
"9. Before adverting to and considering whether solatium and interest would be payable under the Act, at the outset, we will dispose of the objection raised by Shri Vaidyanathan that Hari Krishan Khosla case[39] is not a binding precedent nor does it operate as ratio decidendi to be followed as a precedent and is per se per incuriam. It is not everything said by a Judge while giving judgment that constitutes a precedent. The only thing in a Judge's decision binding a party is the principle upon which the case is decided and for this reason it is important to analyse a decision and isolate from it the ratio decidendi. According to the well- settled theory of precedents, every decision contains three basic postulates--(i) findings of material facts, direct and inferential. An inferential finding of facts is the inference which the Judge draws from the direct, or perceptible facts; (ii) statements of the principles of law applicable to the legal problems disclosed by the facts; and (iii) judgment based on the combined effect of the above. A decision is only an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically follows from the various observations made in the judgment. Every judgment must be read as applicable to the particular facts proved, or assumed to be proved, since the generality of the expressions which may be found there is not intended to be exposition of the whole law, but governed and qualified by the particular facts of the case in which such expressions are to be found. It would, therefore, be not profitable to extract a sentence here and there from the Page 31 of 44 HC-NIC Page 31 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER judgment and to build upon it because the essence of the decision is its ratio and not every observation found therein. The enunciation of the reason or principle on which a question before a court has been decided is alone binding as a precedent. The concrete decision alone is binding between the parties to it, but it is the abstract ratio decidendi, ascertained on a consideration of the judgment in relation to the subject- matter of the decision, which alone has the force of law and which, when it is clear what it was, is binding. It is only the principle laid down in the judgment that is binding law under Article 141 of the Constitution. A deliberate judicial decision arrived at after hearing an argument on a question which arises in the case or is put in issue may constitute a precedent, no matter for what reason, and the precedent by long recognition may mature into rule of stare decisis. It is the rule deductible from the application of law to the facts and circumstances of the case which constitutes its ratio decidendi.
10. Therefore, in order to understand and appreciate the binding force of a decision it is always necessary to see what were the facts in the case in which the decision was given and what was the point which had to be decided. No judgment can be read as if it is a statute. A word or a clause or a sentence in the judgment cannot be regarded as a full exposition of law. Law cannot afford to be static and therefore, Judges are to employ an intelligent technique in the use of precedents......"
15. In another decision of the Hon'ble Supreme Court in the case of Official Liquidator v. Dayanand and others, (2008) 10 SCC 1, it has been held in paragraph 78 as under :-
"78. There have been several instances of different Benches of the High Courts not following the judgments/orders of coordinate and even larger Benches. In some cases, the High Courts have gone to the extent of ignoring the law laid down by this Court without any tangible reason. Likewise, there have been instances in which smaller Benches of this Court have either Page 32 of 44 HC-NIC Page 32 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER ignored or bypassed the ratio of the judgments of the larger Benches including the Constitution Benches. These cases are illustrative of non- adherence to the rule of judicial discipline which is sine qua non for sustaining the system. In Mahadeolal Kanodia vs. Administrator General of W.B. [1960 (3) SCR 578], this Court observed :-
"If one thing is more necessary in law than any other thing, it is the quality of certainty. That quality would totally disappear if Judges of coordinate jurisdiction in a High Court start overruling one another's decisions. If one Division Bench of a High Court is unable to distinguish a previous decision of another Division Bench, and holding the view that the earlier decision is wrong, itself gives effect to that view the result would be utter confusion. The position would be equally bad where a Judge sitting singly in the High Court is of opinion that the previous decision of another Single Judge on a question of law is wrong and gives effect to that view instead of referring the matter to a larger Bench. In such a case lawyers would not know how to advise their clients and all courts subordinate to the High Court would find themselves in an embarrassing position of having to choose between dissentient judgments of their own High Court."
