Delhi High Court
Amit Aggarwal vs Directorate Of Enforcement on 11 January, 2024
Author: Sudhir Kumar Jain
Bench: Sudhir Kumar Jain
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Reserved on: December 13, 2023
Decided on: January 11, 2024
+ BAIL APPLN. 2073/2023
AMIT AGGARWAL ..... Petitioner
Through: Mr. Priyadarshi Manish,
Ms. Anjali Jha Manish,
Ms. Saksham Garg and
Mr. Anmol Arya, Advocates.
V
DIRECTORATE OF ENFORCEMENT ..... Respondent
Through: Mr. Ravi Prakash, CGSC
with Mr. Aman Rewaria,
Mr. Yasharth Shukla,
Mr. Ayushman, Mr. Astu
Khandelwal and Mr. Ali
Khan, Advocates along with
Mr. Deepanshu Trivedi,
Investigating Officer.
CORAM
HON'BLE DR. JUSTICE SUDHIR KUMAR JAIN
JUDGMENT
1. The present bail application is filed under section 438 of The
Code of Criminal Procedure, 1973 (hereinafter referred to as "the
Code") on behalf of the petitioner Amit Aggarwal for grant of
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 1
anticipatory bail in ECIR/DLZO-II/24/2022 registered under sections
3 and 4 of The Prevention of Money Laundering Act, 2002
(hereinafter referred to as "PMLA").
2. The factual background of the case is that FIR bearing no.
0045/2022 was got registered under sections 420/467/468/471/120B
of The Indian Penal Code, 1860 (hereinafter referred to as "IPC") at
Economic Offences Wing (EOW) on the basis of complaint dated
03.12.2021 made by Vikash Mohpal s/o Late Prakash Mohpal
(hereinafter referred to as "the complaint") in respect of cheating,
fraud, forgery stated to be committed by M/s Kinzal Freight
Forwarding (OPC) Private Limited, M/s Shree Shyam International,
M/s Wentorz Logistics Private Limited, M/s Balaji International, M/s
Mizta Tradex Private Limited, Ravi Mehra and other unknown
parties.
2.1 The complainant stated that he is a practicing Chartered
Accountant and engaged in the profession through partnership firm
under the name and style of M/s Mohpal & Associates and his CA
membership number is 505939. The complainant on 03.08.2020
received an email from ICICI Bank, Nehru Place Branch informing
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that CA firm M/s Mohpal & Associates has issued 15CB certificates
to M/s Shree Shyam International. ICICI Bank also requested for due
diligence with regard to the said 15CB certificates. The complainant
informed ICICI Bank that he never issued 15 CB certificate to
M/s Shree Shyam International. The certificate on Form 15CB
issued by a Chartered Accountant in terms of Rule 37BB of the
Income Tax Rules is required to be submitted to the bank at the time
of effecting a foreign remittance by the parties making foreign
remittance. The complainant was also summoned by ED, Zonal
Office-II, Delhi on 16.09.2021 and was informed by Sanjeet Kumar
Sahu, Assistant Director that 15CA/CB certificates issued by using
credentials of the complainant have been used and submitted to banks
by M/s Kinzal Freight Forwarding (OPC) Private Limited, M/s Balaji
International, M/s Shree Shyam International, and M/s Wentorz
Logistics Private Limited, etc. for effecting outward remittances of
approximate Rs.300 crores towards freight payment from the
respective bank accounts maintained with ICICI Bank. The
complainant, after examination of the documents shown to him by
the ED officials realized that those certificates have been forged with
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mala fide intention to remit the funds abroad by using forged and
fabricated documents and by making wrong declaration regarding the
purpose of remittance. The complainant also noticed various
discrepancies in the Form 15CA/CB as detailed in FIR to show that
those documents were fabricated.
2.2 The complainant on examination found that details used by the
subject companies for using forged Form 15CB, have been obtained
from the certificates issued by him on 11.03.2019 to M/s Wentorz
Logistics Private Limited using UDIN no. 19505939AAAAA18327
and the said certificate has been illegally edited again and again for
several foreign remittances. The certificate also indicated that for the
purpose of criminal conspiracy, cheating and forgery, several entities
were being run by common set of persons. The complainant also
stated that he was in contact with Ravi Mehra (Mobile No.
9625978806 and 9354279653) of M/s Wentorz Logistics Private
Limited and was having email ID [email protected] and
said Ravi Mehra used to coordinate with the complainant for the
certificates for outward remittances. The complainant tried to contact
Ravi Mehra but he was neither reachable over mobile, nor available
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at the address of M/s Wentorz Logistics Private Limited. The
complainant also stated that 07 certificates on Form 15CB issued to
M/s Wentorz Logistics Private Limited on the basis of documents
presented to him were submitted with DBS Bank Ltd., Connaught
Place Branch, New Delhi and further remittances may be made in the
same fraudulent manner. UDIN number has to be checked and
verified by the bank officials before approving the foreign payments
and the same can be verified from the UDIN portal which has not be
done by ICICI Branch. The foreign remittances have been effected
fraudulently with connivance of officials of ICICI Bank during the
relevant time. M/s Kinzal Freight Forwarding (OPC) Private Limited,
M/s Shree Shyam International, M/s Wentorz Logistics Private
Limited, Ravi Mehra, M/s Balaji International, M/s Mizta Tradex
Private Limited, the officials of ICICI Bank and other banks and
unknown persons and parties have remitted crores of rupees by using
his name in edited Form 15CB and also forged the Form 15CA with
mala fide intentions to remit the funds abroad which otherwise could
not have been possible.
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2.3 The respondent/ED on the basis of information/documents
submitted by the complainant found that a prima facie case for an
offence of money laundering as per section 3 of PMLA punishable
under section 4 of PMLA has been made out. Accordingly, ECIR
bearing no. DLZO-II/24/2022 dated 28.03.2022 was got recorded
and investigation under the provisions of PMLA was initiated.
3. The respondent/ED during investigation after examination of
documents of ICICI Bank, accounts of the entities i.e. M/s Mizta
Tradex Private Limited, M/s Kinzal Freight Forwarding (OPC)
Private Limited, M/s Shree Shyam International, M/s Wentorz
Logistics Private Limited and M/s Balaji International which are
named in FIR noticed that CA‟s certificate on Form 15CB (as
required under Rule 37BB of the Income Tax Rules) issued by the
complainant had been submitted as documentation. The complainant
during inquiry disclosed that he had issued only around 07
certificates on Form 15CB to M/s Wentorz Logistics Private Limited.
The complainant in the complaint made to EOW stated that details
used by the subject companies for issuing forged Form 15 CB have
been obtained from the certificate issued by him on 11.03.2019 to
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M/s Wentorz Logistics Private Limited using UDIN no.
19505939AAAAA18327. It was also revealed that above mentioned
05 entities are connected with one another and are being run by the
same set of persons.
