Jharkhand High Court
Dilip Kumar Ghosh @ Dilip Ghosh vs Union Of India Through Directorate Of ... on 28 November, 2023
Author: Deepak Roshan
Bench: Deepak Roshan
1
IN THE HIGH COURT OF JHARKHAND AT RANCHI
B.A. No. 7233 of 2023
Dilip Kumar Ghosh @ Dilip Ghosh ..... Petitioner(s)
Versus
Union of India through Directorate of Enforcement
..... Opposite Party(s)
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CORAM: HON'BLE MR. JUSTICE DEEPAK ROSHAN
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For the Petitioner(s) : Mr. S.Nagamuthu, Sr. Advocate
Mr. Suraj Prakash, Adv.
Mr. Rohit Ranjan Sinha, Adv.
Mr. Abhishek Agrawal, Adv.
Ms. Amrita Sinha, Adv.
Mr. Aashish Kumar, Adv.
For the UOI : Mr. Anil Kumar, ASGI
Ms. Chandana Kumari, AC to ASGI
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C.A.V. On 09.11.2023 Delivered on 28/11/2023.
Heard learned counsel for the parties.
2. The instant bail application has been preferred by the
petitioner for grant of regular bail for the offences registered
under Sections 3 read with Section 70 and punishable under
section 4 of the Prevention of Money Laundering Act, 2002
(herein after to be referred as PMLA).
3. Learned senior counsel for the petitioner submits that
Section 19 of the PMLA consists of two parts. While the first
part speaks of reason to believe to be recorded in writing; the
second part mandates that grounds of arrest of the accused
have to be informed to the accused.
As per the recent judgment passed by the Hon'ble Apex
Court in the case of Pankaj Bansal Vs. Union of India r
reported in 2023 SCC online SC 1244, such grounds of
arrest have to be furnished to the accused in writing against
acknowledgment. He further submits that the expression
"henceforth" employed in paragraph 35 of the aforesaid
judgment does not mean that the judgment is prospective in
nature. In this regard he referred another judgment delivered
by the Division Bench of Punjab & Haryana High Court in the
case of Roop Bansal Vs. Union of India (CWP 23005 of
2023).
He contended that non-compliance of the mandate of
Section 19 PMLA would vitiate the very arrest itself. On
this issue he further relied the order passed in the case of
V. Senthil Balaji Vs. State rep. by Deputy Director
reported in 2023 SCC onLine SC 934 and reiterated that
non-compliance of the mandate of Section 19 of the PMLA
Act would vitiate the very arrest itself.
4. Learned senior counsel further draws attention of
this court towards Section 45 of PMLA and submits that
Section 45(1)(ii) stipulates that where the public
prosecutor opposes the application, then if the court is
satisfied that there are reasonable grounds for believing
that the accused is not guilty of such offence and that he
is not likely to commit any offence while on bail and only
in that case the bail should be granted. Referring the
aforesaid provision, he submits that the aforesaid
provision of Section 45 (1)(ii) of PMLA has been clarified
in the case of Vijay Madanlal Choudhary & Ors versus
Union of India, reported in 2022 SCC online SC 929,
inasmuch as, no meticulous examination is required and
only prima facie satisfaction that the accused is not guilty
is to be invoked by the Court and in the instant case
while going through the facts of the case it would
transpire that the petitioner has satisfied both the
conditions engrafted in section 45 (1)(ii) of the PMLA.
5. On merits of the case, learned sr. counsel submits
that there is no document/material on record to implicate
the petitioner in forging and/or manipulating the title
deeds being Deed of Sale No. 4369 dated 11.10.1932 of
the property in question in the office of the Registrar of
Assurances at Kolkata. Nor is there any allegation that
the petitioner was party to the manipulation which took
place in the office of the Registrar of Assurances, Kolkata.
He further submits that the petitioner is not
figuring as an accused in the F.I.R No. 137/2023 dated
10.05.2023 under Sections 120B, 465, 467, 468 and 471
IPC which was registered at Hare Street Police Station,
Kolkata on the report of the fact-finding committee of the
Registrar of Assurances, Kolkata in connection with
forgery of Deed of Sale No. 4369 dated 11.10.1932. There
is no allegation that the petitioner was involved in
obtaining certified copy of the title deeds being Deed of
Sale No. 4369 dated 11.10.1932 from the office of the
Registrar of Assurances, Kolkata.
There is also no material on record to show that the
petitioner was involved in obtaining holding numbers by
accused Pradeep Bagchi by submitting forged Aadhaar
Card, forged electricity bill and forged possession letter to
the office of the Ranchi Municipal Corporation. For such
acts committed by Pradeep Bagchi, one F.I.R. No.
141/2022 dated 04.06.2022 has been registered by the
Police of Bariatu Police Station, Ranchi under Sections
420, 467, 471 IPC against Mr. Pradeep Bagchi (which are
scheduled offences under the PMLA). It is pertinent to
mention here that the petitioner is not named as an
accused/suspect in the said FIR.
As a matter of fact, after obtaining holding number
in respect of the property in question, the said property
was offered to M/s. Jagatbandhu Tea Estate Pvt. Ltd., of
which the petitioner is a Director, and upon obtaining
legal opinion with regard to due-diligence of the title
documents of the said property, the said company
purchased the said property for an agreed amount of
Rs.7.00 crore. The price of the said property was
negotiated for Rs.7.00 crore as against the prevailing
value of over Rs.20.00 crore since there was ongoing
litigation with regard to the said property with the Indian
Army.
Learned counsel strenuously contended that there
is no mens rea on part of the petitioner while executing
the sale-deed on behalf of M/s. Jagatbandhu Tea Estate
Pvt. Ltd. being purchaser of the said property since
neither the petitioner nor M/s. Jagatbandhu Tea Estate
Pvt. Ltd. had any knowledge that the said Pradeep Bagchi
was not the owner of the property and was claiming his
ownership on the basis of forged documents.
He further submitted that three cheques of Rs.
7.00 crore were issued by the company named M/s.