[Emphasis added]"
16. In the case of Government of Karnataka v. Gowramma, 2007 (13) SCC 482, while dealing with a question with regard to precedents. The Hon'ble Supreme Court has observed in paragraphs 9 and 10 as under :-
"9. Reliance on the decision without looking into the factual background of the case before it is clearly impermissible. A decision is a precedent on its own facts. Each case presents its own features. It is not everything said by a Judge while giving a judgment that constitutes a precedent. The only thing in a Judge's decision binding a party is the principle upon which the case is decided and for this reason it is important Page 33 of 44 HC-NIC Page 33 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER to analyse a decision and isolate from it the ratio decidendi. According to the well-settled theory of precedents, every decision contains three basic postulates - (i) findings of material facts, direct and inferential. An inferential finding of facts is the inference which the Judge draws from the direct, or perceptible facts; (ii) statements of the principles of law applicable to the legal problems disclosed by the facts; and (iii) judgment based on the combined effect of the above. A decision is an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically flows from the various observations made in the judgment. The enunciation of the reason or principle on which a question before a Court has been decided is alone binding as a precedent. (See: State of Orissa v. Sudhansu Sekhar Misra and Ors. (AIR 1968 SC 647) and Union of India and Ors. v. Dhanwanti Devi and Ors. (1996 (6) SCC 44). A case is a precedent and binding for what it explicitly decides and no more. The words used by Judges in their judgments are not to be read as if they are words in Act of Parliament. In Quinn v. Leathem (1901) AC 495 (H.L.), Earl of Halsbury LC observed that every judgment must be read as applicable to the particular facts proved or assumed to be proved, since the generality of the expressions which are found there are not intended to be exposition of the whole law but governed and qualified by the particular facts of the case in which such expressions are found and a case is only an authority for what it actually decides.
10. Courts should not place reliance on decisions without discussing as to how the factual situation fits in with the fact situation of the decision on which reliance is placed. Observations of Courts are neither to be read as Euclid's theorems nor as provisions of the statute and that too taken out of their context. These observations must be read in the context in which they appear to have been stated. Judgments of Courts are not to be construed as statutes. To interpret words, phrases and provisions of a statute, it may become necessary for judges to embark into lengthy discussions but the Page 34 of 44 HC-NIC Page 34 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER discussion is meant to explain and not to define. Judges interpret statutes, they do not interpret judgments. They interpret words of statutes; their words are not to be interpreted as statutes. In London Graving Dock Co. Ltd. V. Horton (1951 AC 737 at p.761), Lord Mac Dermot observed :
"The matter cannot, of course, be settled merely by treating the ipsissima vertra of Willes, J as though they were part of an Act of Parliament and applying the rules of interpretation appropriate thereto. This is not to detract from the great weight to be given to the language actually used by that most distinguished judge."
17. I have also come across unreported decision of the High Court of Karnataka rendered in Criminal Petition No.366 of 2017 dated 23.2.2017 which has dealt with similar questions raised in the petition about the applicability of Division Bench of Punjab and Haryana High Court in the case of Gorav Kathuria. The Karnataka High Court has exhaustively dealt with the judgments which are referred herein above and has also relied upon the decision of the Hon'ble Supreme Court in the case of Kunhayammed and others v. State of Kerala, (2000) 6 SCC
539. Paragraph No.28 of the said decision of the Hon'ble Supreme Court reads as under :-
"28. Incidentally we may notice two other decisions of this Court which though not directly in point, the law laid down wherein would be of some assistance to us. In Shankar Ramchandra Abhyankar v. Krishnaji Dattatreya Bapat [(1969) 2 SCC 74 : AIR 1970 SC 1] this Court vide para 7 has emphasised three preconditions attracting applicability of doctrine of merger. They are: (i) the jurisdiction exercised should be appellate or revisional jurisdiction; (ii) the jurisdiction should have been exercised after issue of notice; and (iii) after a full hearing in presence of both the parties. Then the appellate or revisional order would replace the judgment of the lower court and constitute the only final judgment. In Sushil Page 35 of 44 HC-NIC Page 35 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER Kumar Sen v. State of Bihar [(1975) 1 SCC 774 :
AIR 1975 SC 1185] the doctrine of merger usually applicable to orders passed in exercise of appellate or revisional jurisdiction was held to be applicable also to orders passed in exercise of review jurisdiction. This Court held that the effect of allowing an application for review of a decree is to vacate a decree passed. The decree that is subsequently passed on review whether it modifies, reverses or confirms the decree originally passed, is a new decree superseding the original one. The distinction is clear. Entertaining an application for review does not vacate the decree sought to be reviewed. It is only when the application for review has been allowed that the decree under review is vacated. Thereafter the matter is heard afresh and the decree passed therein, whatever be the nature of the new decree, would be a decree superseding the earlier one. The principle or logic flowing from the above said decisions can usefully be utilised for resolving the issue at hand. Mere pendency of an application seeking leave to appeal does not put in jeopardy the finality of the decree or order sought to be subjected to exercise of appellate jurisdiction by the Supreme Court. It is only if the application is allowed and leave to appeal granted then the finality of the decree or order under challenge is jeopardised as the pendency of appeal reopens the issues decided and this Court is then scrutinising the correctness of the decision in exercise of its appellate jurisdiction."
