Himachal Pradesh High Court
Reserved On : 16.09.2024 vs Directorate Of Enforcement Office (Ed) on 8 November, 2024
Author: Virender Singh
Bench: Virender Singh
1 2024:HHC:10972
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
CrMP(M) No. : 1868 of 2024
Reserved on : 16.09.2024
Decided on : 08.11.2024
Krishan Kumar ...Applicant
Versus
Directorate of Enforcement Office (ED) ...Respondent
Coram
The Hon'ble Mr. Justice Virender Singh, Judge.
Whether approved for reporting?1
For the applicant : Mr. Manoj Pathak and Mr. Harsh
Shroal, Advocates.
For the respondent : Mr. Balram Sharma, Deputy
Solicitor General of India, with Mr.
Ajeet Singh Saklani, standing
counsel, assisted by Mr. Sunil
Kumar, Enforcement Officer and Mr.
Mayank Kumar, Assistant
Enforcement Officer.
Virender Singh, Judge.
By way of the present application, filed, under
Section 483 of the Bharatiya Nagarik Suraksha Sanhita,
2023 (hereinafter referred to as the 'BNSS'), a prayer has
Whether Reporters of local papers may be allowed to see the judgment? Yes.
2 2024:HHC:10972
been made to release applicant-Krishan Kumar, on bail, in
case No. ECIR/SHSZO/04/2019, dated 22.07.2019,
registered with registered with Directorate of Enforcement,
Sub-Zonal Office, District Shimla, Himachal Pradesh,
registered under Section 4 of the Prevention of Money
Laundering Act, 2002 (hereinafter called as the 'PMLA').
2. According to the applicant, he is an innocent
person and not having any connection with the alleged
allegations. The allegations against the applicant are
stated to be false and he has nothing to do with the said
allegations.
3. It is the case of the applicant that the evidence
collected against him is too fragile to support the case of
the Directorate of Enforcement.
4. As per the applicant, he has been arrested on
the basis of convenient presumption, on the part of the
Enforcement Directorate and such presumption cannot be
the basis for keeping the applicant in custody.
5. The applicant is stated to be in judicial custody
for almost about two years. The property, lockers, etc. of
the applicant is stated to have been attached by the ED
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and nothing has to be recovered from him. According to
the applicant, there are no chances of his absconding, in
the event of bail, being granted to him.
6. Apart from this, the applicant has given certain
undertakings, for which, he is ready to abide by, in case,
he is ordered to be released on bail.
7. Earlier, the applicant had filed CrMP (M) No. 48
of 2024 for grant of regular bail, before this Court,
however, the same was dismissed, by this Court, vide order
dated 31.05.2024.
8. On the basis of above facts, a prayer has been
made to allow the present application.
9. When put to notice, the status report/reply, on
behalf of ED, has been filed, mentioning therein that the
applicant has been arrested, under Section 19 of the
PMLA, as per the procedure, established, under law.
10. In the status report, filed by the respondent, the
grounds, upon which, the case has been registered, have
been reiterated by pleading that:
10.1. The matter revolves around a scam, involving
the allocation of scholarships to SC, ST and OBC students,
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under the Post Matric Scheme. In this fraudulent activity,
officials from the Department of Higher Education,
alongwith private Educational Institutions and Banks,
were involved, which has resulted into misappropriation of
scholarship funds of more than ₹ 200 crore.
10.2. The applicant, according to the stand, taken by
ED, along with others, has played a major role in the scam,
wrongfully withholding the rightful scholarship entitlement
of the scholarships of the students, belonging to SC, ST
and OBC students of Himachal Pradesh. According to ED,
they have diverted the said funds into their pockets/
accounts. 22 institutions are stated to be involved. In this
regard, ED has relied upon the charge sheet submitted by
CBI. The investigation is stated to be going on to unearth
the illicit money and ascertain the proceeds of crime (PoC),
obtained by way of this scam.
10.3. After recording the reasons to believe in writing,
the applicant and his co-accused were arrested by ED on
30th August, 2023, under Section 19 of PMLA, in the said
ECIR. Thereafter, they were produced before the Special
Designated Court (PMLA), Shimla, on 31 st August, 2023,
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and the learned Special Court, after perusal of all the
documents, including the arrest memo, grounds of arrest,
reasons to believe and material for formation of such belief,
has granted five days' ED custody, with a direction, to
produce the accused persons before the Special Court on
4th September, 2023, on which date, they were produced
before the Special Court and were remanded to judicial
custody.