Jagatbandhu Tea Estate Pvt. Ltd. in favour of accused
Pradeep Bagchi, out of which one cheque of Rs.25.00
lakh was encashed and as per the mutual understanding
the remaining amount was payable upon handing over
the physical possession of the property in question.
The fact remains that three legal notices were
issued to the M/s. Jagatbandhu Tea Estate Pvt. Ltd. of
which this petitioner is a director for payment of balance
amount of Rs.6.75 crore but the same was duly replied
by the company that unless and until the physical
possession will not be handed over to the purchaser-
Company; the remaining part will not be paid. As a
matter of fact, the petitioner and the company are the
victim of this crime. The company M/s. Jagatbandhu Tea
Estate also lodged complaints dated 10/11.05.2023 &
05.06.2023 against Pradeep Bagchi for cheating.
6. Learned Sr. counsel for the petitioner categorically
submitted that the amount of Rs.25.00 lakh paid by M/s.
Jagatbandhu Tea Estate Pvt. Ltd. to Mr. Pradeep Bagchi
was not secured by committing any offence but the same
was paid out of sale of tea leaves from the tea garden of
M/s. Jagatbandhu Tea Estate Pvt. Ltd. and the account
of the company was duly audited and in absence of any
proceeds of crime, there cannot be any allegation of
laundering thereof. He further submitted that the
financial dealings between M/s. Jagatbandhu Tea Estate
Pvt. Ltd. and M/s. Rajesh Auto Merchandise Pvt. Ltd. are
in the nature of borrowing/lending which has also been
admitted in the statements recorded under Section 50 of
the PMLA.
Further, all such amounts borrowed/ lent/
expenditure made are duly recorded in the books of
accounts of M/s. Jagatbandhu Tea Estate Pvt. Ltd. He
lastly submits that for no offence, the petitioner is lying
in custody since 07.06.2023 and the prosecution
complaint has already been filed by the respondent
Enforcement Directorate and since there are 31
charge-sheeted witnesses cited by the
Enforcement Directorate; certainly the trial would
not be completed in a short time and since the
petitioner is a reputed businessman and resides
with his family at Kolkata, so there is no chance
for absconding or tampering with the evidence and
he also undertakes to abide by all the terms and
conditions that may be imposed by this court
while granting bail to this petitioner. Relying upon
the aforesaid submission learned Sr. counsel
prays that the privilege of bail may be granted to
this petitioner.
7. Mr. Anil Kumar, learned ASGI vehemently
opposed the prayer for bail and submits that the
cases cited by learned Sr. counsel for the
petitioner will not be applicable in the instant
case, inasmuch as, in the case of Pankaj Bansal
(Supra) at para-35, it has been directed by the
Hon'ble Apex Court that henceforth, copy of such
written grounds of arrest should be furnished as a
matter of course and without fail. As such, the
very word "Henceforth" & "Wit hout Fail" indicates
that the judgment passed by the Hon'ble Apex
Court is prospective in nature.
In support of his contention, he also relied
upon the dictionary meaning of "Henceforth" and
submits that this is a word of futurity.
He further submits that Section 45 of PMLA
starts with non-obstante clause which starts with
the word notwithstanding anything contained in
the Code of Criminal Procedure, no person
accused of an offence under this Act shall be
released on bail or on his own bond unless the
court is satisfied that there are reasonable
grounds for believing that he is not guilty of such
offence and the entire complaint case indicates
that the petitioner was involved in the entire
conspiracy and as such there is every likelihood
that he will be declared guilty for the offence for
which he has been charged.
On merits of the case he relied upon the
complaint itself and reiterated that the petitioner
is involved in the entire conspiracy, as such the
bail of the petitioner should be rejected an d the
judgment passed by the Hon'ble Apex Court in the
case of Pankaj Bansal (supra) shall not be taken
into consideration by this court because in the
case of Pankaj Bansal (supra) even the facts were
entirely different and the Hon'ble Apex Court has
observed that there was colorable exercise of
power and in that background the Enforcement
Directorate was directed to serve the copy of the
grounds of arrest henceforth and without fail to
every accused.
8. Having heard learned counsel for the parties
and after going through the various documents
available on record, it appears that a Prosecution
complaint was lodged against this petitioner by
the Enforcement Directorate. For brevity relevant
part of the prosecution complaint filed by the
Enforcement Directorate before the learned
Special Court is quoted herein below:
"Complaint filed under section 45 read with Section 44 of Act (PMLA), 2002
for commission of offence of Money Laundering as defined under Prevention of
Money Laundering Section 3 and punishable under section 4 of PMLA, 2002
read with section 70 of PMLA 2002 .
.........................
3. BRIEF FACTS OF THE OFFENCE/ ALLEGATION/ CHARGE/
AMOUNT INVOLVED UNDER PMLA
3.1 An FIR bearing no. 141 of 2022 dated 04.06.2022 was registered by the
Bariatu Police Station, Ranchi under Section 420, 467 and 471 of IPC
against one Pradeep Bagchi, Resident of ward no. 21, Lotus Garden
Complex Block B, PS Bariatu, Dist. Ranchi based on a complaint of Shri
Dilip Sharma, Tax Collector, Ranchi Municipal Corporation (RUD No. 2).
The complainant stated that Pradip Bagchi obtained two holding numbers
0210004194000A1 and 0210004031000A5 by way of submitting forged
papers i.e., Aadhaar Card, Electricity Bill and Possession Letter of one
Flat no. 101, Block B, Lotus Garden Complex, Bariatu Road, Morhabadi,
Ranchi. The documents submitted by Pradip Bagchi and addresses
declared by him were verified and was found that they were fake. Pradip
Bagchi did not reside in the above address and he submitted forged and
fictitious documents to obtain the holding numbers.
3.2 Since offences under sections 420, 467 and 471 of IPC are scheduled
offences under Part A of Schedule of PMLA, 2002, an ECIR bearing No.
RNZO/18/2022 was therefore recorded on 21.10.2022 (RUD No. 1). and an
investigation under the provisions of the Prevention of Money Laundering
Act (PMLA) was initiated.
