Madras High Court
Shri Suresh Kumar D Kochar vs The Directorate Of Enforcement ... on 5 January, 2024
Author: S.S.Sundar
Bench: S.S.Sundar
WP No.13425 of 2023 and
Crl.O.P.No.28042 of 2023
IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON : 22.12.2023
PRONOUNCED ON : 05.01.2024
CORAM :
THE HON'BLE MR. JUSTICE S.S.SUNDAR
AND
THE HON'BLE MR.JUSTICE SUNDER MOHAN
WP No.13425 of 2023
and Crl.O.P.No.28042 of 2023
and WMP No.13100 of 2023 in WP No.13425 of 2023
and Crl.M.P.No.19467 of 2023 in Crl.O.P.No.28042 of 2023
WP No.13425 of 2023
Shri Suresh Kumar D Kochar .. Petitioner
v.
1. The Deputy Director,
Directorate of Enforcement,
O/o.Jt. Director, Chennai Zonal Office,
2nd and 3rd Floor, Murugesan Naicker Complex,
84, Greams Road, Chennai – 600 006.
2. The Assistant Director,
Directorate of Enforcement,
O/o.Jt. Director, Chennai Zonal Office,
2nd and 3rd Floor, Murugesan Naicker Complex,
84, Greams Road, Chennai – 600 006.
1
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WP No.13425 of 2023 and
Crl.O.P.No.28042 of 2023
3. Special District Collector,
Land Acquisitions,
Chennai Metro Rail Limited,
METROS, Anna Salai,
Nandanam, Chennai – 600 035. .. Respondents
Writ Petition filed under Article 226 of Constitution of India, for
issuance of a writ of certiorarified mandamus, calling for the records of the
2nd respondent herein in and connected with order dated 06.03.2023 in
F.No.ECIR/CEZO-1/39/2021 quash the same as being without authority of
law and illegal and direct the said respondent to act on the representation of
the petitioner dated 19.02.2023 and give their no objection for acquisition of
property situated at Old Survey No.43(Part), Block 18, Kolathur Village,
Chennai and payment of compensation thereof by the 3rd respondent.
Crl.O.P.No.28042 of 2023
Shri Suresh Kumar D Kochar .. Petitioner
v.
The Assistant Director,
Directorate of Enforcement,
Govt. of India,
Chennai Zonal Office-1,
V & VI Floor, BSNL Administrative Building,
No.2, Kushkumar Road, Nungambakkam,
Chennai – 600 034. .. Respondents
2
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WP No.13425 of 2023 and
Crl.O.P.No.28042 of 2023
Criminal Original Petition filed under Section 482 of Criminal
Procedure Code, praying to call for the records in and connected with
Spl.C.C.No.6 of 2023 on the file of the learned XII Additional Special Judge
for CBI Cases, Special Court for PMLA Cases, Chennai and quash the same.
For Petitioner
in both cases : Mr.B.Sathish Sundar
For Respondent : Mr.Rajinish Pathiyil (for R1&R2)
in both cases Special Public Prosecutor
COMMON ORDER
(Order of the Court was delivered by SUNDER MOHAN,J.)
The 3rd accused, facing trial in Spl.S.C.No.6 of 2023 on the file of the
learned XII Additional Special Judge for CBI Cases, Special Court for
Prevention of Money Laundering Act (hereinafter referred to as 'PMLA')
Cases, Chennai, on the complaint filed by the respondent herein, has
preferred the above quash petition. He has also filed the above writ petition
to quash the order dated 06.03.2023 in F.No.ECIR/CEZO-1/39/2021 and to
consider his representation dated 09.03.2023, to give no objection for him to
claim compensation that was deposited for acquiring his lands by the
authorities of Chennai Metro Rail Limited (hereinafter referred to as
'CMRL').
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WP No.13425 of 2023 and
2. The brief facts leading to the filing of the above petitions are as
follows:
(a) Between 2004 and 2006, several complaints were filed against one
Dhanraj Kochar (A1) and others alleging that properties of a company by
the name of DR Foundations and Estates Private Limited were
misappropriated and sold to the kith and kin of the said Dhanraj Kochar for
inadequate consideration.
(b) On 04.08.2006, FIR No.815 of 2006, was registered by J-9
Thuraipakkam Police Station for offences under Sections 408, 420, 468, and
120B of the IPC against the petitioner and others that the complainant had
entrusted Rs.1.71 Crores to the company, DR Foundations and Estates Pvt.
Ltd.,; that Dhanraj Kochar and others had misappropriated the same by
withdrawing the money; and that the said Dhanraj Kochar had purchased
properties in the name of his kith and kin.
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WP No.13425 of 2023 and
(c) On 14.04.2007, the police filed the final report after investigation
in the said FIR in C.C.No.530 of 2007 on the file of the learned Judicial
Magistrate, Alandur. The petitioner and others were convicted for the
offence under Sections 409 r/w 109 and 120B of the IPC. The petitioner
preferred an appeal before the learned Additional District and Sessions
Judge, Chengalpattu, in Crl.A.No.82 of 2017.