10.4. It is the further case of the ED that
investigation is on-going and is at crucial stage, which
requires gathering of additional evidence, examination of
voluminous records and recording of statements of several
persons associated with the applicant and other accused
persons related to the case.
10.5. The prayer, so made by the applicant, has
further been opposed, on the ground that the offences,
under the PMLA, are different offences, as such, constitute
class apart and need to be dealt with different approach, in
the matter of bail.
10.6. According to the ED, the offence, under
investigation, requires detailed investigation to unearth the
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material and in such circumstances, if bail is granted, it
would defeat the case of the prosecution. The twin
conditions, as per Section 45 of the PMLA, are also stated
to be not satisfied, in this case.
10.7. Elaborating their stand, it is the case of the ED
that CBI registered Fir No.RC0962019S0002, dated 7 th
May, 2019, under Sections 409, 419, 465, 466 and 471
IPC, against the unknown persons. As per the allegations
of the said case, there were complicity of individuals from
State Government Education Department, Bank Officials
and private institutions. Misappropriation in the
disbursement of scholarship funds, in large scale, has also
been alleged. The offences, under Sections 419 and 471
IPC, are also stated to be scheduled offences, mentioned in
the schedule, appended to PMLA and as such, inquiry was
initiated by ED and the present case, being
ECIR/SHSZO/04/2019, dated 22nd July, 2019, was
registered.
10.8. As per the stand of ED, the applicant, along
with co-accused Rajdeep Singh and Arvind Rajta, through
his wife-Babita Rajta, formed three shell entities, namely,
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M/s ASA Marketing Solutions (in the year 2015, its name
was changed to ASAMS Education Group); (ii) M/s Skill
Development Society; and (iii) M/s Skill Development
School.
10.9. These shell companies opened office-cum-study
centres at various locations, in Himachal Pradesh, namely,
Nurpur, Nahan, Fatehpur, Una, Kangra, Rohru and
Rampur and centres were opened by the name and style of
(i) ASAMS Education Group; (ii) SDS Education Group;
(iii) Skill Development Society; and (iv) NIELIT Center.
Through these study centres, the candidates, belonging to
SC/ST/OBC categories, were allured of free education in
post matric diploma and degree courses, through open and
distance learning mode. They had collected the documents
of the desirous candidates and their signatures were got
appended on the application form, bank forms and bank
authorization letters. Thereafter, on the basis of documents
collected ans signed by the students, bank accounts in the
name of students were opened with the same Bank at
Panchkula, Chandigarh and Solan, with which, bank
accounts in the name of shell entities were already opened
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and also, the minimum amount required for opening such
bank accounts of students was transferred from the bank
account of shell entities.
10.10. Thereafter, as per the stand of the ED, the
documents of the students were uploaded on HP-ePass
software at Mohali office and while uploading the data on
HP-ePass, details of bank accounts opened in the name of
students at Panchkula, Chandigarh and Solan were
mentioned. Also, one out of six to seven mobile numbers
are stated to have been mentioned against the names of
the students on HP-ePass.
10.11. It is the further case of the ED that the
applicant prepared fee structure of his own, for the
students, eligible under PMS Scheme, wherein, the fees of
distance learning courses were much higher than the fees
prescribed by the individual University, i.e. Lovely
Professional University and Karnataka State Open
University. Such fee structure was unrecognized and not
approved by any statutory authority. According to the ED,
even, such fees were not charged from the students, but,
was claimed from Department of Higher Education,
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Shimla. The claims, under the PMS Scheme, for
SC/ST/OBC students were made before the Directorate of
Higher Education, Shimla on the basis of false and forged
affiliation letters of Lovely Professional University and
Karnataka State Open University, by showing the students
enrolled in distance learning programmes of these
universities.
10.12. As per the further stand of the ED, false and
bogus claims of students were made under Post Matric
Scheme for the students who were not enrolled and
registered with any university and were studying in
courses of University, other than Lovely Professional
University and Karnataka State Open University. In order
to fraudulently grab more and more amount of
scholarship, claims are made by changing the course
category and center of the students in subsequent years.
10.13. It is the further case of the ED that in the
academic year 2015-16, the applicant claimed scholarship
under Post Matric Scholarship scheme of students by
falsely showing them enrolled in distance learning courses
of Karnataka State Open University, which was de-
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recognized by University Grants Commission, in the year
2015.