3.3 Investigation revealed that the above-stated two holding Nos.
0210004194000A1 and 0210004031000A were obtained for property -
plot no. MS 557, Morabadi Mouza, ward no. 21/19, having an area of
455.00 decimals at Ranchi. It also revealed that the above-stated property
was later Sold by the said Pradeep Bagchi (Aadhaar no. 511337882315,
PAN (AMBPB1317J) to one company M/s Jagatbandhu Tea Estate Pvt.
Ltd (PAN AABCJ3705F, represented by its Director Dilip Kumar Ghosh
having Aadhaar no. 912605787465) and it is registered at the office of
the SRO Ranchi, bearing deed No 6888, Vol No 919, Page No 525-576,
year 2021. From the sale deed of this property registered on 01.10.2021
(RUD No. 7)., it is seen that the declared government value/Market value
of the said property is Rs 20,75,84,200/whereas the said property has
been sold for an amount of Rs 7,00,00,000 /which is highly undervalued
as compared to the declared government rate.
3.4 The sale deed bearing no. 6888 of 2021 between the said Pradip
Bagchi and M/s Jagatbandhu Tea Estate Pvt. Ltd, in respect of the above
property was executed on 1st October, 2021 (RUD No. 7). The government
value/Market Value of the said property in the sale deed is shown as Rs.
20,75,84,200/but the consideration amount of the property has been
shown as Rs. 7 crores which are shown to be paid by 11 cheques of IDFC
First Bank, account No 10060532973 of M/s Jagatbandhu Tea Estate
Pvt. Ltd. Investigation has further revealed that only one part payment
amounting to Rs 25,00,000/was made into State bank of India account
number 10301956970 of Pradip Bagchi through IDFC First Bank,
Cheque No 461153 and rest of the money was falsely shown to be paid in
the deed no. 6888 of 2021 through other cheques. Although no further
payments were done, the purchasers and sellers have mentioned on page
04 of the sale deed that -
Thus, it is evident that the declaration of payment of the full
amount of Rs 7 (seven) crores by the purchaser and its receipt by the
seller is deliberate, thoughtful and planned to give a legitimate
appearance to the bogus transactions recorded in the sale deed for
acquiring the above said property.
3.5 Investigation conducted into this case has also revealed that the above
stated property situated at MS 557, Morabadi Mouza, ward no. 21/19,
having an area of 455.00 decimals at Ranchi has been under the
possession and occupation of Defence before independence. As per the
documents provided by the defence, it is revealed that defence had been
paying a monthly rent to one Jayant Karnad, a purported
descendant/claimant of B.M Lakshman Rao and his son B.M Mukund Rao.
The documents and records collected states that B.M Lakshman Rao died
in the year 1946 and B.M. Mukund Rao passed away in the year 1998.
Jayant Karnad started receiving rent from the defence as a claimant of the
property after B.M Mukund Rao in the year 2008. In the year 2019, Jayant
Karnad further sold this property to the following 14 persons by way of 16
deeds at a very negligible amount. Initially Jayant Karnad frivolously
managed to get the rent from the defence without any valid succession
certificate and later in the year 2009 succeeded to get the land released in
his favour from the defence. Investigation reveals that all documents which
helped Jayant Karnad to get land from defence and favourable orders from
High Court were arranged and provided by an advocate. Jyant Karnad
first time received the rent from the army, in the year 2008 amounting to
Rs. 417 in his HUF Account 450110110002549 maintained in Bank of
India. After this, he received Rs. 50,640/as an arrear of due rent from 1998
to 2008 in account number 4501101000299692204. He has been receiving
rent from Defence Estate Office, till 28th December, 2021 in HUF account
bearing no 450110110002549 held in Bank of India. Jayant Karnad finally
sold the land to 14 different persons for a total sum of Rs. 2.55 crores
which was received in his Bank of India account bearing no.
450110110002549 (RUD No. 11 & 12).
3.6 As stated above that there were ongoing litigations regarding the
possession of this property between Army and the purported claimant
Jayant Karnad who had sold the land to 14 persons by way of 16 deeds
(RUD No. 115 to KON 130) on strength of the order obtained from the
High Court of Jharkhand by concealing and manipulating facts. The
accused persons namely Afshar Ali Pradip Bagchi and his accomplices
meanwhile prepared a fake deed from the office of the Registrar of
Assurances, Kolkata. In the name of Prafulla aa Bagchi F/o Pradip
Bagchi (RUD No. 108 & 113). It was projected that his father Prafulla
Bagchi had given the land orally to the Army and as on day Pradeep
Bagchi is the purported rightful claimant of the property. These persons
contacted Prem Prakash for selling this land (Accused in illegal mining
case and presently in judicial custody). Prem Prakash Is a power broker
and a very influential person who was access to highly placed government
officials and ministers in Jharkhand. Prem Prakash is also very close to
Mr. Chhavi Ranjan, the Ex-D.C Ranchi and Amit Kumar Agarwal who is
also a very influential person in Jharkhand. In connivence with Prem
Prakash and Amit Kumar Agarwal, Mr. Chavi Ranjan influenced the
officials of Circle office and District Sub Registrar, Ranchi and managed to
procure & favourable report (RUD No. 27) for Pradeep Bagchi and the
property was subsequently acquired in a dishonest manner by Jagatbandhu
Tea Estates Pvt. Ltd. Both persons namely Amit Kumar Agarwal and Prem
Prakash weré aware that the owner Pradip Bagchi was a fake person and
the deed was false which is evident from the fact that they acquired
property worth several crores of rupees by paying only Rs 25 lakhs (which
was, in fact, a commission). Instead, Amit Kumar Agarwal, the beneficial
owner of M/s Jagatbandhu Tea Estate Pvt. Ltd. knowingly acquired the
abovesaid property in the name of Jagatbandhu Tea Estate Pvt. Ltd. Mr.
