Kerala High Court
Kiran P.P vs Assistant Director on 27 March, 2025
Author: P.V.Kunhikrishnan
Bench: P.V.Kunhikrishnan
2025:KER:26665
Bail Appl. Nos.593 & 802 of 2025
1
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE P.V.KUNHIKRISHNAN
THURSDAY, THE 27TH DAY OF MARCH 2025 / 6TH CHAITHRA, 1947
BAIL APPL. NO. 593 OF 2025
CRIME NO.45/2021 OF ENFORCEMENT DIRECTORATE KOCHI
AGAINST THE ORDER/JUDGMENT DATED IN Bail Appl.
NO.11142 OF 2023 OF HIGH COURT OF KERALA
PETITIONER/ACCUSED NO.14:
SHRI. SATHEESH KUMAR P
AGED 56 YEARS
S/O P.N.KUNHIRAMAN NAMBIAR, ANJANAM HOUSE,
KOLAZHY P.O, THRISSUR, PIN - 680010
BY ADVS. R.ANIL
B.RAMAN PILLAI (SR.)
SUJESH MENON V.B.
THOMAS SABU VADAKEKUT
MAHESH BHANU S.
RESSIL LONAN
JOEL GEORGE KAMPIYIL
ANANTH KRISHNA K.S.
RESPONDENT/COMPLAINANT:
1 ASSISTANT DIRECTOR
DIRECTORATE OF ENFORCEMENT, GOVERNMENT OF INDIA,
COCHIN ZONAL OFFICE, REPRESENTED BY STANDING
COUNSEL, HIGH COURT OF KERALA., PIN - 682011
2 STATE OF KERALA
REPRESENTED BY PUBLIC PROSECUTOR,HIGH COURT OF
KERALA, PIN - 682031
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Bail Appl. Nos.593 & 802 of 2025
2
BY ADV JAISHANKAR V. NAIR
OTHER PRESENT:
A R L SUNDARESAN(ASGI)
THIS BAIL APPLICATION HAVING COME UP FOR ADMISSION ON
27.03.2025, ALONG WITH Bail Appl..802/2025, THE COURT ON
THE SAME DAY DELIVERED THE FOLLOWING:
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Bail Appl. Nos.593 & 802 of 2025
3
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE P.V.KUNHIKRISHNAN
THURSDAY, THE 27TH DAY OF MARCH 2025 / 6TH CHAITHRA, 1947
BAIL APPL. NO. 802 OF 2025
CRIME NO.ECIR No KCZO/45/2021 OF ENFORCEMENT DIRECTORATE
KOCHI
AGAINST THE ORDER/JUDGMENT DATED 28.12.2024 IN SC
CASES (PMLA) NO.4 OF 2023 OF ADDITIONAL SPECIAL SESSIONS
COURT (SPE/CBI CASES)-III, ERNAKULAM
PETITIONER/ACCUSED NO.9:
KIRAN P.P.
AGED 33 YEARS
S/O PRAKASAN PALLATH HOUSE PERINJANAM P O
KODUNGALLOOR THRISSUR, PIN - 680664
BY ADVS. S.RAJEEV
V.VINAY
M.S.ANEER
SARATH K.P.
K.S.KIRAN KRISHNAN
DIPA V.
RESPONDENT/STATE/COMPLAINANT:
ASSISTANT DIRECTOR
DIRECTORATE OF ENFORCEMENT GOVERNMENT OF INDIA,
COCHIN ZONAL OFFICE, REPRESENTED BY STANDING
COUNSEL, HIGH COURT OF KERALA., PIN - 682031
2025:KER:26665
Bail Appl. Nos.593 & 802 of 2025
4
OTHER PRESENT:
A R L SUNDARESAN(ASGI)
THIS BAIL APPLICATION HAVING COME UP FOR ADMISSION ON
27.03.2025, ALONG WITH Bail Appl..593/2025, THE COURT ON
THE SAME DAY DELIVERED THE FOLLOWING:
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Bail Appl. Nos.593 & 802 of 2025
5
P.V.KUNHIKRISHNAN, J.