(d) On 10.10.2022, the learned Additional District and Sessions
Judge, Chengalpattu, dismissed the appeal and confirmed the conviction
against the petitioner. The petitioner has preferred Crl.R.C.No.1577 of
2022, which is pending before this Court.
(e) Another FIR in Cr.No.73 of 2018 was registered by Central Crime
Branch, Chennai, for the offence under Sections 420 and 34 of IPC on the
complaint given by one Sathak Ahmed Shaw, S/o.M.S.Hameed (de-facto
complainant in Cr.No.815 of 2006), alleging that the petitioner and others
cheated the de-facto complainant by entering into a joint venture with
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WP No.13425 of 2023 and
another company.
(f) The petitioner and others filed quash petitions before this Court in
Crl.O.P.Nos.7325, 11095, and 11427 of 2018, praying for the quashing of
FIR in Cr.No.73 of 2018. This Court, by order dated 15.02.2020, quashed
the said FIR. It is reported that this order has not been challenged before the
Hon'ble Supreme Court.
(g) Similarly, another FIR was registered against the petitioner and
others in Cr.No.100 of 2014 for the offence under Sections 406, 420, and
506(i) of the IPC which was also quashed by this Court in
Crl.O.P.Nos.15716/2017 and 8609 of 2019, etc. batch on 16.08.2022.
The SLP preferred against the said order was also dismissed by the Hon'ble
Supreme Court on 01.09.2023 in SLP (Crl.) Diary No.5737/2023.
(h) Meanwhile, the respondent herein recorded an ECIR in
F.No.ECIR/CEZO-1/39/2021 and attached the properties belonging to the
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WP No.13425 of 2023 and
petitioner and others to the tune of Rs.62 Crores. The respondent also sent a
communication to the bank authorities not to disburse the sum of
Rs.43,34,528/- which is part of the compensation deposited by the CMRL
authorities for acquiring the land belonging to the petitioner. The petitioner
had requested the 2nd respondent in the writ petition for a 'no objection
certificate', to withdraw the amount deposited as compensation in his bank
account. The 2nd respondent rejected the said request saying that though the
FIR in Cr.No.100 of 2014 has been quashed, the proceedings under the
PMLA to trace the proceeds of crime can be continued since another case is
still pending.
3. During the pendency of the writ petition, the respondent also
produced the provisional attachment order dated 23.11.2023, which states
that a sum of Rs.43,34,528/- payable to the petitioner by the CMRL shall
not be transferred, disposed of, removed, parted with, or otherwise dealt
with unless or until specifically permitted by the authorities of the
Enforcement Directorate.
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WP No.13425 of 2023 and
4. (i) The learned counsel for the petitioner submitted that the
impugned complaint in Crl.O.P.No.28042 of 2023 is not maintainable in
view of the recent judgment of the Hon'ble Supreme Court in Pavana
Dibbur Vs. The Directorate of Enforcement [MANU/SC/1271/2023],
wherein the Hon'ble Supreme Court held that Section 120-B of IPC would
become a scheduled offence only if the criminal conspiracy is to commit any
offence included in parts A, B or C to the schedule to the PMLA.
(ii) The learned counsel for the petitioner submitted that in the instant
case, the complaint only refers to 120B of IPC (i.e) conspiracy to commit the
offence under Section 409 of IPC, which is not a scheduled offence and
therefore, it cannot be termed as proceeds of a crime for the respondent to
maintain a complaint. The learned counsel therefore submitted that the
consequential communication sent by the respondent to withhold the
payment of compensation to the petitioner and the attachment order are
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WP No.13425 of 2023 and
unsustainable and prayed for allowing the petitions.
5. Mr.Rajinish Pathiyil, the learned Special Public Prosecutor
submitted that though the matter is covered by the judgment of the Hon'ble
Supreme Court in Pavana Dibbur's case [cited supra], he may be permitted
to file a counter to refute some of the factual averments made by the
petitioner in the petitions. The learned Special Public Prosecutor also
submitted that even if two FIRs were quashed, the equivalent property to the
value of the property derived or obtained as a result of criminal activity
could be attached. Therefore, the learned Special Public Prosecutor
submitted that the grounds on which the writ petition was filed, are
unsustainable.
6. We have perused the complaint and the impugned orders in the
Writ Petition and the Criminal Original Petition. Though initially we had
ordered notice in the Criminal Original petition to enable the respondent to
file a counter, we were inclined to take up the matter along with the Writ
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Petition since the facts necessary to decide the above petitions are not in
dispute and the issue is directly covered by the decision of the Hon'ble
Supreme Court.
7. The impugned complaint is on the basis that the petitioner was
convicted for the predicate offences under Sections 120B, 409 r/w 109 of the
IPC. There is no dispute with regard to the said fact. The offence under
Section 409 of the IPC is not a scheduled offence. The question is whether
the respondent can maintain the complaint if the predicate offence is the
offence of criminal conspiracy. The Hon'ble Supreme Court answered this
question in Pavana Dibbur's case [cited supra]. The relevant observations
are extracted hereunder.
