Gujarat High Court
Rahul Gangwal S/O Mahendrakumar ... vs State Of Gujarat on 18 April, 2024
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R/SCR.A/6256/2015 JUDGMENT DATED: 18/04/2024
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CRIMINAL APPLICATION (QUASHING) NO. 6256 of
2015
With
R/SPECIAL CRIMINAL APPLICATION NO. 6258 of 2015
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE DIVYESH A. JOSHI
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1 Whether Reporters of Local Papers may be
allowed to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the
fair copy of the judgment ?
4 Whether this case involves a substantial
question of law as to the interpretation
of the Constitution of India or any order
made thereunder ?
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RAHUL GANGWAL S/O MAHENDRAKUMAR GANGWAL
Versus
STATE OF GUJARAT & ORS.
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Appearance:
MR HARDIK P MODH(5344) for the Applicant(s) No. 1
MR YASH N NANAVATY(5626) for the Applicant(s) No. 1
NOTICE SERVED BY DS for the Respondent(s) No. 2,3
MR DHAWAN JAYSWAL, APP for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE DIVYESH A. JOSHI
Date : 18/04/2024
COMMON ORAL JUDGMENT
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1. As similar set of facts and law are involved in
both the petitions and challenge in both the
petitions is the impugned order dated 30.05.2015
passed by the learned Sessions Judge & Designated
Special Judge, Ahmedabad (Rural), whereby, non-
bailable warrant came to be issued against the
petitioners, both the petitions are required to be
heard analogously and decided by this Court with this
common judgment.
2. For deciding the present petitions, the facts of
Special Criminal Application No.6256 of 2015 are
taken into consideration. By way of preferring
present petition under Article 226 and 227 of the
Constitution of India read with Section 482 and 483
of the Code of Criminal Procedure, 1973, the
petitioner has prayed for the following relief/s:
A) To issue a Writ of Mandamus and/or Writ of
Certioran and/or any other writ, order or
direction, directing to quash and set aside
the Order dated 30.05.2015 at Annexure-H
passed by the Hon'ble Designated Special
Court, Ahmedabad in Criminal Miscellaneous
Application qua the Petitioner;
B) To issue a Writ of Mandamus and/or Writ of
Certiorari and/or any other writ, order or
direction, directing to convert Non- bailable
warrant summons into bailable warrant and
further to direct the Hon'ble Designated
Special Court, Ahmedabad to take such surety
as directed by this Hon'ble Court by Order
dated 19/11/2014 in Special Criminal
Application No. 4697 of 2014;
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C) At the interim / ad-interim stage, this
Hon'ble Court may be pleased to restrain the
Respondents from taking any coercive steps
prejudicial to the Petitioner's interests,
during the pendency of the Petition, and to
grant stay of his arrest, or to issue a
direction to grant interim bail till final
disposal of the Instant Petition in the event
of the Petitioner's arrest or appearance
before the Learned Designated Court;
D) To pass any other and further orders as may
be deemed fit and proper.
E) To provide for the costs of this petition.
3. The brief facts as narrated in the memo of the
petition are as under:
3.1. The petitioner has learnt that a team of
officers appointed under the Foreign Exchange
Management Act, 1999 (hereinafter referred to as
"FEMA") searched the premise identified as farm
house in village Sikandarpur, Near Ajwa Chowkdee,
Vadodara on 19.03.2015 under Section 37 of FEMA
on alleged premises that Shri Girish P. Patel @
Tommy Patel and his associate Shri Kiran J. Mala
involved in large scale Hawala Racket in Online
International Cricket betting through UK based
website "Betfair.Com". During the course of
investigation, it was alleged that documents
found were related to hawala payment for cricket
betting which were in nature of offences under
Indian Penal Code and therefore, the documents
and digital items were seized under Panchnama
dated 19.03.2015. The said materials were shared
with the Commissioner of Police, Vadodara for
further investigation by the Police
3.2. The Petitioner learnt that the Police
registered FIR. No. 85/2015 based on the
documents and digital items supplied by the
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authorities under FEMA against Shri Girish P.
Patel @ Tommy Patel, Shri Kiran J. Mala, Shri
Dharmendra V. Chauhan @ Dharmin Chauhan & Shri
Chirag Parikh for commission of offences in terms
of Section 1208 read with 418, 419, 420, 467 and
471 of Indian Penal Code which are scheduled
offences in terms off PMLA.
3.3. Pursuant to the aforesaid FIR No.85/2015,
the Investigation under provisions of PML Act
2002 were being conducted vide Enforcement Case
Information Report (ECIR) No. ECIR/03/AMZO/2015
by Respondent No.2 to ascertain, identify, locate
proceeds of crime generated as a result of
alleged Criminal activities by Shri Girish P.