--------------------------------
B.A.Nos.593 & 802 of 2025
----------------------------------------------
Dated this the 27th day of March, 2025
ORDER
These Bail Applications are filed under Section 483
of Bharatiya Nagarik Suraksha Sanhita (for short, BNSS).
2. Petitioners are the accused in Crime
No.ECIR/KCZO/45/2021, which was registered by the
Enforcement Directorate, Kochi, for allegedly committing the
offences under Section 3 read with Section 17, which is
punishable under Section 4 of the Prevention of Money
Laundering Act, 2002 (for short, Act 2002).
3. The prosecution case in brief is that, from 2014 to
2020, accused Nos. 1 to 6 sanctioned and disbursed multiple
loans from the Karuvannur Service Co-operative Bank (for
short, Bank), to the same person, against the loan limits set by
the Bank, by accepting the title deeds of the same property as
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Bail Appl. Nos.593 & 802 of 2025
collateral security and have forged the membership records of
the Society and including persons who are not members of the
Society. The accused had furnished false addresses,
manipulated the software of the computer system, and
disbursed loans in the names of property owners without their
knowledge or consent. The accused persons had also
manipulated the inventory of the supermarket run by the Bank.
Consequently, the accused cheated and misappropriated an
amount of Rs.100 Crores from the Bank, is the prosecution
case. The first informant filed a complaint before Irinjalakkuda
Police Station and Crime No.650/2021 was registered, alleging
offences punishable under Sections 406, 420, 409 and 465 read
with Section 34 of the Indian Penal Code (for short, IPC).
Subsequently, the case was transferred to the Crime Branch
and was re-registered as Crime No.165/2021. The Dy.S.P.,
Crime Branch, Thrissur, informed the Deputy Director of
Enforcement Directorate, Kochi about the details of the
accused and the status of the crime. As Section 420 IPC is a
scheduled offence under Section 2(1)(x) and 2(1)(j) of the Act
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2002, enquiries were initiated against the accused persons
after recording the facts of the scheduled offence and ECIR
No.KCZO/45/2021 dated 02.08.2021 was registered. It is
alleged that by committing the above criminal activity, the
accused obtained and possessed the proceeds of the crime,
laundered and projected the proceeds of the crime as untainted
money as defined under Sections 2(1)(u) and 2(1)(v) of the Act
2002. The proceeds of the crime generated, acquired,
possessed and concealed by the accused persons are now being
projected and claimed as untainted money and properties. Thus
it is alleged that the accused committed the above offences.
Subsequently, the complaint was filed and the case is now
pending before the Additional Special Court Judge (SPE/CBI)-
III, Ernakulam, which is the Special Court for trial of the
offences under the Act 2002. The case is numbered as SC
PMLA 04/2023. The petitioners seek bail under Section 483 of
BNSS in these bail applications.
4. Heard the learned Senior Counsel Sri.B. Raman
Pillai who appeared for the petitioner in BA No.593/2025 and
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Sri.S. Rajeev, the learned counsel for the petitioner in BA
No.802/2025. I also heard Sri: A.R.L.Sundaresan, the Assistant
Solicitor General of India (ASGI).
5. The counsel for the petitioners raised a short point
before this Court. The counsel submitted that the petitioners
are in custody for about 18 months. They were arrested on
04.09.2023. The trial of the case is not started. The maximum
punishment that can be imposed for the offence alleged is up to
seven years. In such circumstances, in the light of the principle
laid down by the Apex Court in V. Senthil Balaji v. Deputy
Director, Directorate of Enforcement [2024 KLT OnLine
2363 (SC)], the petitioners are entitled to bail. The ASGI
submitted that the petitioners are not entitled to the benefit of
the above dictum. The ASGI took me through the counter filed
on behalf of the respondents. It is submitted that the trial court
is taking steps to conclude the trial and there is no delay on the
part of the prosecution in completing the trial. In such
circumstances this Court may not accept the principle in
Senthil Balaji's case (supra) is the submission. The ASGI also
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submitted that the contention of the petitioner in BA
No.593/2025 was considered in detail in BA No.11142/2023 and
this Court observed that there are no reasonable grounds for
believing that the petitioner is not guilty of the offences alleged
and that he is not likely to commit the offence if he is enlarged
on bail. The ASGI also submitted that the above order was
challenged before the Apex Court by filing Special Leave to
Appeal (Criminal) No.14188/2024, which was dismissed as
withdrawn. It is also submitted that the Apex Court directed
the Special Court to proceed with the trial as expeditiously as
possible. Therefore it is submitted that Senthil Balaji's case
(supra) is not applicable to the facts and circumstances of the
case.