3.1 The investigation further revealed that the entities as named in
FIR bearing no. 0045/2022 i.e. M/s Mizta Tradex Private Limited,
M/s Kinzal Freight Forwarding (OPC) Private Limited, M/s Shree
Shyam International, M/s Wentorz Logistics Private Limited and M/s
Balaji International have fraudulently effected heavy remittances of
more than Rs.464 Crores in equivalent foreign exchange (US
Dollars) to entities based in Singapore and Hong Kong after
arranging funds into the bank accounts in India via RTGS/NEFT
without any other corresponding business activity. The
Directors/Proprietor/Partners in the bank accounts of the above said
entities used for fraudulent outward forex remittances were not
traceable at their addresses given in KYC documents to the banks and
it was suspected that the KYC/identity documents used were forged
and the names of the Director(s)/Proprietor(s) were pseudonymous.
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3.2 It was noticed during the investigation that 07 entities apart
from 05 entities named in police FIR were also found to be connected
in similar transactions in similar manner where RTGS/Funds were
arranged and foreign remittances were fraudulently effected to
common entities in Singapore and Hong Kong. It was further
revealed that during the period between 25.07.2019 to 16.07.2021,
foreign exchange worth USD 93,575,185.53 (equivalent to
Rs.696,69,27,962.27/-) has been fraudulently remitted by the Indian
entities to 16 companies/entities of Hong Kong and Singapore. It
was also revealed that bogus shell entities were operated for short
time periods by employing bogus Director(s)/Proprietor(s) mostly on
forged IDs in cases where the quantum of amounts involved was
large. The photographs in KYC documents were found to be original
but the identity documents were found to be forged. There was
layering between the operators of Indian entities and the operators
who arranged and made the funds available abroad. The funds were
introduced by way of RTGS/NEFT/other modes into the bank
accounts of shell/bogus entities and thereafter, they were transferred
abroad to various entities. During the investigation, 16 companies in
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Hong Kong and Singapore were identified where foreign exchange
worth USD 93,575,185.53 (equivalent to Rs.696,69,27,962.27/-) has
been fraudulently remitted by the shell/bogus Indian entities.
3.3 The persons operating the Indian entities were pseudonyms/not
traceable, as such efforts were made to seek data from regulatory
sites in Hong Kong and Singapore. The data available on internet site
of the „Centre of the Integrated Companies Registry Information
System‟ (ICRIS), Hong Kong and „The Accounting and Corporate
Regulatory Authority‟ (ACRA), Singapore revealed that one Navin
Kejriwal, an Indian national with address at Delhi was the Director of
KK Overseas Limited, Hong Kong and Speedtec Global Services Pte
Ltd. Singapore.
3.4 Navin Kejriwal was found to be associated with one Manpreet
Singh Talwar and searches as per section 17(1) of PMLA were
conducted on 21-22.09.2022 at their residential/business premises
and recoveries were made. Navin Kejriwal evaded investigation and
non bailable warrants were ordered to be issued against him on
14.02.2023. The respondent/ED also recovered data from the mobile
phone of Manpreet Singh Talwar which was consisting of
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incriminating material regarding one „Infiniti Futures Pte Ltd.‟,
Singapore including the bank account details, User ID, etc. The
fraudulently remitted foreign exchange from India was being
received in bank account of „Infiniti Futures Pte Ltd.‟ which included
remittances from ICICI Bank account of M/s Wentorz Logistics
Private Limited and a total of USD 7,68,470.80 (Rs.5,46,69,093.92/-)
was fraudulently remitted in 06 tranches during October 2019. The
investigation also revealed that from 18 Indian entities maintaining
bank accounts in ICICI Bank, USD 12,578,993.08 (equivalent to INR
104,05,97,228.54/-) was remitted into the bank account of Infiniti
Futures Pte Ltd., Singapore. Data of one „KK Overseas Limited‟,
Hong Kong was also recovered and USD 31,669,688 (equivalent to
INR 233,46,35,282.60/-) were fraudulently remitted from India
during the period between 12.03.2020 and 24.08.2020 from 07 bank
accounts maintained in the bogus/shell entities.
3.5 A pseudonymous person 'Rashmi Dwivedi‟ was found to be
Director in M/s Mizta Tradex Private Limited and M/s Truzel Tradex
Private Limited which were managing funds in its bank accounts via
RTGS/NEFT, etc. and then fraudulently making outward foreign
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remittances to Hong Kong and Singapore. M/s Mizta Tradex Private
Limited and M/s Truzel Tradex Private Limited were maintaining
accounts in ICICI Bank. It was revealed that „Rashmi Dwivedi‟ was
actually „Chitra Pandey‟ who could be traced by the officers of the
respondent/ED. The respondent/ED searched the residence of Chitra
Pandey @ Rashmi Dwivedi on 25-26.11.2022 as per section 17(1) of
PMLA and incriminating recoveries were made.
3.6 Chitra Pandey @ Rashmi Dwivedi during investigation,
disclosed/deposed about the role of Amit Aggarwal (hereafter
referred to as the "petitioner") in the commission of offences and
stated that the petitioner used to meet people by the nickname „Ravi
Mehra‟ and had incorporated bogus/shell companies for effecting
fraudulent remittances. Chitra Pandey @ Rashmi Dwivedi also
admitted about forged IDs i.e. Voter ID Card, PAN Card, Aadhaar
Card of the staff working under the petitioner and his associate Rahul
Kumar whereon the real pictures were used with fake names. The
employees were made Directors of the bogus/shell entities used for
foreign outward remittances. The petitioner and Rahul Kumar
incorporated and operated the companies by using forged IDs for
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illegal transfer of forex to Hong Kong and Singapore. Chitra Pandey
@ Rashmi Dwivedi also disclosed that one Gaurav Sharma was
working as an Accountant who used to book the rate for forex
transfer and also upload the documents related to export over internet
banking on instructions of the petitioner and Rahul Kumar.
3.7 The statement of Gaurav Sharma was also recorded under
section 50 of the PMLA wherein he disclosed that he joined the
petitioner as accountant and was made Director in the name of
Sarmod Kumar in M/s Wentorz Logistics Pvt. Ltd. by using forged
KYC documents by Rahul Kumar and the petitioner for a
commission of 5 paise per dollar. M/s Wentorz Logistics Pvt. Ltd.
was being used for illegal forex transfer and forged documents i.e.
Airway Bill, Invoice, A2 Form, Form 15CA and Form 15CB were
prepared by the petitioner and on instructions of the petitioner, he
used to upload the documents for effecting outward remittances.
3.8 The statement of Rahul Kumar was also recorded under
section 17(1) and section 50(2) and (3) of PMLA wherein he stated
that he and the petitioner purchased two companies, namely,
M/s Truzel Tradex Private Limited and M/s Mizta Tradex Private
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Limited from Chetan who was a Company Secretary wherein Chitra
Pandey, Varun Rana and Mohammed Raza were the directors with
names of Rashmi Dwivedi, Manab Chaudhary and Rahil. The fake
IDs were created to camouflage the real identities of the Directors.
He along with the petitioner used to pay a commission of 20 paise per
dollar for arranging fake KYC documents and also used to arrange
RTGS entries through various Hawala entry operators based at Karol
Bagh and Ghaziabad.
3.9 The documents/evidence collected during the search,
investigation and information received from the banks clearly
indicates active indulgence of the petitioner in effecting fraudulent
outward foreign remittance using bogus/shell companies. The
respondent/ED issued various summons under section 50(2) and (3)
of PMLA to the petitioner to join investigation but the petitioner
evaded the summons and did not join the investigation. The petitioner
along with his associates was found to be instrumental in the
commission of offence of forgery, fraud and thereby offence of
money laundering was committed and was liable to be examined.