Chhavi Ranjan, then DC of Ranchi assisted these persons to acquire the
above property by misusing his official position and overlooking the
records available in his office/subordinate offices. Mr. Chhavi Ranjan had
knowledge that the abovesaid property is disputed as one dispute between
Defence and Jayant Karnad was aiso pending before his disposal i.e. in the
court of the District Magistrate, Ranchi which he used to preside during
his tenure. Yet on receipt of the application of Pradeep Bagchi, who falsely
claimed himself to be the rightful owner of the property, the then Deputy
Commissioner, Mr. Chhavi Ranjan assisted Prem Prakash, Amit Kumar
Agarwal, Afsar Ali, Saddam Hussain and others verbally directed the
Circle officer to visit the office of Registrar of Assurances (Records),
Kolkata and verify the original deeds for ascertaining actual owner of the
property. Investigation has revealed that the original registers in the
records of Registrar of Assurances, Kolkata were already forged/tampered
with and falsified In favour of Pradeep Bagchi and the direction to visit
Kolkata to verify the records available with Registrar of Assurances was a
well-executed plan so that the property could be transferred to Amit Kumar
Agarwal through his company Jagat Bandhu Tea Estates Pvt. Ltd.
3.7 The amount involved i.e.; proceeds of crime acquired by the above
criminal activities can be summarized as follows :-................."
Emph asis Supplied
9. Having perused the prosecution complaint
quoted herein above now this Court will look into
the contention raised by learned Sr. counsel for
the petitioner which in substances are as follows:-
(i) Non-compliance of section 19 of PMLA by the
Enforcement Directorate;
(ii) The Petitioner has satisfied both the conditions of
section 45(1)(ii) of the PMLA.
(iii) The petitioner had no knowledge that the accused
Pradeep Bagchi committed forgery in order to
impersonate himself as owner of the property in
question.
(iv) It is the Company of which the petitioner is
Director was the victim of cheating for which they also
lodged complaint against Pradeep Bagchi;
(v) Even assuming the entire allegation made in the
complaint to be true, no case under section 3
punishable under section 4 PMLA is made out as the
allegations fall short for essential ingredients for offence
of money laundering under section 3 of PMLA Act.
10. So far as first contention of the petitioner is
concerned with regard to non-compliance of Section 19 of
PMLA by the Enforcement Directorate; it would be
profitable to quote Section 19 of the Act itself:-
"19. Power to arrest.--(1) If the Director, Deputy Director,
Assistant Director or any other officer authorised in this
behalf by the Central Government by general or special
order, has on the basis of material in his possession, reason
to believe (the reason for such belief to be recorded in
writing) that any person has been guilty of an offence
punishable under this Act, he may arrest such person and
shall, as soon as may be, inform him of the grounds for
such arrest.
(2) The Director, Deputy Director, Assistant Director or
any other officer shall, immediately after arrest of such
person under sub-section (1), forward a copy of the order
along with the material in his possession, referred to in that
sub-section, to the Adjudicating Authority, in a sealed
envelope, in the manner as may be prescribed and such
Adjudicating Authority shall keep such order and material
for such period, as may be prescribed.
(3) Every person arrested under sub-section (1) shall,
within twenty-four hours, be taken to a [Special Court or]
Judicial Magistrate or a Metropolitan Magistrate, as the case
may be, having jurisdiction:
Provided that the period of twenty-four hours shall
exclude the time necessary for the journey from the place of
arrest to the [Special Court or] Magistrate's Court."
Ongoing through the aforesaid provision, it appears that
sub-section (i) consists of two parts; while the first part
speaks with respect to reason to believe to be recorded in
writing and the second part mandates that the grounds of
arrest of the accused have to be informed to the accused. The
issue with regard to informing the accused has been
deliberated in detail in the case of Pankaj Bansal (Supra)
wherein at para 37 & 39 the Hon'ble Apex Court has held as
under:-
"37. The second reason as to why this would be the proper
course to adopt is the constitutional objective underlying such
information being given to the arrested person. Conveyance of
this information is not only to apprise the arrested
person of why he/she is being arrested but also to enable
such person to seek legal counsel and, thereafter, present
a case before the Court under Section 45 to seek release
on bail, if he/she so chooses. In this regard, the grounds of
arrest in V. Senthil Balaji (supra) are placed on record and we
find that the same run into as many as six pages. The grounds
of arrest recorded in the case on hand in relation
to Pankaj Bansal and Basant Bansal have not been produced
before this Court, but it was contended that they were produced
at the time of remand. However, as already noted earlier, this
did not serve the intended purpose. Further, in the event their
grounds of arrest were equally voluminous, it would be well-
nigh impossible for either Pankaj Bansal or Basant Bansal to
record and remember all that they had read or heard being read
out for future recall so as to avail legal remedies. More so, as a
person who has just been arrested would not be in a calm and
collected frame of mind and may be utterly incapable of
remembering the contents of the grounds of arrest read by or
read out to him/her. The very purpose of this constitutional
and statutory protection would be rendered nugatory by
permitting the authorities concerned to merely read out
or permit reading of the grounds of arrest, irrespective of
their length and detail, and claim due compliance with the
constitutional requirement under Article 22(1) and the statutory
mandate under Section 19(1) of the Act of 2002.
39. On the above analysis, to give true meaning and purpose to
the constitutional and the statutory mandate of Section 19(1) of
the Act of 2002 of informing the arrested person of the grounds
of arrest, we hold that it would be necessary, henceforth,
that a copy of such written grounds of arrest is furnished
to the arrested person as a matter of course and without
exception. The decisions of the Delhi High Court in Moin Akhtar
Qureshi (supra) and the Bombay High Court in Chhagan
Chandrakant Bhujbal (supra), which hold to the contrary, do not
lay down the correct law. In the case on hand, the admitted
position is that the ED's Investigating Officer merely read out or
permitted reading of the grounds of arrest of the appellants and
left it at that, which is also disputed by the appellants. As this
form of communication is not found to be adequate to fulfil
compliance with the mandate of Article 22(1) of
the Constitution and Section 19(1) of the Act of 2002, we have
no hesitation in holding that their arrest was not in keeping with
the provisions of Section 19(1) of the Act of 2002. Further, as
already noted supra, the clandestine conduct of the ED in
proceeding against the appellants, by recording the second
ECIR immediately after they secured interim protection in
relation to the first ECIR, does not commend acceptance as it
reeks of arbitrary exercise of power. In effect, the arrest of the
appellants and, in consequence, their remand to the custody of
the ED and, thereafter, to judicial custody, cannot be
sustained."
