Madras High Court
Liyakhath Ali vs State Rep. By on 2 August, 2024
Author: M.S.Ramesh
Bench: M.S. Ramesh
Crl.A.Nos.619 of 2021 & 272 of 2019
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Reserved on 21.06.2024
Pronounced on 02.08.2024
CORAM :
THE HONOURABLE MR. JUSTICE M.S. RAMESH
AND
THE HONOURABLE MR. JUSTICE SUNDER MOHAN
Crl.A.Nos.619 of 2021 & 272 of 2019
Liyakhath Ali ...Appellant in Crl.A.No.619/2021
Mani Anbazhagan ...Appellant in Crl.A.No.272/2019
Vs.
State rep. by
Assistant Director,
Directorate of Enforcement,
Chennai Regional Office,
Murugesa Naiyakar Complex,
No.84, Greams Road, Chennai. ...Respondent in Crl.A.No.619/2021
State rep. by
Deputy Director,
Directorate of Enforcement,
Govt. of India, Ministry of Finance,
Department of Revenue,
Murugesa Naiyakar Complex,
No.84, Greams Road, Chennai. ...Respondent in Crl.A.No.272/2019
PRAYER in Crl.A.No.619 of 2021: Criminal Appeal filed under Section
Page 1 of 21
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374(2) of the Criminal Procedure Code to set aside the order in
C.C.No.3/2017 dated 02.11.2021 on the file of the 12th Additional Special
Court for CBI, Chennai.
PRAYER in Crl.A.No.272 of 2019: Criminal Appeal filed under Section
374(2) of the Criminal Procedure Code to set aside the judgment of
conviction dated 13.03.2019 on the file of the XII Special Court for CBI
Cases at Chennai in C.C.No.18/2017.
For Appellant : Mr.Govindarajan
in both cases for Ms.S.Gunasekaran
For Respondent : Mr.AR.L.Sundaresan,
in both cases assisted by Mr.N.Ramesh,
Special Public Prosecutor
COMMON JUDGMENT
M.S.RAMESH,J.
In both these Criminal Appeals, arising out of the judgments of the
XIIth Additional Special Court for CBI Cases, Chennai, passed in C.C.Nos.3
of 2017 and 18 of 2017, the appellants have been convicted for the offence
under Section 4 of the Prevention of Money Laundering Act (hereinafter
referred to as 'PMLA') and sentenced to undergo 7 years rigorous
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imprisonment and to pay a fine of Rs.1 Crore, in default of which to undergo
one year rigorous imprisonment.
2.(i) It is the case of the prosecution that the appellant in
Crl.A.No.272 of 2019 [Mani Anbazhagan] was acting as a single point
contact for the company by the name, M/s.Galaxy Impex; that he opened the
current account in the name of the said company; that the said company was
run by Liyakhath Ali, the appellant in Crl.A.No.619 of 2021; that taking
advantage of the laxity prevailing in the Thousand Lights Branch of Indian
Bank, the appellant [Mani Anbazhagan] managed to receive the account
opening form and opened a current account, by making use of a form signed
by the said Liyakhath Ali, in the absence of Liyakhath Ali; that the
appellants had produced forged Bills of Entry and other imported documents
in respect of the said M/s.Galaxy Impex and six other entities and made an
outward remittance to the extent of USD2786300 = Rs.18,66,54,241/- under
the guise of importing television and air conditioners; that a case in Cr.No.63
of 2017 was registered by the CCB, Chennai for the offences under Sections
465, 467, 468, 471 and 420 of the IPC; that since a scheduled offence was
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committed and the appellants generated huge proceeds of crime and were
involved in the proceeds of crime, they are liable to be convicted under
Section 4 of the PMLA.
(ii) It is further alleged that Liyakhath Ali, the appellant in
Crl.A.No.619 of 2021 had also opened the account in the assumed name of
Vaseem Liyakhath Ali with an intention to escape from the clutches of law
and had given false statements to the respondent as to the person managing
the affairs of the company.
3. Though the learned counsel for the appellants submitted that there
are several infirmities in the evidence adduced by the prosecution and the
judgment of the trial Court, they did not canvass the said points. However,
they prayed for a reduction of the sentence, considering the nature of the
offence, the evidence adduced and the role played by the appellants.
4. The learned Additional Solicitor General, per contra submitted that
the respondents have established that a scheduled offence was committed;
that the said offence generated proceeds of crime and that the appellants had
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dealt with the proceeds of crime and therefore, committed the offence of
money laundering. He therefore submitted that the judgment of conviction
and the sentence imposed on the appellants, are justified and there is no
reason to interfere with them.