18. By considering the judgment of the Division Bench of the Punjab and Haryana High Court read with the order passed by the Hon'ble Supreme Court in the case of Gorav Kathuria dismissing the appeal as well as considering the decision in the case of Gautam Kundu (Supra), it has been held that if an accused is facing charge for the offences punishable under Section 3of the PML Act, the rigor of Section 45 of the PML Act would be applicable.
19. In the case of Gautam Kundu v. Manoj Kumar, Page 36 of 44 HC-NIC Page 36 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER Assistant Director, Eastern Region, Directorate of Enforcement, AIR 2016 SC 106, while dealing with an application under Section 439 of the Code read with Section 45 of PML Act, the following observations have been made by the Hon'ble Supreme Court in paragraphs 28 to 33 :-
"28. Before dealing with the application for bail on merit, it is to be considered whether the provisions of Section 45 of the PMLA are binding on the High Court while considering the application for bail under Section 439 of the Code of Criminal Procedure. There is no doubt that PMLA deals with the offence of money laundering and the Parliament has enacted this law as per commitment of the country to the United Nations General Assembly. PMLA is a special statute enacted by the Parliament for dealing with money laundering. Section 5 of the Code of Criminal Procedure, 1973 clearly lays down that the provisions of the Code of Criminal Procedure will not affect any special statute or any local law. In other words, the provisions of any special statute will prevail over the general provisions of the Code of Criminal Procedure in case of any conflict.
29. Section 45 of the PMLA starts with a non obstante clause which indicates that the provisions laid down in Section 45 of the PMLA will have overriding effect on the general provisions of the Code of Criminal Procedure in case of conflict between them. Section 45 of the PMLA imposes following two conditions for grant of bail to any person accused of an offence punishable for a term of imprisonment of more than three years under Part-A of the Schedule of the PMLA: (i) That the prosecutor must be given an opportunity to oppose the application for bail; and (ii) That the Court must be satisfied that there are reasonable grounds for believing that the accused person is not guilty of such offence and that he is not likely to commit any offence while on bail.
30. The conditions specified under Section 45 Page 37 of 44 HC-NIC Page 37 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER of the PMLA are mandatory and needs to be complied with which is further strengthened by the provisions of Section 65 and also Section 71 of the PMLA. Section 65 requires that the provisions of Cr.P.C. shall apply in so far as they are not inconsistent with the provisions of this Act and Section 71 provides that the provisions of the PMLA shall have overriding effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. PMLA has an overriding effect and the provisions of Cr.P.C. would apply only if they are not inconsistent with the provisions of this Act. Therefore, the conditions enumerated in Section 45 of PMLA will have to be complied with even in respect of an application for bail made under Section 439 of Cr.P.C. That coupled with the provisions of Section 24 provides that unless the contrary is proved, the Authority or the Court shall presume that proceeds of crime are involved in money laundering and the burden to prove that the proceeds of crime are not involved, lies on the appellant.
