[Cites 84, Cited by 0]
Jharkhand High Court
Rajesh Yadav @ Dahu Yadav vs The Directorate Of Enforcement ... ... ... on 15 April, 2026
Author: Sujit Narayan Prasad
Bench: Sujit Narayan Prasad
[2026:JHHC:10805]
IN THE HIGH COURT OF JHARKHAND AT RANCHI
A.B.A. No. 623 of 2026
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Rajesh Yadav @ Dahu Yadav, aged about 48 years, s/o Pashupati Yadav, r/o
Sobhanpur Bhatta, P.O. P.S.-Sahibganj, District-Sahibganj (Jharkhand).
... ... Petitioner
Versus
The Directorate of Enforcement ... ... Opposite Party
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CORAM: HON'BLE MR. JUSTICE SUJIT NARAYAN PRASAD
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For the Petitioner : Mr. Vishal Gosain, Advocate
Ms. Rudrani Tyagi, Advocate
Mr. Rajiv Ranjan Raj, Advocate
Mr. Rajveer Singh, Advocate
For the Opp. Party : Mr. Amit Kumar Das, Advocate
Mr. Saurav Kumar, Advocate
Mr. Manmohit Bhalla, Advocate
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st
C.A.V. on 01 April, 2026 Pronounced on 15/04/2026
Prayer
1. The instant application has been filed under Section 482 and 484 of the
Bharatiya Nagarik Suraksha Sanhita, 2023 praying for grant of anticipatory
bail in connection with the Vth Prosecution Complaint being ECIR Case
No.04/2022(D) arising out of FIR No.85 of 2020 registered at Police Station
Barharwa, Sahibganj, District Jharkhand under Sections 147, 149, 341, 342,
323, 379, 504, 506 read with Section 120-B of the Indian Penal Code, 1860 .
Factual Matrix
2. The prosecution story in brief as per the allegation made in the instant
ECIR/complaint is that an official complaint vide Enforcement Case
Information Report (ECIR) 03/2022 was recorded on the basis of the
Barharwa P.S. Case No. 85/2020 dated 22.06.2020, under section 147, 149,
341, 342, 323, 379, 1208, 504, 506 of IPC against Pankaj Mishra and others
that the informant Shambhu Nandan Kumar was threatened and obstructed on
22.06.2020 by the named persons to participate in tender for Barharwa Toll. It
is alleged by the informant that he was ordered by Pankaj Mishra over phone,
not to participate in the tender, on refusal of which, he was attacked by mob,
on the behest of Pankaj Mishra. After investigation, charge sheet has been
filed.
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3. During the investigation of ECIR 03/2022, other FIRs were also identified to
be lodged against the accused persons which has been merged in the instant
ECIR and taken into the ambit of investigation to conduct a comprehensive
investigation. In addition to section 120B of IPC invoked in the FIRs, which
is scheduled offence, offences u/s 307/120B of IPC along with section 27 of
Arms Act were identified and merged in the investigation under ECIR/RNZO
03/22 for a comprehensive investigation.
4. The prosecution complaint reveals that the main reason for not allowing the
complainant to participate in the tender for Barharwa Toll was to gain control
over the 06 Tolls which come under Nagar Panchayat. Investigation reveals
that total 06 Tolls fixed by Barharwa Nagar Panchayat Toll fall in route
connecting the mining sites and the main roads from where the mined items
are transported to destined places. It was revealed during the investigation that
the vehicles carrying the mined items had to cross Barharwa Toll before
reaching main roads. It was revealed that apart from mining under valid
license, a huge quantity of mining is being carried out illegally in Sahibganj
District and adjoining areas. The investigation also revealed that main
accused Pankaj Mishra is also involved in illegal collection of levies from the
trucks carrying stone chips through his accomplices, including accused
Bachhu Yadav too. The control over the Barharwa Nagar Panchayat Toll
would have enabled the Accused Pankaj Mishra and his accomplices to have
control and dominance over the area and thereby enabling them to easily
monitor the number of vehicles and quantity of mining proceeds being carried
out in those vehicles which would have also facilitated them in collection of
the levies. The aforesaid Pankaj Mishra flaunts his influence and dominance
to control mining businesses as well as inland ferry services in Sahibganj and
its adjoining areas. He has control over the mining of stone chips and boulders
as well as installation and operations of several crushers, set up various
mining sites in Sahibganj. He has himself been allotted mining lease in
Sahibganj in the name of his proprietorship firm Mahakal Stone Works at
Mouza- Gilamari, Rajmahal Sub Division, Dist. Sahibganj, Jharkhand. He
carries out his illegal mining. The scrutiny of the bank accounts also indicates
the transactions with his associates Bhagwan Bhagat, Krishna Kumar Saha,
Pavitra Kumar Yadav and others who work for laundering the proceeds of
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crime acquired by him out of his criminal activities. Besides Pankaj Mishra,
other associates are also involved in the activities of illegal mining in
Sahibganj.
5. It has further been revealed that Pankaj Mishra has organized the local
criminals Rajesh Yadav @ Dahu Yadav (the petitioner herein), Pavitra Kumar
Yadav @ Guddu Yadav, Bishnu Yadav @ Chotu Yadav and Bachhu Yadav
and are using their association for illegal mining activities and illegal inland
ferry services in Sahibganj.
6. It has also been revealed that stone chips are loaded and carried through
railways by declaring them as stone boulders which is causing loss to the
government in terms of royalty. Further he is involved in illegal mining on a
large scale and he is being assisted by his accomplices. The scrutiny of the
bank accounts of Pankaj Mishra and his associates reveals that huge amount
of cash is being deposited frequently in the bank accounts under their control
and occupation which are nothing but the proceeds of crime derived out of the
illegal mining activities. The proceeds of crime is acquired by them is
laundered by him and his associates.
7. Thus, it has been alleged that Pankaj Mishra, along with his close associates
including present petitioner Rajesh Yadav @ Dahu Yadav, had established
dominance over the area and were exercising control over illegal mining and
transportation activities and Rajesh Yadav @ Dahu Yadav was an active
participant in facilitating the illegal transportation network.
8. Further it has been alleged that the accused persons were predominantly
dealing in cash. Scrutiny of bank accounts of Rajesh Yadav @Dahu Yadav
and related entities revealed huge cash deposits running into several crores
of rupees over different financial years. The total cash deposits detected
were to the tune of more than 20 crores, apart from non-cash deposits,
thereby reflecting laundering of proceeds of crime through the banking
channel.
9. It has further been stated that part of the proceeds of crime so generated was
layered and projected as untainted by investing in business ventures and
ferry contracts and an amount of ₹8.52 crores in cash was deposited towards
obtaining ferry service tender through Naav Yatayat Samiti Ltd., which was
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under the control of the accused persons including present petitioner Rajesh
Yadav @ Dahu Yadav and his associates.
10. During investigation searches were conducted under Section 17 of the
PMLA on various dates in July and August 2022, total cash amounting to
₹5,34,44,400/-, bank balances of approximately 13,32,26,570/-, inland
vessels including M.V. Infralink-III, crushers, trucks and incriminating
documents were seized/frozen. Registers containing details of transportation
of vehicles loaded with stone chips were also recovered,
11. On the basis of the aforesaid it has been alleged that Rajesh Yadav @Dahu
Yadav was knowingly involved in the process and activity connected with
proceeds of crime including its acquisition, possession, use and projection as
untainted property, thereby committing the offence of money laundering
punishable under Section 4 of the PMLA.
12. The petitioner, in view of the above, had preferred anticipatory bail
application in apprehension of his arrest before the learned special court
which was numbered as A.B.P. No. 2032 of 2025 in connection with ECIR-
04/2022(D) which had been rejected vide order dated 18.07.2025.
13. Hence, the present application.
Argument on behalf of the learned counsel for the petitioner:
14. Mr. Vishal Gosain, learned counsel for the petitioner has argued inter alia on
the following grounds:
(i) It has been submitted that the petitioner is neither named as an accused
in the principal FIR (Barharwa P.S. Case No. 85 of 2020) nor in the
final report (231/2020 dt. 31.11.2020) and even he has not been charge-
sheeted in the predicate offence.
(ii) It has been submitted that the one remaining FIR out of the three FIRs,
is unrelated to the allegation as levelled in the present ECIR and also
does not about any generation of proceeds of crime.
(iii) It has also been submitted that no cash whatsoever has been recovered
from the petitioner and all the money which has been seized in his
company, Rayadav Transportation Pvt. Ltd., is filly accounted for and
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derived from the legitimate business transactions without any trail of
money or communication with the main accused.
(iv) It has also been submitted that the petitioner is involved in the business
of operating ferries and has no connection, either direct or indirect, with
the main accused Pankaj Mishra. There is no evidence to support that
the petitioner fraudulently acquired the tender, furthermore, Hulash
Choudhary who was a member of the said samiti has also nowhere
stated that the said tender was illegally obtained by the petitioner.
(v) It has been submitted that entire case of the Respondent against the
petitioner/Applicant hinges on his and the statements of co-accused
persons recorded under Section 50 of the PMLA and it is only on the
basis of statement under Section 50 of the Applicant and other co-
accused persons that he has been linked with the syndicate and his role
in transportation of trucks. Other than the statements there is no
corroborative or incriminating material to prove the allegations of the
Respondent and guilt of the Applicant.
(vi) It has been stated the said ECIR and raids constitute a blatant abuse of
process, as they are based on FIR No. 85/20 where the Applicant has
not been named as accused therefore, there is no predicate offence on
the basis of which the Applicant has been roped in, in the present case.
The Respondent's actions, lacking any legal or factual basis, are
vexatious and designed to harass rather than pursue legitimate
enforcement. The absence of a predicate offence render the ECIR an
instrument of oppression, warranting protection from arrest to the
Applicant.
(vii) Referring the aforesaid fact it has been submitted that because the
absence of a predicate offence, coupled with the Respondent's failure to
provide cogent reasons for invoking PMLA, renders the ECIR and raids
an exercise in arbitrariness. Executive actions affecting fundamental
rights must adhere to principles of natural justice, a standard the
Respondent has blatantly disregarded.
(viii) It has been contended that the applicant has never received any amount
in his personal accounts from any of the companies i.e. Rayadav
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Transportation Pvt. Ltd. and Sindhwani Transports and Logistics
therefore, he has neither been in either possession of the alleged
proceeds of crime, nor has he concealed or used the said proceeds of
crime or further projected the same as untainted. Therefore, there is no
material on record to prove the complicity of the Applicant under
Section 3/4 of the PMLA.
(ix) It has further been submitted that the applicant satisfies the stringent
twin conditions under Section 45 PMLA, which the Special Court
incorrectly failed to record. The only incriminating material against the
Applicant is his statement and the statement of the co-accused persons
recorded under Section 50 of the PMLA. It is a well-settled principle
that such an uncorroborated statement cannot be used Incriminate the
Applicant, thus satisfying the requirement of reasonable grounds for
believing he is not guilty.
(x) It has been submitted that in the present case there is no corroborative
evidence to prove the case of the Respondent. There is no link that the
Applicant was involved in the business of illegal transportation of
illegally mined minerals as there is no evidence on record to directly or
indirectly establish a link between the miners and the Applicant or that
he had knowledge of the trucks carrying any illegally mined minerals.
The only so-called corroborative piece of evidence used against the
Applicant are registers seized from his residence which have entries
regarding trucks transported in his ferry. These registers in the absence
of authentication, authorship, or supporting material, are akin to loose
papers and cannot prove that the Applicant had any knowledge
regarding the trucks containing any illegally mined minerals.
(xi) It has been submitted that the main accused and the Applicant's family
members, including his father, son, and brother Sunil Yadav, have all
been released on bail. On the grounds of parity, the Applicant also
deserves the protection of anticipatory bail.
(xii) It has further been submitted that the prosecution complaint has already
been filed, and all evidence is documentary. The purpose of arrest is to
secure presence, which the Applicant has demonstrated a willingness to
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comply with. Therefore, no custodial interrogation is required or
justified.
15. Learned counsel for the petitioner based upon the aforesaid grounds has
submitted that the learned court while considering the prayer for pre-arrest
bail ought to have taken into consideration all these aspects of the matter both
legal and factual but having not done so, serious error has been committed.
16. Further submission has been made in the aforesaid view of the matter as per
the ground agitated that it is a fit case where the petitioner is to be given the
benefit of pre-arrest bail.
Argument on behalf of the learned counsel for the respondent:
17. While on the other hand, Mr. Amit Kumar Das, learned counsel for the
respondent-Enforcement Directorate has seriously opposed the said
submission/ground both based upon the fact and the law as referred
hereinabove by Mr. Vishal Gosain, learned counsel for the petitioner.
18. It has been submitted that submitted that the present anticipatory bail petition
is not maintainable as because the process of 82 and 83 Cr.P.C. had already
been issued against the petitioner and as per established law the anticipatory
bail petition is not maintainable and the aforesaid anticipatory bail petition of
the petitioner is without merit, hence it may be rejected on this ground only.
19. Further the learned counsel has submitted that against the order of issuance of
NBW and issue of process by the special court, the petitioner had preferred
Cr.M.P. before this Hon'ble Court but same was dismissed and thereafter
against the order of this Court, the present petitioner preferred S.L.P.(Crl)
before the Hon'ble Apex Court but no relief had been granted by the Hon'ble
Apex Court and direction was passed upon the present applicant to appear
before the Investigating Officer within two weeks but the petitioner has not
complied the order of the Hon'ble Supreme Court and wilfully remained
absconder in this case, therefore, the conduct of the petitioner cannot be said
to be proper and further he has criminal antecedent, therefore, the privilege of
Anticipatory Bail cannot be granted to the present applicant.
20. It has been contended that investigation has revealed large-scale illegal
mining and transportation activities generating proceeds of crime, supported
by seizures of cash, freezing of bank accounts, and recovery of incriminating
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records, therefore the plea that the PMLA case is without foundation is
factually untenable.
21. It has been contended that the offence under Section 3 of the PMLA is
independent in nature and covers any person who is directly or indirectly
involved in any process or activity connected with proceeds of crime. The
statute does not require that a person must be named in the predicate FIR or
charge-sheet before action can be taken against him under the PMLA. The
Hon'ble Supreme Court in Pavana Dibbur vs. Directorate of Enforcement
(Criminal Appeal No. 2779/2023) reaffirmed that an accused under PMLA
need not necessarily be named in the scheduled offence if they are involved in
laundering proceeds of crime. The decision clarifies that the offence of money
laundering is independent of the predicate offence. The law focuses on the act
of concealing or converting proceeds of crime, and those who facilitate this
process, even if they were not involved in the original criminal activity, can
still be prosecuted for money laundering.
22. It has been submitted that FIR No. 85/2020, on the basis of which
ECIR/RNZO/03/2022 was recorded, continues to subsist and a chargesheet
has already been filed. The ECIR is based on multiple scheduled offences
identified and merged during investigation and therefore, so long as at least
one scheduled offence subsists, proceedings under the PMLA remain valid.
23. It has been contended that Investigation has revealed the Petitioner's
association with the illegal transportation network connected to unlawful
mining activities. Seized documents, including operational registers and
digital records, along with financial analysis of bank accounts, prima facie
indicates his involvement in handling, facilitating and deploying funds arising
from such illegal activities.
24. It has further been submitted that the learned Special Court (PMLA), Ranchi
has taken cognizance of the Prosecution Complaint against the present
Petitioner vide order dated 17.07.2025, after perusal of the material placed on
record and order taking cognizance reflects judicial application of mind and
prima facie satisfaction regarding the petitioner's involvement in the offence
of money laundering, therefore, prima facie the prayer for anticipatory bail of
the petitioner/applicant is not fit to be allowed.
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25. The learned counsel for ED/respondent has further submitted that the contract
dated 15.03.2022 with Nav Yatayat Sahyog Samiti does not, by itself, confer
legitimacy upon the activities carried out and in the instant case the issue
under investigation is not the existence of a ferry contract, but the use of ferry
services as a conduit for facilitating transportation of proceeds-generating
illegal mining operations.
26. It has further been contended that the statements recorded under Section 50 of
the PMLA were obtained during a lawful inquiry and are admissible in law
and in the instant case such statements are not the sole basis of the
prosecution case, rather the said statement stand corroborated by
documentary, financial and circumstantial evidence gathered during
investigation.
27. The learned counsel has submitted that even assuming that two FIRs have
been closed or quashed, the existence of other subsisting FIR(s), including
those invoking scheduled offences, and the material indicating continued
association with illegal mining and transportation activities cannot be ignored.
Hence, closure or quashing of certain FIRs does not automatically efface the
broader pattern of conduct revealed during investigation.
28. It has been contended that the plea of parity of the learned counsel is wholly
misconceived and untenable in the facts and circumstances of the present case
because grant of bail to certain co-accused does not automatically entitle
another accused to anticipatory bail. The principle of parity applies only when
the role, nature of allegations, stage of proceedings, material collected and
surrounding circumstances are identical and each application is required to be
examined independently on its own factual matrix.
29. Learned counsel for the respondent-Enforcement Directorate, based upon the
aforesaid ground, has submitted that it is not a fit case where the prayer for
pre-arrest bail is to be granted.