5. Though, the learned counsel for the appellants had not made any
submissions on the merits of the case, in order to satisfy ourselves as to the
correctness of the finding of guilt rendered by the trial Court, we had
examined the evidence.
6. It is to be noted that though, both the appellants were involved in
the offence of money laundering, the complaint against Liyakhath Ali,
appellant in Crl.A.No.619 of 2017 was filed initially and the case was taken
on file in C.C.No.3 of 2017 on the file of the XII Additional Special Court
for CBI Cases, Chennai. The appellant in Crl.A.No.272 of 2019, was
prosecuted by way of a separate complaint and his case was taken on file in
C.C.No.18 of 2017. Though, the facts are interconnected and the appeals in
both the cases were taken up together, we propose to analyse the evidence
independently, as both the appellants were tried separately and the evidence
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adduced against them, is slightly different.
7. (a) (i) In C.C.No.18 of 2017 [Crl.A.No.272 of 2019], the
prosecution had examined 15 witnesses, marked 44 exhibits and one
material object, to establish its case.
(ii) PW1, who was working in Thousand Lights Branch of Indian
Bank and had opened the current account in the name of M/s.Galaxy Impex
and in the names of six other companies by name (a) Green International (b)
Metal Traders (c) Snow City & Co., (d) Bold Trend Exim (e) Aegusta Hitech
Trade and (f) Harijohn Trading. He also would speak about the fact that the
appellant-Mani Anbazhagan submitted the application forms and the said
Liyakhath Ali visited the bank and personally received the cheque book in
respect of M/s.Galaxy Impex. He had also seen the Proprietors of the other
companies, viz., Eliyas Peer Mohammed and Rasol Khan.
(iii) PW2 was working as Assistant Commissioner at Chennai
Customs and he had deposed that the Bills of Entry shown to him, were
appeared in the EDI system maintained in the office and issued the
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certificate-Ex.P3 in which he had stated that except for one Bill of Entry, 24
other Bill of Entries, were not genuine. PW3 was working as a Cashier in
Indian Bank, Thousand Lights Branch and had identified the photographs of
the appellant which were taken from the CCTV footage maintained at the
bank.
(iv) PW4 was working as a Cashier and had identified the appellant
and about making payments based on the Bearer cheques of the company.
(v) PW5 is the Assistant Commissioner of Commercial Taxes
Department and has marked a letter issued by the Additional Chief
Secretary, Commercial Taxes Department, to show that M/s.Galaxy Impex
had not registered with the Commercial Taxes office.
(vi) PW6 was working as Manager, Thousand Lights Branch of
Indian Bank and had suspected the payment made to foreign countries and
has asked the officials of the Bank, to conduct enquiry and on enquiry, they
informed the customs officials and lodged the complaint with the police and
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thereafter with the respondent herein.
(vii) PW7 was working as an Inspector in CCB and had registered the
case for the scheduled offence in Cr.No.63 of 2017 and also speaks about
the fact that the name of the appellant in the said FIR was wrongly
mentioned as Kannan instead of Anbazhagan.
(viii) PW8 who was working as a Regional Transport Officer and
speaks about the driving licence issued to one Waseem Liyakhath Ali. PW9
is the friend of the appellant and had identified the appellant in the CCTV
footage before the respondent.
(ix) PW10 had assisted the respondent in the investigation. PW11
identified the appellant and the Proprietors of the other companies from the
CCTV footage and photographs.
(x) PW12 was working as Chief Manager in the Indian Bank and has
spoken about the details of payments sent to foreign countries from the
accounts of M/s.Galaxy Impex and documents containing the details of the
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account was marked as Ex.P23. PW13 was working as Assistant Manager
and speaks about the outward remittances made from the current accounts
of the other six companies and also about the fact that the appellant was
representing the above mentioned companies and submitting documents.
PW14 is the Deputy Director, who had enquired PW4 and recorded her
statement. PW15 is the investigating officer.
(b) (i) As regards the evidence in C.C.No.3 of 2017 [Crl.A.No.619 of
2021], the prosecution had examined 11 witnesses, marked 56 exhibits and
5 material objects, to establish its case.
(ii) Interestingly, the appellant in Crl.A.No.272 of 2019 was examined
as a witness in C.C.No.3 of 2017, wherein the appellant-Liyakhath Ali was
tried. By and large, the nature of the evidence let in, in this case, is the
same, with minor changes in the array of witnesses.