The petitioner was summoned to appear on 03.01.2023 and his short
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statement was recorded. The petitioner also appeared on 04.01.2023
but due to medical condition, the petitioner was allowed to leave.
The petitioner in the statement recorded on 03.01.2023 admitted that
he was involved in illegal remittance of forex but he failed to explain
the source of funds remitted abroad and is actual beneficiary. The
petitioner did not disclose the details of the RTGS and counter party
details and other plausible information. The petitioner was not
cooperating in the investigation. The investigation qua the petitioner
is still pending due to his non-appearance and the prosecution
complaint qua the petitioner is yet to be filed. The petitioner was
found to be the main accused for the offence of money laundering
under investigation and has failed to cooperate in the investigation.
The petitioner due to non-cooperation in the investigation has not
been arrayed as accused either in the prosecution complaint or in the
supplementary prosecution complaint. The petitioner has been
named in the FIR registered at EOW as „Ravi Mehra‟.
4. The petitioner filed a bail application bearing no. 54/2023
titled as Amit Aggarwal V ED, which was dismissed vide order
dated 06.06.2023 passed by the court of Sh. Babru Bhan, ASJ-03,
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North-West District, Rohini Courts, Delhi. The relevant portion of
the said order is reproduced as under: -
16. It is settled proportion of law that court is not supposed
to enter into the merits of the case or to weigh the evidence
at the state of hearing of bail application. So, the argument
put-forth by Ld. Counsel for the petitioner that the
investigating agency has not elaborated about the
generation of proceeds of crime is not of much relevance at
this stage. Even otherwise, Ld. SPP for the respondent has
satisfactorily explained that a forged CA Certificate was
used by some shell companies to effect fraudulent foreign
remittance. It has come on record that these companies
were being run by fake directors appointed on forged
identities. The evidence collected so far indicates that the
entire process of foreign remittance was based upon fraud
and forgery. Thus, this argument relating to the proceeds of
crime is liable to be rejected.
17. As far as role of the petitioner is concerned, accused
Chitra, Rahul Kumar and Gaurav Sharma have elaborated
the role of the petitioner in the entire series of transactions.
As has already been discussed, these statements were
recorded u/s 50 of PMLA and same are admissible piece of
evidence.
18. Further, Ld. SPP for the respondent has produced a
complete chart containing the details of the notices issued to
the petitioner to join the investigation but he refused to join
the same on one pretext or another. The details of the
notices given to the petitioner indicate that he is
deliberately evading the process of law.
19. Taking note of the huge amount of money involved, role
of the petitioner and his conduct during the investigation,
this court is not inclined to grant anticipatory bail to the
petitioner.
20. The application is dismissed.
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5. The petitioner in the present bail application filed under
section 438 of the Code stated that the petitioner was a partner in a
firm styled as M/s Krishna Lighting and engaged in business of LED
lights. The petitioner in the month of December, 2022, retired from
the said firm and is now doing individual business but he is not able
to continue with the business presently due to bad health. The
petitioner was not concerned with the entities as named in FIR
bearing no. 0045/2022. The petitioner is not named in FIR and no
covert act is also attributed to the petitioner.
5.1 The respondent/ED registered the present ECIR DLZO-
II/24/2022 dated 28.03.2022 and commenced the investigation
for the offence punishable under sections 3/4 of PMLA with
allegations that the companies remitted crores of rupees using
complainant‟s credentials in edited 15CB certificate and forged Form
15CA with mala fide intention to remit funds abroad which otherwise
could not have been possible. The respondent/ED conducted a search
on 01.12.2022 at the residential address of the petitioner and also
seized five electronic articles. The petitioner further stated that one
Rahul Kumar was arrested on 02.12.2022 in reference to present
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ECIR and his statement was also recorded under force and coercion.
Manpreet Singh Talwar was also arrested on 22.11.2022 and was
remanded to judicial custody on 05.12.2022 and his statement was
also recorded during police remand under force and coercion. The
notices under section 50 of PMLA were also issued against the
petitioner and the petitioner on some occasions could not appear
before the issuing authority due to the reasons as forwarded to the
respondent. The petitioner appeared before the authority on
03.01.2023 and his statement was partially recorded, however, the
petitioner was physically assaulted by the respondent. The petitioner
was taken to Ram Manohar Lohia Hospital on 03.01.2023. The
petitioner again appeared before the authority on 04.01.2023 and was
pressurized by the respondent for recording of the statement as per
the dictates of the officers of the respondent and on refusal, he was
again physically assaulted. The petitioner was again taken to the
hospital. The petitioner also filed a complaint before NHRC about
the inhuman treatment besides making a complaint to the Director of
the respondent. The respondent, against the seizure of documents
and electronic gadgets, filed an application before the adjudicating
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authority under section 17(4) of PMLA with the prayer for retention
of these documents on 23.12.2022 which was allowed vide order
dated 10.05.2023 passed by the adjudicating authority. The
respondent filed a complaint under sections 44 and 45 of PMLA on
21.01.2023 and supplementary complaint on 31.01.2023 wherein the
petitioner has been arrayed as an accused. The High Court of Delhi
has already granted default bail to Rahul Kumar vide order dated
28.04.2023. The petitioner also filed an application for grant of
anticipatory bail on 25.05.2023 before the Additional Sessions Judge-
03, North-West District, Rohini Courts, Delhi wherein he alleged that
no proceeds of crime have been discovered attributed or found in the
hands of the petitioner.
5.2 The petitioner sought anticipatory bail on the grounds that the
case of the respondent/ED is based on statements of the co-accused
and there is no incriminating material or evidence which can connect
the petitioner with the present case. The respondent/ED has failed to
disclose how the petitioner is connected with the alleged foreign
remittance as he was neither the Director nor employee or any other
person, who was involved in other illegal forex remittance. The
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petitioner has neither been named in the FIR nor has any covert act
been attributed to the petitioner. The petitioner has never held any
post in the companies as named in the FIR bearing no. 0045/2022.
There is no material against the petitioner except the statements made
by the persons who were holding the posts in the company as named
in the FIR. No proceeds of crime have ever been recovered attributed
to or traced against the petitioner. The petitioner has cooperated in
the investigation by participating on 03.01.2023 and 04.01.2023. The
petitioner has undergone three kidney operations. There is no single
document which can impute any criminality on the petitioner. No
incriminating material was recovered by the respondent/ED during
the raid conducted at the premises of the petitioner. The statements
given by other persons wherein the petitioner was implicated have no
evidentiary value. Accordingly, the petitioner prayed for grant of
anticipatory bail.
6. The respondent/ED filed a Status Report wherein it mentioned
the factual background of the case and the investigation conducted by
the respondent as detailed hereinabove. The Status Report stated that
the non bailable warrants issued against the petitioner by the court of
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Additional Sessions Judge-03, North-West District, Rohini Courts,
Delhi could not be executed and he was never found at his residence
despite being advised for rest. The presence of the petitioner is
required as he is the key person involved in the entire
transaction/crime. The petitioner may tamper with the evidence. The
petitioner is required to satisfy the twin conditions as imposed under
section 45 of the PMLA which are not satisfied in the present
application. The economic offences are grave offences causing loss
and damage to the economic health of the country. The present bail
application is liable to be dismissed.