Patel @ Tommy Patel, Shri Kiran J. Mala, Shri
Dharmendra V. Chauhan, Shri Chirag Parekh and
unknown accused as others which constitutes
commission of offence in terms of Section 3 of
PMLA.
3.4. The Respondent No.2 approached the
Designated Court under PMLA for issuance of Non-
Bailable Warrant against the above referred
accused since they allegedly not responded the
summons issued by them. The Learned Designated
Court vide order dated 10.04.2015 issued Non-
Bailable warrant against the four accused as
named above.
3.5. The said four accused against whom non-
bailable warrants were issued by the Designated
Court were arrested and examined. It is pertinent
to note that neither any of the 4 accused uttered
name of the Petitioner during the course of
Interrogation nor the Petitioner was made as
accused in the ECIR No. ECIR/03/AMZO/2015 filed
by the Respondent No.2 under PMLA.
3.6. During the course of investigations, name of
certain more persons namely Shri Ritesh Bansal @
Bharat Delhi and his brother Shri Ankush Bansal
were revealed. Pursuant to which their
residential premises were searched on
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9/10.05.2015 and It was alleged to be found some
incriminating documents which were further seized
under PMLA. Both these accused were later on
arrested under PMLA and are presently in judicial
custody.
3.7. The Complaint numbered as "PMLA Complaint
Case No. 08/2015" was filed against the 7 accused
as named above in the Designated Court. The
Petitioner is not amongst 7 accused.
3.8. During the further course of investigation,
names of Shri Mukesh Kumar having his residence
in Delhi, Shri Sukhminder Singh Sodhi having
residence in Mumbai, Shri Anil Jaisinghani having
residence in Ulhasnagar along with the name of
the Petitioner and his brother were revealed. The
residential premise of the Petitioner was
searched on 22.05.2015. Since the Petitioner was
out of station with his family, his residential
premise was found to be locked. The officers of
Directorate of Enforcement, Jaipur Zonal office,
neither waited for the Petitioner nor gave any
opportunity to explain the cause, illicitly broke
the lock and searched the premises wherein it was
alleged to be found incriminating documents,
jewellery and other valuable items which were
seized under Panchnama dated 22.05.2015.
3.9. Being aggrieved with the action of the
officers of Directorate of Enforcement, Jaipur
Zonal office, the Petitioner through his Advocate
addressed a letter dated 26.05.2015 to the
Assistant Directorate, Directorate of
Enforcement, Jaipur Zonal office and informed
that the Petitioner was out of station with his
family and therefore, the premise was found to be
locked. The Petitioner also stated that the
officials from Enforcement Directorate affixed
the summons on his house alongwith Panchnama but
due to bad weather, the contents of summons and
Panchnama were found to be absolutely in
unreadable condition and therefore, the
Petitioner requested to supply copies of summons
and Panchnama drawn on 22.05.2015. The Petitioner
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also requested that reasonable time of one week
may be granted for appearance in pursuance of
summons.
3.10.Since the house of Petitioner was locked and
sealed by the Enforcement Department, Shri
Mahendra Kumar Gangwal, the father of the
Petitioner and Co-owner of the house, vide letter
dated 26.05.2015 requested the Assistant
Directorate of Enforcement, Jaipur Zonal office,
to open the lock and requested not to attach such
immovable property as it is owned by him and used
by him and his family for residential purpose.
3.11. Pursuant to the request made by father of
the Petitioner, the Enforcement Department handed
over the key and possession of the residential
premise on 29.05.2015. During the course of
proceedings, the Officials of the Enforcement
Directorate informed that the Petitioner was
required to furnish income tax returns for the
last 5 years alongwith bank statements and
details of the property. The Petitioner, without
waiting summons and to show his bonafide and co-
operation with the Enforcement Directorate,
submitted income tax returns for last 5 years
alongwith details of immovable and movable
property under their Advocate's letter dated
03.06.2015. The Petitioner inter alia stated that
the Documents/Information furnished by him was
suffice for the purpose of investigation and also
requested them to call for more documents or
information, if any, required to assist in the
investigation.
3.12. The Petitioner was again summoned vide
letter dated 09.06.2015, which was received by
him on 13.06.2015 at 17.00 hours, to appear in
person before the Respondent No.2 along with the
details of all immovable and movable property in
India and abroad and to give statement. The
Petitioner resubmitted the details of immovable
and movable property under covering letter dated
15.06.2015 addressed by their Advocate.