Response of the learned counsel for the applicant:
30. In response to the maintainability the present application for grant of
anticipatory bail it has been contended by the learned counsel for the
petitioner that the mere issuance of process or culmination of proclamation
proceedings does not create an absolute bar to the consideration of an
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application under Section 438 CrPC, once the accused submits himself to the
jurisdiction of the Court. In order to substantiate this limb of argument the
learned counsel for the petitioner/applicant has put his reliance on the
judgment rendered by the Hon'ble Apex Court in the case of Asha Dubey Vs
State of Madhya Pradesh 2024 SCC OnLine SC 5633.
Analysis:
31. Heard the learned counsel for the parties and has gone across the ECIR.
Issue of maintainability:
32. The issue of maintainability has been raised on behalf of the learned counsel
for the respondent-ED by stating that since the issuance of process under
Section 82 and 83 Cr.P.C has already been processed and same has been
affirm up to the Hon'ble Apex Court, therefore the instant application is not
maintainable.
33. The issue of maintainability of the instant application on the ground of the
issuance of process under Section 82 and 83 Cr.P.C. has been raised. The
aforesaid order of issuance of process under Section 82 and 83 Cr.P.C. has not
been interfered by this Court vide order dated 13.04.2023 passed in CRMP
No.4200 of 2022.
34. The present applicant against the said order dated 13.04.2023 has preferred a
petition being SLP (Crl.) No. 6322 of 2023 before the Hon'ble Apex Court
but vide order dated 18.08.2023 the aforesaid SLP has also been dismissed by
the Hon'ble Apex Court and consequently direction was passed upon the
present petitioner to surrender before the investigating officer with two
weeks. For ready reference the relevant paragraphs of the order dated
18.08.2023 are being quoted as under:
"Heard learned counsel for the petitioner.
We do not find any reason to interfere with the order impugned in this
petition.
The special leave petition is, accordingly, dismissed.
The petitioner, however, is given two weeks time to appear before the
Investigating Officer.
Pending application(s), if any, shall stand disposed of."
35. The learned counsel for the petitioner has submitted by referring the judgment
rendered in the case of Asha Dubey Vs State of Madhya Pradesh (supra) has
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submitted that the mere issuance of process or culmination of proclamation
proceedings under Section 82 and 83 Cr.P.C. does not create an absolute bar
to the consideration of an application under Section 438 CrPC, once the
accused submits himself to the jurisdiction of the Court.
36. From the plain reading of the Section 438 Cr.P.C/ 482 of BNSS cannot put
any embargo on the filing of the anticipatory bail application after issuance of
the process under Section 82 and 83 Cr.P.C./Section 84 and 85 BNSS.
37. For ready reference Section 438 Cr.P.C/ 482 of BNSS is being referred
herein which reads as under:
"438. Direction for grant of bail to person apprehending arrest-- (1)
Where any person has reason to believe that he may be arrested on
accusation of having committed a non-bailable offence, he may apply to
the High Court or the Court of Session for a direction under this section
that in the event of such arrest he shall be released on bail; and that
Court may, after taking into consideration, inter alia, the following
factors, namely:--
(i) the nature and gravity of the accusation;
(ii) the antecedents of the applicant including the fact as to whether he
has previously undergone imprisonment on conviction by a Court in
respect of any cognizable offence;
(iii) the possibility of the applicant to flee from justice; and
(iv) where the accusation has been made with the object of injuring or
humiliating the applicant by having him so arrested, either reject the
application forthwith or issue an interim order for the grant of
anticipatory bail:
Provided that, where the High Court or, as the case may be, the Court of
Session, has not passed any interim order under this sub-section or has
rejected the application for grant of anticipatory bail, it shall be open to
an officer in-charge of a police station to arrest, without warrant the
applicant on the basis of the accusation apprehended in such application.
(1-A) Where the Court grants an interim order under sub-section (1), it
shall forthwith cause a notice being not less than seven days notice,
together with a copy of such order to be served on the Public Prosecutor
and the Superintendent of Police, with a view to give the Public
Prosecutor a reasonable opportunity of being heard when the application
shall be finally heard by the Court.
(1-B) The presence of the applicant seeking anticipatory bail shall be
obligatory at the time of final hearing of the application and passing of
final order by the Court, if on an application made to it by the Public
Prosecutor, the Court considers such presence necessary in the interest
of justice.]
(2) When the High Court or the Court of Session makes a direction under
sub-section (1), it may include such conditions in such directions in the
light of the facts of the particular case, as it may think fit, including--
(i) a condition that the person shall make himself available for
interrogation by a police officer as and when required;
(ii) a condition that the person shall not, directly or indirectly, make any
inducement, threat or promise to any person acquainted with the facts of
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the case so as to dissuade him from disclosing such facts to the Court or
to any police officer;
(iii) a condition that the person shall not leave India without the previous
permission of the court;
(iv) such other condition as may be imposed under sub-section (3) of
Section 437, as if the bail were granted under that section.
(3) If such person is thereafter arrested without warrant by an officer in
charge of a police station on such accusation, and is prepared either at
the time of arrest or at any time while in the custody of such officer to
give bail, he shall be released on bail; and if a Magistrate taking
cognizance of such offence decides that a warrant should issue in the
first instance against that person, he shall issue a bailable warrant in
conformity with the direction of the Court under sub-section (1).
(4) Nothing in this section shall apply to any case involving the arrest of
any person on accusation of having committed an offence under
subsection (3) of Section 376 or Section 376-AB or Section 376-DA or
Section 376-DB of the Penal Code, 1860."
482. Direction for grant of bail to person apprehending arrest -- (1)
When any person has reason to believe that he may be arrested on an
accusation of having committed a non-bailable offence, he may apply to
the High Court or the Court of Session for a direction under this section;
and that Court may, if it thinks fit, direct that in the event of such arrest,
he shall be released on bail."
(2) When the High Court or the Court of Session makes a direction under
sub-section (1), it may include such conditions in such directions in the
light of the facts of the particular case, as it may think fit, including--
(i) a condition that the person shall make himself available for
interrogation by a police officer as and when required;
(ii) a condition that the person shall not, directly or indirectly, make any
inducement, threat or promise to any person acquainted with the facts of
the case so as to dissuade him from disclosing such facts to the Court or
to any police officer;
(iii) a condition that the person shall not leave India without the previous
permission of the Court;
(iv) such other condition as may be imposed under sub-section (3) of
Section 480, as if the bail were granted under that section.
(3) If such person is thereafter arrested without warrant by an officer in
charge of a police station on such accusation, and is prepared either at
the time of arrest or at any time while in the custody of such officer to
give bail, he shall be released on bail; and if a Magistrate taking
cognizance of such offence decides that a warrant should be issued in the
first instance against that person, he shall issue a bailable warrant in
conformity with the direction of the Court under sub-section (1).
(4) Nothing in this section shall apply to any case involving the arrest of
any person on accusation of having committed an offence under Section
65 and sub-section (2) of Section 70 of the Bharatiya Nyaya Sanhita,
2023."
38. The above provision makes it clear that the power exercisable under Section
438 of the Code is somewhat extraordinary in character and it is to be
exercised only in exceptional cases where it appears that the person may be
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falsely implicated or where there are reasonable grounds for holding that a
person accused of an offence is not likely to otherwise misuse his liberty.
39. The central question which has to be decided herein that whether the
anticipatory bail application filed under Section 438 of the Cr. P.C./482 of the
BNSS is maintainable in case proceedings under Section 82 and 83 or of
the Cr. P.C. have been initiated against the accused/applicant and the same
has been affirmed up to the Hon'ble Apex Court and in a situation where
accused has been declared as absconder/proclaimed offender under
Section 82/83 of the Cr. P.C.(84/85 of BNSS).
40. It needs to refer herein that the Hon'ble Apex Court in the case of State of
MP. v. Pradeep Sharma (2014) 2 SCC 171 by taking reference of the
judgment rendered in the case of Lavesh v. State (NCT of Delhi) (2012) 8
SCC 730 has observed that it is a settled position of law that where the
accused has been declared as an absconder and has not cooperated with the
investigation, he should not be granted anticipatory bail, for ready reference
the relevant paragraph of the aforesaid order is being quoted as under:
17. In the case on hand, a perusal of the materials i.e. confessional
statements of Sanjay Namdev, Pawan Kumar alias Ravi and Vijay alias
Monu Brahambhatt reveals that the respondents administered poisonous
substance to the deceased. Further, the statements of the witnesses that
were recorded and the report of the Department of Forensic Medicine
and Toxicology, Government Medical College and Hospital, Nagpur
dated 21-3-2012 have confirmed the existence of poison in milk rabri.
Further, it is brought to our notice that warrants were issued on 21-11-
2012 for the arrest of the respondents herein. Since they were not
available/traceable, a proclamation under Section 82 of the Code was
issued on 29-11-2012. The documents (Annexure P-13) produced by the
State clearly show that the CJM, Chhindwara, M.P. issued a
proclamation requiring the appearance of both the respondent-accused
under Section 82 of the Code to answer the complaint on 29-12-2012. All
these materials were neither adverted to nor considered by the High
Court while granting anticipatory bail and the High Court, without
indicating any reason except stating "facts and circumstances of the
case", granted an order of anticipatory bail to both the accused. It is
relevant to point out that both the accused are facing prosecution for
offences punishable under Sections 302 and 120-B read with Section 34
IPC. In such serious offences, particularly, the respondent-accused being
proclaimed offenders, we are unable to sustain the impugned orders
[Sudhir Sharma v. State of M.P., Misc. Criminal Case No. 9996 of 2012,
order dated 10-1-2013 (MP)] , [Gudda v. State of M.P., Misc. Criminal
Case No. 15283 of 2012, order dated 17-1-2013 (MP)] of granting
anticipatory bail. The High Court failed to appreciate that it is a settled
position of law that where the accused has been declared as an
absconder and has not cooperated with the investigation, he should not
be granted anticipatory bail.
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41. Thus, the Hon'ble Apex Court in the case of Pradeep Sharma (supra)
considering the judgment passed in the case of Lavesh (supra), has observed
that where the accused has been declared as an absconder and has not
cooperated with the investigation, he should not be entitled for grant of
anticipatory bail.
42. The Hon'ble Apex Court recently in the case of Asha Dubey v. State of
Madhya Pradesh (supra) considering the earlier judgment passed in the case
of Pradeep Sharma (supra) has held that in the event of the declaration under
Section 82 of the Cr. P.C. it is not as if in all cases that there will be a total
embargo on considering the application for grant of anticipatory bail. When
the liberty of the appellant pitted against, the Court will have to see the
circumstances of the case, nature of the offence and the background based on
which such a proclamation was issued, for ready reference the relevant
paragraphs of the aforesaid Judgment are being quoted as under:
"8. Coming to the consideration of anticipatory bail, in the event of the
declaration under Section 82 of the Cr. P.C. it is not as if in all cases that
there will be a total embargo on considering the application for the grant
of anticipatory bail.
9. When the liberty of the appellant is pitted against, this Court will have
to see the circumstances of the case, nature of the offence and the
background based on which such a proclamation was issued. Suffice it is
to state that it is a fit case for grant of anticipatory bail, on the condition
that the appellant shall cooperate with the further investigation.
However, liberty is also given to the respondents to seek cancellation of
bail that has been granted, in the event of a violation of the conditions
which are to be imposed by the Trial Court or if there are any perceived
threats against the witnesses."
43. Thus, it is apparent that the Hon'ble Apex Court has observed there will not
be a total embargo on considering the application for the grant of anticipatory
bail and the Court will have to see the circumstances of the case, nature of the
offence and the background based on which such a proclamation was issued.
Thus, from the aforesaid judgment it is evident that the Hon'ble Apex Court
has talked about the circumstances and the entitlement of pre-arrest bail of the
accused/petitioner specifically in the case where against the said
accused/petitioner proclamation has been issued.
44. Further in the case of Pradeep Sharma (supra), it is evident from paragraph
17 which has been quoted and referred hereinabove that the Hon'ble Apex
Court has discussed therein about the circumstances and entitlement to the
pre-arrest bail to the accused petitioner and has observed that where the
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accused has been declared as an absconder and has not cooperated with the
investigation, he should not be entitled for grant of anticipatory bail.
45. Thus, on the basis of discussion made hereinabove this Court is of the view
that the present application is well maintainable but herein the question of
entitlement of the pre-arrest bail to the present applicant/accused has to be
determined by taking into the consideration, primarily the conduct and
culpability of the present applicant in the alleged commission of the crime
under Section 3 of the Act 2002.
46. Admittedly, the petitioner has not followed the categorical directions passed
by the Hon'ble Supreme Court of India. As admitted by the Petitioner in
Paragraph 33 of the instant petition that the Special Leave Petition (Crl.) No.
6322 of 2023, which challenged the initiation of proceedings under Section 82
of the Code of Criminal Procedure, 1973 (Cr.P.C.) and the issuance of Non-
Bailable Warrants (NBWs), was dismissed by the Hon'ble Apex Court vide
order dated 18.08.2023. While dismissing the SLP, the Hon'ble Supreme
Court granted the Petitioner a specific, time-bound concession of two weeks
to surrender before the Investigating Officer. The petitioner admittedly has
not appeared before the investigating officer. The order dated 18.08.2023
passed by the Hon'ble Apex Court has already been quoted hereinabove in the
preceding paragraph.
47. The justifications for non-adherence of the direction passed by the Hon'ble
Apex Court have been tendered by the petitioner in Paragraph 34 of the
petition-citing his mother's illness and the arrest of a co-accused relative but
prima facie the said justifications are not legally tenable and it amounts sheer
abuse of the judicial process.
48. It is settled position of law that a litigant cannot unilaterally extend or ignore a
surrender deadline fixed by the highest Court of the land under the guise of
personal inconvenience. By failing to surrender by the stipulated deadline in
September 2023, the Petitioner's status reverted to that of a proclaimed
absconder.
49. This Court vide order dated 13.04.2023 passed in Cr.M.P. No. 4200 of 2022
while refusing to interfere with the process under Section 82 and 83 has come
to the conclusive finding about the background under which the process under
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Section 82 and 83 has been issued as has been referred in the paragraph-22
which is being referred as under:
22. After making initial appearances, the petitioner was evading
appearance before the investigating agency despite repeated summons
being issued against him. It was against this background that non-
bailable warrant of arrest and other processes have been issued against
the petitioner. In any case a person accused of a serious offence cannot
be permitted to dictate and control the pace of investigation by seeking
adjournments and then not joining the investigation.
50. It is in this background of the orders passed by this Court and the Hon'ble
Apex Court, this Court is of the view that the involvement of the present
petitioner in the alleged commission of crime is to be taken into consideration
along with the conduct of the petitioner in defiance of the order passed by the
Hon'ble Apex Court by not adhering to the liberty which he took of putting
appearance before the investigating officer and even the present petitioner has
not filed any application for modification of the order dated 18.08.2023
passed by the Hon'ble Apex Court.
Issue of culpability of the petitioner:
51. This Court is now proceeding to examine the issue on merit by maintaining
the present application in order to assess as to whether in the backdrop of the
conduct of the petitioner by not adhering to the liberty granted by the Hon'ble
Apex Court vide order dated 18.08.2023 wherein the process issued under
Section 82 and 83 has been declined to be interfered with as also the
culpability as alleged to be committed by the petitioner as per the ECIR is
required to be considered.
52. This Court before considering the merit of the case deems it fit and proper to
discuss herein some of the provision of law as contained under the PML Act,
2002 (herein referred as Act 2002) with its object and intent as also the legal
proposition as settled by the Hon'ble Apex Court in various judgments.
53. The Act 2002 was enacted to address the urgent need to have a
comprehensive legislation inter alia for preventing money-laundering,
attachment of proceeds of crime, adjudication and confiscation thereof
including vesting of it in the Central Government, setting up of agencies and
mechanisms for coordinating measures for combating money-laundering and
also to prosecute the persons indulging in the process or activity connected
with the proceeds of crime.
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54. It is evident that the Act 2002 was enacted in order to answer the urgent
requirement to have a comprehensive legislation inter alia for preventing
money-laundering, attachment of proceeds of crime, adjudication and
confiscation thereof for combating money-laundering and also to prosecute
the persons indulging in the process or activity connected with the proceeds of
crime.
55. The objective of the PMLA is to prevent money laundering which has posed a
serious threat not only to the financial systems of the country but also to its
integrity and sovereignty. The offence of money laundering is a very serious
offence which is committed by an individual with a deliberate desire and the
motive to enhance his gains, disregarding the interest of the nation and the
society as a whole, and such offence by no stretch of imagination can be
regarded as an offence of trivial nature. The stringent provisions have been
made in the Act to combat the menace of money laundering.