Emphasis Supplied
After perusing the aforesaid judgment, it is clear
that the Hon'ble Apex Court in unequivocal term has directed
that henceforth, copy of grounds of arrest is to be furnished
to the arrested person as a matter of course and without
exception.
11. Now coming to the contention of learned ASGI that
as to whether the said judgment is prospective in nature as
the word "Henceforth" is used by the Hon'ble Apex Court or
whether the direction of the Hon'ble Apex court is clarificatory
in nature. In this regard, learned Sr. counsel for the
petitioner has also relied upon the judgment passed in the
case of Roop Bansal (Supra) wherein Punjab & Haryana High
Court has clarified that since in the case of Pankaj Bansal
(supra) the petitioners were not supplied with the document
and petitioners of that case were granted relief then
admittedly, the case of Pankaj Bansal (supra) has to be read
as having retrospective effect. For brevity, para-28 of Roop
Bansal (supra) is quoted herein below:
"28. The argument of the respondents that since the grounds
of arrest would be required to be supplied henceforth, the
arrest in the present case would not be affected, is devoid of
merit. No doubt, the Hon'ble Apex Court held that the
grounds of arrest would "henceforth" be furnished in writing
to the accused but at the same time, it declared the arrest
and the consequential remand of Pankaj Bansal and Basant
Bansal to be illegal. Had the intention been to make the
condition only prospective, the Hon'ble Apex Court would not
have declared the arrest of Pankaj Bansal and Basant
Bansal to be illegal."
12. At this stage it is also pertinent to mention that the law
is no more res integra, inasmuch as, the normal rule is that
the judgment is always retrospective in nature unless it is
declared prospective and amended provision of law is always
prospective unless it is declared retrospective. By examining
the relevant paragraph of the Hon'ble Apex Court in the
judgment rendered in the case of Pankaj Bansal (Supra) it
appears that the word "Henceforth" has been used as a
direction for the future cases but it cannot be construed by
any imagination that the said judgment will not affect the
cases in which the arrest has been done without service of
grounds for arrest. The intention of the Hon'ble Apex Court
was not to condone the illegalities committed by the
Enforcement Directorate prior to passing of the judgment.
At this stage it is also profitable to observe that like
in any judgment there is a ratio, obiter and direction; by
perusing the said paragraph of the Judgment of Pankaj
Bansal (Supra) it is evident that ratio has been laid down by
the Hon'ble Apex Court that "no arrest can be made without
serving of copy of grounds of arrest to the accused" and the
direction is given to the ED that "henceforth the ED should not
commit that mistake and without fail in every case it must
serve the copy of grounds of arrest". Thus, this court is of the
considered view that the ratio laid down in the case of Pankaj
Bansal (supra) will be squarely applicable in the instant case
also. This Court also respectfully accepts the reasoning given
in the case of Roop Bansal (supra) passed by the Division
Bench of Punjab and Haryana High court which has been
referred to herein above.
13. Regarding compliance of Section 19(1) of the PMLA
w.r.t. serving of copy to the accused, learned ASGI has also
argued that the grounds of arrest were read over to the
accused and that the petitioner has also signed the same. In
this regard, once again it would be profitable to refer para-37
& 39 of the judgment of Pankaj Bansal (supra) wherein the
Hon'ble Apex Court has clarified this issue and also held as
under:- "............................The very purpose of this constitutional
and statutory protection would be rendered nugatory by permitting the
authorities concerned to merely read out or permit reading of the grounds
of arrest...............
..................... we hold that it would be necessary, henceforth, that a
copy of such written grounds of arrest is furnished to the arrested person
as a matter of course and without exception."
Having regard to the discussions made herein
above, on this score alone, i.e. non-compliance of section
19(1) of PMLA by the Enforcement Directorate, the petitioner
deserves to be enlarged on bail.
14. Now coming upon the merits of the case and the
other contentions of learned counsel for the rival parties; after
going through the prosecution complaint, relevant part of
which is quoted in the preceding paragraph; prima facie it
appears that the Enforcement Directorate have reason to
suspect but not reason to believe that the petitioner is an
accused of conspiracy in the instant case.
For example; one of the allegations is that the
property in question was of 20 Crore but the company
through the petitioner has negotiated and purchased it in
only 7 Crore. This allegation itself transpires that it is mere a
suspicion as it is well established principle that the market
value and the government value of any property cannot in
every case be equal. Another allegation is that only one part
of total payment amounting to Rs 25,00,000/- was made into
State Bank of India account number 10301956970 of Pradip
Bagchi through IDFC First Bank, Cheque No 461153 and rest
of the money was falsely shown to be paid in the deed no.
6888 of 2021 through other cheques. However, in the
complaint itself it is mentioned that no further payments
were done. This allegation is also more of suspicion; rather
than belief. Another allegation is that the property in question
was litigated land. Thus, this court is of the view that the
entire allegation as contained in the prosecution complaint is
more of reason to suspect; rather of reason to belief.
At this stage it is pertinent to mention that reason
to suspect and reason to believe are two different things and
one of the conditions in Section 19 speaks of reason to
believe. Reason to suspect is subordinate to reason to believe
and cannot be equated with reason to believe. The expression
reason to believe is made by two words i.e. reason and believe
the word reason means cause or justification and the word
believe means to accept as true or to have faith; thus, the
officer has to have faith or accept a fact to exist and further
there must be justification for such faith or acceptance.