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3.13. The Petitioner did not remain present to
give statement om 15.06.2015 as his mother Mrs.
Kusum Gangwall suffered severe chest pain and was
admitted to Fortis Hospitall om 14.06.2015 and
therefore in that circumstances, the Advocate, as
authorized representative for the Petitioner
remained present before the Respondent No.2 and
provided the details of immovable and movable
property as mentioned hereinabove and requested
to allow the Petitioner to remain present after
15 days for recording his statement.
3.14. The Petitioner submits that he always
carried bonafide belief that his statement was
required to be recorded in the capacity of a
witness. However, the Petitioner first time
realized when the officers of Enforcement
Directorate, Jaipur Zonal office, came to the
residential premises of the Petitioner on
10.07.2015 and informed that an arrest warrant
was issued against the Petitioner in connection
with ECIR No. ECIR/03/AMZO/2015 and claiming that
the Petitioner is an accused for the offences
punishable under PMLA.
3.15. The Petitioner submits that on perusal of
the Criminal Miscellaneous Application filed by
the Respondent No.2 in ECIR No.
ECIR/03/AMZO/2015, the Ld. Designated Court
issued non-bailable warrant on the premise that
the offence involved was in economic nature and
therefore, in the interest of economy of the
country, issuance of non-bailable warrant was
inevitable.
3.16. The Petitioner submits that on perusal of
Criminal Miscellaneous Application, he came to
know that two summons were claimed to be issued
for appearance on 25.05.2015 and 28.05.2015
before the Respondent No.2. The Petitioner
submits that out of above mentioned two summons,
the summons issued for appearing on 28.05.2015
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was never received by the Petitioner and
therefore he did not appear.
3.17. After issuance of non-bailable warrant, the
Petitioner was again called by summon dated
13.07.2015 to give his statement before the
Respondent No.2 on 20.07.2015. It is pertinent to
note that in this summons, the Petitioner was
only called for giving a statement in connection
with investigation initiated under the Provisions
of PMLA Act and not called for any documents
since the Petitioner submitted the documents as
demanded by Respondent No.2.
3.18. The Petitioner, through his Advocate,
addressed a letter dated 20.07.2015 to the
Respondent No.2 and clarified the fact that he
was not aware about issuance of Non-Bailabe
Warrant by the Designated Court. He stated that
he always carried impression that he was called
upon to record his statement as a witness and not
as an Accused in the case.
3.19. The Petitioner again received a summons
dated 03.08.2005 to appear before the Respondent
No.2 on 11.08.2005. In the said summons, the
petitioner was called upon to give statement as
detailed in earlier summons.
3.20. The petitioner through his advocate vide
letter dated 11.08.2015 replied to summon dated
03.08.2015 and reiterated the request as made in
earlier letter dated 20.07.2015.
3.21.Being aggrieved and dissatisfied with the
impugned order dated 30.05.2014 passed by the
learned Designated Special Court, Ahmedabad the
petitioner has preferred present petition.
4. Heard learned advocate Mr. Hardik P. Modh for
the petitioners and learned APP Mr. Dhawan Jayswal
for the respondent - State. Though notice is served
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to respondent Nos. 2 and 3, none appears for the said
respondents.
5. Learned advocate Mr. Modh for the petitioners
submitted that issuance of the Non-Bailable Warrant
against the petitioners at the first instance,
instead of a Bailable Warrant, is manifestly illegal
and contrary to the law enunciated by the Hon'ble
Apex Court in the case of Inder Mohan Goswami v.
State of Uttaranchal, reported in (2007) 12 SCC 1.
Learned advocate Mr. Modh further submitted that the
object of non-bailable warrant is to ensure the
presence of a person before the Court of law in a
situation where a summons or bailable warrant have
failed to secure the presence of such a person. Thus,
it is incumbent upon the Court to issue summons or
bailable warrant and only on failure of the aforesaid
remedies available to secure the presence of a
person, the question of issuance of non-bailable
warrant comes. Here in the instant case, without
issuance of Summons and/or bailable warrant, straight
way, the non-bailable warrant came to be issued which
is manifestly illegal. Learned advocate Mr. Modh
further submitted that in similar set of facts, the
Coordinate Bench of this Court has quashed the order
issuing non-bailable warrant against the concerned
petitioner vide order dated 23.07.2015 rendered in
Special Criminal Application (Quashing) No.4441 of
2015. Learned advocate Mr. Modh, therefore, submitted
that considering the facts of the present case, the
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impugned order be quashed and set aside and non-
bailable warrant may be converted into bailable
warrant.