56. It needs to refer herein the definition of "proceeds of crime" as provided
under Section 2(1)(u) of the Act, 2002 which reads as under:-
"2(u) "proceeds of crime" means any property derived or obtained,
directly or indirectly, by any person as a result of criminal activity
relating to a scheduled offence or the value of any such property [or
where such property is taken or held outside the country, then the
property equivalent in value held within the country] [or abroad];
[Explanation.--For the removal of doubts, it is hereby clarified that
"proceeds of crime" include property not only derived or obtained from
the scheduled offence but also any property which may directly or
indirectly be derived or obtained as a result of any criminal activity
relatable to the scheduled offence;]"
57. It is evident from the aforesaid provision by which the "proceeds of crime"
means any property derived or obtained, directly or indirectly, by any person
as a result of criminal activity relating to a scheduled offence or the value of
any such property or where such property is taken or held outside the country,
then the property equivalent in value held within the country or abroad.
58. In the explanation, it has been referred that for the removal of doubts, it is
hereby clarified that "proceeds of crime" include property not only derived or
obtained from the scheduled offence but also any property which may directly
or indirectly be derived or obtained as a result of any criminal activity
relatable to the scheduled offence.
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59. It is, thus, evident that the reason for giving explanation under Section 2(1)(u)
is by way of clarification to the effect that whether as per the substantive
provision of Section 2(1)(u), the property derived or obtained, directly or
indirectly, by any person as a result of criminal activity relating to a scheduled
offence or the value of any such property or where such property is taken or
held outside the country then the property equivalent in value held within the
country but by way of explanation the proceeds of crime has been given
broader implication by including property not only derived or obtained from
the scheduled offence but also any property which may directly or indirectly
be derived or obtained as a result of any criminal activity relatable to the
scheduled offence.
60. Further, the "property" has been defined under Section 2(1)(v) which means
any property or assets of every description, whether corporeal or incorporeal,
movable or immovable, tangible or intangible and includes deeds and
instruments evidencing title to, or interest in, such property or assets,
wherever located.
61. The schedule has been defined under Section 2(1)(x) which means schedule
to the Prevention of Money Laundering Act, 2002.
62. It is evident that the "scheduled offence" means the offences specified under
Part A of the Schedule; or the offences specified under Part B of the Schedule
if the total value involved in such offences is [one crore rupees] or more; or
the offences specified under Part C of the Schedule.
63. The offence of money laundering has been defined under Section 3 of the Act,
2002 which reads as under: -
"3. Offence of money-laundering.--Whosoever directly or indirectly
attempts to indulge or knowingly assists or knowingly is a party or is
actually involved in any process or activity connected with the [proceeds
of crime including its concealment, possession, acquisition or use and
projecting or claiming] it as untainted property shall be guilty of offence
of money-laundering.
[Explanation.-- For the removal of doubts, it is hereby clarified that,--
(i) a person shall be guilty of offence of money-laundering if such person
is found to have directly or indirectly attempted to indulge or knowingly
assisted or knowingly is a party or is actually involved in one or more of
the following processes or activities connected with proceeds of crime,
namely:--
(a) concealment; or
(b) possession; or
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(c) acquisition; or
(d) use; or
(e) projecting as untainted property; or
(f) claiming as untainted property, in any manner whatsoever;
(ii) the process or activity connected with proceeds of crime is a
continuing activity and continues till such time a person is directly or
indirectly enjoying the proceeds of crime by its concealment or
possession or acquisition or use or projecting it as untainted property or
claiming it as untainted property in any manner whatsoever.]"
64.It is evident from the aforesaid provision that "offence of money-laundering"
means whosoever directly or indirectly attempts to indulge or knowingly
assists or knowingly is a party or is actually involved in any process or
activity connected with the proceeds of crime including its concealment,
possession, acquisition or use and projecting or claiming it as untainted
property shall be guilty of offence of money-laundering.
65.It is further evident that the process or activity connected with proceeds of
crime is a continuing activity and continues till such time a person is directly
or indirectly enjoying the proceeds of crime by its concealment or
possession or acquisition or use or projecting it as untainted property or
claiming it as untainted property in any manner whatsoever.
66.The punishment for money laundering has been provided under Section 4 of
the Act, 2002.
67.Further the specific provision has been made under the PML Act, 2002 to be
followed at the time of arrest i.e., the ground of arrest is to be informed to
the person facing the accusation as soon as possible that is the original text
of Section 19(1) of the Act, 2002.
68.Section 50 of the Act, 2002 confers power upon the authorities regarding
summons, production of documents and to give evidence.
69.The various provisions of the Act, 2002 along with interpretation of the
definition of "proceeds of crime" has been dealt with by the Hon'ble Apex
Court in the case of Vijay Madanlal Choudhary and Ors. Vs. Union of
India and Ors., reported in (2022) SCC OnLine SC 929 wherein the Bench
comprising of three Hon'ble Judges of the Hon'ble Supreme Court have
decided the issue by taking into consideration the object and intent of the
Act, 2002.
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70.The predicate offence has been considered in the aforesaid judgment
wherein by taking into consideration the explanation as inserted by way of
Act 23 of 2019 under the definition of the "proceeds of crime" as contained
under Section 2(1)(u), whereby and whereunder, it has been clarified for the
purpose of removal of doubts that, the "proceeds of crime" include property
not only derived or obtained from the scheduled offence but also any
property which may directly or indirectly be derived or obtained as a result
of any criminal activity relatable to the scheduled offence, meaning thereby,
the words "any property which may directly or indirectly be derived or
obtained as a result of any criminal activity relatable to the scheduled
offence" will come under the fold of the proceeds of crime.
71.It needs to refer herein that the various provisions of the Act, 2002
alongwith interpretation of the definition of "proceeds of crime" has been
dealt with by the Hon'ble Apex Court in the case of Vijay Madanlal
Choudhary and Ors. Vs. Union of India and Ors., (supra) wherein the
Bench comprising of Three Hon'ble Judges of the Hon'ble Supreme Court
have decided the issue by taking into consideration the object and intent of
the Act, 2002, as would appear from paragraph 128, 129 and 130. For ready
reference, relevant paragraph is being referred as under:
"128. To put it differently, the section as it stood prior to 2019 had
itself incorporated the expression "including", which is indicative of
reference made to the different process or activity connected with the
proceeds of crime. Thus, the principal provision (as also the
Explanation) predicates that if a person is found to be directly or
indirectly involved in any process or activity connected with the proceeds
of crime must be held guilty of offence of money laundering. If the
interpretation set forth by the petitioners was to be accepted, it would
follow that it is only upon projecting or claiming the property in question
as untainted property, the offence would be complete. This would
undermine the efficacy of the legislative intent behind Section 3 of the Act
and also will be in disregard of the view expressed by the FATF in
connection with the occurrence of the word "and" preceding the
expression "projecting or claiming" therein.
129.This Court in Pratap Singh v. State of Jharkhand, enunciated that
the international treaties, covenants and conventions although may not
be a part of municipal law, the same be referred to and followed by the
Courts having regard to the fact that India is a party to the said treaties.
This Court went on to observe that the Constitution of India and other
ongoing statutes have been read consistently with the rules of
international law. It is also observed that the Constitution of India and
the enactments made by Parliament must necessarily be understood in
the context of the present-day scenario and having regard to the
international treaties and convention as our constitution takes note of the
institutions of the world community which had been created.
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130.In Apparel Export Promotion Council v. A.K. Chopra, the Court
observed that domestic Courts are under an obligation to give due
regard to the international conventions and norms for construing the
domestic laws, more so, when there is no inconsistency between them and
there is a void in domestic law. This view has been restated in Githa
Hariharan, as also in People's Union for Civil Liberties, and National
Legal Services Authority v. Union of India."
72.The implication of Section 50 has also been taken into consideration.
Relevant paragraph, i.e., paragraphs-327 to 332, 338, 339, 342 are quoted as
under:
"327. The validity of this provision has been challenged on the ground of
being violative of Articles 20(3) and 21 of the Constitution. For, it allows
the authorised officer under the 2002 Act to summon any person and
record his statement during the course of investigation. Further, the
provision mandates that the person should disclose true and correct facts
known to his personal knowledge in connection with the subject matter of
investigation. The person is also obliged to sign the statement so given
with the threat of being punished for the falsity or incorrectness thereof
in terms of Section 63 of the 2002 Act. Before we proceed to analyse the
matter further, it is apposite to reproduce Section 50 of the 2002 Act, as
amended. -----:
330. By this provision, the Director has been empowered to exercise the
same powers as are vested in a civil Court under the 1908 Code while
trying a suit in respect of matters specified in sub-section (1). This is in
reference to Section 13 of the 2002 Act dealing with powers of Director
to impose fine in respect of acts of commission and omission by the
banking companies, financial institutions and intermediaries. From the
setting in which Section 50 has been placed and the expanse of
empowering the Director with same powers as are vested in a civil Court
for the purposes of imposing fine under Section 13, is obviously very
specific and not otherwise.
331. Indeed, sub-section (2) of Section 50 enables the Director,
Additional Director, Joint Director, Deputy Director or Assistant
Director to issue summon to any person whose attendance he considers
necessary for giving evidence or to produce any records during the
course of any investigation or proceeding under this Act. We have
already highlighted the width of expression "proceeding" in the earlier
part of this judgment and held that it applies to proceeding before the
Adjudicating Authority or the Special Court, as the case may be.
Nevertheless, sub-section (2) empowers the authorised officials to issue
summon to any person. We fail to understand as to how Article 20(3)
would come into play in respect of process of recording statement
pursuant to such summon which is only for the purpose of collecting
information or evidence in respect of proceeding under this Act. Indeed,
the person so summoned, is bound to attend in person or through
authorised agent and to state truth upon any subject concerning which he
is being examined or is expected to make statement and produce
documents as may be required by virtue of sub-section (3) of Section 50
of the 2002 Act. The criticism is essentially because of subsection (4)
which provides that every proceeding under sub-sections (2) and (3)
shall be deemed to be a judicial proceeding within the meaning of
Sections 193 and 228 of the IPC. Even so, the fact remains that Article
20(3) or for that matter Section 25 of the Evidence Act, would come into
play only when the person so summoned is an accused of any offence at
the relevant time and is being compelled to be a witness against himself.
This position is well-established.
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332.The Constitution Bench of this Court in M.P. Sharma had dealt with
a similar challenge wherein warrants to obtain documents required for
investigation were issued by the Magistrate being violative of Article
20(3) of the Constitution. This Court opined that the guarantee in Article
20(3) is against "testimonial compulsion" and is not limited to oral
evidence. Not only that, it gets triggered if the person is compelled to be
a witness against himself, which may not happen merely because of
issuance of summons for giving oral evidence or producing documents.
Further, to be a witness is nothing more than to furnish evidence and
such evidence can be furnished by different modes. The Court went on to
observe as follows: "Broadly stated the guarantee in article 20(3) is
against "testimonial compulsion". It is suggested that this is confined to
the oral evidence of a person standing his trial for an offence when
called to the witness-stand. We can see no reason to confine the content
of the constitutional guarantee to this barely literal import. So to limit it
would be to rob the guarantee of its substantial purpose and to miss the
substance for the sound as stated in certain American decisions. The
phrase used in Article 20(3) is "to be a witness". A person can "be a
witness" not merely by giving oral evidence but also by producing
documents or making intelligible gestures as in the case of a dumb
witness (See section 119 of the Evidence Act) or the like. "To be a
witness" is nothing more than "to furnish evidence", and such evidence
can be furnished through the lips or by production of a thing or of a
document or in other modes. So far as production of documents is
concerned, no doubt Section 139 of the Evidence Act says that a person
producing a document on summons is not a witness. But that section is
meant to regulate the right of cross examination. It is not a guide to the
connotation of the word "witness", which must be understood in its
natural sense, i.e., as referring to a person who furnishes evidence.
Indeed, every positive volitional act which furnishes evidence is
testimony, and testimonial compulsion connotes coercion which procures
the positive volitional evidentiary acts of the person, as opposed to the
negative attitude of silence or submission on his part. Nor is there any
reason to think that the protection in respect of the evidence so procured
is confined to what transpires at the trial in the court room. The phrase
used in article 20(3) is "to be a witness" and not to "appear as a
witness". It follows that the protection afforded to an accused in so far as
it is related to the phrase "to be a witness" is not merely in respect of
testimonial compulsion in the court room but may well extend to
compelled testimony previously obtained from him. It is available
therefore to a person against whom a formal accusation relating to the
commission of an offence has been levelled which in the normal course
may result in prosecution. Whether it is available to other persons in
other situations does not call for decision in this case." (emphasis
supplied)
338. In the context of the 2002 Act, it must be remembered that the
summon is issued by the Authority under Section 50 in connection with
the inquiry regarding proceeds of crime which may have been attached
and pending adjudication before the Adjudicating Authority. In respect of
such action, the designated officials have been empowered to summon
any person for collection of information and evidence to be presented
before the Adjudicating Authority. It is not necessarily for initiating a
prosecution against the noticee as such. The power entrusted to the
designated officials under this Act, though couched as investigation in
real sense, is to undertake inquiry to ascertain relevant facts to facilitate
initiation of or pursuing with an action regarding proceeds of crime, if
the situation so warrants and for being presented before the Adjudicating
Authority. It is a different matter that the information and evidence so
collated during the inquiry made, may disclose commission of offence of
money-laundering and the involvement of the person, who has been
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summoned for making disclosures pursuant to the summons issued by the
Authority. At this stage, there would be no formal document indicative of
likelihood of involvement of such person as an accused of offence of
money laundering. If the statement made by him reveals the offence of
money laundering or the existence of proceeds of crime, that becomes
actionable under the Act itself.
339.To put it differently, at the stage of recording of statement for the
purpose of inquiring into the relevant facts in connection with the
property being proceeds of crime is, in that sense, not an investigation
for prosecution as such; and in any case, there would be no formal
accusation against the noticee. Such summons can be issued even to
witnesses in the inquiry so conducted by the authorised officials.
However, after further inquiry on the basis of other material and
evidence, the involvement of such person (noticee) is revealed, the
authorised officials can certainly proceed against him for his acts of
commission or omission. In such a situation, at the stage of issue of
summons, the person cannot claim protection under Article 20(3) of the
Constitution. However, if his/her statement is recorded after a formal
arrest by the ED official, the consequences of Article 20(3) or Section 25
of the Evidence Act may come into play to urge that the same being in the
nature of confession, shall not be proved against him. Further, it would
not preclude the prosecution from proceeding against such a person
including for consequences under Section 63 of the 2002 Act on the basis
of other tangible material to indicate the falsity of his claim. That would
be a matter of rule of evidence.
342. It is, thus, clear that the power invested in the officials is one for
conducting inquiry into the matters relevant for ascertaining existence of
proceeds of crime and the involvement of persons in the process or
activity connected therewith so as to initiate appropriate action against
such person including of seizure, attachment and confiscation of the
property eventually vesting in the Central Government."
73.It is evident from the observation so made as above that the purposes and
objects of the 2002 Act for which it has been enacted, is not limited to
punishment for offence of money-laundering, but also to provide measures
for prevention of money-laundering. It is also to provide for attachment of
proceeds of crime, which are likely to be concealed, transferred or dealt with
in any manner which may result in frustrating any proceeding relating to
confiscation of such proceeds under the 2002 Act. This Act is also to compel
the banking companies, financial institutions and intermediaries to maintain
records of the transactions, to furnish information of such transactions within
the prescribed time in terms of Chapter IV of the 2002 Act.
74.So far as the purport of Section 45(1)(i) & (ii) is concerned, the aforesaid
provision starts from the non-obstante clause that notwithstanding anything
contained in the Code of Criminal Procedure, 1973, no person accused of an
offence under this Act shall be released on bail or on his own bond unless-
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(i) the Public Prosecutor has been given an opportunity to oppose the
application for such release; and
(ii) where the Public Prosecutor opposes the application, the court is
satisfied that there are reasonable grounds for believing that he is not
guilty of such offence and that he is not likely to commit any offence
while on bail.
75.Sub-section (2) thereof puts limitation on granting bail specific in sub-
section (1) in addition to the limitations under the Code of Criminal
Procedure, 1973 or any other law for the time being in force on granting of
bail.
76.The explanation is also there as under sub-section (2) thereof which is for
the purpose of removal of doubts, a clarification has been inserted that the
expression "Offences to be cognizable and non-bailable" shall mean and
shall be deemed to have always meant that all offences under this Act shall
be cognizable offences and non-bailable offences notwithstanding anything
to the contrary contained in the Code of Criminal Procedure, 1973, and
accordingly the officers authorised under this Act are empowered to arrest
an accused without warrant, subject to the fulfilment of conditions under
section 19 and subject to the conditions enshrined under this section
77.The fact about the implication of Section 45 has been interpreted by the
Hon'ble Apex Court in Vijay Madanlal Choudhary and Ors. Vs. Union of
India and Ors.(supra) at paragraphs-285, 286 and 316. For ready reference,
the said paragraphs are being referred as under:-
"285.............The provision post the 2018 Amendment, is in the nature of
no bail in relation to the offence of money laundering unless the twin
conditions are fulfilled. The twin conditions are that there are reasonable
grounds for believing that the accused is not guilty of offence of money
laundering and that he is not likely to commit any offence while on bail.