7. It is reflecting that the complainant is a Chartered Accountant
and made a complaint to Economic Offences Wing after receiving an
email from the ICICI Bank wherein it was alleged that the Form
15CB has been forged on a certificate issued by him on 11.03.2019
to M/s Wentorz Logistics Private Limited using UDIN no.
19505939AAAAA18327. The forged Form 15CA/CB certificates
allegedly issued by using credentials of the complainant were
submitted to the banks by the entities as named in FIR i.e. M/s Kinzal
Freight Forwarding (OPC) Private Limited; M/s Balaji International;
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M/s Shree Shyam International and M/s Wentorz Logistics Private
Limited, etc. for effecting onward remittance of more than Rs.300
crores. EOW, Delhi Police on the basis of complaint made by the
complainant registered FIR bearing no. 0045/2022 dated 16.03.2022
for offences punishable under sections 420/467/438/471/120B IPC
against M/s Kinzal Freight Forwarding (OPC) Private Limited and
others. Subsequently, the respondent/ED also recorded ECIR bearing
no. DLZO-II/24/2022 dated 28.03.2022 as the offences complained
of in FIR bearing no. 0045/2022 are scheduled offences.
7.1 It was revealed during the investigation that the complainant
issued only 07 certificates on Form 15CB to M/s Wentorz Logistics
Private Limited and the details which were mentioned on 07
certificates on Form 15CB issued to M/s Wentorz Logistics Private
Limited were used by the subject companies/entities for forging Form
15CB. It was also revealed that the 05 entities as named in FIR were
connected with one another and were being run by the same set of
persons. It was further revealed that the entities as named in FIR
have effected remittance of more than Rs.464 crores to the entities
based in Singapore and Hong Kong fraudulently and the funds were
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arranged into the bank accounts in India by RTGS and NEFT without
any corresponding business activities. It was also revealed during
investigation that the Directors/Proprietors/Partners as mentioned in
the bank accounts of the entities named in the FIR could not be traced
at the addresses given in KYC documents. It was also revealed that
apart from 05 entities mentioned in FIR, 07 entities were found to be
connected in a similar manner in similar transactions i.e. the
remittance to common entities in Hong Kong and Singapore
fraudulently. The respondent/ED could not trace the identity of the
persons operating the Indian entities but came to know during
subsequent investigation that Navin Kejriwal was the Director of
foreign companies, namely, KK Overseas Limited, Hong Kong and
Speedtec Global Services Pte Ltd., Singapore. Navin Kejriwal was
also found to be associated with Manpreet Singh Talwar and
accordingly, their residence/business premises were raided on
21-22.09.2022 under section 17(1) of PMLA. Data was recovered
from the mobile phone of Manpreet Singh Talwar and incriminating
material regarding one Infiniti Futures Pte Ltd., Singapore was also
recovered besides bank account details, user ID, etc. It was found
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that the Infiniti Futures Pte Ltd. also received fraudulently remitted
foreign exchange from India including remittances from ICICI Bank
from the account of Indian entities as named in the FIR.
7.2 Rashmi Dwivedi who was stated to be the Director in
M/s Mizta Tradex Private Limited and Truzel Tradex Private
Limited, was found to be involved into managing funds into their
bank accounts via RTGS and NEFT and then making the outward
forex remittance fraudulently to Hong Kong and Singapore. Rashmi
Dwivedi was actually found to be Chitra Pandey and was traced by
the officials of the respondent/ED. The statements of the complainant
i.e. Vikash Mohpal, Rahul Kumar (co-accused) and Chitra Pandey
were recorded under section 17(2) and section 50 of PMLA during
investigation.
7.3 The complainant in the statement recorded on 04.12.2022
stated that Ravi Mehra who was identified by the complainant as the
petitioner used to contact him for using his service for obtaining
Form 15CB certificates. Ravi Mehra obtained 18 certificates from
the complainant during the period from February, 2019 to April,
2019 and out of which, 07 certificates were in the name of M/s
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Wentorz Logistics Private Limited. The complainant on being shown
the photograph of the petitioner identified/recognized him as Ravi
Mehra.
7.4 The co-accused Rahul Kumar in the statement recorded on
02.12.2022 stated that M/s Mizta Tradex Private Limited and
M/s Truzel Tradex Private Limited were managed by him along with
the petitioner and the petitioner used to operate as Ravi Mehra. The
co-accused Rahul Kumar also stated that he met with the petitioner
through his friend Vishal Gupta in the year 2017 and subsequently,
he became the partner with the father of the petitioner in a firm which
used to run under the name and style of M/s Shri Venkatsaya Impex.
The co-accused Rahul Kumar and the petitioner in the year 2019
purchased two companies i.e. M/s Truzel Tradex Private Limited and
M/s Mizta Tradex Private Limited from one Company Secretary,
namely, Chetan for total consideration of Rs.50,000/-. The co-
accused Rahul Kumar also stated that Chitra Pandey, Varun Rana and
Mohammad Raza were the Directors in these companies in the name
of Rashmi Dwivedi, Manab Chaudhary and Rahil. Fake identities
were created to camouflage the real identity of the directors, which
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 24
were arranged by Bijender Kumar Jain. Kumar Pritam who was the
husband of Chitra Pandey @ Rashmi Dwivedi used to arrange fake
IDs through Bijender Kumar Jain and was paid 20 paise per dollar.
Rahul Kumar and the applicant used to arrange RTGS entries from
Karol Bagh and Ghaziabad through various Hawala entry operators.
Navin Kejriwal was the beneficiary of M/s KK Overseas Limited,
Hong Kong and Speedtec Global Services Pte Ltd., Singapore. Rahul
Kumar and the petitioner used to pay commission in cash for smooth
processing of transaction. Rahul Kumar and the petitioner were
getting 30-35 paise per dollar in every transaction. Rahul Kumar in
statement recorded on 12.12.2022 regarding the role of the petitioner
stated that all the cash transactions in lieu of RTGS were handled by
the petitioner besides handling of custom related work with regard to
directed import. Rahul Kumar could not state about the involvement
of the petitioner in the payment towards the freight payments but
stated that the petitioner forged 15CB certificates and met Chartered
Accountant for obtaining 15CA/CB certificates for M/s Wentorz
Logistics Private Limited.
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 25
7.5 Chitra Pandey @ Rashmi Dwivedi in the statement recorded
on 26.11.2022 stated that the petitioner was the main person who
used to give directions for all transactions and he along with Rahul
Kumar also used to give directions for dealing with bankers and
getting signatures on pre-filled applications for effecting foreign
remittances. Chitra Pandey @ Rashmi Dwivedi also stated that in the
statement recorded on 26.11.2022 stated that M/s Mizta Tradex
Private Limited and M/s Truzel Tradex Private Limited were used for
illegal transfer of forex to Hong Kong and Singapore and the
petitioner was the mastermind in the illegal transaction. The
petitioner along with others, used to incorporate company by using
forged KYC documents i.e. the Voter ID Card, PAN Card, Aadhaar
Card.