31. It was submitted on behalf of the appellant that Section 12A read with Section 24 of the SEBI Act does not include Section 24 of the said Act as a scheduled offence but it is only Section 12A which is to be construed as a scheduled offence as the description of offence against Section 24 of the SEBI Act mentioned under paragraph 11 of the Schedule to PMLA is part of Section 12A of the said Act. In this context it was submitted by the learned Solicitor General that PMLA being a Special Statute cannot be given restricted meaning while interpreting its provisions including the Schedule which is an integral part of this Act. PMLA has been enacted by the Parliament as per commitment of the country to the United Nations and having global dimensions and cannot be confined to national boundaries of our country. Moreover, its legislative intent has to be gathered from the plain reading of the language used in the provisions of the Act and the Schedule appended thereunder. Hence, there is no ambiguity that Section 24 of the SEBI Act is a scheduled offence under Paragraph 11 of the Schedule. The fact remains that Section 24 of the Page 38 of 44 HC-NIC Page 38 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER SEBI Act is inclusive in nature and also includes Section 12A within its ambit and scope. Further, on perusal of various offences listed in the Schedule in 28 Paragraphs, it could be seen that only penal provisions of the Statutes have been incorporated in the Schedule. There is no denying the fact that Section 24 of the SEBI Act is a penal provision of inclusive nature and thus it clearly reflects the legislative intent of a scheduled offence under PMLA. Admittedly, the complaint was filed by SEBI against the appellant on the allegation of committing offence punishable under Section 4 of PMLA. The complaint reveals that SEBI received a letter from the Ministry of Corporate Affairs, Office of the Registrar of Companies ("ROC"), West Bengal, with reference to Rose Valley in which the ROC had stated that Rose Valley has repeatedly issued debentures in the years 2001-2002, 2004-2005, 2005-2006 and 2007- 2008 to more than 49 persons in each financial year without filing offer documents with either the ROC or the SEBI and requested SEBI to investigate into the matter. From the information provided by ROC, it was observed that Rose Valley had raised a total sum of Rs.1282.225 lakhs from 2585 persons by issuing secured debentures to the general public without complying with the norms related to IPO of securities as per first provision to Section 67(3) of the Companies Act, 1956. Rose Valley by making public issue of debentures during the period between 2001-2002 to 2007-2008, without complying with the public issue norms, violated the provisions of erstwhile SEBI (Disclosure and Investor Protection) Guidelines, 2000 and the provisions of Section 117(A) of the Companies Act, 1956 and other provisions of SEBI Act which is a Scheduled Offence under PMLA.
32. We have heard the learned counsel for the parties. At this stage we refrained ourselves from deciding the questions tried to be raised at this stage since it is nothing but a bail application. We cannot forget that this case is relating to "Money Laundering" which we feel is a serious threat to the national economy and national interest. We cannot brush aside the fact that the schemes have been prepared in a calculative manner with Page 39 of 44 HC-NIC Page 39 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER a deliberative design and motive of personal gain, regardless of the consequence to the members of the society.
33. With regard to the questions raised by Mr. Gopal Subramanium, learned senior counsel appearing on behalf of the appellant, at this stage, we do not think that we should answer or deal with the same in view of the fact that the matter is pending before a Division Bench of the High Court in writ jurisdiction, as has been pointed out before us. Hence, any observation or remarks made by us may cause prejudice to the case of both the sides. Therefore, we feel that it would be proper for us only to deal with the matter concerning bail. We note that admittedly the complaint is filed against the appellant on the allegations of committing the offence punishable under Section 4 of the PMLA. The contention raised on behalf of the appellant that no offence under Section 24 of the SEBI Act is made out against the appellant, which is a scheduled offence under the PMLA, needs to be considered from the materials collected during the investigation by the respondents. There is no order as yet passed by a competent court of law, holding that no offence is made out against the appellant under Section 24 of the SEBI Act and it would be noteworthy that a criminal revision praying for quashing the proceedings initiated against the appellant under Section 24 of SEBI Act is still pending for hearing before the High Court. We have noted that Section 45 of the PMLA will have overriding effect on the general provisions of the Code of Criminal Procedure in case of conflict between them. As mentioned earlier, Section 45 of the PMLA imposes two conditions for grant of bail, specified under the said Act. We have not missed the proviso to Section 45 of the said Act which indicates that the legislature has carved out an exception for grant of bail by a Special Court when any person is under the age of 16 years or is a woman or is a sick or infirm. Therefore, there is no doubt that the conditions laid down under Section 45A of the PMLA, would bind the High Court as the provisions of special law having overriding effect on the provisions of Section 439 of the Code of Page 40 of 44 HC-NIC Page 40 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER Criminal Procedure for grant of bail to any person accused of committing offence punishable under Section 4 of the PMLA, even when the application for bail is considered under Section 439 of the Code of Criminal Procedure."
20. Considering the above aspects and when there is no pronouncement by Hon'ble the Supreme Court or of any High Courts that the provisions of Section 45 of the PML Act are ultra- vires or the inclusion of the offences of Part B into Part 1 of the Schedule of PML Act is declared ultra-vires to the provisions of the Constitution of India, in my opinion, the Court is required to read the provisions of law which are applicable on the day. When the Court is dealing with an application of an accused under Section 439 read with Section 45 of the PML Act, the provisions of the PML Act are required to be scrupulously followed. The applicant is facing charges for several offences punishable under the provisions of Indian Penal Code and also under the provisions of Prevention of Corruption Act, which are of Part A to the Schedule of PML Act and, therefore, rigor of Section 45 would be applicable. Therefore, the Court cannot presume that certain offences which were in part B in past shall be treated in the same Part even though they have been amended in the year 2013. Hence, I hereby hold that the rigors of Section 45 would be applicable in the present case.