286. Considering the purposes and objects of the legislation in the form
of the 2002 Act and the background in which it had been enacted owing
to the commitment made to the international bodies and on their
recommendations, it is plainly clear that it is a special legislation to deal
with the subject of money laundering activities having transnational
impact on the financial systems including sovereignty and integrity of the
countries. This is not an ordinary offence. To deal with such serious
offence, stringent measures are provided in the 2002 Act for prevention of
money laundering and combating menace of money laundering, including
for attachment and confiscation of proceeds of crime and to prosecute
persons involved in the process or activity connected with the proceeds of
crime. In view of the gravity of the fallout of money laundering activities
having transnational impact, a special procedural law for prevention and
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regulation, including to prosecute the person involved, has been enacted,
grouping the offenders involved in the process or activity connected with
the proceeds of crime as a separate class from ordinary criminals. The
offence of money laundering has been regarded as an aggravated form of
crime "world over". It is, therefore, a separate class of offence requiring
effective and stringent measures to combat the menace of money
laundering.
316. As a result, we have no hesitation in observing that in whatever form
the relief is couched including the nature of proceedings, be it under
Section 438 of the 1973 Code or for that matter, by invoking the
jurisdiction of the constitutional court, the underlying principles and
rigours of Section 45 of the 2002 Act must come into play and without
exception ought to be reckoned to uphold the objectives of the 2002 Act,
which is a special legislation providing for stringent regulatory measures
for combating the menace of money laundering."
78.The fact about the implication of Section 45 has further been interpreted by
the Hon'ble Apex Court in Vijay Madanlal Choudhary and Ors. Vs. Union
of India and Ors.(supra) at paragraphs-268-270 also . For ready reference,
the said paragraphs are being referred as under:
"268. Section 45 has been amended vide Act 20 of 2005, Act 13 of 2018
and Finance (No. 2) Act, 2019. The provision as it obtained prior to
23.11.2017 read somewhat differently. The constitutional validity of Sub-
section (1) of Section 45, as it stood then, was considered in Nikesh Tarachand
Shah. This Court declared Section 45(1) of the 2002 Act, as it stood then,
insofar as it imposed two further conditions for release on bail, to be
unconstitutional being violative of Articles 14 and 21 of the Constitution. The
two conditions which have been mentioned as twin conditions are: (i) that
there are reasonable grounds for believing that he is not guilty of such offence;
and (ii) that he is not likely to commit any offence while on bail.
269. According to the petitioners, since the twin conditions have been declared
to be void and unconstitutional by this Court, the same stood obliterated. To
buttress this argument, reliance has been placed on the dictum in State of
Manipur.
270. The first issue to be answered by us is: whether the twin conditions, in
law, continued to remain on the statute book post decision of this Court in
Nikesh Tarachand Shah and if yes, in view of the amendment effected to
Section 45(1) of the 2002 Act vide Act 13 of 2018, the declaration by this Court
will be of no consequence. This argument need not detain us for long. We say
so because the observation in State of Manipur in paragraph of the judgment
that owing to the declaration by a Court that the statute is unconstitutional
obliterates the statute entirely as though it had never been passed, is
contextual. In this case, the Court was dealing with the efficacy of the
repealing Act. While doing so, the Court had adverted to the repealing Act and
made the stated observation in the context of lack of legislative power. In the
process of reasoning, it did advert to the exposition in
BehramKhurshidPesikaka and Deep Chand including American jurisprudence
expounded in Cooley on Constitutional Limitations and Norton v. Shelby
County."
79.Subsequently, the Hon'ble Apex Court in the case of Tarun Kumar vs.
Assistant Director Directorate of Enforcement, (2023) SCC OnLine SC
1486 by taking into consideration the law laid down by the Larger Bench of
the Hon'ble Apex Court in Vijay Madanlal Choudhary and Ors. Vs. Union
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of India and Ors. (supra), it has been laid down that since the conditions
specified under Section 45 are mandatory, they need to be complied with.
The Court is required to be satisfied that there are reasonable grounds for
believing that the accused is not guilty of such offence and he is not likely to
commit any offence while on bail.
80.It has further been observed that as per the statutory presumption permitted
under Section 24 of the Act, the Court or the Authority is entitled to presume
unless the contrary is proved, that in any proceedings relating to proceeds of
crime under the Act, in the case of a person charged with the offence of
money laundering under Section 3, such proceeds of crime are involved in
money laundering. Such conditions enumerated in Section 45 of PML Act
will have to be complied with in respect of an application for bail made
under Section 439 Cr. P.C. in view of the overriding effect given to the PML
Act over the other law for the time being in force, under Section 71 of the
PML Act. For ready reference, paragraph-17 of the said judgment reads as
under:-
"17. As well settled by now, the conditions specified under Section 45
are mandatory. They need to be complied with. The Court is required
to be satisfied that there are reasonable grounds for believing that the
accused is not guilty of such offence and he is not likely to commit any
offence while on bail. It is needless to say that as per the statutory
presumption permitted under Section 24 of the Act, the Court or the
Authority is entitled to presume unless the contrary is proved, that in
any proceedings relating to proceeds of crime under the Act, in the
case of a person charged with the offence of money laundering under
Section 3, such proceeds of crime are involved in money laundering.
Such conditions enumerated in Section 45 of PML Act will have to be
complied with even in respect of an application for bail made under
Section 439 Cr. P.C. in view of the overriding effect given to the PML
Act over the other law for the time being in force, under Section 71 of
the PML Act."
81.The Hon'ble Apex Court in the said judgment has further laid down that the
twin conditions as to fulfil the requirement of Section 45 of the Act, 2002
before granting the benefit of bail is to be adhered to which has been dealt
with by the Hon'ble Apex Court in Vijay Madanlal Choudhary and Ors.
Vs. Union of India and Ors. (supra) wherein it has been observed that the
accused is not guilty of the offence and is not likely to commit any offence
while on bail.
82.In the judgment rendered by the Hon'ble Apex Court in Vijay Madanlal
Choudhary and Ors. Vs. Union of India and Ors. (supra) it has been held
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that the Authority under the 2002 Act, is to prosecute a person for offence of
money-laundering only if it has reason to believe, which is required to be
recorded in writing that the person is in possession of "proceeds of crime".
Only if that belief is further supported by tangible and credible evidence
indicative of involvement of the person concerned in any process or activity
connected with the proceeds of crime, action under the Act can be taken
forward for attachment and confiscation of proceeds of crime and until
vesting thereof in the Central Government, such process initiated would be a
standalone process.
83.So far as the issue of grant of bail under Section 45 of the Act, 2002 is
concerned, in the case of Vijay Madanlal Choudhary and Ors. Vs. Union of
India and Ors. (supra) it has been held therein by making observation that
whatever form the relief is couched including the nature of proceedings, be it
under Section 438 of the 1973 Code or for that matter, by invoking the
jurisdiction of the Constitutional Court, the underlying principles and rigors
of Section 45 of the 2002 must come into play and without exception ought
to be reckoned to uphold the objectives of the 2002 Act, which is a special
legislation providing for stringent regulatory measures for combating the
menace of money-laundering.
84.The Hon'ble Apex Court in the case of Gautam Kundu vs. Directorate of
Enforcement (Prevention of Money-Laundering Act), Government of
India through Manoj Kumar, Assistant Director, Eastern Region, reported
in (2015) 16 SCC 1 has been pleased to hold at paragraph -30 that the
conditions specified under Section 45 of PMLA are mandatory and need to
be complied with, which is further strengthened by the provisions of Section
65 and also Section 71 of PMLA.
85.Section 65 requires that the provisions of CrPC shall apply insofar as they
are not inconsistent with the provisions of this Act and Section 71 provides
that the provisions of PMLA shall have overriding effect notwithstanding
anything inconsistent therewith contained in any other law for the time being
in force. PMLA has an overriding effect and the provisions of CrPC would
apply only if they are not inconsistent with the provisions of this Act.
86.Therefore, the conditions enumerated in Section 45 of PMLA will have to be
complied with even in respect of an application for bail made under Section
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439 CrPC. That coupled with the provisions of Section 24 provides that
unless the contrary is proved, the authority or the Court shall presume that
proceeds of crime are involved in money-laundering and the burden to prove
that the proceeds of crime are not involved, lies on the petitioner.
87.Now, after having discussed the judgments passed by the Hon'ble Apex
Court on the issue of various provisions of the Act, 2002, this Court, is
proceeding to answer the legal grounds as has been raised on behalf of the
learned counsel for the petitioner.
88.We are dealing herein with the petition of pre-arrest bail which is to be
granted in exercise of power conferred under Section 438 of Cr.P.C. The law
is well settled so far as the consideration of the prayer of the pre-arrest bail is
concerned, what is the requirement to be looked into for the purpose of
granting the said benefit.
89.It has been settled by Hon'ble Apex Court time and again in its various
pronouncements that the powers under Section 438 Cr.P.C., is in extra-
ordinary character and must be exercised sparingly in exceptional cases only
and therefore, the anticipatory bail can be granted only in exceptional
circumstances where the court is prima facie of the view that the applicant
has falsely been implicated in the crime, as grant of anticipatory bail to some
extent, is interference in the sphere of investigation of an offence and hence,
the court must be cautious while exercising such powers.
90.It is also settled connotation of law that the grant or refusal of the application
should necessarily depend on the facts and circumstance of each case and
there is no hard and fast rule and no inflexible principles governing such
exercise by the Court.
91.It is pertinent to mention here that the law on grant of anticipatory bail has
been summed up by the Hon'ble Apex Court in Siddharam Satlinappa
Mhetre vs. state of Maharashtra & Ors. reported in (2011)1 SCC 694 after
due deliberation on the parameters as evolved by the Constitution Bench in
Gurubaksh Singh Sibbia vs. State of Punjab reported in (1980) 2 SCC 565.
The relevant paragraphs of the said judgment as rendered by the Hon'ble
Apex Court is being quoted hereunder:-
"111. No inflexible guidelines or straitjacket formula can be provided for
grant or refusal of anticipatory bail. We are clearly of the view that no
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attempt should be made to provide rigid and inflexible guidelines in this
respect because all circumstances and situations of future cannot be
clearly visualised for the grant or refusal of anticipatory bail. In
consonance with the legislative intention the grant or refusal of
anticipatory bail should necessarily depend on the facts and
circumstances of each case. As aptly observed in the Constitution Bench
decision in Sibbia case [(1980) 2 SCC 565 : 1980 SCC (Cri) 465] that the
High Court or the Court of Session has to exercise their jurisdiction
under Section 438 CrPC by a wise and careful use of their discretion
which by their long training and experience they are ideally suited to do.
In any event, this is the legislative mandate which we are bound to
respect and honour.
112. The following factors and parameters can be taken into
consideration while dealing with the anticipatory bail:
(i) The nature and gravity of the accusation and the exact role of the
accused must be properly comprehended before arrest is made;
(ii) The antecedents of the applicant including the fact as to whether the
accused has previously undergone imprisonment on conviction by a court
in respect of any cognizable offence;
(iii) The possibility of the applicant to flee from justice;
(iv) The possibility of the accused's likelihood to repeat similar or other
offences;
(v) Where the accusations have been made only with the object of injuring
or humiliating the applicant by arresting him or her;
(vi) Impact of grant of anticipatory bail particularly in cases of large
magnitude affecting a very large number of people;
(vii) The courts must evaluate the entire available material against the
accused very carefully. The court must also clearly comprehend the exact
role of the accused in the case. The cases in which the accused is
implicated with the help of Sections 34 and 149 of the Penal Code, 1860
the court should consider with even greater care and caution because
overimplication in the cases is a matter of common knowledge and
concern;
(viii) While considering the prayer for grant of anticipatory bail, a
balance has to be struck between two factors, namely, no prejudice
should be caused to the free, fair and full investigation and there should
be prevention of harassment, humiliation and unjustified detention of the
accused;
(ix) The court to consider reasonable apprehension of tampering of the
witness or apprehension of threat to the complainant;
(x) Frivolity in prosecution should always be considered and it is only the
element of genuineness that shall have to be considered in the matter of
grant of bail and in the event of there being some doubt as to the
genuineness of the prosecution, in the normal course of events, the
accused is entitled to an order of bail.
114. These are some of the factors which should be taken into
consideration while deciding the anticipatory bail applications. These
factors are by no means exhaustive but they are only illustrative in nature
because it is difficult to clearly visualise all situations and circumstances
in which a person may pray for anticipatory bail. If a wise discretion is
exercised by the Judge concerned, after consideration of the entire
material on record then most of the grievances in favour of grant of or
refusal of bail will be taken care of. The legislature in its wisdom has
entrusted the power to exercise this jurisdiction only to the Judges of the
superior courts. In consonance with the legislative intention we should
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accept the fact that the discretion would be properly exercised. In any
event, the option of approaching the superior court against the Court of
Session or the High Court is always available."
92. In Sushila Aggarwal v. State (NCT of Delhi) reported in (2020) 5 SCC 1 the
Constitution Bench of the Hon'ble Apex Court has reiterated that while
deciding applications for anticipatory bail, Courts should be guided by factors
like the nature and gravity of the offences and the role attributed to the
applicant and the facts of the case.
93. The Hon'ble Supreme Court, in catena of decisions, has categorically held
that the judicial discretion of the Court while considering the anticipatory bail
shall be guided by various relevant factors and largely it will depend upon the
facts and circumstances of each case. Reference in this regard may be taken
from the judgment rendered by the Hon'ble Apex Court in the case of Central
Bureau of Investigation Vs Santosh Krnani and Another reported in 2023
SCC OnLine SC 427. For ready reference the relevant paragraph of the
aforesaid judgment is being quoted herein under:
"24. The time-tested principles are that no straitjacket formula can be
applied for grant or refusal of anticipatory bail. The judicial discretion of
the Court shall be guided by various relevant factors and largely it will
depend upon the facts and circumstances of each case. The Court must draw
a delicate balance between liberty of an individual as guaranteed under
Article 21 of the Constitution and the need for a fair and free investigation,
which must be taken to its logical conclusion. Arrest has devastating and
irreversible social stigma, humiliation, insult, mental pain and other fearful
consequences. Regardless thereto, when the Court, on consideration of
material information gathered by the Investigating Agency, is prima facie
satisfied that there is something more than a mere needle of suspicion
against the accused, it cannot jeopardise the investigation, more so when the
allegations are grave in nature."
94. It is, evident by taking into consideration the provision of Section 45(1),
45(2), the conditions which are required to be considered while granting the
benefit of regular bail in exercise of power conferred under Section 438 or
439 of Cr.P.C., i.e., pre-arrest bail apart from the twin conditions which has
been provided under Section 45(1) of the Act, 2002, the conditions or the
requirement which has been followed while granting the bail under Section
439 or 438, as the case may be.
Further after going through the provision of Section 45(1), is of the
view that there is no reference to that effect that once the ECIR has been
submitted the public prosecutor appearing for the Enforcement Directorate
will have no occasion to make opposition for grant of bail of pre-arrest bail
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rather the Section 45(1) of the Act, 2002 provide occasion as under
45(1)(i)(ii), i.e., to provide an opportunity to the public prosecutor before
passing an order either under Section 439 or 438 of Cr.P.C.
95. Sub-section (1)(ii) of Section 45 of the Act, 2002, provides that if 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, meaning thereby, the
parameter which is to be followed by the concerned court that satisfaction is
required to be there for believing that such accused person is not guilty of
such offence and is not likely to commit of offence while on bail.
96. This Court, after discussing the aforesaid legal issues, is of the view that the
case is to be tested on the basis of the ground that the fulfilment of twin
conditions as provided under Section 45 of the Act, 2002, i.e., the Public
Prosecutor has been given an opportunity to oppose the application for such
release; and where the Public Prosecutor opposes the application, whether 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.
97. The Larger Bench of the Hon'ble Apex Court in Vijay Madanlal Choudhary
and Ors. Vs. Union of India and Ors.(supra) has taken into consideration
while dealing with the issue of anticipatory bail by taking aid of the
judgement rendered by the Hon'ble Apex Court in P. Chidambaram vs.
Directorate of Enforcement, (2019) 9 SCC 24 wherein it has been observed
at paragraph-313 which reads as under:
"313. In P. Chidambaram, this Court observed that the power of anticipatory
bail should be sparingly exercised in economic offences and held thus:
"77. After referring to Siddharam Satlingappa Mhetre and other
judgments and observing that anticipatory bail can be granted only in
exceptional circumstances, in Jai Prakash Singh v. State of Bihar, the
Supreme Court held as under : (SCC p.386, para 19)
"19. Parameters for grant of anticipatory bail in a serious offence are
required to be satisfied and further while granting such relief, the court must
record the reasons therefor. Anticipatory bail can be granted only in
exceptional circumstances where the court is prima facie of the view that the
applicant has falsely been enroped in the crime and would not misuse his
liberty. (See D.K. Ganesh Babu v. P.T. Manokaran, State of
Maharashtra v. Mohd. Sajid Husain Mohd. S. Husain and Union of
India v. Padam Narain Aggarwal)
Economic Offences
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78. Power under Section 438 CrPC being an extraordinary remedy, has
to be exercised sparingly; more so, in cases of economic offences. Economic
offences stand as a different class as they affect the economic fabric of the
society. In Directorate of Enforcement v. Ashok Kumar Jain, it was held that
in economic offences, the accused is not entitled to anticipatory bail.