7.6 The statement of Gaurav Sharma was also recorded during
investigation who disclosed that he was employed by the petitioner as
an Accountant and was made Director in M/s Wentorz Logistics
Private Limited by using forged KYC documents and was paid
commission of 5 paise per dollar. The company M/s Wentorz
Logistics Private Limited was being used for illegal forex transfer
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 26
and the petitioner used to prepare forged document i.e. Airway Bill,
Invoice, A2 Form, Form 15CA and Form 15CB and thereafter,
Gaurav Sharma on instructions of the petitioner used to upload
documents for effecting outward remittances.
7.7 The respondent issued various summons to the petitioner and
the petitioner has joined the investigation only on 03.01.2023 and
04.01.2023. The respondent has already filed prosecution complaint
dated 20.01.2023 and supplementary prosecution complaint dated
31.01.2023 under sections 44 and 45 of the PMLA.
8. The counsel for the petitioner advanced oral arguments and
also submitted written submissions wherein besides mentioning the
factual position, he also raised multiple arguments in support of bail
application. The counsel for the petitioner argued that initially the
respondent/ED conducted enquiry under the Foreign Exchange
Management Act, 1999 (FEMA) qua the outward remittance by some
companies using credentials of the complainant and his statement
was recorded on 16.09.2021. FIR bearing no. 0045/2022 was got
registered after a period of 03 months under sections
420/467/468/471/120B of IPC. The respondent/ED issued the
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 27
summons for investigation and then the present ECIR was got
registered. The counsel for the petitioner referred statement of Ajay
Kumar, employee of ICICI Bank recorded on 25.11.2022 recognized
Chitra Pandey @ Rashmi Dwivedi and her husband Kumar Pritam
and on 06.12.2022 stated that the accounts of M/s Mizta Tradex
Private Limited and M/s Wentorz Logistics Private Limited were
opened on the direction of Kumar Pritam and Dheeraj Khetarpal.
Chitra Pandey @ Rashmi Dwivedi in her statement recorded on
26.11.2022 also disclosed the role of Kumar Pritam in the illegal
forex transaction and also stated that Kumar Pritam introduced the
Banker of ICICI Bank to facilitate smooth transaction for M/s
Wentorz Logistics Private Limited. The counsel for the petitioner
also referred the statement of Kirti Yadav recorded on 30.11.2022.
The co-accused Rahul Kumar has already been admitted on default
bail. The respondent/ED has not produced any documentary
evidence which can make out a prima facie case against the petitioner
or show his involvement in the alleged offence.
8.1 The counsel for the petitioner further argued that the petitioner
appeared before the respondent/ED on 03.01.2023 and 04.01.2023
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 28
but he was physically assaulted by the officers of the respondent/ED
and as a result of which he was taken to Ram Manohar Lohia
Hospital for treatment. The petitioner also made a complaint at
NHRC and had already undergone three separate operations related
to kidney at Max Healthcare on 10.01.2023, 06.02.2023 and
04.04.2023.
8.2 The counsel for the petitioner argued that in the present case
neither any „proceeds of crime‟ were generated from the scheduled
offence nor does the alleged offence fall in the category of scheduled
offences. The alleged offence, pertaining to the unauthorized
outward remittance by placing the forged 15CB Form, has not
fulfilled the ingredients of the offence of money laundering as there
are no „proceeds of crime‟ being generated from the scheduled
offence i.e. fabrication of 15CB Form. The „proceeds of the crime‟ is
the core of the ingredients constituting the offence of money
laundering and all the properties recovered and attached by the
investigating agency in connection with offence of the criminal
activity relating to the scheduled offence under the general law
cannot be regarded as „proceeds of crime‟. The counsel for the
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 29
petitioner placed reliance on Vijay Madanlal Chaudhary V Union
of India, 2022 SCC OnLine SC 929. The respondent/ED has not
alleged that the money which was remitted outward was itself
generated from some scheduled offence and was tainted money
and/or „proceeds of crime‟.
8.3 The counsel for the petitioner also argued that the remittance
of the money out of India can in itself, constitute an offence under
sections 3 and 4 of the FEMA and is to be dealt with as per section
37A and section 13(1C) of the said Act.
8.4 It was also argued that the twin conditions as per section 45 of
PMLA are not applicable as the petitioner is a sick and infirm person
and has already undergone repeated kidney surgeries and requires
constant medical supervision and has also developed further
complications. The counsel for the petitioner relied upon Kewal
Krishan Kumar V Enforcement Directorate, 2023 SCC OnLine
Del 1547 and Sameer Mahendru V Directorate of Enforcement,
2023:DHC:4155.
8.5 The counsel for the petitioner also argued that the
respondent/ED merely relied upon the statements of the co-accused
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 30
which cannot be considered against the petitioner at the stage of
consideration of the bail application and referred Surender Kumar
Khanna V Directorate of Revenue Intelligence, (2018) 8 SCC 201,
Hari Charan Kurmi & Jogia Hajam V State of Bihar, (1964) 6
SCR 623. The confessional statement or statement of co-accused
cannot be taken as substantial piece of evidence against the co-
accused and relied upon Commissioner of Custom Preventive,
Lucknow V Shakil Ahmed Khan, 2019 (366) ELT 634 (All). The
counsel for the petitioner also referred Vijay Agarwal V Directorate
of Enforcement, 2023 SCC OnLine Del 3176 and Basant Bansal V
State & Others (Bail Application bearing no. 2030/2023) wherein it
was observed that the evidentiary value of the statement recorded
under section 50 of PMLA has to be tested at the end of the trial and
not at the stage of granting bail. Chitra Pandey @ Rashmi Dwivedi
in the statement recorded on 26.11.2022 has not made any specific
allegation against the petitioner but made Rahul Kumar responsible
for every work and only stated that the petitioner was an accomplice
to him.
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 31
8.6 The petitioner has joined the investigation on two occasions
but was physically assaulted by the officers of the respondent/ED.
The petitioner has replied all the notices issued to him by the
respondent/ED and the custodial interrogation of the petitioner is not
required. The counsel for the petitioner prayed that the petitioner be
granted anticipatory bail.
9. Mr. Ravi Prakash, Central Government Standing Counsel
(CGSC) advanced oral arguments and also submitted written
submissions. The CGSC argued that FIR bearing no. 0045/2022
registered under sections 420/467/468/471/120B IPC discloses the
commission of scheduled offence and generation of „proceeds of
crime‟ within the meaning of section 2(1)(y) of PMLA.
9.1 The CGSC further argued that „Rashmi Dwivedi‟ who was
later on identified as Chitra Pandey was the Director in M/s Mizta
Tradex Private Limited and M/s Truzel Tradex Private Limited and
these companies were involved in managing funds into its bank
accounts via RTGS and NEFT and then fraudulently making outward
forex remittance to Hong Kong and Singapore. Chitra Pandey @
Rashmi Dwivedi in the statement recorded under section 50 of
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 32
PMLA deposed about the role of the petitioner in commission of the
offence subject matter of the present litigation. The co-accused
Rahul Kumar in statement, also admitted that he was working with
the petitioner and they have purchased two companies i.e. M/s Truzel
Tradex Private Limited and M/s Mizta Tradex Private Limited from
one Company Secretary, namely, Chetan and also stated that the fake
identities were created to camouflage the real identity of the
Directors and he along with petitioner used to pay commission of 20
paise per dollar for arranging fake KYC documents. The complainant
in statement under section 50 of PMLA also identified the petitioner
as Ravi Mehra who used to meet him for obtaining 15CA/CB
Certificates. The CGSC relied upon Tarun Kumar V Enforcement
Directorate, 2023 SCC OnLine SC 1486.