“25. 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. 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
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registered is not a scheduled offence, the provisions of the PMLA
and, in particular, Section 3 will be invoked by simply applying
Section 120-B. If we look at Section 120-B, only because there is a
conspiracy to commit an 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 120-B, 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 120-B Section
120-B 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 120-B. Therefore, in our view, the
offence under Section 120-B 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 120-B of IPC will become a scheduled offence only if the
conspiracy alleged is of committing an offence which is otherwise a
scheduled offence.
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WP No.13425 of 2023 and
26. Coming back to the facts of the case, in the charge sheets
filed in the alleged scheduled offences, there is no allegation of the
commission of criminal conspiracy to commit any of the offences
included in the Schedule. As pointed out earlier, except for Section
120-B of the IPC, no other offence in the schedule has been applied.
Therefore, in this case, the scheduled offence does not exist at all.
Hence, the appellant cannot be prosecuted for the offences
punishable under Section 3 of the PMLA.”
8. In the complaint, the respondent has stated in paragraph 3 (i) as
follows:
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WP No.13425 of 2023 and
“(i) As submitted above, Shri Dhanraj Kocha and his
family members in connivance with the said three Authorised
Signatories of M/s.D R Foundations and Estates Pvt. Ltd.
cheated Shri M.S Hameed through a criminal conspiracy and this
fact i.e., the commission of scheduled offence [Section 120 B] is
proved in the trial held in the predicate offence.”
9. As stated earlier, the petitioner was convicted for the offence of 409
r/w 109 and 120B of the IPC. Therefore, the predicate offence alleged and
proved is conspiracy to commit offence under Section 409 of the IPC which
is not a scheduled offence. Therefore, even assuming that there are
proceeds of crime, it cannot be said to be as a result of commission of a
scheduled offence, which is a prerequisite to maintain a complaint under
Section 3 of the PMLA. The above referred observations of the Hon'ble
Supreme Court are squarely applicable to the facts of the instant case. The
complaint is therefore liable to be quashed on that sole ground, and hence,
we are not expressing any opinion on the other submissions made by the
learned counsel for the petitioner.
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WP No.13425 of 2023 and
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10. Since the respondent lacks jurisdiction under the PMLA, the
communications sent to the Bank to withhold the portion of the
compensation amount payable to the petitioner by the CMRL, also cannot be
sustained. As stated earlier, during the pendency of the writ petition, the
respondents passed a provisional attachment order dated 23.11.2023
bearing F.No.ECIR/CEZO-1/39/2021. Even in the said provisional
attachment order, the respondent has stated that the petitioner has
committed an offence under Section 120B of the IPC. The relevant portion
reads as follows:
“17. Investigation revealed that Shri Dhanraj Kochar and his
family members in connivance with the said three Authorized
Signatories of M/s.D R Foundations and Estates Pvt. Ltd. cheated
Shri M.S Hameed through a criminal conspiracy and this fact i.e., the
commission of scheduled offence [Section 120B] is proved in the
trial held in the predicate offence....”
11. Since the respondent has no jurisdiction to invoke the provisions
of PMLA, as there are no proceeds of crime relating to any scheduled
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offence, the proceedings impugned in the Writ Petition is also liable to be set
aside. Consequentially, though the Provisional Attachment Order: 13/2023
has not been challenged, we are inclined to hold that the said attachment
order is also without jurisdiction.
12. With the above observations, the Criminal Original Petition and
the Writ Petition are allowed, as prayed for. Consequently, the connected
Miscellaneous Petitions are closed.
(S.S.S.R.,J.) (S.M.,J.)
05.01.2024
Index : yes/no
Neutral citation : yes/no
Speaking Order/Non-Speaking Order
ars
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WP No.13425 of 2023 and
To
1. The Deputy Director,
Directorate of Enforcement,
O/o.Jt. Director, Chennai Zonal Office,
2nd and 3rd Floor, Murugesan Naicker Complex,
84, Greams Road, Chennai – 600 006.
2. The Assistant Director,
Directorate of Enforcement,
O/o.Jt. Director, Chennai Zonal Office,
2nd and 3rd Floor, Murugesan Naicker Complex,
84, Greams Road, Chennai – 600 006.
3. Special District Collector,
Land Acquisitions,
Chennai Metro Rail Limited,
METROS, Anna Salai,
Nandanam, Chennai – 600 035.
4. The Assistant Director,
Directorate of Enforcement,
Govt. of India,
Chennai Zonal Office-1,
V & VI Floor, BSNL Administrative Building,
No.2, Kushkumar Road, Nungambakkam,
Chennai – 600 034.
5. The Public Prosecutor,
High Court, Madras
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WP No.13425 of 2023 and
S.S.SUNDAR,J.
AND
SUNDER MOHAN,J.
ars
Pre-delivery common order in
05.01.2024
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