The information received by the ED prima facie
appears to be allegation only which can raise suspicion in the
mind of the authorities based on the information an enquiry
can be triggered to find whether there is any material leading
to formation of reason to believe. It is well settled that
expression "reasons to believe" must be conditioned on the
existence of tangible material and that reasons must have a
live link with the formation of the belief. Reference in this
regard may be made to the case of Radha Krishan
Industries v. State of H.P.; reported in (2021) 6 SCC 771
wherein at para 52 it has been held by the Hon'ble Apex
Court as under:-
"52. We adopt the test of the existence of "tangible
material". In this context, reference may be made to the
decision of this Court in CIT v. Kelvinator of India
Ltd. [CIT v. Kelvinator of India Ltd., S.H. Kapadia, J. (as the
learned Chief Justice then was) while considering the
expression "reason to believe" in Section 147 of the Income
Tax Act, 1961 that income chargeable to tax has escaped
assessment inter alia by the omission or failure of the
assessee to disclose fully and truly all material facts
necessary for the assessment of that year, held that the
power to reopen an assessment must be conditioned on the
existence of "tangible material" and that "reasons must
have a live link with the formation of the belief". This
principle was followed subsequently in a two-Judge Bench
decision in CIT v. Techspan (India) (P) Ltd. While adverting
to these decisions we have noticed that Section 83 of
the HPGST Act uses the expression "opinion" as
distinguished from "reasons to believe". However for the
reasons that we have indicated earlier we are clearly of the
view that the formation of the opinion must be based on
tangible material which indicates a live link to the
necessity to order a provisional attachment to protect the
interest of the government revenue."
15. Applying the above principle to the facts of the
present case, the following would appear: -
(i) There is no document/material on record to
implicate the petitioner in forging and manipulating
the title deeds being Deed of Sale No. 4369 dated
11.10.1932 of the Property in question in the office of
the Registrar of Assurances at Kolkata. Nor is there
any allegation that the petitioner was party to the
manipulation which took place in the Office of the
Registrar of Assurances, Kolkata.
(ii) There is no allegation that the petitioner was
involved in obtaining certified copy of the title deeds
being Deed of Sale No. 4369 dated 11.10.1932 from
the Office of the Registrar of Assurances, Kolkata.
(iii) There is no material on record to show that
the petitioner was involved in obtaining holding
numbers by accused Pradeep Bagchi by submitting
forged Aadhaar Card, forged electricity bill and forged
possession letter to the Office of the Ranchi
Municipal Corporation. For such acts committed by
Pradeep Bagchi, F.I.R. No. 141/2022 dated
04.06.2022 has been registered by the Police of
Bariatu Police Station, Ranchi under Sections 420,
467, 471 IPC against Mr. Pradeep Bagchi (which are
scheduled offences under the PMLA. It is pertinent to
mention here that the petitioner is not named as an
accused/suspect in the said FIR.
It is trite that only the author who
manufactures a false document can be held guilty for
the offence of forgery. Reference in this context is
made to the case of Sheila Sebastain v.
R.Jawaharaj and Anr. Reported in [(2018) 7 SCC
581 (para 25)] wherein it was inter alia held that
making of a document is different than causing it to
be made and for constituting an offence under
section 464 IPC it is imperative that a false document
is made and the accused person is the maker of the
same.
(iv) The cheques for Rs.7.00 crore was issued by
M/s. Jagatbandhu Tea Estate Pvt. Ltd. in favour of
accused Pradeep Bagchi, out of which one cheque for
Rs.25.00 lakh was encashed by Pradeep Bagchi. As
per the mutual understanding the remaining amount
was payable upon Pradeep Bagchi handing over
possession of the said Property to M/s. Jagatbandhu
Tea Estate Pvt. Ltd. As per Section 54 of the Transfer
of Properties Act, the said transaction is valid.
(v) It is pertinent to mention here that M/s.
Jagatbandhu Tea Estate Pvt. Ltd. is not making any
claim over the said property and gave its no objection
to the Adjudicating Authority under the PMLA for
attachment of the property and the said property has
already been attached vide order-dated 08.11.2023
passed by the Adjudicating Authority.
(vi) There is no material on record to show, even
remotely, that any proceeds of crime have been
generated by the petitioner. The amount of Rs.25.00
lakh paid by M/s. Jagatbandhu Tea Estate Pvt. Ltd.
to Mr. Pradeep Bagchi was not secured by
committing any offence but the same was paid out of
sale of tea leaves from the tea garden of M/s.
Jagatbandhu Tea Estate Pvt. Ltd. and the account of
the company was duly audited.
16. Even otherwise, for any offence mensrea has to
exist unless the statute expressly excludes the same {Refer
People's Union for Civil Liberties v. Union of India;
(2004) 9 SCC 580 (para 48)}. The PMLA does not
expressly exclude mensrea and hence it has to be present
to make a person liable to be punished thereunder.
Moreover, the amount of Rs.25 Lakh was debited
by the company and there is no whisper in the allegation
that the said amount has not been shown in its books of
account.
It is well settled that in absence of any proceeds of
crime, there cannot be any allegation of laundering
thereof. Reference in this regard may be made to the
judgment of Vijay Madanlal Choudhary (supra), at
Paragraph 467(d)]. For better appreciation paragraph
467(d) is quoted hereinbelow:
"467(d) The offence under Section 3 of the 2002 Act is
dependent on illegal gain of property as a result of criminal
activity relating to a scheduled offence. It is concerning the
process or activity connected with such property, which
constitutes the offence of money-laundering. The
Authorities under the 2002 Act cannot prosecute any
person on notional basis or on the assumption that a
scheduled offence has been committed, unless it is so
registered with the jurisdictional police and/or pending
enquiry/trial including by way of criminal complaint before
the competent forum. If the person is finally
discharged/acquitted of the scheduled offence or the
criminal case against him is quashed by the Court of
competent jurisdiction, there can be no offence of money-
laundering against him or any one claiming such property
being the property linked to stated scheduled offence
through him..."
Thus, in the instant case, even if the allegations
levelled against the petitioner in the Prosecution Complaint
are accepted at its face value and in their entirety; prima
facie, the same do not make out a case under Section 3,
punishable under Section 4 of the PMLA, inasmuch as, such
allegations fall short of the essential ingredients for offence of
money-laundering under Section 3 of the PMLA Act.
17. Now coming to the argument of learned ASGI w.r.t.
section 45 of the PMLA, it would be beneficial to quote
Section 45 (1) (ii) of PMLA Act;
"(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 reupees], may be released on bail,
if the special court so directs: Provided further that the Special
Court shall not take cognizance of any offence punishable
under section 4 except upon a complaint in writing made by--
(i) the Director; or
(ii) any officer of the Central Government or State Government
authorised in writing in this behalf by the Central
Government by a general or a special order made in this
behalf by that Government."