9.2 The CGSC also argued that the counsel for the petitioner has
not advanced arguments regarding section 45 of PMLA and placed
reliance on para no. 412 of Vijay Madanlal Choudhary (supra).
9.3 The CGSC also argued that the petitioner was avoiding the
process of law as such, he is not entitled for grant of bail and besides
mentioning the details of the summons issued to the petitioner, also
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 33
referred Monu Kapoor V Directorate of Revenue, 2019 SCC
OnLine Del 11829. The custodial interrogation of the petitioner is
necessary as the money laundering related to the present case,
involves multiple layers of placement layering and integration and
relied upon P. Chidambram V Directorate of Enforcement, (2019)
9 SCC 24. He also argued that the purpose of the investigation would
be defeated if the petitioner is protected by pre-arrest bail.
Accordingly, the CGSC prayed that the present anticipatory bail
application be dismissed.
10. It is reflecting at this stage that the prime incriminating
evidence collected during investigation by the respondent/ED are
statements of Chitra Pandey @ Rashmi Dwivedi and Rahul Kumar.
The CGSC as mentioned hereinabove argued that statements of
witnesses/accused recorded under section 50 of PMLA are
admissible evidence and can be relied on against the petitioner. The
CGSC relied on Tarun Kumar (supra) and Rohit Tandon V
Directorate of Enforcement, (2018) 11 SCC 46. The Supreme Court
in Tarun Kumar (supra) after referring to Rohit Tandon (supra)
observed that the statements of witnesses/accused are admissible in
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 34
evidence in view of Section 50 of the said Act and such statements
may make out a formidable case about the involvement of the
accused in the commission of a serious offence of money laundering.
The Supreme Court in Rohit Tandon (supra) observed that that the
prosecution has relied on statements of 26 witnesses/accused which
have already been recorded and the High Court has relied on 07
witnesses which are admissible in view of section 50 of PMLA. It
was further observed that these statements made formidable case
about involvement of the appellant therein in the commission of
serious offence of money laundering.
10.1 The counsel for the petitioner as mentioned hereinabove
argued that the statements of the co-accused cannot be considered
against the petitioner which are not substantial piece of evidence and
their evidentiary value has to be tested at the end of the trial and not
at the stage of granting bail. This Court in Vijay Agrawal through
Parokar V Directorate of Enforcement, 2023 SCC OnLine Del
3176 relied on by the counsel for the petitioner observed that the
evidentiary value of the statement recorded under section 50 of
PMLA has to be tested at the end of trial and not at the stage of bail.
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 35
Similar view was also taken by another Coordinate Bench of this
Court in Basant Bansal V State (Govt. of NCT of Delhi) and
Others, Bail Application bearing no.2030/2023 decided on
09.06.2023 after referring to Vijay Agrawal (supra). It was observed
that the evidentiary value of the statement recorded under section 50
of PMLA has to be tested at the end of the trial and not at the stage of
bail. The legal position which is emerging from above referred
decision is that statements of witnesses/accused recorded under
section 50 of PMLA are admissible in evidence and can make
formidable case against the accused regarding his involvement in
commission of offence of money laundering but their exact
evidentiary value has to be tested at the end of trial and not at the
stage of bail.
11. The CGSC for the respondent/ED argued that the counsel for
the petitioner has not advanced arguments regarding lifting of bar of
section 45 of PMLA. He further argued that rigour of section 45 of
PMLA has to be satisfied before granting bail under section 438 of
the Code and referred Vijay Madanlal Choudhary (supra).
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 36
11.1 Section 45 of PMLA provides that the offences punishable
under PMLA are cognizable and non-bailable offences. Section 45
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 under this Act shall be released on bail or on his
own bond unless--
(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, or is
accused either on his own or along with other co-accused of
money-laundering a sum of less than one crore rupees],
may be released on bail, if the Special Court so directs:
11.2 The Supreme Court in Vijay Madanlal Choudhary (supra)
referred by the CGSC, regarding applicability of section 45 of PMLA
in grant of anticipatory bail under section 438 of the Code, observed
as under:-
407. Another incidental issue that had been raised is about
the non-application of rigors of Section 45 of the 2002 Act
in respect of anticipatory bail filed under Section 438 of the
1973 Code. This submission presumably is linked to the
observation in paragraph 42 in the case of Nikesh
Tarachand Shah (2018) 11 SCC 1. Similar argument was
considered in The Asst. Director Enforcement Directorate vs.
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 37
Dr. V.C. Mohan (Criminal Appeal No.21 of 2022, decided on
04.01.2022). We are in agreement with the observation in
this decision that it is one thing to say that Section 45 of the
2002 Act refers to a scheduled offence under the general
law, but, as noted earlier, the offence under this Act in
terms of Section 3 is specific to involvement in any process
or activity connected with the proceeds of crime which is
generated as a result of criminal activity relating to a
scheduled offence. It is also true that Section 45 does not
make specific reference to Section 438 of the 1973 Code, but
it cannot be overlooked that sub-section (1) opens with a
non-obstante clause and clearly provides that anything
contained in the 1973 Code (2 of 1974), no person accused
of an offence under this Act shall be released on bail or on
his own bond, unless the stipulations provided therein are
fulfilled. On account of the non-obstante clause in Section
45(1) of the 2002 Act, the sweep of that provision must
prevail in terms of Section 71 of the 2002 Act. Further, the
expression "anticipatory bail" is not used either in the 1973
Code or the 2002 Act. The relief granted in terms of Section
438 of the 1973 Code is one of directing release of the
person on "bail" in case of his arrest; and such a relief has
been described in judicial pronouncements as anticipatory
bail. Section 45(1) uses generic expression "bail" without
reference to any provision of the 1973 Code, such as
Sections 437, 438 and 439 of the 1973 Code. Concededly,
Section 65 of the 2002 Act states that the provisions of the
1973 Code shall apply to the provisions under the Act
insofar as they are not inconsistent with the provisions of
the 2002 Act. Further, Section 71 of the Act gives
overriding effect to the Act. Section 45 of the Act begins
with a non-obstante clause, thus excluding the application
of the 1973 Code in matters related to "bail". The word
"anticipatory bail" has not been defined under the 1973
Code...