(iii) PW1 in this case was examined as PW1 in the other case. He had
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spoken about the opening of the account in the name of seven companies
and about the fact that the appellant-Liyakhath Ali, received the cheque
book on behalf of M/s.Galaxy Impex. He had marked the documents relating
to the account opening form. PW2 was working in the Customs department
and had certified that out of twenty-five Bills of Entry, twenty-four were not
genuine. He was examined in the other case.
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(iv) PW3 was working at the YBMS Clearing and Forwarding Agency
and had spoken about the fact that except for one Bill of Entry, other Bill of
Entries, were forged. PW4 was working in the Commercial Taxes
Department and has spoken about the fact that M/s.Galaxy Impex was not
registered with the Commercial Taxes office.
(v) PW5 was working in Indian Bank, Thousand Lights Branch and
speaks about the conduct of the enquiry with regard to the payments made
from the accounts of seven banks and about giving the complaint to the CCB
and also about the complaint given to the Enforcement Directorate. PW6
was working as Inspector in CCB and speaks about the registration of FIR
in Cr.No.63 of 2017 for the offences under Sections 465, 467, 468, 471 and
420 of the IPC.
(vi) PW7 was working in the Income Tax Department and speaks
about the income tax accounts in the names of the appellant-Liyakhath Ali
and his family members. PW8 was working as an Assistant Director in the
Enforcement Directorate and speaks about recording the statements of
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witnesses and assisting the investigating officer.
(vii) PW9 is the investigating officer, who speaks about the
attachment of Rs.1,75,49,753/- held in the account of the appellant-
Liyakhath Ali and also about the details of the investigation conducted by
him. PW10, is the investigating officer in Cr.No.63 of 2017 and speaks
about the investigation conducted in the said case.
(viii) PW11 is Mani Anbazhagan, the appellant in Crl.A.No.272 of
2019. He speaks about the fact that the appellant-Liyakhath Ali had visited
the Indian Bank for obtaining the cheque Book of M/s.Galaxy Impex and
thereby proving the link between the appellant and M/s.Galaxy Impex.
(ix) The appellant had examined 5 witnesses viz., DW1 to DW5 and
marked 12 exhibits viz., Ex.D1 to Ex.D12, on his side.
8. From the above evidence, the prosecution had established that
forged Bill of Entries, were produced by the appellants and outward
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remittances to the tune of Rs.18,66,54,241/- were sent to various accounts
outside India. The evidence also establishes that a scheduled offence was
committed, which generated proceeds of crime and the appellants had dealt
with the proceeds of crime.
9. The trial Court in both the cases had elaborately considered all the
evidence on record and found the appellants guilty of the offence. On re-
appreciation of the entire evidence on record, which is elaborately discussed
in the judgment of the trial Court, we find that the finding of guilt against
both the appellants herein, is justified and there is no reason to interfere with
the same. The appellants were unable to discredit the prosecution case in
any manner. The prosecution had established the foundational facts and the
appellants have not rebutted the statutory presumption under Section 24 of
the PMLA.
10. However, as regards the sentence imposed on the appellants, we
find that the appellants had been sentenced to the maximum sentence of
seven years and also directed to pay fine of Rs.1 Crore and to undergo a
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default sentence for a period of one year.
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11. On this aspect, we may observe that it has been consistently held
in several decisions of the Hon'ble Supreme Court that while awarding
sentences, a Judge has a wide discretion within the statutory limits and
therefore, there cannot be any uniformity in imposition of such offences. In
the case of State of Rajasthan Vs. Mohan Lal and Another reported in
(2018) 18 SCC 535, it has been held that while imposing the punishment,
the Courts will have to take into account certain principles while exercising
their discretion in sentencing, such as proportionality, deterrence and
rehabilitation. In a proportionality analysis, it is necessary to assess the
seriousness of an offence in order to determine the commensurate
punishment for the offender. The seriousness of an offence depends, apart
from other things, also upon its harmfulness.
12. The Hon'ble Court in the case of Soman v. State of Kerala
reported in (2013) 11 SCC 382, observed thus:-
“27.1. Courts ought to base sentencing decisions on various
different rationales — most prominent amongst which would be
proportionality and deterrence.
27.2. The question of consequences of criminal action can be
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relevant from both a proportionality and deterrence standpoint.
27.3. Insofar as proportionality is concerned, the sentence must
be commensurate with the seriousness or gravity of the offence.