83. Grant of anticipatory bail at the stage of investigation may frustrate
the investigating agency in interrogating the accused and in collecting the
useful information and also the materials which might have been
concealed. Success in such interrogation would elude if the accused knows
that he is protected by the order of the court. Grant of anticipatory bail,
particularly in economic offences would definitely hamper the effective
investigation. Having regard to the materials said to have been collected by
the respondent Enforcement Directorate and considering the stage of the
investigation, we are of the view that it is not a fit case to grant anticipatory
bail.
84. In a case of money-laundering where it involves many stages of
"placement", "layering i.e. funds moved to other institutions to conceal
origin" and "interrogation i.e. funds used to acquire various assets", it
requires systematic and analysed investigation which would be of great
advantage. As held in Anil Sharma, success in such interrogation would
elude if the accused knows that he is protected by a pre-arrest bail order.
Section 438 CrPC is to be invoked only in exceptional cases where the case
alleged is frivolous or groundless. In the case in hand, there are allegations
of laundering the proceeds of the crime. The Enforcement Directorate claims
to have certain specific inputs from various sources, including overseas
banks. Letter rogatory is also said to have been issued and some response
have been received by the Department. Having regard to the nature of
allegations and the stage of the investigation, in our view, the investigating
agency has to be given sufficient freedom in the process of investigation.
Though we do not endorse the approach of the learned Single Judge in
extracting the note produced by the Enforcement Directorate, we do not find
any ground warranting interference with the impugned order. Considering
the facts and circumstances of the case, in our view, grant of anticipatory
bail to the appellant will hamper the investigation and this is not a fit case
for exercise of discretion to grant anticipatory bail to the appellant."
(emphasis supplied)
98. It is evident from the reference so made in the case of P. Chidambaram vs.
Directorate of Enforcement (supra) which has been taken note by the Hon'ble
Apex Court in Vijay Madanlal Choudhary and Ors. Vs. Union of India and
Ors.(supra) taking the principle to be applied for consideration of pre-arrest
bail under Section 438 of Cr.P.C. in the matter of economic offence has also
been dealt with at paragraph-84 of the aforesaid judgment. The specific
condition has been made in the case of money laundering where it involves
many stages of "placement", "layering i.e. funds moved to other institutions
to conceal origin" and "interrogation i.e. funds used to acquire various
assets", it requires systematic and analysed investigation which would be of
great advantage.
99. Section 438 CrPC is to be invoked only in exceptional cases where the case
alleged is frivolous or groundless. Reference may be made to the paragraphs-
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83 and 84 of the judgment rendered in P. Chidambaram vs. Directorate of
Enforcement (supra) as quoted and referred above.
100. This Court, in order to come to a conclusive finding as to whether the
petitioner is fulfilling these criteria/grounds, needs to refer herein the
evidence collected in course of preparation of Vth supplementary prosecution
complaint which are as followed:
9. BRIEF SUMMARY OF RESULT OF INVESTIGATION UNDER
PMLA
9.5 It is established that Rajesh Yadav @ Dahu Yadav (A-12), a habitual
offender with an extensive criminal history, acted as the key henchman
and on-ground commander for Pankaj Mishra. The investigation
revealed that Rajesh Yadav, in connivance with Pankaj Mishra and
others, fraudulently acquired the tender for the Sahibganj-Manihari ferry
services for 28.52 Crore by using a front entity, Nav Yatayat Sahyog
Samiti, as a corporate veil to conceal the involvement of the main
criminal syndicate and to channelize the illicit funds. The statement of
Shri Hulash Choudhary, the overseer of the ferry ghat, recorded on
31.08.2022, confirmed that Rajesh Yadav and his brother Sunil Yadav
(A-8) financed the tender. By controlling the ferry services, the syndicate
illegally transported thousands of trucks carrying stone chips without
valid challans, from which they extorted illegal levies. To manage the
operations and layer the illicit funds, he used a network of corporate
vehicles, including the partnership firm M/s Singhwahini Transport &
Logistics (A-9) and the private limited company M/s Rayadav
Transportation Pvt. Ltd. (A-18). The seizure of handwritten registers
from his residence on 08.07.2022, which recorded the movement of these
trucks and the cash collected, provided irrefutable documentary evidence
of this systematic and illegal operation.
9.7 The investigation has established that the proceeds of crime were
primarily generated in cash and then laundered through a classic three-
stage process.
Placement: The illicit cash was injected into the formal financial system
through massive cash deposits into a web of bank accounts. The accounts
linked to the transport businesses of the Yadav family alone saw cash
deposits exceeding 20.67 Crore.
Layering: The funds were then moved through a series of complex and
often fictitious transactions between the bank accounts of the accused,
their family members, and their front companies, such as M/s
Singhwahini Transport & Logistics (A-9) and M/s Rayadav
Transportation Pvt. Ltd. (A-18), to obscure the illicit origin of the funds.
Integration: Finally, the laundered funds were integrated into the
legitimate economy through the acquisition of high-value assets, such as
the 'White House' hotel, purchased for ₹3.15 Crore by M/s Maya Holiday
Inn (a firm controlled by the son of Rajesh Yadav), and were also
ploughed back to finance the criminal enterprise, such as paying for the
28.52 Crore ferry tender.
10.4 Evidence against Rajesh Yadav Dahu Yadav (A-12)
10.41 The investigation has established that Rajesh Yadav Dahu Yadav,
a habitual offender with numerous criminal cases registered against him,
acted as the key henchman and on-ground operator for Pankaj Mishra.
He was instrumental in enforcing the syndicate's control over the illegal
stone mining and transportation racket in Sahibganj. A primary area of
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his control was the interstate ferry service on the fiver Ganga, a critical
artery for transporting illegally mined stone from Tharkhand to Bihar.
10.42 The investigation reveals that Rajesh Yadav, in connivance with
Pankaj Mishra and others, fraudulently acquired the tender for the
Sahibganj-Manihari ferry services for 28.52 Crore. This was achieved by
using a front entity, Nav Yatayat Sahyog Samiti. In his statement dated
31.08.2022, Shri Hulash Choudhary, the overseer of the ferry ghat,
confirmed that Rajesh Yadav and Sunil Yadav provided the funds for the
tender. This is corroborated by bank records showing transfers from M/s
Singhwahini Transport & Logistics to Hulash Choudhary's account for
the tender payment. He further stated that in return for this financing, the
Samiti received a nominal fixed amount of 210 lakh per year, while the
entire operations and earnings of the ferry services were managed by
Rajesh Yadav's team. [RUD No. 8 in Prosecution Complaint dated
20.102023]
10.4.3 This statement is corroborated by the financial investigation. Bank
analysis revealed that on 16.03.2022, amounts of ₹1.45 Crore and ₹1.35
Crore were transferred from the bank account of M/s Singhwahini
Transport & Logistics (a firm controlled by Rajesh Yadav) to the SBI
account of Hulash Choudhary as part of the tender payment. This
establishes a direct link between the funds of Rajesh Yadav and the
acquisition of the ferry tender.
10.4.4 Rajesh Yadav utilized a network of business entities to launder the
proceeds of crime generated from the illegal transportation and
extortion. M/s Singhwahini Transport & Logistics, a partnership firm,
with his brothers Sunil Yadav and Anil Yadav, was central to the
operation. The firm's bank accounts were used to funnel huge amounts of
cash. For instance, the firm's IOB account saw cash deposits exceeding
₹12.10 Crore between 2018 and 2022. The HDFC account saw cash
deposits of over 7.49 Crore between 2021 and 2022. These funds,
projected as business income, were used for purposes such as financing
the ferry tender and making payments for the operation of vessels.
10.4.5 In his statements recorded under Section 50 of PMLA on
15.07.2022 and 17.07.2022, Rajesh Yadav made crucial admissions. He
admitted to the modus operandi of the illegal mining operation in
Sahibganj under the patronage of Pankaj Mishra. He acknowledged that
his firm, Singhwahini Transport, obtained the ferry tenders and operated
two large cargo ships (Titan 3 and 4) to transport storie-laden trucks.
Critically, he admitted his awareness that a large number of these trucks
were carrying stone chips without valid mining challans. In his statement
dated 17.07.2022, he quantified the scale, stating that prior to the
crackdown, about 2,000 trucks per day were transporting stone, which
had reduced to 400-500 trucks after enforcement actions. This admission
underscores his knowledge and direct involvement in facilitating the
transport of illegally mined minerals. [RUD No. 1].
10.4.6 During the search of his premises, registers/logbooks of trucks
were seized, which further evidence the massive scale of the illegal
transport operations he was managing. Financial scrutiny of Rajesh
Yadav's personal bank accounts revealed large, unexplained cash
deposits. For example, his HDFC Bank account (No. 50200014597685)
showed cash deposits of 242.57 Lakh between October 2015 and January
2017, heavily concentrated in October November 2016. He could not
provide a satisfactory explanation for these deposits, claiming a lapse of
memory. Following his initial statements in July 2022, Rajesh Yadav
became non-compliant, repeatedly ignored summons issued by the
Directorate, and subsequently absconded. While he initially appeared
and gave statements in July 2022, his cooperation ceased thereafter. He
repeatedly ignored subsequent summonses issued by the Directorate,
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leading this Hon'ble Court to issue a Non-Bailable Warrant against him.
The accused challenged this action, and the matter eventually reached
the Hon'ble Supreme Court of India. In its order dated 18.08.2023 in SLP
(CrL.) No. 6322/2023, the Hon'ble Supreme Court, while dismissing his
petition, gave the petitioner, Rajesh Yadav, a final opportunity, directing
him to "appear before the Investigating Officer" within "two weeks'
time". His failure to comply with this clear and specific direction from
the apex court and his continued evasion of the investigation since that
date, unequivocally establishes him as a fugitive from justice,
demonstrating a guilty mind and a deliberate attempt to obstruct the
legal process.
10.47 The cumulative evidence, including witness statements, financial
trails, bank account analyses, seizure of incriminating documents, and
his own admissions, conclusively proves that Rajesh Yadav @ Dahu
Yadav was not merely an associate but a pivotal figure who knowingly
and actively participated in the offence of money laundering. He was
directly involved in the process and activity connected with the proceeds
of crime, including its collection (through extortion and illegal ferry
operations), possession, concealment, and use (by laundering through his
companies to acquire assets and control businesses), as defined under
Section 3 of the PMLA, 2002.
11. CONDUCT OF THE ACCUSED PERSONS DURING
INVESTIGATION
11.1 The conduct of the accused persons during the investigation under
the Prevention of Money Laundering Act, 2002, has been a mix of non-
cooperation, evasion, providing misleading information, and, in some
instances, absconding to frustrate the investigation. The specific conduct
of each accused is detailed below:
11.2 Rajesh Yadav Dahu Yadav (A-12) and Sunil Yadav (A-8)
(i) Willful Evasion and Abscondence: After initial summonses were
issued, both Rajesh Yadav and Sunil Yadav deliberately and intentionally
avoided appearing before the Investigating Officer on multiple dates in
July, August, and September 2022.
(ii) Non-Cooperation Leading to Coercive Measures. Their persistent
non-compliance led the Directorate to approach this Hon'ble Court,
which was pleased to issue a Non-Bailable Warrant (NBW) against them
on 29.10.2022 Subsequently, processes under Sections 82 and 83 of the
Code of Criminal Procedure were also invoked.
(iii) Continued Defiance and Abscondence of Rajesh Yadav: Despite the
NBW and a specific direction from the Hon'ble Supreme Court of India
vide order dated 18.08.2023, the accused Rajesh Yadav @ Dahu Yadav
has failed to surrender and remains absconding to date. His conduct
demonstrates a clear intention to evade the process of law.
(iv) Criminal Antecedents: Investigation has revealed that Rajesh Yadav
has extensive criminal histories, with multiple FIRs registered against
them for serious offenses including attempt to murder, extortion, and
violations of the Arms Act, indicating his propensity for criminal
activities.
13.4 The specific roles of the accused, which individually and
collectively satisfy the ingredients of the offence of money laundering
as defined under Section 3 of the PMLA, 2002, are detailed below:
13.5 Rajesh Yadav Dahu Yadav (Accused No. 12)
Investigation has established that Rajesh Yadav Dahu Yadav, a habitual
offender with numerous criminal cases registered against him, acted as
the key henchman and on-ground operator for Pankaj Mishra (A-1). He
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was instrumental in enforcing the syndicate's control over the illegal
stone mining and transportation racket in Sahibganj. His involvement in
the offence of money laundering is multifaceted:
Acquisition and Use of Proceeds of Crime: He was directly involved in
the fraudulent acquisition of the tender for the Sahibganj-Manihari ferry
services for 28.52 Crore. He achieved this by using illicit cash and
routing funds through his firm, M/s Singhwahini Transport & Logistics,
thereby using the proceeds of crime to acquire control over a critical
infrastructure asset. He then used this asset as an instrument to further
the offence by facilitating the illegal transportation of minerals, which in
turn generated more proceeds of crime.
Generation, Collection, and Concealment of PoC: As confirmed in his
own statements recorded on 15.07.2022 and 17.07.2022, he managed the
syndicate's illegal ferry operations, knowingly transporting hundreds of
trucks daily that were carrying illegally mined stone without valid
challans. He systematically collected illegal levies in cash from these
operations. The handwritten registers seized from his residence on
08.07.2022 are direct documentary evidence of this illegal business,
detailing the illicit cash collections and proving his direct role in the
generation and systematic concealment of proceeds of crime.
Possession and Layering of PoC: He used a web of bank accounts,
primarily those of his firm M/s Singhwahini Transport & Logistics, to
possess and layer the illicit funds. Investigation has revealed cash
deposits exceeding 19.59 Crore into these accounts. He further used
these laundered funds for operational expenses, including a payment of
₹2.75 Crore to M/s Marine Infralink Logistics Pvt. Ltd. (A-17) for the use
of its vessel.
Party to Criminal Conspiracy & Evasion: His admissions confirm his
awareness of the illegality of the operations and his role within the
syndicate, which included paying a fixed share of the proceeds to Pankaj
Mishra (A-1). His subsequent abscondence establishes his guilty mind
and deliberate attempt to obstruct justice. After the issuance of a Non-
Bailable Warrant, the Hon'ble Supreme Court of India, while hearing his
SLP (Crl.) No. 6322/2023, vide its order dated 18.08.2023, directed him
to appear before the Investigating Officer. His continued failure to
appear before the authorities in defiance of this clear and specific
direction from the nation's apex court unequivocally demonstrates his
contempt for the legal process and his intent to evade the investigation.
In view of the above, it is established that Rajesh Yadav Dahu Yadav was
knowingly a party to and was actually involved in all processes and
activities connected with the proceeds of crime, thereby committing an
offence punishable under Section 3 of the PMLA, 2002.
101. It is evident from the aforesaid material which has been surfaced in course of
investigation that that the Petitioner is closely associated with co-accused
persons involved in organized illegal mining and transportation of stone chips
in Sahebganj. Multiple FIRs involving serious offences, including Sections
307 and 120-B of the IPC and Section 27 of the Arms Act, have been
registered against him and his associates and merged into the present ECIR
for comprehensive investigation. Further, substantial proceeds of crime in the
form of large cash seizures, frozen bank balances, vessels and other assets
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have been identified during investigation, reflecting the organized and large-
scale nature of the activities.
102. The investigation has revealed that the Petitioner, in active coordination with
co-accused persons, exercised control over ferry operations which were
systematically used for transporting trucks loaded with illegally mined stone
chips across the river route. The ferry services were not restricted to lawful
passenger movement but were utilized as a crucial link in the illegal
transportation network connected with the generation and movement of
proceeds of crime. The Prosecution Complaint further records that illegal
mining and transportation activities were carried out in an organized and
coordinated manner, and that inland vessel operations formed an essential
component in facilitating the movement of illegally mined minerals and
handling of proceeds of crime.
103. Further, it transpires that the present petitioner Rajesh Yadav @ Dahu Yadav
(A-12), a habitual offender with an extensive criminal history, acted as the
key henchman and on-ground commander for Pankaj Mishra. The
investigation revealed that Rajesh Yadav, in connivance with Pankaj Mishra
and others, fraudulently acquired the tender for the Sahibganj-Manihari ferry
services for 28.52 Crore by using an entity, Nav Yatayat Sahyog Samiti, as a
corporate veil to conceal the involvement of the main criminal syndicate and
to channelize the illicit funds.
104. Further, the statement of Shri Hulash Choudhary, the overseer of the ferry
ghat, recorded on 31.08.2022, confirmed that Rajesh Yadav and his brother
Sunil Yadav (A-8) financed the tender. By controlling the ferry services, the
syndicate illegally transported thousands of trucks carrying stone chips
without valid challans, from which they extorted illegal levies. To manage the
operations and layer the illicit funds, he used a network of corporate vehicles,
including the partnership firm M/s Singhwahini Transport & Logistics (A-9)
and the private limited company M/s Rayadav Transportation Pvt. Ltd. (A-
18). The seizure of handwritten registers from his residence on 08.07.2022,
which recorded the movement of these trucks and the cash collected, provided
irrefutable documentary evidence of this systematic and illegal operation.