408. Thus, anticipatory bail is nothing but a bail granted in
anticipation of arrest, hence, it has been held in various
judgments by this Court that the principles governing the
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 38
grant of bail in both cases are more or less on the same
footing, except that in case of anticipatory bail the
investigation is still underway requiring the presence of the
accused before investigation authority. Thus, ordinarily,
anticipatory bail is granted in exceptional cases where the
accused has been falsely implicated in an offence with a
view to harass and humiliate him. Therefore, it would not
be logical to disregard the limitations imposed on granting
bail under Section 45 of the 2002 Act, in the case of
anticipatory bail as well.
xxx xxx xxx
410. Therefore, as noted above, investigation in an
economic offence, more so in case of money-laundering,
requires a systematic approach. Further, it can never be the
intention of the Parliament to exclude the operation of
Section 45 of 2002 Act in the case of anticipatory bail,
otherwise, it will create an unnecessary dichotomy between
bail and anticipatory bail which not only will be irrational
but also discriminatory and arbitrary. Thus, it is totally
misconceived that the rigors of Section 45 of the 2002 Act
will not apply in the case of anticipatory bail.
xxx xxx xxx
412. As a result, we have no hesitation in observing that in
whatever form the relief is couched including the nature of
proceedings, be it under Section 438 of the 1973 Code or for
that matter, by invoking the jurisdiction of the
Constitutional Court, the underlying principles and rigors
of Section 45 of the 2002 must come into play and without
exception ought to be reckoned to uphold the objectives of
the 2002 Act, which is a special legislation providing for
stringent regulatory measures for combating the menace of
money-laundering.
11.3 A Coordinate Bench of this Court in Vijay Agrawal (supra)
observed that as per Vijay Madanlal Choudhary (supra), though
the twin conditions provided under Section 45 of PMLA restrict the
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 39
right of accused to grant of bail but it cannot be said that the
conditions provided under Section 45 impose absolute restraint on the
grant of bail. It is a settled proposition that the discretion vested in
the Court has to be exercised in accordance with the law and has to
be guided by the principles of law. The observation in Vijay
Agrawal (supra) was followed by another Coordinate Bench of this
Court in Basant Bansal (supra). It was also observed in Vijay
Agrawal (supra) as under:-
30. The jurisprudence of the bail positively lays down that a
liberty of a person should not ordinarily been interfered
with unless there exist cogent grounds. Despite, the twin
conditions, it is not necessary that at the stage of bail, the
Court has to come to the conclusion that the petitioner is
not guilty for such an offence. The Court is at the stage of
has to examine the case on the scale of broad probabilities.
The Court at this stage is required to record an objective
finding on the basis of material available on record and no
other purpose.
12. The counsel for the petitioner argued that the alleged offence
i.e. unauthorized outward remittance by placing the forged 15CB
form has not fulfilled the ingredients of the offence of money
laundering as there is no "proceeds of crime" being generated from
the scheduled offence i.e. fabrication of 15CB form. The counsel for
the petitioner relied on observations made in Vijay Madanlal
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 40
Choudhary (supra). The Supreme Court in Vijay Madanlal
Choudhary (supra) observed as under:-
250. The other relevant definition is "proceeds of crime" in
Section 2(1)(w) of the 2002. Act. This definition is common
to all actions under the Act, namely, attachment,
adjudication and confiscation being civil in nature as well
as prosecution or criminal action. The original provision
prior to amendment vide Finance Act, 2015 and Finance
(No. 2) Act, 2019, took within its sweep any property
(mentioned in Section 2(1)(v) of the Act) derived or
obtained, directly or indirectly, by any person "as a result
of" criminal activity "relating to" a scheduled offence
(mentioned in Section 20(1)(y) read with Schedule to the
Act) or the value of any such property. Vide Finance Act,
2015, it further included such property (being proceeds of
crime) which is taken or held outside the country, then the
property equivalent in value held within the country and by
further amendment vide Act 13 of 2018, it also added
property which is abroad. By further amendment vide
Finance (No. 2) Act, 2019, Explanation has been added
which is obviously a clarificatory amendment. That is
evident from the plain language of the inserted Explanation
itself. The fact that it also includes any property which
may, directly or indirectly, be derived as a result of any
criminal activity relatable to scheduled offence does not
transcend beyond the original provision. In that, the word
"relating to" (associated with/has to do with) used in the
main provision is a present participle of word "relate" and
the word "relatable" is only an adjective. The thrust of the
original provision itself is to indicate that any property is
derived or obtained, directly or indirectly, as a result of
criminal activity concerning the scheduled offence, the
same be regarded as proceeds of crime. In other words,
property in whatever form mentioned in Section 2(1)(v), is
or can be linked to criminal activity relating to or relatable
to scheduled offence, must be regarded as proceeds of
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 41
crime for the purpose of the 2002 Act. It must follow that
the Explanation inserted in 2019 is merely clarificatory and
restatement of the position emerging from the principal
provision [i.e., Section 2(1)(w)].
251. The "proceeds of crime" being the core of the
ingredients constituting the offence of money-laundering,
that expression needs to be construed strictly. In that, all
properties recovered or attached by the investigating
agency in connection with the criminal activity relating to a
scheduled offence under the general law cannot be
regarded as proceeds of crime. There may be cases where
the property involved in the commission of scheduled
offence attached by the investigating agency dealing with
that offence, cannot be wholly or partly regarded as
proceeds of crime within the meaning of Section 2(1)(w) of
the 2002 Act - so long as the whole or some portion of the
property has been derived or obtained by any person "as a
result of" criminal activity relating to the stated scheduled
offence. To be proceeds of crime, therefore, the property
must be derived or obtained, directly or indirectly, "as a
result of" criminal activity relating to a scheduled offence.
To put it differently, the vehicle used in commission of
scheduled offence may be attached as property in the
concerned case (crime), it may still not be proceeds of crime
within the meaning of Section 2(1)(u) of the 2002 Act.
Similarly, possession of unaccounted property acquired by
legal means may be actionable for tax violation and yet, will
not be regarded as proceeds of crime unless the concerned
tax legislation prescribes such violation as an offence and
such offence is included in the Schedule of the 2002 Act.
For being regarded as proceeds of crime, the property
associated with the scheduled offence must have been
derived or obtained by a person "as a result of" criminal
activity relating to the concerned scheduled offence. This
distinction must be borne in mind while reckoning any
property referred to in the scheduled offence as proceeds of
crime for the purpose of the 2002 Act. Dealing with
proceeds of crime by way of any process or activity
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 42
constitutes offence of money-laundering under Section 3 of
the Act.
252. Be it noted that the definition clause includes any
property derived or obtained "indirectly" as well. This
would include property derived or obtained from the sale
proceeds or in a given case in lieu of or in exchange of the
"property" which had been directly derived or obtained as
a result of criminal activity relating to a scheduled offence.
In the context of Explanation added in 2019 to the
definition of expression "proceeds of crime", it would
inevitably include other property which may not have been
derived or obtained as a result of any criminal activity
relatable to the scheduled offence. As noticed from the
definition, it essentially refers to "any property" including
abroad derived or obtained directly or indirectly. The
Explanation added in 2019 in no way travels beyond that
intent of tracking and reaching upto the property derived
or obtained directly or indirectly as a result of criminal
activity relating to a scheduled offence. Therefore, the
Explanation is in the nature of clarification and not to
increase the width of the main definition "proceeds of
crime". The definition of "property" also contains
Explanation which is for the removal of doubts and to
clarify that the term property includes property of any kind
used in the commission of an offence under the 2002 Act or
any of the scheduled offences. In the earlier part of this
judgment, we have already noted that every crime property
need not be termed as proceeds of crime but the converse
may be true. Additionally, some other property is
purchased or derived from the proceeds of crime even such
subsequently acquired property must be regarded as
tainted property and actionable under the Act. For, it
would become property for the purpose of taking action
under the 2002 Act which is being used in the commission
of offence of money-laundering. Such purposive
interpretation would be necessary to uphold the purposes
and objects for enactment of 2002 Act.