Further, it is pertinent to note that the validity of the provisions as well as amended provisions of Section 45 of the PML Act is under consideration before the Hon'ble Supreme Court since Rakesh Kothari, petitioner before the Division Bench of this Court in Special Criminal Application No.4496 of 2014 has challenged the said decision of this Court before the Hon'ble Supreme Court and the same is pending consideration before the Hon'ble Supreme Court.
Page 41 of 44
HC-NIC Page 41 of 44 Created On Thu Mar 16 01:39:00 IST 2017
R/CR.MA/30674/2016 CAV ORDER
21. Now dealing with the case on merits, I would like to reproduce certain provisions of PML Act. Section 2 (u), (x) and (y) read as under :-
"2 (u) "proceeds of crime" means any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence or the value of any such property;"
2 (x) "Schedule" means the Schedule to this Act;
2 (y) "scheduled offence" means --
(i) the offences specified under Part A of the Schedule; or
(ii) the offences specified under Part B of the Schedule if the total value involved in such offences is thirty lakh rupees or more; or]
(iii) the offences specified under Part C of the Schedule;"
22. Section 3 of the PML Act reads as under :-
"3. Offence of money-laundering :-
Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime and projecting it as untainted property shall be guilty of offence of money laundering."
23. Sections 23 and 24 of the PML Act reads as under :-
"23. Presumption in inter-connected transactions :-
Where money-laundering involves two or more inter-connected transactions and one or more such transactions is or are proved to be involved in money-laundering, then for the purposes of adjudication or confiscation, [under Section 8 or Page 42 of 44 HC-NIC Page 42 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER for the trial of the money-laundering offence, it shall unless otherwise proved to the satisfaction of the Adjudicating Authority or the Special Court], be presumed that the remaining transactions form part of such inter-connected transactions."
24. Burden of proof :- In any proceeding relating to proceeds of crime under this Act -
(a) in the case of a person charged with the offence of money-laundering under section 3, the Authority or Court shall, unless the contrary is proved, presume that such proceeds of crime are involved in money-laundering; and
(b) in the case of any other person the Authority or Court, may presume that such proceeds of crime are involved in money-
laundering.]"
24. If the definition of proceeds of crime is read and compared with the material collected by the Investigating Agency, it appears that Crores of rupees have been transferred in the bank accounts of the wife and children of the applicant in USA by different modes. The said aspect is supported by the information supplied by the United States of America, pursuant to the request made by the Special Judge under Section 57 of the PML Act. When the Investigating Agency could gather such material against the applicant, the burden to prove not guilty of having committed the schedule offence lie on accused as per Section 24 of the PML Act, which in my opinion, the applicant has failed to establish that. However, at this stage, I would not like to deal with the same in detail since the present case is being dealt with for the purpose of releasing a person on bail.
25. It is also alleged that through Havala entries via Dubai (UAE), Crores of rupees have been credited in the account of his wife and his children in USA. The wife of the applicant who was made a Partner in a firm to the extent of 30% and that too, by Page 43 of 44 HC-NIC Page 43 of 44 Created On Thu Mar 16 01:39:00 IST 2017 R/CR.MA/30674/2016 CAV ORDER investing only Rs.1 Lac, and getting Crores of rupees from India as well as UAE, the Court cannot believe that the applicant is not guilty of offences for which he has been charged. The burden is upon the accused to prove that the amount which has been transferred in the account of his family member in foreign country is not proceeds of crime as per Section 24 of the PML Act. In the present case, except his own statements, the applicant is unable to prove himself that the amount received by his family members are not proceeds of crime. The statements recorded of the witnesses who would be governed under Section 50 of the PML Act and there are number of judgments of validity of such statements recorded under the provisions of Section 50. I have also gone through several statements of witnesses referred and relied upon by the Investigating Agency and have also gone through the material which prima facie suggests that huge amount has been credited in the account of the wife of the applicant and his children though they might have settled in USA. Therefore, the present application fails on both the grounds and hence, the same is accordingly dismissed. Rule is hereby discharged.
Sd/-
(A.J.DESAI, J.) Savariya Page 44 of 44 HC-NIC Page 44 of 44 Created On Thu Mar 16 01:39:00 IST 2017