Sri. G. Raghunath vs Directorate Of Enforcement
2022 Latest Caselaw 12249 Kant

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      IN THE HIGH COURT OF KARNATAKA AT BENGALURU

       DATED THIS THE 30TH DAY OF SEPTEMBER, 2022

                          BEFORE

          THE HON'BLE MR. JUSTICE K.NATARAJAN

           CRIMINAL PETITION NO.7993 OF 2022

BETWEEN

SRI. G. RAGHUNATH
S/O. SRI. GURUDUTT.S,
AGED ABOUT 52 YEARS,
R/AT NO. 65, OLAVU,
2ND STAGE, BEML LAYOUT,
BASAVESHWARANAGAR,
BENGALURU-560 079.                    ... PETITIONER

(BY SRI D.R. RAVISHANKAR, SENIOR ADVOCATE
 FOR SRI SRINIVAS RAO S S, ADVOCATE)

AND

DIRECTORATE OF ENFORCEMENT
REPRESENTED BY THE ASSISTANT DIRECTOR,
GOVERNMENT OF INDIA,
BENGALURU-560 027.

REPRESENTED BY ADDITIONAL
SOLICITOR GENERAL OF INDIA            ... RESPONDENT

(BY SRI MADHUKAR DESHPANDE, SPECIAL COUNSEL)

      THIS CRIMINAL PETITION IS FILED UNDER SECTION 439
OF THE CODE OF CRIMINAL PROCEDURE, PRAYING TO KINDLY
DIRECT THE DIRECTORATE OF ENFORCEMENT TO RELEASE THE
PETITIONER FORTH WITH IN CONNECTION WITH ECIR
NO.BGZO/9/2020 PENDING BEFORE THE PRINCIPAL CITY CIVIL
AND SESSIONS JUDGE, BENGALURU (CCH-1) FOR THE
OFFENCE P/U/S. 4 OF THE PREVENTION OF MONEY
LAUNDERING ACT 2002 REGISTERED ON 29.02.2020.
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     THIS CRIMINAL PETITION HAVING BEEN HEARD AND
RESERVED FOR ORDERS ON 26.09.2022 THIS DAY, THE COURT
MADE THE FOLLOWING:

                          ORDER

This petition filed by the petitioner accused No.17

under section 439 of Cr.P.C. for granting bail in ECIR

No.BGZO/09/2020 registered by the Directorate of

Enforcement, Bengaluru (hereinafter referred to as 'ED')

for the offences punishable under sections 420, 120B, 406,

409 and 34 of IPC and Section 9 of Karnataka Protection of

Interest of Depositors in Financial Establishments Act,

2004 (hereinafter referred to as 'KPIDFE Act') and Section

4 of the Prevention of Money Laundering Act (hereinafter

referred to as 'PML Act'), now pending on the file of

Principal City Civil and Sessions Judge and Special Judge

for Trial of PMLA Cases, Bengaluru.

2. Heard the arguments of learned Senior Counsel

appearing for the petitioner's counsel and the Special

Counsel Sri Madhukar Desphande for respondent-ED.

3. The case of the prosecution is that the office of

Registrar of Co-operative Society issued a letter dated

23.01.2020 to the respondent-ED to investigate the lapses

and the irregularities with respect to the functioning of

Guru Raghavendra Sahakara Bank Niyamitha which is a

co-operative bank registered under the Karnataka State

Co-operative Societies Act, 1959. It is alleged that the

said bank has allegedly created fake deposits, loans were

sanctioned without any documentation and without

obtaining proper security for the loan and that, the

President and Vice President and the MD have been

responsible for causing losses of Rs.1,556 crores. After

registering the case against the bank, a case in crime

No.37/2020 was registered at Basavanagudi police.

Subsequently, the preliminary investigation was concluded

and then the offence under Section 4 of PML Act was

invoked and the complaint came to filed by the ED wherein

it was alleged that the petitioner had availed loan of

Rs.105 crores and there is outstanding balance was

Rs.139.85 crores. Accused No.4 Ramakrishna layered his

proceeds through the petitioner and money was

fraudulently siphoned off to the tune of Rs.46 crores to

M/s. Samrudhi Enterprises. In spite of issuing notice, the

petitioner did not appear and not given any proper

explanation and therefore, the ED registered a case and

arrested the petitioner on 28.6.2022. His bail petition

came to be rejected by the trial Court and hence, he is

before this Court.

4. The learned Senior counsel for the petitioner

contended that the petitioner is innocent of the alleged

offence and he is only borrower of the loan from the bank

and till registering the case in the predicate offence, he

was repaying the loan amount. His account was not an

NPA account. Till January 2020, he has paid EMIs. In the

predicate offence, the trial Court has granted anticipatory

bail to him. Accused NO.1 who is MD of the bank has

misused the official position and this petitioner is one of

the borrowers is nothing to do with any offence alleged by

the ED. Once the ED accepted the petitioner is borrower

and liable to pay the loan amount, it cannot fall under the

category of section 4 of PML Act. The provision of Section

45 will not attract against this petitioner. Until the

prosecution brought the guilt of the accused he cannot

take any defence of proving that he is not the guilt will not

arise. Petitioner is not involved in any business of money

laundering. The loan said to be given to other parties

through three accounts. The petitioner is in custody for

more than three months. He is ready to abide by any

conditions. All accused are on bail except this petitioner

and accused No.1. Hence, prayed for granting bail.