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 43
253. Tersely put, it is only such property which is derived
or obtained, directly or indirectly, as a result of criminal
activity relating to a scheduled offence can be regarded as
proceeds of crime. The authorities under the 2002 Act
cannot resort to action against any person for money-
laundering on an assumption that the property recovered
by them must be proceeds of crime and that a scheduled
offence has been committed, unless the same is registered
with the jurisdictional police or pending inquiry by way of
complaint before the competent forum. For, the expression
"derived or obtained" is indicative of criminal activity
relating to a scheduled offense already accomplished.
Similarly, in the event the person named in the criminal
activity relating to a scheduled offence is finally absolved by
a Court of competent jurisdiction owing to an order of
discharge, acquittal or because of quashing of the criminal
case (scheduled offence) against him/her, there can be no
action for money laundering against such a person or
person claiming through him in relation to the property
linked to the stated scheduled offence. This interpretation
alone can be countenanced on the basis of the provisions of
the 2002 Act, in particular Section 2(1)(u) read with Section
3. Taking any other view would be rewriting of these
provisions and disregarding the express language of
definition clause "proceeds of crime", as it obtains as of
now.
12.1 Another Coordinate Bench of this Court in Vijay Agrawal
(supra) in view of above observations in Vijay Madanlal
Choudhary (supra) observed as under:-
25. The bare perusal of these paragraphs would indicate
that any property which is derived or obtained directly or
indirectly as a result of criminal activity concerning the
schedule offence, is regarded as proceeds of crime. If any
property which can be linked to criminal activity relating to
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 44
or relatable to the scheduled offence, it has to be regarded
as proceeds of crime. However, It has also been stated that
all properties recovered or attached by the investigating
agency in connection with the criminal activity relating to a
scheduled offence under the general law cannot be
regarded as proceeds of crime. The property which has
been derived must be directly or indirectly related to the
criminal activity relating to the concerned scheduled
offence. It is not necessary that the property must have
been directly acquired or derived, if the property has been
derived in lieu of or in exchange of the „property‟ which
had been directly derived or obtained as a result of
criminal activity relating to a scheduled offence, such
property would also fall within the definition of „proceeds
of crime.‟ It has also been inter alia held in Vijay Madanlal
Choudhary (supra) that even at the stage of bail, the court is
expected to consider the question from the angle as to
whether the accused possessed the requisite mens rea.
12.2 In the present case main allegation of the respondent/ED
against the petitioner is that he was instrumental in outward
remittance of huge amount in the account of foreign entities on the
basis of forged Form 15CB Certificates. However, in the present
case, there is no property which is derived or obtained directly or
indirectly as a result of criminal activity concerning the scheduled
offence which can be regarded as „proceeds of crime‟. There is legal
force in the arguments advanced by the counsel for the petitioner that
the unauthorized outward remittance by forged Form 15CB
Certificates does not amount to „proceeds of crime‟ being generated
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 45
from the scheduled offence i.e. fabrication of Form 15CB
Certificates.
13. The counsel for the petitioner also argued that the twin
conditions as per section 45 of PMLA are not applicable as the
petitioner is a sick and infirm person and has already undergone
repeated kidney surgeries and requires constant medical supervision
and primarily relied upon Kewal Krishan Kumar (supra). The
medical records/documents submitted by the petitioner reflect that
the petitioner is suffering from various ailments including renal
problem which requires constant medical treatment. This court in
Kewal Krishan Kumar (supra) has granted bail on ground of
sickness and infirmity of the accused.
14. The CGSC also argued that the petitioner is avoiding
investigation and his custodial investigation is required as the offence
of money laundering involves multiple layers of placement, layering
and integration. It is further argued that summons were issued to the
petitioner to join investigation but the petitioner only joined
investigation on 03.01.2023 and 04.01.2023 and subsequently
avoided investigation. The CGSC also referred details of summons
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 46
issued to the petitioner. The petitioner joined investigation on
03.01.2023 and 04.01.2023 and gave reasons for not joining
investigation. The petitioner neither appears to be a flight risk, nor is
he likely to influence any witness and tamper with the evidence.
15. This court in Vijay Agrawal (supra) also observed as under:-
22. The jurisprudence regarding bail is by now very well
settled that rule has always been bail and its exception jail.
It has also been stated time and again that such a principle
has to be followed strictly. Right to bail is also essential for
the reason that it provides the accused with an opportunity
of securing fair trial. The right to bail is linked to Article 21
of the Constitution of India, which confers right to live with
freedom and dignity. However, while protecting the right of
an individual of freedom and liberty the court also has to
consider the right of the society at large as well as the
prosecuting agency. This is the reason that the gravity of
the offence is required to be taken into account. The gravity
of the offence is gathered from the attendant facts and
circumstances of the case. It is a settled proposition that
economic offences fall within the category of „grave
offences.‟ While dealing with the economic offence cases,
the court has to be sensitive to the nature of allegation
made against the accused. Such economic offences normally
involve the public exchequer and money of the honest tax
payer. The offence of money laundering in itself is a very
serious offence. The money laundering not only is a threat
to the financial health of the country but it may also
adversely impact its integrity and sovereignty. Moreover,
the act of money laundering can even lead to the collapse of
the economic system.
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 47
16. In view of the above discussion and after considering all facts,
including incriminating material against the petitioner which are the
statements made by co-accused/witness under section 50 of PMLA
and the fact that their evidentiary value can be tested at the stage of
trial, no generation of „proceeds of crime‟ from criminal activity and
the petitioner being a sick and infirm person, the present anticipatory
bail application is allowed. The petitioner, in case of arrest, shall be
released on bail on furnishing personal bond in the sum of
Rs.1,00,000/- with one surety of the like amount to the satisfaction of
the concerned Investigating Officer or any other authorized person
subject to following conditions:-
i. The petitioner shall join investigation as and when
directed by the Investigating Officer and shall provide
necessary information and documents as required for the
purpose of investigation to the satisfaction of the
Investigating Officer.
ii. The petitioner shall surrender his passport before the
concerned trial court within fifteen (15) days and shall not
leave country in any circumstance without prior permission
of the concerned trial court.
iii. The petitioner shall mark his presence before the
Investigating Officer on the fourth Friday of each English
Calendar Month till the completion of investigation qua
him.
iv. The petitioner shall not, in any manner, make any
inducement to the witnesses directly and indirectly.
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 48
v. The petitioner shall provide his operational mobile
number within seven (7) days so that he can be contacted
by the Investigating Officer as and when required. The
petitioner shall also intimate any change in his residential
address immediately to the Investigating Officer.
17. The present bail application stands disposed of. However, it is
made clear that no observation made in this judgment shall be taken
as an opinion on the merit of the case.
18. Dasti.
DR. SUDHIR KUMAR JAIN
(JUDGE)
JANUARY 11, 2024
N/AM
Signing Date:12.01.2024 BAIL APPLN. 2073/2023 Page 49