At this stage it is profitable to refer to the judgment
passed in the case of Vijay Madanlal Choudhary (supra);
wherein the Hon'ble Apex Court has clarified the intent as
well as the effect of Section 45 of PMLA Act. For brevity para-
400 to 403 is quoted herein below:
"400. It is important to note that the twin conditions
provided under Section 45 of the 2002 Act, though restrict
the right of the 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. The discretion vests
in the Court which is not arbitrary or irrational but judicial,
guided by the principles of law as provided under Section
45 of the 2002 Act. While dealing with a similar provision
prescribing twin conditions in MCOCA, this Court
in Ranjitsing Brahmajeetsing Sharma, held as under:
"44. The wording of Section 21(4), in our opinion,
does not lead to the conclusion that the court must
arrive at a positive finding that the applicant for
bail has not committed an offence under the Act. If
such a construction is placed, the court intending to grant
bail must arrive at a finding that the applicant has not
committed such an offence. In such an event, it will be
impossible for the prosecution to obtain a judgment of
conviction of the applicant. Such cannot be the intention of
the legislature. Section 21(4) of MCOCA, therefore, must
be construed reasonably. It must be so construed that
the court is able to maintain a delicate balance
between a judgment of acquittal and conviction and
an order granting bail much before commencement of
trial. Similarly, the Court will be required to record a
finding as to the possibility of his committing a crime after
grant of bail. However, such an offence in futuro must be
an offence under the Act and not any other offence. Since it
is difficult to predict the future conduct of an accused, the
court must necessarily consider this aspect of the matter
having regard to the antecedents of the accused, his
propensities and the nature and manner in which he is
alleged to have committed the offence.
45. It is, furthermore, trite that for the purpose
of considering an application for grant of bail,
although detailed reasons are not necessary to
be assigned, the order granting bail must
demonstrate application of mind at least in
serious cases as to why the applicant has been
granted or denied the privilege of bail.
46. The duty of the court at this stage is not to
weigh the evidence meticulously but to arrive at
a finding on the basis of broad probabilities.
However, while dealing with a special statute
like MCOCA having regard to the provisions
contained in sub-section (4) of Section 21 of the
Act, the court may have to probe into the matter
deeper so as to enable it to arrive at a finding
that the materials collected against the accused
during the investigation may not justify a
judgment of conviction. The findings recorded by
the court while granting or refusing bail
undoubtedly would be tentative in nature, which
may not have any bearing on the merit of the
case and the trial court would, thus, be free to
decide the case on the basis of evidence adduced
at the trial, without in any manner being
prejudiced thereby"
(emphasis supplied)
401. We are in agreement with the observation made by
the Court in Ranjitsing Brahmajeetsing Sharma. The Court
while dealing with the application for grant of bail need not
delve deep into the merits of the case and only a view of
the Court based on available material on record is required.
The Court will not weigh the evidence to find the guilt of the
accused which is, of course, the work of Trial Court. The
Court is only required to place its view based on probability
on the basis of reasonable material collected during
investigation and the said view will not be taken into
consideration by the Trial Court in recording its finding of
the guilt or acquittal during trial which is based on the
evidence adduced during the trial. As explained by this
Court in Nimmagadda Prasad, the words used in Section
45 of the 2002 Act are "reasonable grounds for believing"
which means the Court has to see only if there is a genuine
case against the accused and the prosecution is not
required to prove the charge beyond reasonable doubt.
402. Sub-section (6) of Section 212 of the Companies Act
imposes similar twin conditions, as envisaged under
Section 45 of the 2002 Act on the grant of bail, when a
person is accused of offence under Section 447 of the
Companies Act which punishes fraud, with punishment of
imprisonment not less than six months and extending up to
10 years, with fine not less than the amount involved in the
fraud, and extending up to 3 times the fraud. The Court
in Nittin Johari, while justifying the stringent view towards
grant of bail with respect to economic offences held that-
"24. At this juncture, it must be noted that even as per
Section 212(7) of the Companies Act, the limitation under
Section 212(6) with respect to grant of bail is in addition to
those already provided in the CrPC. Thus, it is necessary to
advert to the principles governing the grant of bail under
Section 439 of the CrPC. Specifically, heed must be
paid to the stringent view taken by this Court
towards grant of bail with respect of economic
offences. In this regard, it is pertinent to refer to the
following observations of this Court in Y.S. Jagan Mohan
Reddy.
"34. Economic offences constitute a class apart
and need to be visited with a different approach
in the matter of bail. The economic offences having
deep-rooted conspiracies and involving huge loss of
public funds need to be viewed seriously and
considered as grave offences affecting the economy of
the country as a whole and thereby posing serious
threat to the financial health of the country.
35. While granting bail, the court has to keep in mind
the nature of accusations, the nature of evidence
in support thereof, the severity of the punishment
which conviction will entail, the character of the
accused, circumstances which are peculiar to the
accused, reasonable possibility of securing the
presence of the accused at the trial, reasonable
apprehension of the witnesses being tampered
with, the larger interests of the public/State and
other similar considerations."
(emphasis supplied)
403. This Court has been restating this position in several
decisions, including Gautam Kundu and Amit Kumar.
Thus, while considering the application for bail under
Section 45 of the 2002 Act, the Court should keep in mind
the abovementioned principles governing the grant of bail.
The limitations on granting bail as prescribed under Section
45 of the 2002 Act are in addition to the limitations under
the 1973 Code."
By going through the aforesaid judgment, it is clear that
the Hon'ble Apex Court has clarified that at the stage of
hearing the bail application, the court would have to see the
prima facie case only.
18. In view of the aforesaid discussions and looking to
the allegation made in the prosecution complaint and the
factual scenario that there is no document on record, at least
at this stage, to implicate the petitioner in forging and
manipulating the title deed being Deed of Sale No. 4369 dated
11.10.1932 of the property in question in the office of
Registrar of Assurances at Kolkata and doing conspiracy of
laundering out of proceeds of crime; hence this Court is of the
opinion that at least at this stage, the allegations fall short of
essential ingredients of offence of money laundering under
section 3 of the Act which clearly states that the proceeds of
crime has been used in any manner; however, in the case at
hand Rs. 25 lakhs which was paid by the company was out of
sale of Tea leaves from the Tea Garden and the account of the
company was duly audited.