6. The short point to be decided in this case is whether
the principle in Senthil Balaji's case (supra) is to applicable in
the facts and circumstances of the case. It will be better to
extract the relevant portion of Senthil Balaji's case (supra).
"27. Under the Statutes like PMLA, the
minimum sentence is three years, and the
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maximum is seven years. The minimum
sentence is higher when the scheduled offence
is under the NDPS Act. When the trial of the
complaint under PMLA is likely to prolong
beyond reasonable limits, the Constitutional
Courts will have to consider exercising their
powers to grant bail. The reason is that S.45(1)
(ii) does not confer power on the State to
detain an accused for an unreasonably long
time, especially when there is no possibility of
trial concluding within a reasonable time. What
a reasonable time is will depend on the
provisions under which the accused is being
tried and other factors. One of the most
relevant factor is the duration of the minimum
and maximum sentence for the offence.
Another important consideration is the higher
threshold or stringent conditions which a
statute provides for the grant of bail. Even an
outer limit provided by the relevant law for the
completion of the trial, if any, is also a factor to
be considered. The extraordinary powers, as
held in the case of K. A. Najeeb ((2021) 3 SCC
713), can only be exercised by the
Constitutional Courts. The Judges of the
Constitutional Courts have vast experience.
Based on the facts on record, if the Judges
conclude that there is no possibility of a trial
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concluding in a reasonable time, the power of
granting bail can always be exercised by the
Constitutional Courts on the grounds of
violation of Part III of the Constitution of India
notwithstanding the statutory provisions. The
Constitutional Courts can always exercise its
jurisdiction under Art.32 or Art.226, as the
case may be. The Constitutional Courts have to
bear in mind while dealing with the cases
under the PMLA that, except in a few
exceptional cases, the maximum sentence can
be of seven years. The Constitutional Courts
cannot allow provisions like S.45(1)(ii) to
become instruments in the hands of the ED to
continue incarceration for a long time when
there is no possibility of a trial of the scheduled
offence and the PMLA offence concluding
within a reasonable time. If the Constitutional
Courts do not exercise their jurisdiction in such
cases, the rights of the undertrials under
Art.21 of the Constitution of India will be
defeated. In a given case, if an undue delay in
the disposal of the trial of scheduled offences
or disposal of trial under the PMLA can be
substantially attributed to the accused, the
Constitutional Courts can always decline to
exercise jurisdiction to issue prerogative writs.
An exception will also be in a case where,
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considering the antecedents of the accused,
there is every possibility of the accused
becoming a real threat to society if enlarged on
bail. The jurisdiction to issue prerogative writs
is always discretionary.
28. Some day, the courts, especially
the Constitutional Courts, will have to take a
call on a peculiar situation that arises in our
justice delivery system. There are cases where
clean acquittal is granted by the criminal
courts to the accused after very long
incarceration as an undertrial. When we say
clean acquittal, we are excluding the cases
where the witnesses have turned hostile or
there is a bona fide defective investigation. In
such cases of clean acquittal, crucial years in
the life of the accused are lost. In a given case,
it may amount to violation of rights of the
accused under Art.21 of the Constitution which
may give rise to a claim for compensation.
29. As stated earlier, the appellant
has been incarcerated for 15 months or more
for the offence punishable under the PMLA. In
the facts of the case, the trial of the scheduled
offences and, consequently, the PMLA offence
is not likely to be completed in three to four
years or even more. If the appellant's detention
is continued, it will amount to an infringement
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of his fundamental right under Art.21 of the
Constitution of India of speedy trial."