6. Learned APP Mr. Dhawan Jayswal has opposed
present petitions with vehemence and submitted that
the learned Designated Special Judge has not
committed any error while passing the impugned order
whereby non-bailable warrant came to be issued
against the petitioners. However, learned APP has
fairly conceded that before issuing non-bailable
warrant, summons and/or bailable warrant has not been
issued by the learned Designated Court under PMLA and
straight way non-bailable warrant came to be issued.
Thus, learned APP therefore submitted that
considering the facts of the present case,
appropriate order may be passed.
7. Having heard the learned advocates appearing for
the parties and having gone through the material
placed on record, it is found out from the record
that it is the case of the prosecution that pursuant
to specific intelligence regarding operation of large
scale Hawala racket in online International Cricket
Betting through U.K. based website 'Betfair.com' by
one Shri Girish P. Patel @ Tommy Patel and his
associate Shri Kiran J. Mala, the premises identified
as Farm House in village Sikandarpur, Near Ajwa
Chowkdee, Vadodara was searched on 19.03.2015 under
Section 37 of Foreign Exchange Management Act (FEMA),
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1999 which resulted in recovery and seizure of
incriminating documents, digital records etc. It is
also the case of the proseution that during the
course of initial investigation under FEMA, 1999,
apart from Hawala payments relating to cricket
betting, some material indicating offences committed
in terms of IPC were also observed. Pursuant to the
material provided by the office of the Directorate of
Enforcement, Ahmedabad, investigation has been
carried out by the concerned police authority and on
the basis of the preliminary investigation, on
acccount of the forgery committed, FIR. No. 85/2015
was registered on 25.03.2015 by the Kishanwadi Police
Station, Vadodara against Shri Girish P. Patel @
Tommy Patel, Shri Kiran J. Mala, Shri Dharmendra V.
Chauhan @ Dharmin Chauhan & Shri Chirag Parikh for
commission of offences under Section 120-B read with
418, 419, 420, 467 and 471 of Indian Penal Code. As
offence under Sections 120-B read with 418, 419, 420,
467 and 471 of Indian Penal Code are scheduled
offences under Section 2(1)(y) of Prevention of Money
Laundering Act, 2002, a case was registered by the
office of Directorate of Enforcement, Ahmedabad Zonal
office against the aforesaid four accused persons and
some unknown persons under case file
No.ECIR/03/AZO/2015 dated 26.03.2015 with a view to
identify the properties/assets etc. acquired out of
illegal gains earned by the accused persons.
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8. It is also found out from the record that on the
basis of certain incriminating material, the Deputy
Director, Directorate of Enforcement, Ahmedabad Zonal
Office filed PMLA complaint No.8 of 2015 against
total 7 accused persons wherein names of present
petitioners are not there. It is also found out from
the record that during the course of further
investigation, names of present petitioners were
revealed and therefore their premises were searched
under the provisions of PMLA, 2002 on 22.05.2015. It
is alleged that when the residential premises of the
petitioners were searched under the provisions of
PMLA, 2002 on 22.05.2015, neither of them was found
at their respective houses. It is alleged that the
search of residential premises of the petitioners
resulted in recovery and seizure of incriminating
documents, jewellery and other valuable items worth
rupees more than 20 crores. It is also alleged that
the initial investigation under PMLA, 2002 disclosed
involvement of petitioners in cross border betting
racket and illegal financial transaction. It is also
alleged that connections between the petitioners and
hawala operator based at Pakistan and Dubai have been
found during the investigation. It is also alleged
that summons under PMLA for appearance were issued to
the petitioners, however, it is alleged that
petitioners did not remain present on such dates and
therefore, an application for issuance of non-
bailable warrant against the petitioners and other
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two persons came to be filed by the Assistant
Director, PMLA, Enforcement Directorate.
9. After considering and appreciating the material
placed on record, the learned Sessions Judge &
Designated Special Judge, Ahmedabad (Rural) allowed
the said application and issued Non-Bailable Warrant
against the petitioners and others. The petitioners,
therefore, preferred present petition.
10. At this juncture, I would like to refer to the
judgment and order dated 23.07.2015 passed by the
Coordinate Bench of this Court in Special Criminal
Application (Quashing) No.4441 of 2015, wherein, in
para 9 to 16, the Coordinate Bench of this Court
observed and held as under:
"9. This Court would like to make it clear at the
very outset that it would confine itself to the
issue before it, which is the legality, or
otherwise, of the order of the Designated Court
issuing non-bailable warrant against the
petitioner. Though reference has been made by the
learned Central Government Standing Counsel on
the merits of the matter under PML Act, this
Court does not consider it appropriate to delve
into those aspects as it is for the Designated
Court to decide.