19. Thus, on both the counts; i.e., with regard to non-
compliance of section 19 of PMLA by the Enforcement
Directorate and also on merits of the case, prima facie with
the available records produced before this court it does not
transpire that the petitioner has committed the crime under
the Act and/or is likely to commit any offence while on bail as
the prosecution has not produced any material which would
impress this Court that the petitioner might commit a similar
offence. It has not been disputed that the petitioner does not
have any criminal antecedent and since it is difficult to
predict the future conduct of the petitioner, the lack of
criminal antecedent, his propensities and the nature and
manner of his involvement as demonstrated have been
considered by this court to decide on the second limb of
section 45 (1)(ii) of the PMLA {Refer Ranjit sing Brahmajeet
Sing Sharma Versus State of Maharastra reported in
(2005) 5 SCC 294 at paragraph 44}.
20. It goes without saying that this is only stage of bail
and this Court is not sitting under its inherent power under
section 482 for quashing the entire proceeding; further there
are 31 charge-sheeted witnesses and the petitioner is in
custody since 07.06.23. Reference may be made to the recent
judgment dated 30.10.2023 of the Hon'ble Apex Court of
India rendered in the case of Manish Sisodia versus
Central Bureau of Investigation, reported in 2023 SCC
online SC 1393, wherein at paragraphs 27 and 29 it was
held as under:
"27. However, we are also concerned about the prolonged
period of incarceration suffered by the appellant - Manish
Sisodia. In P. Chidambaram v. Directorate of Enforcement,
the appellant therein was granted bail after being kept in
custody for around 49 days, relying on the Constitution
Bench in Shri Gurbaksh Singh Sibbia v. State of Punjab,
and Sanjay Chandra v. Central Bureau of Investigation,
that even if the allegation is one of grave economic offence,
it is not a rule that bail should be denied in every case.
Ultimately, the consideration has to be made on a case to
case basis, on the facts. The primary object is to secure the
presence of the accused to stand trial. The argument that
the appellant therein was a flight risk or that there was a
possibility of tampering with the evidence or influencing the
witnesses, was rejected by the Court. Again, in Satender
Kumar Antil v. Central Bureau of Investigation, this Court
referred to Surinder Singh Alias Shingara Singh v. State of
Punjab and Kashmira Singh v. State of Punjab, to
emphasise that the right to speedy trial is a fundamental
right within the broad scope of Article 21 of
the Constitution. In Vijay Madanlal Choudhary (supra), this
Court while highlighting the evil of economic offences like
money laundering, and its adverse impact on the society
and citizens, observed that arrest infringes the
fundamental right to life. This Court referred to Section 19
of the PML Act, for the in-built safeguards to be adhered to
by the authorised officers to ensure fairness, objectivity
and accountability.Vijay Madanlal Choudhary (supra), also
held that Section 436A of the Code can apply to offences
under the PML Act, as it effectuates the right to speedy
trial, a facet of the right to life, except for a valid ground
such as where the trial is delayed at the instance of the
accused himself. In our opinion, Section 436A should not
be construed as a mandate that an accused should not be
granted bail under the PML Act till he has suffered
incarceration for the specified period. This Court, in Arnab
Manoranjan Goswami v. State of Maharashtra, held that
while ensuring proper enforcement of criminal law on one
hand, the court must be conscious that liberty across
human eras is as tenacious as tenacious can be.
29. Detention or jail before being pronounced guilty of an
offence should not become punishment without trial. If the
trial gets protracted despite assurances of the prosecution,
and it is clear that case will not be decided within a
foreseeable time, the prayer for bail may be meritorious.
While the prosecution may pertain to an economic offence,
yet it may not be proper to equate these cases with those
punishable with death, imprisonment for life, ten years or
more like offences under the Narcotic Drugs and
Psychotropic Substances Act, 1985, murder, cases of rape,
dacoity, kidnaping for ransom, mass violence, etc. Neither
is this a case where 100/1000s of depositors have been
defrauded. The allegations have to be established and
proven. The right to bail in cases of delay, coupled with
incarceration for a long period, depending on the nature of
the allegations, should be read into Section 439 of the Code
and Section 45 of the PML Act. The reason is that the
constitutional mandate is the higher law, and it is the basic
right of the person charged of an offence and not convicted,
that he be ensured and given a speedy trial. When the trial
is not proceeding for reasons not attributable to the
accused, the court, unless there are good reasons, may
well be guided to exercise the power to grant bail. This
would be truer where the trial would take years."
Having regard to the number of oral and the
documentary evidences and the present stage of trial and the
period of custody undergone, this court is inclined to grant
this petitioner on bail.
21. Accordingly, the petitioner is directed to be released
on bail on furnishing bail bond of Rs. 100,000/- (One Lakh
Only) with two sureties of the like amount each to the
satisfaction of learned Special Judge, CBI-cum-PMLA at
Ranchi, in connection with ECIR Case No. 01 of 2023 [arising
out of ECIR/RNZO/18/2022 dated 21.10.2022].
However, the bail granted by this Court is subject
to following conditions:-
(i) The petitioner shall surrender his passport before the
learned trial court and if he wishes for release of the
same, he shall make proper application before the
concerned court who shall decide the application for
release of passport on its on merit.
(ii) The petitioner will not tamper with any evidence
and/or will not threaten any of the witnesses.
(iii) The petitioner shall appear before the Ld. Special
Judge on each and every date unless exempted by the
learned Trail court on being satisfied with the causes
shown by the petitioner in this regard.
It goes without saying that the findings recorded by
this court are tentative in nature and will not have any
bearing on the merits of the case and the learned Trial
court would be free to decide the case on the basis of
evidence adduced at the trial, without in any manner
being prejudiced by the findings given hereinabove.
22. As a result, the instant application stands
allowed.
(Deepak Roshan, J.)
Amardeep/