105. After considering the evidence available on record in its entirety, prima-facie
it is evident that there are specific allegations against the petitioner that the
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petitioner knowingly utilized a network of business entities to launder the
proceeds of crime generated from the illegal transportation and extortion. M/s
Singhwahini Transport & Logistics, a partnership firm, with his brothers Sunil
Yadav and Anil Yadav, was central to the operation. The firm's bank accounts
were used to funnel huge amounts of cash. For instance, the firm's IOB
account saw cash deposits exceeding ₹12.10 Crore between 2018 and 2022.
The HDFC account saw cash deposits of over 7.49 Crore between 2021 and
2022. These funds, projected as business income, were used for purposes such
as financing the ferry tender and making payments for the operation of
vessels.
106. It is evident from Vth supplementary prosecution complaint that the petitioner
himself admitted to the modus operandi of the illegal mining operation in
Sahibganj under the patronage of Pankaj Mishra. He acknowledged that his
firm, Singhwahini Transport, obtained the ferry tenders and operated two
large cargo ships (Titan 3 and 4) to transport storie-laden trucks. Critically, he
admitted his awareness that a large number of these trucks were carrying
stone chips without valid mining challans. In his statement dated 17.07.2022,
he quantified the scale, stating that prior to the crackdown, about 2,000 trucks
per day were transporting stone, which had reduced to 400-500 trucks after
enforcement actions. This admission underscores his knowledge and direct
involvement in facilitating the transport of illegally mined minerals. [RUD
No. 1].
107. Further it has come during investigation that during the search of petitioner's
premises, registers/logbooks of trucks were seized, which further evidence the
massive scale of the illegal transport operations he was managing. Financial
scrutiny of Rajesh Yadav's personal bank accounts revealed large,
unexplained cash deposits. For example, his HDFC Bank account (No.
50200014597685) showed cash deposits of 242.57 Lakh between October
2015 and January 2017, heavily concentrated in October November 2016. The
petitioner could not provide a satisfactory explanation for these deposits,
claiming a lapse of memory. Following his initial statements in July 2022,
Rajesh Yadav became non-compliant, repeatedly ignored summons issued by
the Directorate, and subsequently absconded. While he initially appeared and
gave statements in July 2022, his cooperation ceased thereafter.
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108. Thus, from the aforesaid paragraph, prima facie the culpability of the present
appellant has been established in the alleged commission of crime.
109. In the backdrop of the aforesaid settled connotation of law and further taking
into consideration the culpability of the present petitioner this Court is now
adverting to the argument of the learned counsel for the parties.
110. The foremost contention made by the learned counsel for the petitioner that
since petitioner has not been named in the principal FIR or charge-sheet,
therefore he cannot be prosecuted under the Act 2002.
111. In the aforesaid context it requires to refer herein that the Hon'ble Apex
Court in the case of Pavana Dibbur vs. The Directorate of Enforcement
passed in Criminal Appeal No. 2779 of 2023 has considered the effect of the
appellant not being shown as an accused in the predicate offence by taking
into consideration the Section 3 of the Act, 2002.
112. The Hon'ble Apex Court by interpreting the provision of Section 3 of the Act,
2002 has come out with the finding that on a plain reading of Section 3,
unless proceeds of crime exist, there cannot be any money laundering offence.
Based upon the definition Clause (u) of sub-section (1) of Section 2 of
the Act 2002 which defines "proceeds of crime", the Hon'ble Apex Court at
paragraph-12 has been pleased to observe that clause (v) of sub-section (1) of
Section 2 of PMLA defines "property" to mean any property or assets of
every description, whether corporeal or incorporeal, movable or immovable,
tangible or intangible. To constitute any property as proceeds of crime, it
must be derived or obtained directly or indirectly by any person as a result of
criminal activity relating to a scheduled offence. The explanation clarifies
that the proceeds of crime include property, not only derived or obtained from
scheduled offence but also any property which may directly or indirectly be
derived or obtained as a result of any criminal activity relatable to the
scheduled offence. Clause (u) also clarifies that even the value of any such
property will also be the proceeds of crime. Thus, the existence of "proceeds
of crime" is sine qua non for the offence under Section 3 of the PMLA.
At paragraph-13, it has observed that Clause (x) of subsection (1) of
Section 2 of the PMLA defines "schedule". Clause (y) thereof defines
"scheduled offence", which have been quoted and referred above.
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At paragraph-14, it has observed by referring the decision rendered by
the Hon'ble Apex Court in Vijay Madanlal Choudhary and Ors. Vs. Union
of India and Ors.(supra) that the condition precedent for the existence of
proceeds of crime is the existence of a scheduled offence.
At paragraph-15 the finding has been given therein that on plain
reading of Section 3 of the Act, 2002, an offence under Section 3 can be
committed after a scheduled offence is committed. By giving an example, it
has been clarified that if a person who is unconnected with the scheduled
offence, knowingly assists the concealment of the proceeds of crime or
knowingly assists the use of proceeds of crime, in that case, he can be held
guilty of committing an offence under Section 3 of the PMLA.
The Hon'ble Apex Court has further clarified by giving an example
that the offences under Sections 384 to 389 of the IPC relating to "extortion"
are scheduled offences included in Paragraph 1 of the Schedule to the PMLA.
An accused may commit a crime of extortion covered by Sections 384 to 389
of IPC and extort money. Subsequently, a person unconnected with the
offence of extortion may assist the said accused in the concealment of the
proceeds of extortion. In such a case, the person who assists the accused in
the scheduled offence for concealing the proceeds of the crime of extortion
can be guilty of the offence of money laundering. Therefore, it is not
necessary that a person against whom the offence under Section 3 of the
PMLA is alleged must have been shown as the accused in the scheduled
offence. What is held in paragraph 270 of the decision of this Court in the
case of Vijay Madanlal Choudhary supports the above conclusion. The
conditions precedent for attracting the offence under Section 3 of the PMLA
are that there must be a scheduled offence and that there must be proceeds of
crime in relation to the scheduled offence as defined in clause (u) of sub-
section (1) of Section 3 of the PMLA.
For ready reference, paragraphs-12, 13, 14, 15 of the judgment
rendered in the case of Pavana Dibbur vs. The Directorate of Enforcement
(supra) read as under:
"12. Clause (v) of subsection (1) of Section 2 of the PMLA defines
"property" to mean any property or assets of every description, whether
corporeal or incorporeal, movable or immovable, tangible or intangible.
To constitute any property as proceeds of crime, it must be derived or
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obtained directly or indirectly by any person as a result of criminal
activity relating to a scheduled offence. The explanation clarifies that
the proceeds of crime include property, not only derived or obtained
from scheduled offence but also any property which may directly or
indirectly be derived or obtained as a result of any criminal activity
relatable to the scheduled offence. Clause (u) also clarifies that even the
value of any such property will also be the proceeds of crime. Thus, the
existence of "proceeds of crime" is sine qua non for the offence under
Section 3 of the PMLA.
13. Clause (x) of subsection (1) of Section 2 of the PMLA defines
"schedule". Clause (y) thereof defines "scheduled offence", which reads
thus:
"2. Definition - (1) In this Act, unless the context otherwise requires,
.. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. . .
(y) "scheduled offence" means--
(i) the offences specified under Part Aof the Schedule; or
(ii) the offences specified under Part Bof the Schedule if the total value
involved in such offences is one crore rupees or more; or
(iii) the offences specified under PartC of the Schedule."
14. The condition precedent for the existence of proceeds of crime is the
existence of a scheduled offence. On this aspect, it is necessary to refer
to the decision of this Court in the case of Vijay Madanlal Choudhary.
In paragraph 253 of the said decision, this Court held thus:
"253. Tersely put, it is only such property which is derived or obtained,
directly or indirectly, as a result of criminal activity relating to a
scheduled offence can be regarded as proceeds of crime. The authorities
under the 2002 Act cannot resort to action against any person for money-
laundering on an assumption that the property recovered by them must
be proceeds of crime and that a scheduled offence has been committed,
unless the same is registered with the jurisdictional police or pending
inquiry by way of complaint before the competent forum. For, the
expression "derived or obtained" is indicative of criminal activity
relating to a scheduled offence already accomplished. Similarly, in the
event the person named in the criminal activity relating to a scheduled
offence is finally absolved by a Court of competent jurisdiction owing to
an order of discharge, acquittal or because of quashing of the criminal
case (scheduled offence) against him/her, there can be no action for
moneylaundering against such a person or person claiming through him
in relation to the property linked to the stated scheduled offence. This
interpretation alone can be countenanced on the basis of the provisions
of the 2002 Act, in particular Section 2(1)(u) read with Section 3. Taking
any other view would be rewriting of these provisions and disregarding
the express language of definition clause "proceeds of crime", as it
obtains as of now."
(underline supplied)
In paragraphs 269 and 270, this Court held thus:
"269. From the bare language of Section 3 of the 2002 Act, it is amply
clear that the offence of moneylaundering is an independent offence
regarding the process or activity connected with the proceeds of crime
which had been derived or obtained as a result of criminal activity
relating to or in relation to a scheduled offence. The process or activity
can be in any form -- be it one of concealment, possession, acquisition,
use of proceeds of crime as much as projecting it as untainted property
or claiming it to be so. Thus, involvement in any one of such process or
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activity connected with the proceeds of crime would constitute offence of
moneylaundering. This offence otherwise has nothing to do with the
criminal activity relating to a scheduled offence -- except the proceeds of
crime derived or obtained as a result of that crime.
270. Needless to mention that such process or activity can be indulged in
only after the property is derived or obtained as a result of criminal
activity (a scheduled offence). It would be an offence of moneylaundering
to indulge in or to assist or being party to the process or activity
connected with the proceeds of crime; and such process or activity in a
given fact situation may be a continuing offence, irrespective of the date
and time of commission of the scheduled offence. In other words, the
criminal activity may have been committed before the same had been
notified as scheduled offence for the purpose of the 2002 Act, but if a
person has indulged in or continues to indulge directly or indirectly in
dealing with proceeds of crime, derived or obtained from such criminal
activity even after it has been notified as scheduled offence, may be liable
to be prosecuted for offence of moneylaundering under the 2002 Act --
for continuing to possess or conceal the proceeds of crime (fully or in
part) or retaining possession thereof or uses it in trenches until fully
exhausted. The offence of moneylaundering is not dependent on or linked
to the date on which the scheduled offence or if we may say so the
predicate offence has been committed. The relevant date is the date on
which the person indulges in the process or activity connected with such
proceeds of crime. These ingredients are intrinsic in the original
provision (Section 3, as amended until 2013 and were in force till
31.7.2019); and the same has been merely explained and clarified by way
of Explanation vide Finance (No. 2) Act, 2019. Thus understood,
inclusion of Clause (ii) in Explanation inserted in 2019 is of no
consequence as it does not alter or enlarge the scope of
Section 3 at all."
(underline supplied)
15. Coming back to Section 3 of the PMLA, on its plain reading, an
offence under Section 3 can be committed after a scheduled offence is
committed. For example, let us take the case of a person who is
unconnected with the scheduled offence, knowingly assists the
concealment of the proceeds of crime or knowingly assists the use of
proceeds of crime. In that case, he can be held guilty of committing an
offence under Section 3 of the PMLA. To give a concrete example, the
offences under Sections 384 to 389 of the IPC relating to "extortion" are
scheduled offences included in Paragraph 1 of the Schedule to the
PMLA. An accused may commit a crime of extortion covered by Sections
384 to 389 of IPC and extort money. Subsequently, a person
unconnected with the offence of extortion may assist the said accused in
the concealment of the proceeds of extortion. In such a case, the person
who assists the accused in the scheduled offence for concealing the
proceeds of the crime of extortion can be guilty of the offence of money
laundering. Therefore, it is not necessary that a person against whom
the offence under Section 3 of the PMLA is alleged must have been
shown as the accused in the scheduled offence. What is held in
paragraph 270 of the decision of this Court in the case of Vijay
Madanlal Choudhary supports the above conclusion. The conditions
precedent for attracting the offence under Section 3 of the PMLA are that
there must be a scheduled offence and that there must be proceeds of
crime in relation to the scheduled offence as defined in clause (u) of sub-
section (1) of Section 3 of the PMLA.
113. At paragraph-18 of the aforesaid judgment the Hon'ble Apex Court, on the
basis of the argument advanced on behalf of the counsel based on the
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interpretation of the Schedule, has been pleased to note that in the case of
Vijay Madanlal Choudhary and Ors. Vs. Union of India and Ors.(supra),
even the validity of the Schedule was under challenge. A perusal of the said
decision shows that this Court was not called upon to interpret any entry in
the Schedule and, in particular, entry of Section 120B in the Schedule. The
challenge to the Schedule is dealt with in paragraphs 453, 454 and 455 of the
said decision. The contention before this Court was that even minor offences
have been included in the Schedule, and even compoundable offences form
part of the Schedule. It was submitted that the offences which do not have
cross-border implications have been included in the Schedule.
At paragraph-19, definition of "criminal conspiracy" as defined under
Section 120-A of IPC has been taken note thereof.
At paragraph-20, it has been observed that many of the offences,
which may generate proceeds of crime, have not been included in the
Schedule and for illustrating the same, some of offences have been referred
therein, which are as follows:
a. Section 263A of IPC, which deals with the offence of making or
possessing fictitious stamps is not a part of the Schedule;
b. Though offences punishable under Sections 392 to 402 regarding robbery
and dacoity have been included in part A of the Schedule, the offence
punishable under Section 379 of committing theft and the offence
punishable under Section 380 of theft in a dwelling house are not made a
part of parts A and B of the Schedule. The theft of both categories can be
of a very large amount running into crores. The said two offences become
scheduled offences by virtue of clause (3) of part C of the Schedule only if
the offences have cross-border implications;
c. The offence punishable under Section 403 of dishonest misappropriation
of property does not form part of the Schedule. The said offence becomes
a scheduled offence by virtue of clause (3) of part C of the Schedule only
if the offence has cross-border implications;
d. The offence under Section 405 of criminal breach of trust, which is
punishable under Section 406, is not a part of the Schedule The said
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offence becomes a scheduled offence by virtue of clause (3) of part C of
the Schedule only if the offence has cross-border implications;
e. Though the offence under Section 417 of cheating has been made a
scheduled offence, the more stringent crime of forgery for the purposes of
cheating under Section 468 is not a part of the Schedule, and
f. Though the offences under Sections 489A to 489C regarding forging or
counterfeiting currency notes are part of the Schedule, the offence under
Section 489D of making or possessing instruments or materials for
forging or counterfeiting currency notes is not a part of the Schedule.
At paragraph-21, it has been observed by coming to Part-B of the
Schedule that it includes only one offence under Section 132 of the Customs
Act, 1962. The offence under Section 132 of the Customs Act of making a
false declaration, etc., becomes a scheduled offence in view of sub-clause (ii)
of Clause (y) of subsection (1) of Section 2 of the PMLA only if the total
value involved in the offence is Rs.1 crore or more. Part C of the Schedule
provides that any offence specified in Part A having cross-border implications
becomes a part of Part C. More importantly, all the offences against the
property under Chapter XVII of IPC having cross-border implications become
scheduled offences. As pointed out earlier, the offences punishable under
Sections 379 (theft), 380 (theft in dwelling house), 403 (dishonest
misappropriation of property) and 405 (criminal breach of trust) are part of
Chapter XVII. Though the said offences are not included in Part A, they
become scheduled offences by virtue of Part C only if they have cross-border
implications. Thus, it can be said that many offences capable of generating
proceeds of crime do not form a part of the schedule.
At paragraph-22, it has been observed on the argument advanced on
behalf of the learned Additional Solicitor General that as Section 120B of IPC
is included in Part A to the Schedule, even if the allegation is of making a
criminal conspiracy to commit an offence which is not a part of the Schedule,
the offence becomes a scheduled offence, that many offences under Chapter
XVII of IPC are not included in Parts A and B. They become scheduled
offences only if the same have cross-border implications. Thus, the offences
of dishonest misappropriation of property or criminal breach of trust or theft
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can become a scheduled offence, provided they have cross-border
implications.
At paragraph-23, it has been observed that penal statutes are required
to strictly construed and penal laws must be construed according to the
legislative intent as expressed in the enactment.
At paragraph-24, it has been observed that if two reasonable
interpretations can be given to a particular provision of a penal statute, the
Court should generally adopt the interpretation that avoids the imposition of
penal consequences. In other words, a more lenient interpretation of the two
needs to be adopted.
At paragraph-25, it has been observed that the legislative intent which
can be gathered from the definition of the scheduled offence under clause (y)
of sub-section (1) of Section 2 of the PMLA is that every crime which may
generate proceeds of crime need not be a scheduled offence. Therefore, only
certain specific offences have been included in the Schedule.