5. Per contra, the special counsel for the respondent

filed serious objection and contended that the petitioner is

borrower Rs.105 crores from the bank but he has not

accounted for it. he has received Rs.60 crores by way of

case and the same was not explained by him when he was

called to the ED office. though the petitioner said to be

spent money towards investment of a hotel at Kengeri and

business of Ogera and cinema, but he has not given the

details when he was summoned to the office, simply he

has stated that he has invested in hotel business and

cinema. the ED unable to attach the property under the

provisional attachment. Therefore, if the petitioner is

granted bail, he may likely to tamper the witnesses and

destroy the evidence and it is possible for the ED to attach

the property in order to recover Rs.139 crores. Though

the amount of Rs.105 Crores shown as loan, but the

accused NO.1 and this petitioner colluded together.

Accused NO.1 not obtained adequate security for the loan

and now the banker unable to recover the loan. there

were total loss caused to the bank for more than Rs.1500

crores. He further contended that notice was issued to

him on various dates. But he never appeared and later he

was appeared and he has not given proper account and

explanation sought by the ED. The bank said to be lent

some amount to his company SRV solutions for Rs.16.63

crores and the petitioner is the beneficiary of the amount

misused by the accused NO.1 in the bank and the said

money has been laundered by this petitioner. Therefore, it

is contended that the coordinate bench also rejected bail

petition of accused NO.1. Hence prayed for rejection of the

petition.

6. Having heard learned Senior Counsel for the

petitioner and the learned Special Counsel for respondent,

perused the records.

7. On perusal of the record, it reveals that the

petitioner was an accused in Crime No.37/2020 registered

by Basavanagudi police for the offences punishable under

Sections 406, 409, 420, 120B read with 34 of IPC and

Section 9 of KPIDFE Act. The said case was registered

against the petitioner and accused No.1-Ramakrishna, who

is said to be the Director of the co-operative bank.

Accused No.1 said to be lent loan to the petitioner to the

tune of Rs.105 crores without following the procedure and

without obtaining proper and adequate security and

collected the documents for the purpose of recovering the

loan amount. On the basis of the predicate offence in

Crime No.37/2020 and during preliminary investigation, it

was revealed that section 120B and 420 of IPC are

schedule offences under the PML Act and the bank official

said to be created bogus/fake deposits by debiting loans

and advances to the tune of Rs.1544.43 crores and this

petitioner said to be major beneficiary who availed Rs.105

crores and he was due of Rs.139 crores. The President of

said Sahakara bank was the chief perpetrator of the

fraud, whose statement was recorded and it is unearth,

that this petitioner received Rs.60 crores by way of cash

and Rs.46 crores by way of RTGS through bank

transfer and he has laundered the money and in spite

of summoning him to ED, he has not given any proper

explanation and accounts, but simply stated that he

has invested in hotel at Kengeri, food brand 'Ogara' and

cinema. He has not properly accounted for the cash

received by him for about Rs.60 crores. The remand

application reveals that in spite of summoning him to ED

office, he has not cooperated with the officers and he

has suppressed the facts for having laundering the

money. The main apprehension of the prosecution is that

the petitioner is having considerable influence and if he is

released on bail, he would scuttle the investigation and

destroy the evidence and he may also defeat the

objectives of the PML Act, and further, he may also

alienate the property, which is in his possession and he

has not disclosed the same and he may cause hurdle for

attaching the property by the ED authorities.

8. The Co-ordinate Bench of this Court has also

rejected the bail application of accused No.1 Ramakrishna

in Criminal Petition No.2561/2022 dated 24.06.2022 by

relying upon the judgment of the Hon'ble Supreme Court

reported in Central Bureau of Investigation Vs.

Ramendu Chattopadhyay reported in (2020)14 SCC

396. The petitioner was released on bail in the predicate

offence, but this case is based upon the money laundering.

Of course, Section 45 provides that if the Court is satisfied

that there are reasonable grounds to believe that the

petitioner is not guilty of such offence and he is not likely

to commit any offence while on bail, then only he shall be

released. Here in this case, the petitioner has not

whispered and has not given any details of the property

on which he has invested. Even though, he has received

Rs.60 crores by way of cash which was against the law has

not disclosed the amount in which he has invested.

Therefore, considering the facts and circumstances of the

case, I am of the view that if the petitioner is granted bail,

there is every possibility of obstructing the ED from

attaching the properties and they require some more time

for getting other sources to trace the property in which the

petitioner has invested. When the petitioner has not

disclosed about the investment, it is for the ED officials to

find out any other method to unearth the properties and

attach the same. Therefore, when the petitioner himself

has not properly explained the investment made by him

and is reluctant in giving information, the ED shall make

an endeavour to find out truth in various other modes

known to law. Hence, the petitioner cannot be released on

bail at this stage.

Accordingly, the bail petition filed by accused No.17-

Raghunatha G. is hereby dismissed.

Sd/-

JUDGE

Cs