7. In this case also, for the offences alleged, the
minimum sentence is three years and the maximum sentence is
seven years. Admittedly the trial in the case has not started. In
the objection filed in BA No.593/2025, it is stated that the
procedure for trial is in motion and the trial is about to
commence. It is also stated that now the case is posted for
consideration of the discharge petition. That itself shows that
the trial has not started. Admittedly the petitioners in these
cases are in custody from 04.09.2023. That means they are in
custody for 18 months. In such circumstances, the principle
laid down by the Apex Court in Senthil Balaji's case (supra) is
squarely applicable in this case. The rigour under Section 45 of
Act 2002 can be relaxed in the peculiar facts and circumstances
of the case. Therefore the petitioners can be released on bail
after imposing stringent conditions.
8. Moreover, it is a well-accepted principle that the bail
is the rule and the jail is the exception. The Hon'ble Supreme
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Court in Chidambaram. P v Directorate of Enforcement
[2019 (16) SCALE 870], after considering all the earlier
judgments, observed that, the basic jurisprudence relating to
bail remains the same inasmuch as the grant of bail is the rule
and refusal is the exception so as to ensure that the accused
has the opportunity of securing fair trial.
9. Moreover, in Jalaluddin Khan v. Union of India
[2024 KHC 6431], the Hon'ble Supreme Court observed that:
"21. Before we part with the Judgment, we
must mention here that the Special Court and
the High Court did not consider the material in
the charge sheet objectively. Perhaps the focus
was more on the activities of PFI, and
therefore, the appellant's case could not be
properly appreciated. When a case is made out
for a grant of bail, the Courts should not have
any hesitation in granting bail. The allegations
of the prosecution may be very serious. But, the
duty of the Courts is to consider the case for
grant of bail in accordance with the law. "Bail
is the rule and jail is an exception" is a settled
law. Even in a case like the present case where
there are stringent conditions for the grant of
bail in the relevant statutes, the same rule
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holds good with only modification that the bail
can be granted if the conditions in the statute
are satisfied. The rule also means that once a
case is made out for the grant of bail, the Court
cannot decline to grant bail. If the Courts start
denying bail in deserving cases, it will be a
violation of the rights guaranteed under Art.21
of our Constitution." (underline supplied)
10. In Manish Sisodia v. Directorate of Enforcement
[2024 KHC 6426], also the Hon'ble Supreme Court observed
that:
"53. The Court further observed that, over a
period of time, the trial courts and the High
Courts have forgotten a very well-settled
principle of law that bail is not to be withheld as
a punishment. From our experience, we can say
that it appears that the trial courts and the High
Courts attempt to play safe in matters of grant of
bail. The principle that bail is a rule and refusal
is an exception is, at times, followed in breach.
On account of non - grant of bail even in straight
forward open and shut cases, this Court is
flooded with huge number of bail petitions
thereby adding to the huge pendency. It is high
time that the trial courts and the High Courts
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should recognize the principle that "bail is rule
and jail is exception"."
11. Considering the dictum laid down in the above
decision and considering the facts and circumstances of this
case, these Bail Applications are allowed with the following
directions:
1. Petitioners shall be released on bail on
executing a bond for Rs.50,000/- (Rupees
Fifty Thousand only) with two solvent
sureties each, each for the like sum to the
satisfaction of the jurisdictional Court.
2. The petitioners shall appear before the
Investigating Officer for interrogation as
and when required. The petitioners shall
co-operate with the investigation and 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/her from
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disclosing such facts to the Court or to any
police officer.
3. Petitioners shall not leave India without
permission of the jurisdictional Court.
4. Petitioners shall not commit an offence
similar to the offence of which they are
accused, or suspected, of the commission
of which they are suspected.
5. The observations and findings in this order
is only for the purpose of deciding this bail
application. The principle laid down by this
Court in Anzar Azeez v. State of Kerala
[2025 SCC OnLine KER 1260] is applicable
in this case also.
6. If any of the above conditions are violated
by the petitioners, the jurisdictional Court
can cancel the bail in accordance to law,
even though the bail is granted by this
Court. The prosecution and the victim are
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at liberty to approach the jurisdictional
court to cancel the bail, if there is any
violation of the above conditions.
sd/-
P.V.KUNHIKRISHNAN
JUDGE
JV