For ready reference, paragraphs-18, 19, 20, 21, 22, 23, 24 and 25 of
the judgment rendered in Pavana Dibbur vs. The Directorate of
Enforcement (supra) reads as under:
"18. Now, we come to the third argument made by the learned senior
counsel appearing for the appellant based on the interpretation of the
Schedule. It must be noted here that in the case of Vijay Madanlal
Choudhary, even the validity of the Schedule was under challenge. A
perusal of the said decision shows that this Court was not called upon to
interpret any entry in the Schedule and, in particular, entry of Section
120B in the Schedule. The challenge to the Schedule is dealt with in
paragraphs 453, 454 and 455 of the said decision. The contention before
this Court was that even minor offences have been included in the
Schedule, and even compoundable offences form part of the Schedule. It
was submitted that the offences which do not have crossborder
implications have been included in the Schedule. In paragraphs 454 and
455 of the said decision, this Court held thus:
"454. This Schedule has been amended by Act 21 of 2009, Act 2 of 2013,
Act 22 of 2015, Act 13 of 2018 and Act 16 of 2018, thereby inserting new
offences to be regarded as scheduled offence. The challenge is not on the
basis of legislative competence in respect of enactment of Schedule and
the amendments thereto from time to time. However, it had been urged
before us that there is no consistency in the approach as it includes even
minor offences as scheduled offence for the purposes of offence of
moneylaundering, more so even offences which have no transborder
implications and are compoundable between the parties. The
classification or grouping of offences for treating the same as relevant
for constituting offence of moneylaundering is a matter of legislative
policy. The Parliament in its wisdom has regarded the property derived
or obtained as a result of specified criminal activity, being an offence
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under the concerned legislation mentioned in the Schedule. The fact that
some of the offences may be noncognizable offences under the concerned
legislation or regarded as minor and compoundable offences, yet, the
Parliament in its wisdom having perceived the cumulative effect of the
process or activity concerning the proceeds of crime generated from such
criminal activities as being likely to pose threat to the economic stability,
sovereignty and integrity of the country and thus, grouped them together
for reckoning it as an offence of moneylaundering, is a matter of
legislative policy. It is not open to the Court to have a second guess at
such a policy.
455. Needless to underscore that the 2002 Act is intended to initiate
action in respect of moneylaundering activity which necessarily is
associated with the property derived or obtained by any person, directly
or indirectly, as a result of specified criminal activity. The prosecution
under this Act is not in relation to the criminal activity per se but limited
to property derived or obtained from specified criminal activity.
Resultantly, the inclusion of criminal activity which has been regarded as
noncognizable, compoundable or minor offence under the concerned
legislation, should have no bearing to answer the matter in issue. In that,
the offence of moneylaundering is an independent offence and the
persons involved in the commission of such offence are grouped together
as offenders under this Act. There is no reason to make distinction
between them insofar as the offence of moneylaundering is concerned. In
our opinion, therefore, there is no merit in the argument under
consideration."
In this case, we are not called upon to decide the validity of the Schedule
or any part thereof. The question is whether the offence under Section
120B of IPC, included in Paragraph 1 of the Schedule, can be treated as
a scheduled offence even if the criminal conspiracy alleged is to commit
an offence which is not a part of the Schedule. This issue did not arise for
consideration in the case of Vijay Madanlal Choudhary1.
19. Section 120A of IPC defines "criminal conspiracy", which reads
thus:
"120A. Definition of criminal conspiracy.--When two or more persons
agree to do, or cause to be done,--
(1) an illegal act, or
(2) an act which is not illegal by illegalmeans, such an agreement is
designated a criminal conspiracy:
Provided that no agreement except an agreement to commit an offence
shall amount to a criminal conspiracy unless some act besides the
agreement is done by one or more parties to such
agreement in pursuance thereof.
Explanation.--It is immaterial whether the illegal act is the ultimate
object of such agreement, or is merely incidental to that object."
Section 120B of IPC provides for punishment for a criminal conspiracy
which reads thus:
"120B. Punishment of criminal conspiracy.-- (1) Whoever is a party to
a criminal conspiracy to commit an offence punishable with death,
imprisonment for life or rigorous imprisonment for a term of two years
or upwards, shall, where no express provision is made in this Code for
the punishment of such a conspiracy, be punished in the same manner as
if he had abetted such offence.
(2) Whoever is a party to a criminal conspiracy other than a criminal
conspiracy to commit an offence punishable as aforesaid shall be
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punished with imprisonment of either description for a term not
exceeding six months, or with fine or with both."
20. Now, we turn to the Schedule to the PMLA. We find that many
offences, which may generate proceeds of crime, have not been included
in the Schedule. We are referring to only a few of such offences only by
way of illustration:
a. Section 263A of IPC, which deals with the offence of making or
possessing fictitious stamps is not a part of the Schedule;
b. Though offences punishable under Sections 392 to 402 regarding
robbery and dacoity have been included in part A of the Schedule, the
offence punishable under Section 379 of committing theft and the offence
punishable under Section 380 of theft in a dwelling house are not made a
part of parts A and B of the Schedule. The theft of both categories can be
of a very large amount running into crores. The said two offences
become scheduled offences by virtue of clause (3) of part C of the
Schedule only if the offences have crossborder implications;
c. The offence punishable under Section 403 of dishonest misappropriation
of property does not form part of the Schedule. The said offence becomes
a scheduled offence by virtue of clause (3) of part C of the Schedule only
if the offence has crossborder implications;
d. The offence under Section 405 of criminal breach of trust, which is
punishable under Section 406, is not a part of the Schedule The said
offence becomes a scheduled offence by virtue of clause (3)
of part C of the Schedule only if the offence has crossborder
implications;
e. Though the offence under Section 417 of cheating has been made a
scheduled offence, the more stringent crime of forgery for the purposes of
cheating under Section 468 is not a part of the
Schedule, and
f. Though the offences under Sections 489A to 489C regarding forging or
counterfeiting currency notes are part of the Schedule, the offence under
Section 489D of making or possessing instruments or materials for
forging or counterfeiting currency notes is not a part of the Schedule.
21. Now, coming to Part B of the Schedule, it includes only one offence
under Section 132 of the Customs Act, 1962. The offence under Section
132 of the Customs Act of making a false declaration, etc., becomes a
scheduled offence in view of subclause (ii) of Clause (y) of subsection (1)
of Section 2 of the PMLA only if the total value involved in the offence is
Rs.1 crore or more. Part C of the Schedule provides that any offence
specified in Part A having crossborder implications becomes a part of
Part C. More importantly, all the offences against the property under
Chapter XVII of IPC having crossborder implications become scheduled
offences. As pointed out earlier, the offences punishable under Sections
379 (theft), 380 (theft in dwelling house), 403 (dishonest
misappropriation of property) and 405 (criminal breach of trust) are part
of Chapter XVII. Though the said offences are not included in Part A,
they become scheduled offences by virtue of Part C only if they have
crossborder implications. Thus, it can be said that many offences capable
of generating proceeds of crime do not form a part of the schedule.
22. The learned Additional Solicitor General argued that as Section
120B of IPC is included in Part A to the Schedule, even if the allegation
is of making a criminal conspiracy to commit an offence which is not a
part of the Schedule, the offence becomes a scheduled offence. As stated
earlier, many offences under Chapter XVII of IPC are not included in
Parts A and B. They become scheduled offences only if the same have
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crossborder implications. Thus, the offences of dishonest
misappropriation of property or criminal breach of trust or theft can
become a scheduled offence, provided they have crossborder
implications. If the argument of the learned Additional Solicitor General
is accepted, if there is a conspiracy to commit offences under Section 403
or Section 405, though the same have no crossborder implications, the
offence under Section 120B of conspiracy to commit offences under
Sections 403 and 405 will become a scheduled offence. Thus, if any
offence is not included in Parts A, B and C of the Schedule but if the
conspiracy to commit the offence is alleged, the same will become a
scheduled offence. A crime punishable under Section 132 of the Customs
Act is made a scheduled offence under Part B, provided the value
involved in the offence is Rupees One Crore or more. But if Section 120B
of IPC is applied, one who commits such an offence having a value of
even Rs.1 lac can be brought within the purview of the PMLA. By that
logic, a conspiracy to commit any offence under any penal law which is
capable of generating proceeds, can be converted into a scheduled
offence by applying Section 120B of the IPC, though the offence is not a
part of the Schedule. This cannot be the intention of the legislature.
23. The penal statutes are required to be strictly construed. It is true
that the penal laws must be construed according to the legislative intent
as expressed in the enactment. In Chapter 1 of GP Singh's Principles of
Statutory Interpretation (15th Edition), it is observed that:
"The intention of the Legislature, thus, assimilates two aspects: In one
aspect it carries the concept of "meaning", i.e. what the words mean
and in another aspect, it conveys the concept of "purpose and object"
or the "reason and spirit" pervading through the statute. The process
of construction, therefore, combines both literal and purposive
approaches. In other words the legislative intention, i.e., the true or legal
meaning of an enactment is derived by considering the meaning of the
words used in the enactment in the light of any discernible purpose or
object which comprehends the mischief and its remedy to which the
enactment is directed." In the words of A Driedger, Construction of
Statute, 2nd Edn, 1983: The words of an Act are to be read in their
entire context and in their grammatical and ordinary sense
harmoniously with the Scheme of the Act, the object of the Act, and the
intent of the Parliament. This formulation later received the approval of
the Supreme Court and was called the "cardinal principle of
construction"." In both Constitutional and statutory interpretation, the
court is supposed to exercise discretion in determining the proper
relationship between the subjective and objective purposes of the law and
help the law achieve its purpose."
(Emphasis added)
24. While giving effect to the legislature's intention, if two reasonable
interpretations can be given to a particular provision of a penal statute,
the Court should generally adopt the interpretation that avoids the
imposition of penal consequences. In other words, a more lenient
interpretation of the two needs to be adopted.
25. The legislative intent which can be gathered from the definition of
the scheduled offence under clause (y) of subSection (1) of Section 2 of
the PMLA is that every crime which may generate proceeds of crime
need not be a scheduled offence. Therefore, only certain specific
offences have been included in the Schedule. Thus, if the submissions of
the learned Additional Solicitor General are accepted, the Schedule will
become meaningless or redundant. The reason is that even if an offence
registered is not a scheduled offence, the provisions of the PMLA and, in
particular, Section 3 will be invoked by simply applying Section 120B. If
we look at Section 120B, only because there is a conspiracy to commit an
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offence, the same does not become an aggravated offence. The object is
to punish those involved in conspiracy to commit a crime, though they
may not have committed any overt act that constitutes the offence.
Conspiracy is an agreement between the accused to commit an offence. If
we look at the punishments provided under Section 120B, it becomes
evident that it is not an aggravated offence. It only incorporates the
principle of vicarious liability. If no specific punishment is provided in
the Statute for conspiracy to commit a particular offence, Section 120B
treats a conspirator of the main accused as an abettor for the purposes of
imposing the punishment. The interpretation suggested by the ED will
defeat the legislative object of making only a few selected offences as
scheduled offences. If we accept such an interpretation, the statute may
attract the vice of unconstitutionality for being manifestly arbitrary. It
cannot be the legislature's intention to make every offence not included in
the Schedule a scheduled offence by applying Section 120B. Therefore,
in our view, the offence under Section 120B of IPC included in Part A of
the Schedule will become a scheduled offence only if the criminal
conspiracy is to commit any offence already included in Parts A, B or C
of the Schedule. In other words, an offence punishable under Section
120B of IPC will become a scheduled offence only if the conspiracy
alleged is of committing an offence which is otherwise a scheduled
offence."
The conclusion has been arrived at paragraph-27 which reads as
under:
"27. While we reject the first and second submissions canvassed by
the learned senior counsel appearing for the appellant, the third
submission must be upheld. Our conclusions are:
a. It is not necessary that a person against whom the offence under
Section 3 of the PMLA is alleged, must have been shown as the
accused in the scheduled offence;
b. Even if an accused shown in the complaint under the PMLA is not an
accused in the scheduled offence, he will benefit from the acquittal of
all the accused in the scheduled offence or discharge of all the
accused in the scheduled offence. Similarly, he will get the benefit of
the order of quashing the proceedings of the scheduled offence;
c. The first property cannot be said to have any connection with the
proceeds of the crime as the acts constituting scheduled offence were
committed after the property was acquired;
d. The issue of whether the appellant has used tainted money forming
part of the proceeds of crime for acquiring the second property can be
decided only at the time of trial; and
e. The offence punishable under Section 120B of the IPC will become a
scheduled offence only if the conspiracy alleged is of committing an
offence which is specifically included in the Schedule."
114. Thus, the Hon'ble Apex Court has categorically laid down that it is not
necessary for a person to be shown as an accused in the scheduled offence for
him to be prosecuted under the PMLA, provided there exist proceeds of crime
derived from a scheduled offence and the person has indulged in or facilitated
any process or activity connected with such proceeds of crime.
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115. At paragraph-15 the finding has been given therein that on plain reading of
Section 3 of the Act, 2002, an offence under Section 3 can be committed after
a scheduled offence is committed. By giving an example, it has been clarified
that if a person who is unconnected with the scheduled offence, knowingly
assists the concealment of the proceeds of crime or knowingly assists the use
of proceeds of crime, in that case, he can be held guilty of committing an
offence under Section 3 of the PMLA. Therefore, it is not necessary that a
person against whom the offence under Section 3 of the PMLA is alleged
must have been shown as the accused in the scheduled offence.
116. Keeping in mind these essential elements that make up the molecular
structure of Section 3, this Court adverts in to facts of the instant case as
discussed in preceding paragraph is of view that the contention of the learned
counsel for the petitioner has no substance.
117. The learned counsel for the petitioner has further contended that the petitioner
has been implicated in the present case on the basis of his self-statement and
the statement of the co-accused recorded under Section 50 of the PML Act
2002, hence, the statement recorded under Section 50 of the PML Act cannot
be used against the present petitioner.
118. In the aforesaid context it needs to refer herein that there is no dispute
regarding the settled proposition of law that the statements recorded which are
merely confessional in nature ought to be ignored while adjudicating upon a
case as confessional statement of co-accused cannot be treated as substantive
evidence and such statements can only be pressed into service when the
Hon'ble Courts are inclined to accept other evidences. Thus, instead of
placing reliance solely upon the statements of the petitioner and the other co-
accused persons recorded under Section 50 of PMLA, the opposite party
ought to have collected and relied upon other evidence in order to prosecute
the petitioner.
119. It needs to refer herein that the three Judge Bench the Hon'ble Apex Court in
the case of "Rohit Tandon vs. Directorate of Enforcement" (supra) held that
the statements of witnesses recorded by Prosecution - ED are admissible in
evidence in view of Section 50. Such statements may make out a formidable
case about the involvement of the accused in the commission of the offence of
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money laundering. For ready reference the relevant paragraph is being quoted
as under:
"31. Suffice it to observe that the appellant has not succeeded in persuading
us about the inapplicability of the threshold stipulation under Section 45 of
the Act. In the facts of the present case, we are in agreement with the view
taken by the Sessions Court and by the High Court. We have independently
examined the materials relied upon by the prosecution and also noted the
inexplicable silence or reluctance of the appellant in disclosing the source
from where such huge value of demonetised currency and also new currency
has been acquired by him. The prosecution is relying on statements of 26
witnesses/accused already recorded, out of which 7 were considered by the
Delhi High Court. These statements are admissible in evidence, in view of
Section 50 of the 2002 Act. The same makes out a formidable case about the
involvement of the appellant in commission of a serious offence of money
laundering. It is, therefore, not possible for us to record satisfaction that
there are reasonable grounds for believing that the appellant is not guilty of
such offence. Further, the courts below have justly adverted to the
antecedents of the appellant for considering the prayer for bail and
concluded that it is not possible to hold that the appellant is not likely to
commit any offence ascribable to the 2002 Act while on bail. Since the
threshold stipulation predicated in Section 45 has not been overcome, the
question of considering the efficacy of other points urged by the appellant to
persuade the Court to favour the appellant with the relief of regular bail
will be of no avail. In other words, the fact that the investigation in the
predicate offence instituted in terms of FIR No. 205/2016 or that the
investigation qua the appellant in the complaint CC No. 700 of 2017 is
completed; and that the proceeds of crime are already in possession of the
investigating agency and provisional attachment order in relation thereto
passed on 13-2-2017 has been confirmed; or that charge-sheet has been
filed in FIR No. 205/2016 against the appellant without his arrest; that the
appellant has been lodged in judicial custody since 2-1-2017 and has not
been interrogated or examined by the Enforcement Directorate thereafter;
all these will be of no consequence."
120. In a recent judgment, the Hon'ble Supreme Court in "Abhishek Banerjee &
Anr. v. Directorate of Enforcement", (2024) 9 SCC 22 has again made
similar observations:
"21. ...Section 160 which falls under Ch. XII empowers the police officer
making an investigation under the said chapter to require any person to
attend within the limits of his own or adjoining station who, from the
information given or otherwise appears to be acquainted with the facts and
circumstances of the case, whereas, the process envisaged by Section
50 PMLA is in the nature of an inquiry against the proceeds of crime and is
not "investigation" in strict sense of the term for initiating prosecution; and
the authorities referred to in Section 48 PMLA are not the police officers as
held in Vijay Madanlal [Vijay Madanlal Choudhary v. Union of India,
(2023) 12 SCC 1] .