27.4. One of the factors relevant for judging seriousness of the
offence is the consequences resulting from it.
27.5. Unintended consequences/harm may still be
properly attributed to the offender if they were reasonably
foreseeable. In case of illicit and underground manufacture of
liquor, the chances of toxicity are so high that not only its
manufacturer but the distributor and the retail vendor would
know its likely risks to the consumer. Hence, even though any
harm to the consumer might not be directly intended, some
aggravated culpability must attach if the consumer suffers some
grievous hurt or dies as result of consuming the spurious
liquor.”
13. The same is the verdict of the Hon'ble Supreme Court in the case
of Alister Anthony Pareira v. State of Maharashtra reported in (2012) 2
SCC 648, wherein it was observed as follows:-
“84. Sentencing is an important task in the matters of
crime. One of the prime objectives of the criminal law is
imposition of appropriate, adequate, just and proportionate
sentence commensurate with the nature and gravity of crime and
the manner in which the crime is done. There is no straitjacket
formula for sentencing an accused on proof of crime. The courts
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have evolved certain principles: the twin objective of the
sentencing policy is deterrence and correction. What sentence
would meet the ends of justice depends on the facts and
circumstances of each case and the court must keep in mind the
gravity of the crime, motive for the crime, nature of the offence
and all other attendant circumstances.”
14. On an overall appraisal of the aforesaid decisions, it could be said
that the imposition of sentence by a Court would be determinable on the
facts and circumstances of each case and would be within the discretion of
the concerned Court.
15. However, the exercise of such discretion also came to be dealt with
by the Hon'ble Supreme Court in the case of Swamy Shraddananda Vs.
State of Karnataka reported in (2007) 12 SCC 288, wherein it was held as
follows:-
“66. There is a clear and discernible necessity of caution
to set the maximum punishment in an offence. And also by
implication there must be intensive and exhaustive inquiry into
accused-related parameters before employing the maximum
sentence by a court of law. Therefore, discretion to the judiciary
in this respect (to declare the maximum punishment) is of utmost
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critical and seminal value. Reasons must be detailed setting
clearly why any punishment other than the maximum punishment
will not suffice. This is a general and age-old rule of sentencing
which has been statutorily recognised under Section 354(3).”
16. Thus, though discretion is vested with the Court in imposing the
period of punishment, such discretion is required to be exercised by giving
reasons, when the maximum punishment is opted to be imposed.
17. In the instant case, the Trial Court, though had imposed on both
the appellants the maximum sentence of 7 years, we are not convinced by
the reasons given by the trial Court for imposing the maximum sentence. By
adopting the ratio laid down in Swami Shraddananda's case (supra), and
considering the nature of offence, the evidence let in by the prosecution, and
the fact that the property of the appellant in Crl.A.No.619 of 2021, has been
attached and ordered to be confiscated, we are of the view that the ends of
justice would be met if the maximum sentence of 7 years of rigorous
imprisonment is reduced to 4 years of rigorous imprisonment.
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18. For all the foregoing reasons, the impugned judgments passed by
the XIIth Additional Special Court for CBI Cases, Chennai, in
C.C.No.3/2017, dated 02.11.2021 and C.C.No.18/2017, dated 13.03.2019,
insofar as they imposes the maximum punishment of 7 years of rigorous
imprisonment on both the appellants, is modified to 4 years of rigorous
imprisonment. All other observations and findings, leading to the conviction
and the fine amount of Rs.1 Crore, in default of payment to undergo
rigorous imprisonment for a period of one year, stand confirmed. The order
with regard to confiscation of the property in C.C.No.3 of 2017, is also
confirmed.
19. Accordingly, both the Criminal Appeals stand partly allowed.
[M.S.R.,J.] [S.M.,J.]
02.08.2024
Index:Yes/No
Neutral Citation:Yes/No
Speaking order/Non-speaking order
Issue order copy by 07.08.2024
hvk/ars
To
1.The Assistant Director,
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Directorate of Enforcement,
Chennai Regional Office,
Murugesa Naiyakar Complex,
No.84, Greams Road, Chennai.
2.The Deputy Director,
Directorate of Enforcement,
Govt. of India, Ministry of Finance,
Department of Revenue,
Murugesa Naiyakar Complex,
No.84, Greams Road, Chennai.
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M.S.RAMESH, J.
and
SUNDER MOHAN, J.
ars
Pre-delivery common judgment made in
Crl.A.Nos.619 of 2021 & 272 of 2019
02.08.2024
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