10. Insofar as the issuance of the non-bailable
warrant against the petitioner is concerned, the
position of law is by now well-settled by the
Supreme Court in Inder Mohan Goswami And Another
Vs. State of Uttaranchal And Others (supra),
Vikas Vs. State of Rajasthan (supra) and
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Raghuvansh Dewanchand Bhasin Vs. State of
Maharashtra And Another (supra).
11. To put it very succinctly, the very purpose
of the issuance of a non-bailable warrant is to
ensure the presence of that person before a Court
of law in a situation where summons or bailable
warrants have failed to procure such presence.
This necessarily means that, in the first
instance, it is incumbent upon the Court to issue
summons or bailable warrants and only when the
above two remedies have failed to procure the
presence of the person, or such presence is
unlikely to be procured by the first two means,
would the Court resort to the issuance of a non-
bailable warrant.
12. As has been stated by the Supreme Court in
Vikas Vs. State of Rajasthan (supra) in a
complaint case (such as the present one) at the
first instance, the Court should prefer issuing
summons or bailable warrants, failing which a
non-bailable warrant should be issued.
13. In Raghuvansh Dewanchand Bhasin vs. State of
Maharashtra And Another (supra), the Supreme
Court has held that since the execution of a non-
bailable warrant directly involves the
curtailment of liberty of a person, a warrant of
arrest ought not issued in mechanical a but only
manner, to be after recording satisfaction in the
facts and circumstances of the case, that it is
so warranted.
14. Testing the impugned passed by order the
Designated Court on the touchstone of the
principles of law enunciated by the Supreme Court
in the above judgments, it is clear that it fails
on all counts. The Designated Court has not
resorted to the issuance of summons in the first
instance or to the issuance of a bailable
warrant, but has straightaway issued a non-
bailable warrant on the mere asking of respondent
No.1. Further, no reasons have been assigned for
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the issuance of a non-bailable warrant
straightaway. The impugned order is merely a
three-word cryptic order, which does not even
form a proper sentence, leave alone convey any
reasons, or record satisfaction, as to why the
Designated Court thought it fit to deviate from
the settled principles of law propounded by the
Supreme Court, and issue a non-bailable warrant
in the first instance.
15. Whatever be the seriousness of the
allegations against the petitioner, the
Designated Court is bound follow the proper
procedure and the judicial guidelines formulated
by the Supreme Court while issuing a warrant of
arrest, the purpose of which is to procure the
presence of the petitioner. The Court should not
allow itself to get swayed by allegations and
react instantly, by issuing a non-bailable
warrant, without applying its mind to the factual
and legal situation and balancing curtailment of
the liberty of the a aspect of the person and the
requirements of law. The issuance of a warrant of
arrest entails serious consequences, therefore,
the Court has to adopt a pragmatic and judicious
approach, weighing factors such as past conduct
of the petitioner along with the seriousness of
the offence. The seriousness of the allegations
alone do not give leave or licence to the Court
to deviate from the said principles of law. If,
such as in the present case, the petitioner has
appeared before respondent No.1 on four occasions
after the passing of the order by the Supreme
Court and is willing to co-operate in future, the
issuance of a non-bailable warrant in the first
instance does not appear to be justified.
16. This Court is, therefore, of the considered
view that the impugned order of the Designated
issuing the non-bailable warrant against Court
the petitioner is unsustainable in law and cannot
be permitted to stand."
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11. If the facts of the present case are considered
in the context of the aforesaid observations made by
the Coordinate Bench of this Court, in that event, it
is found out from the record that it is admitted
position of fact that before issuing non-bailable
warrant against the petitioners, the learned
Designated Court has not followed the proper
procedure and the judicial guidelines formulated by
the Hon'ble Apex Court while issuing a warrant of
arrest against the petitioners. Learned advocate Mr.
Modh has fairly submitted that the non-bailable
warrant issued against the petitioner may be
converted into bailable warrant.
12. In the result, the petitions are partly allowed.
Accordingly, impugned order dated 30.05.2015 passed
by the learned Sessions Judge & Designated Special
Judge, Ahmedabad (Rural) in Criminal Miscellaneous
Application in ECIR/03/AMZO/2015, is hereby
modified, whereby, the non-bailable warrant issued
against the petitioners is converted into bailable
warrant qua the petitioners only. The petitioners
shall make themselves available before the Designated
Court on 02.05.24. The petitioners shall furnish
surety to the satisfaction of the Designated Court
and shall appear before the said Court and respondent
authority, as and when summoned.
(DIVYESH A. JOSHI,J)
LAVKUMAR J JANI