22. It has been specifically laid down in the said decision that the statements
recorded by the authorities under Section 50 PMLA are not hit by Article
20(3) or Article 21 of the Constitution, rather such statements recorded by
the authority in the course of inquiry are deemed to be the
judicial proceedings in terms of Section 50(4), and are admissible in
evidence, whereas the statements made by any person to a police officer in
the course of an investigation under Ch. XII of the Code could not be used
for any purpose, except for the purpose stated in the proviso to Section 162
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of the Code. In view of such glaring inconsistencies between Section
50 PMLA and Sections 160/161CrPC, the provisions of Section 50 PMLA
would prevail in terms of Section 71 read with Section 65 thereof."
121. In light of the foregoing judicial pronouncements, it is evident that statements
recorded under Section 50 of the PML Act, 2002 hold evidentiary value and
are admissible in legal proceedings. The Hon'ble Supreme Court, while
emphasizing the legal sanctity of such statements, observed that they
constitute valid material upon which reliance can be placed to sustain
allegations under the PML Act, 2002.
122. In the aforesaid judgment, the Hon'ble Supreme Court also reaffirmed the
admissibility of Section 50 of the PML Act, 2002 distinguishing them from
statements recorded under the Cr.PC. The Court underscored that such
statements, being recorded during an inquiry rather than an investigation, are
not subject to the restrictions under Article 20(3) and Article 21 of the
Constitution. Instead, they are deemed to be judicial proceedings
under Section 50(4) of the PML Act, 2002 and, therefore, admissible as
evidence in proceedings under the PML Act, 2002. The Hon'ble Apex Court
further clarified that the provisions of Section 50 of the PML Act, 2002
having an overriding effect by virtue of Sections 65 and 71 of the PML Act,
2002 prevail over the procedural safeguards under the CrPC.
123. Further From the bare perusal of Section 24 of the PML Act, 2002, it is
evident that once a person is charged with the offence of money laundering
under Section 3 of the PML Act, 2002, the law presumes that the proceeds of
crime are involved in money laundering unless the contrary is proven by the
accused.
124. In the present case, the investigating agency has relied not only on the self-
statement of the petitioner under Section 50 of the PML Act, 2002 but also
other evidences which indicate the applicant's active role in the alleged money
laundering activities.
125. By virtue of Section 24 of the PML Act, 2002, the respondent ED is not
required to conclusively establish the applicant's guilt at the pre-trial stage,
rather, the applicant must demonstrate that the proceeds of crime attributed to
him are not linked to money laundering.
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126. Apart from that it is evident from the various paragraphs of the Vth
prosecution complaint filed which have been referred hereinabove, is prima
facie supported by substantial evidence gathered during the investigation and
culpability against the petitioner is not based solely upon on the statements of
the petitioner and his accomplices. Furthermore, prima facie there is ample
evidence establishing the petitioner's involvement in the offence of money
laundering, which is further corroborated by other evidences. Further, the
petitioner's role has already been discussed herein in detail in the preceding
paragraphs, therefore, the averments of the petitioner are unfounded and liable
to be dismissed.
127. It has further been contended that there is no link whatsoever between FIR
No. 85/2020; FIR No. 63/21, FIR No. 28/22 and FIR No. 29/22, and that the
latter were merged only to falsely implicate the Petitioner.
128. In the aforesaid context it needs to refer herein that the investigation under the
PMLA is not confined to identity of accused persons in a single FIR. The
relevant consideration as per the provision of the Act 2002 is whether the
offences disclosed are scheduled offences and whether the persons concerned
are involved in any process or activity connected with the proceeds of crime
arising therefrom. Admittedly, the said three FIRs involve offences under
Sections 307 and 120-B of the IPC and Section 27 of the Arms Act, which are
scheduled offences under the PMLA.
129. It is evident from the supplementary prosecution complaint as revealed in the
investigation that the accused persons named in the different FIRs were part
of the same organized network operating in Sahebganj, engaged in illegal
mining, transportation of stone chips and exertion of control over routes
through intimidation and violence. Control over toll points, ferry routes and
transport corridors was maintained through such coordinated criminal acts,
which directly facilitated the illegal extraction and movement of minerals and
the generation of proceeds of crime.
130. Admittedly, the FIR No. 63/21 stood quashed and that a closure report has
been filed in FIR No. 29/22, but FIR No. 28/2022 remains a subsisting FIR
involving serious offences under Sections 147, 148, 149, 307 and 120-B of
the IPC, which are scheduled offences under the Prevention of Money
Laundering Act, 2002. The existence of even a single scheduled offence is
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sufficient to sustain investigation under the PMLA, if material discloses
involvement in the process or activity connected with the proceeds of crime.
131. Thus, the merger of the said FIRs into the existing ECIR was therefore
undertaken to ensure a comprehensive and holistic investigation into the
entire spectrum of scheduled offences and laundering activities. The
allegation that the FIRs were merged solely to falsely implicate the Petitioner
is not tenable and contrary to the material collected during investigation.
132. It has been contended that the Petitioner had no means to ascertain whether
the transported minerals were legal or illegal but the said contention cannot be
accepted at this stage. The liability under Section 3 of the Prevention of
Money Laundering Act, 2002 extends to any person who directly or indirectly
assists in, or is knowingly a party to, any knowledge and intent can be
inferred from surrounding circumstances, including patterns of transactions,
financial deposits, control over routes, and coordinated conduct with other
accused persons. The plea that petitioner was not authorized to verify the
legality of goods does not absolve him if the material on record suggests
conscious facilitation of transportation forming part of a larger illegal mining
and transport network. Whether the trucks carried minerals linked to illegal
mining and whether the Petitioner had requisite knowledge are matters of
evidence, to be adjudicated during trial.
133. Further, the existence of an agreement dated 01.04.2022 between M/s
Singhwani Transporters & Logistics and Navya Nayaat Sahyog Samiti does
not render the transaction lawful. Prima facie, investigation has revealed that
the said Samiti was under the effective control and influence of the accused
persons and was used as a conduit for routing proceeds of crime generated
from illegal mining and transportation activities in Sahebganj.
134. It is evident from record that the petitioner's plea for cancellation of NBWs
and proceedings under Section 82 Cr.P.C. by the Ld. Special Court, has
already been rejected followed by dismissal of his petition by this Court and
thereafter dismissal of SLP (Crl.) No. 6322/2023 by the Hon'ble Supreme
Court of India. Even the direction of the Hon'ble Supreme Court requiring the
Petitioner to surrender within a stipulated period before investigating officer
has not been complied with and even no any application has been filed before
the Hon'ble Apex Court to modify the order and the aforesaid conduct is
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indicative of the fact that he is evading investigation and process of law, thus
the sequence of judicial orders reflects persistent non-cooperation of the
petitioner. Further, the order of the Hon'ble Apex Court was unambiguous and
binding. Hence, failure to comply with the same cannot be explained away on
the basis of subjective belief or alleged family hardship.
135. It needs to refer herein that the Apex Court in the case of Srikant
Upadhyay v. State of Bihar, SLP No. 7940/2023, has held as follows:--
24. We have already held that the power to grant anticipatory bail is an
extraordinary power. Though in many cases it was held that bail is said
to be a rule, it cannot, by any stretch of imagination, be said that
anticipatory bail is the rule. It cannot be the rule and the question of its
grant should be left to the cautious and judicious discretion by the Court
depending on the facts and circumstances of each case. While called
upon to exercise the said power, the Court concerned has to be very
cautious as the grant of interim protection or protection to the accused in
serious cases may lead to miscarriage of justice and may hamper the
investigation to a great extent as it may sometimes lead to tampering or
distraction of the evidence. We shall not be understood to have held that
the Court shall not pass an interim protection pending consideration of
such application as the Section is destined to safeguard the freedom of an
individual against unwarranted arrest and we say that such orders shall
be passed in eminently fit cases. At any rate, when warrant of arrest or
proclamation is issued, the applicant is not entitled to invoke the
extraordinary power. Certainly, this will not deprive the power of the
Court to grant pre-arrest bail in extreme, exceptional cases in the
interest of justice. But then, person(s) continuously, defying orders and
keep absconding is not entitled to such grant."
136. Thus, in the aforesaid circumstances and in the backdrop of the settled
proposition of law as discussed and referred in the preceding paragraphs and
applying the ratio laid down by the Hon'ble Apex Court in the case of
Siddharam Satlinappa Mhetre vs. state of Maharashtra & Ors(supra), the
present petitioner is not eligible for pre-arrest bail.
Conclusion:
137. Thus, in the instant case investigation is based on analysis, bank records, cash
deposits, routing of funds through business entities, and statements recorded
under Section 50 of the PMLA. The material collected reflects coordinated
functioning in relation to ferry operations, financing of tenders, chartering of
vessels and movement of funds disproportionate to disclosed legitimate
business. It is not necessary that there be a written communication to establish
nexus. Conspiracy and organized economic offences are often proved through
financial trail and coordinated conduct. The cumulative material gathered
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during investigation establishes prima facie linkage, which cannot be brushed
aside at this stage.
138. This Court is conscious with the fact that herein the issue of grant of
anticipatory bail and hence, applying the principle to consider the application
for pre-arrest bail is required to be considered by passing an order for grant of
pre-arrest bail if prima facie case is not made out.
139. This Court is conscious of this fact that while deciding the issue of granting
regular bail/pre-arrest bail in grave economic offences it is the utmost duty of
the Court that the nature and gravity of the alleged offence should be kept in
mind because corruption poses a serious threat to the society and should be
dealt with by iron hand.
140. Further, it is required to refer herein that the Money Laundering is an
economic offence and economic offences comes under the grave offences
hence, needs to be visited with a different approach in the matter of bail as
held by the Hon'ble Apex court in the case of "Y. S Jagan Mohan Reddy v/s
Central Bureau of Investigation", reported in (2013) 7 SCC 439. For ready
reference, the relevant paragraphs of the aforesaid judgments are being quoted
as under:
"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."
141. Similarly, the Hon'ble Apex Court in case of "Nimmagadda Prasad Vs.
Central Bureau of Investigation", reported in (2013) 7 SCC 466 has
reiterated the same view in paragraphs-23 to 25 which reads as under:
"23. Unfortunately, in the last few years, the country has been seeing an
alarming rise in white-collar crimes, which has affected the fibre of the
country's economic structure. Incontrovertibly, economic offences have
serious repercussions on the development of the country as a whole.
In State of Gujarat v. Mohanlal Jitamalji Porwal [(1987) 2 SCC 364 :
1987 SCC (Cri) 364] this Court, while considering a request of the
prosecution for adducing additional evidence, inter alia, observed as
under: (SCC p. 371, para 5)
"5. ... The entire community is aggrieved if the economic offenders
who ruin the economy of the State are not brought to book. A murder
may be committed in the heat of moment upon passions being aroused.
An economic offence is committed with cool calculation and
deliberate design with an eye on personal profit regardless of the
consequence to the community. A disregard for the interest of the
community can be manifested only at the cost of forfeiting the trust
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and faith of the community in the system to administer justice in an
even-handed manner without fear of criticism from the quarters which
view white-collar crimes with a permissive eye unmindful of the
damage done to the national economy and national interest."
24. 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. It has also to be kept
in mind that for the purpose of granting bail, the legislature has used the
words "reasonable grounds for believing" instead of "the evidence"
which means the court dealing with the grant of bail can only satisfy
itself as to whether there is a genuine case against the accused and that
the prosecution will be able to produce prima facie evidence in support
of the charge. It is not expected, at this stage, to have the evidence
establishing the guilt of the accused beyond reasonable doubt.
25. Economic offences constitute a class apart and need to be visited with
a different approach in the matter of bail. The economic offence having
deep-rooted conspiracies and involving huge loss of public funds needs
to be viewed seriously and considered as a grave offence affecting the
economy of the country as a whole and thereby posing serious threat to
the financial health of the country."
142. The Hon'ble Apex Court in the case of "Central Bureau of Investigation Vs
Santosh Karnani and Another", 2023 SCC OnLine SC 427 has observed
that corruption poses a serious threat to our society and must be dealt with
iron hands. The relevant paragraph of the aforesaid judgment is being referred
as under:-
"31. The nature and gravity of the alleged offence should have been kept
in mind by the High Court. Corruption poses a serious threat to our
society and must be dealt with iron hands. It not only leads to abysmal
loss to the public exchequer but also tramples good governance. The
common man stands deprived of the benefits percolating under social
welfare schemes and is the worst hit. It is aptly said, "Corruption is a
tree whose branches are of an unmeasurable length; they spread
everywhere; and the dew that drops from thence, Hath infected some
chairs and stools of authority." Hence, the need to be extra conscious."
143. Further, the Hon'ble Apex Court in catena of judgments has held that the
economic offences constitute a class apart and need to be visited with a
different approach in the matter of bail/pre-arrest 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.
144. The Hon'ble Apex Court has further observed that with the advancement of
technology and Artificial Intelligence, the economic offences like money
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laundering have become a real threat to the functioning of the financial
system of the country and have become a great challenge for the investigating
agencies to detect and comprehend the intricate nature of transactions, as also
the role of the persons involved therein. Reference in this regard be made to
the judgment rendered by the Hon'ble Apex Court in the case of "Tarun
Kumar vs. Assistant Director Directorate of Enforcement" (supra). The
relevant paragraphs of the aforesaid Judgment are being quoted as under:
"22. Lastly, it may be noted that as held in catena of decisions, the
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. Undoubtedly, economic offences have
serious repercussions on the development of the country as a whole. To
cite a few judgments in this regard are Y.S. Jagan Mohan Reddy v. Central
Bureau of Investigation, Nimmagadda Prasad v. Central Bureau of
Investigation, Gautam Kundu v. Directorate of Enforcement (supra), State
of Bihar v. Amit Kumar alias Bachcha Rai. This court taking a serious
note with regard to the economic offences had observed as back as in 1987
in case of State of Gujarat v. Mohanlal Jitamalji Porwal as under:--
"5... The entire community is aggrieved if the economic offenders who
ruin the economy of the State are not brought to books. A murder may be
committed in the heat of moment upon passions being aroused. An
economic offence is committed with cool calculation and deliberate design
with an eye on personal profit regardless of the consequence to the
community. A disregard for the interest of the community can be
manifested only at the cost of forfeiting the trust and faith of the
community in the system to administer justice in an even-handed manner
without fear of criticism from the quarters which view white collar crimes
with a permissive eye unmindful of the damage done to the National
Economy and National Interest..."
23. With the advancement of technology and Artificial Intelligence, the
economic offences like money laundering have become a real threat to
the functioning of the financial system of the country and have become a
great challenge for the investigating agencies to detect and comprehend
the intricate nature of transactions, as also the role of the persons
involved therein. Lot of minute exercise is expected to be undertaken by
the Investigating Agency to see that no innocent person is wrongly booked
and that no culprit escapes from the clutches of the law. When the
detention of the accused is continued by the Court, the courts are also
expected to conclude the trials within a reasonable time, further ensuring
the right of speedy trial guaranteed by Article 21 of the Constitution.
24. With the afore-stated observations, the appeal is dismissed."
145. This Court, considering the aforesaid material available against the petitioner
quoted and referred hereinabove in such a grave nature of offence and
applying the principle of grant of pre-arrest bail as referred hereinabove
wherein the principle of having prima facie case is to be followed, is of the
view that it is not a fit case of grant of anticipatory bail.
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[2026:JHHC:10805]
146. For the foregoing reasons, having regard to facts and circumstances, as have
been analysed hereinabove, the applicant has failed to make out a special case
for exercise of power to grant pre-arrest bail and considering the facts and
parameters, necessary to be considered for adjudication of anticipatory bail,
this Court does not find any exceptional ground to exercise its discretionary
jurisdiction under Section 438 of the Code of Criminal Procedure/482 BNSS
to grant anticipatory bail.
147. On the basis of discussion made hereinabove it is considered view of this
Court that granting pre-arrest bail to the petitioner particularly taking into
consideration the conduct of petitioner wherein he has defied the order of the
Hon'ble Supreme Court requiring the Petitioner to surrender within a
stipulated period before investigating officer, would send a wrong signal to
society and embolden economic offenders, thereby undermining public
confidence in the justice delivery system. The offence in question is not a
mere fiscal offence but a crime against the economic health of the nation, with
a cascading effect on honest taxpayers, market integrity, and state revenue,
therefore, this Court is of the view that it is not a case where the prayer for
anticipatory bail is to be granted, as such the instant application stands
dismissed
148. Accordingly, based upon the aforesaid discussion, this Court is of the view
that the instant application is fit to be dismissed and as such, stands dismissed.
149. It is made clear that any observations made herein are prima-facie for
consideration of matter of bail only and the view expressed herein shall not be
construed as an expression on the merits of the case.
150. The learned Trial Court shall proceed with the matter uninfluenced by any
observations made by this Court and shall decide the case strictly in
accordance with law.
151. Pending interlocutory application(s), if any, also stands disposed of.
(Sujit Narayan Prasad, J.)
Jharkhand High Court, Ranchi
Dated: 15/04/2026
Saurabh / A.F.R.
Uploaded on 16.04.2026
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