10.14. It is their further case that in the year 2016-17,
the name of the study centers was changed to NIELIT so as
to resemble the same with the name of National Institute of
Electronics and Information Technology, which is an
autonomous society under the administrative control of
Ministry of Electronics and Information Technology,
Government of India. Further claims are stated to have
been made through the centers, by the name of NIELIT, for
students, who were not enrolled in any courses offered by
NIELIT, Delhi and scholarship in their name was received.
10.15. It is the further allegation of the ED that the
applicant, with co-accused, namely Arvind Rajta through
his wife Babita Rajta, obtained proceeds of crime worth
Rs.28,09,00,055/-, as a result of criminal activity of
cheating and making false claims of students on the basis
of forged affiliation and fee structure letters and also by
receiving scholarship of students not registered with
NIELIT, New Delhi, under Post Matric Scholarship Scheme.
11 2024:HHC:10972
10.16. The bail application has also been opposed, on
the ground, that the twin conditions, as per Section 45 of
the PMLA, have not been fulfilled, in this case.
10.17. Apart from this, it has been apprehended that
the applicant may influence the witnesses, who, are his
ex-employees and also hamper the investigation to trace
remaining leads of crime.
11. On the basis of above facts, a prayer has been
made to dismiss the application.
12. First of all, coming to the arguments of the
learned counsel, appearing for the applicant, that non-
supply of the copy of the 'reasons to believe' is violative of
Section 19 of the PMLA Act, admittedly, the applicant has
not challenged his arrest. When, the applicant himself has
not challenged his arrest, there is no need for this Court to
adjudicate upon this issue.
13. The applicant has earlier also sought the
similar relief, by filing CrMP (M) No. 48 of 2024, which was
dismissed, by this Court, vide order, dated 31 st May, 2024,
whereby, this Court has specifically held that it cannot be
said that the mandatory provisions of Section 19 of the
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PMLA have not been complied with, by the ED, in this
case.
14. So far as the plea of the applicant, regarding
delay in trial, is concerned, at this stage, it cannot be said
that there is any delay in trial. As such, the applicant
cannot take benefit of the decisions of the Hon'ble Supreme
Court, in SLP (Crl.) No. 3205 of 2024, titled as Ramkripal
Meena vs. Directorate of Enforcement; SLP (Crl) No. 11644-
11645 of 2023, titled as Benoy Babu vs. Directorate of
Enforcement; Raman Bhuraria vs. Directorate of
Enforcement, reported in 2023 SCC OnLine Del 657;
Criminal Appeal arising out of SLP (Crl) No. 8167 of 2023,
titled as Manish Sisodia vs. CBI; Criminal Appeal arising out
of SLP (Crl) No. 8781 of 2024, titled as Manish Sisodia vs.
Directorate of Enforcement; SLP (Crl) No. 5416 of 2024, titled
as Prem Prakash vs. UOI through the Directorate of
Enforcement; Criminal Appeal No. 2493 of 2024, titled as
Arvind Kejriwal vs. Directorate of Enforcement. In those
cases, the Hon'ble Supreme Court has accepted the prayer
for bail, on the basis of the peculiar facts and
circumstances of the said cases.
13 2024:HHC:10972
15. The co-accused of the applicant, namely Hitesh
Gandhi, in CrMP (M) No. 1746 of 2024, has also placed on
record the zimni orders, passed by the learned Special
Judge, Shimla, according to which, the charges have not
been framed. However, it cannot be said that there is
inordinate delay, as, before, putting the charge, the Special
Judge is duty bound to comply with the mandatory
provisions of BNSS. Perusal of order, dated 22 nd July,
2024, passed by the learned Special Judge, Shimla, shows
that the case was adjourned for checking of copies.
16. Considering all these facts, it cannot be said
that the twin conditions, as enumerated in Section 45 of
the PMLA, are existing in favour of the applicant, at this
stage.
17. In view of the above discussion, in the
considered opinion of this Court, the applicant is not able
to make out a case for grant of bail, at this stage.
Consequently, the bail application is dismissed.
18. Any of the observations, made hereinabove,
shall not be taken as an expression of opinion, on the
merits of the case, as, these observations, are confined,
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only, to the disposal of the present bail application.
( Virender Singh )
Judge
November 08 , 2024
( rajni )
