Punjab-Haryana High Court
Bhupinder Singh @ Honey vs Enforcement Of Directorate on 1 July, 2022
CRM-M-27871-2022 (O&M) -1-
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CRM-M-27871-2022 (O&M)
Reserved on : 30.06.2022
Pronounced on : 01.07.2022
Bhupinder Singh @ Honey ...Petitioner
Versus
Enforcement of Directorate ...Respondent
CORAM:- HON'BLE MR. JUSTICE ARVIND SINGH SANGWAN
Present:- Mr. Bipan Ghai, Sr. Advocate with
Mr. Paras Talwar, Advocate,
Mr. Tushan Rawal, Advocate,
Mr. Deepanshu Mehta, Advocate &
Mr. Rishabh Singla, Advocate
for the petitioner.
Mr. Shobit Phutela, Advocate
for the respondent-Directorate of Enforcement.
********
ARVIND SINGH SANGWAN, J.
Prayer in this petition, filed under Section 439 Cr.P.C., is for
grant of regular bail to the petitioner in case/FIR ECIR
No. ECIR/JLZO/21/2021 dated 30.11.2021 for the offence under Section
3, punishable under Section 4 of the Prevention of Money Laundering Act,
2002 (for short 'PMLA'), District Jalandhar.
Learned senior counsel, appearing for the petitioner, has
submitted that the petitioner is not involved in any other case; he is in
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custody for the last about 05 months, that is w.e.f. 03.02.2022, and the
investigation in all respect is complete; a formal complaint is already filed
before the competent Court of law, therefore, the petitioner is no more
required for any further custodial investigation.
Brief facts of the case are that on 20.05.2017, in an E-Auction
conducted by the Mining Department, one Kudratdeep Singh was the
successful bidder for Rs. 4.04 crores and was allotted a sand mine
measuring 4.41 hectares in village Malikpur, District S. B. S. Nagar. Later
on, finding that the location of the land is not clear, he got the same
demarcated through Halqa Patwari on 16.08.2017 and found that the
location of the land is on southern side of Satluj river and there is no
proper passage from village Malikpur, where he was allotted the land and
some illegal occupants in the village Dhulewal and Rod Majra in District
Ludhiana are doing the illegal mining. On this account, Kudratdeep Singh
represented various officials of the Mining and Industry Department as
well as other higher authorities, however, his grievances were not
redressed and on 06.02.2018, the General Manager-cum-Mining Officer,
District Industry Centre, S. B. S. Nagar, Punjab suspended his mining
license. Kudratdeep Singh filed a Civil Writ Petition before this Court,
which was disposed of on 10.01.2020 by giving certain directions and he
again filed a second writ petition praying that he may be permitted to
surrender the mining site in village Malikpur as the same is not feasible at
the spot. Thereafter, he did not perform any work at the said site.
Learned senior counsel further submitted that later on, FIR
No. 26 dated 07.03.2018, under Sections 379, 420, 465,467, 468, 471 of
the IPC and Sections 21(1) & 4(1) of the Mines & Minerals (Regulation of
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Development) Act, 1957 was registered against many persons with the
allegations that when a team of the Mining Department and civil
administration visited the spot, it was found that several mines have been
excavated and illegal mining activities have been carried out at the spot
and several machines like tipper/trucks, proclaim machines, JCB machines
etc. were seized by the department. As per the FIR, the sand mine was
allotted to Kudratdeep Singh on a representation given by him that he is
not conducting any mining, however, it was found that majority of the
numbers allotted to him were on the other side of Satluj river in District
Ludhiana and, therefore, the mining operations were suspended by the
department itself. Later on, the police submitted the challan under Section
173(2) Cr.P.C. and Kudratdeep Singh was kept in Column No. 2, whereas
the challan was presented against 56 persons.
Learned senior counsel further submitted that thereafter, the
Directorate of Enforcement (for short 'ED') raided the premises of
Kudratdeep Singh, petitioner Bhupinder Singh @ Honey and one Sandeep
Kumar in January, 2022. From Kudratdeep Singh, no recovery of money
was effected, however, a mobile phone was taken into possession. From
petitioner Bhupinder Singh @ Honey, as per allegations, Rs. 8 crores
(approx.) was recovered and from Sandeep Kumar, an amount of
Rs. 1,99,17,200/- was recovered in cash. With regard to this money also, it
is the case of the ED that this amount was given by the petitioner to
Sandeep Kumar. It is further submitted that this recovery is effected on
18.01.2022, therefore, the same does not relate to the offence under FIR
No. 26, which was registered on 07.03.2018.
Learned senior counsel has next argued that during
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investigation, even Sandeep Kumar has been let off by the ED and the
disclosure statement of the petitioner was recorded in custody that the
money recovered from Sandeep Kumar in fact belongs to the petitioner and
a total of Rs. 9,97,52,700/- is shown to have been recovered from the
petitioner. It is further submitted that the investigation of the ED further
suggests that there were total 09 partners, who had obtained Malikpur sand
mine contract along with Kudratdeep Singh, however, petitioner
Bhupinder Singh @ Honey was not one of the partners in the said firm.
Learned senior counsel further argued that in order to connect
the petitioner with the said offence, ED recorded the statement of
Kudratdeep Singh that the petitioner used to help him whenever there was
a dispute between the partners and would also help in supervising the
mining activities as a common friend.
It is further argued that during investigation, ED exaggerated
the earning of the petitioner by an imaginary calculation that the slips,
issued by the Mining Department for one day, depicted mining of about
902 Metric tons sand per day and by multiplying it with 153 days, the same
was taken to be 1,38,113 Metric tons of sand and held that the petitioner
has earned Rs. 10,68,34,000/- by illegal mining. It is further submitted that
despite the fact that no recovery was effected from Kudratdeep Singh,
whom the mining lease/license was allotted, a fictitious figure of Rs. 10
crores from illegal mining has been calculated by the ED and the recovery
of the said amount cannot be termed as proceeds of crime in reference to
FIR No. 26, which was registered way back on 07.03.2018.
It is next argued on behalf of the petitioner that even no
offence under Sections 379, 420, 465, 467, 468 and 471 of the IPC is made
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out against the petitioner as three slips recovered from the tipper/two
drivers, at the time of the raid conducted on 06.03.2018, were found to be
fake by the Mining Department and the same were given by Kudratdeep
Singh as per final report submitted under Section 173 Cr.P.C. as petitioner
is not an accused in said FIR.
Learned senior counsel further submitted that since the
petitioner is not an accused in the aforesaid FIR and no challan has been
presented against him, the petitioner has been falsely implicated in the
present case. Further it is submitted that till date, there is no verification by
ED regarding three slips from the department whether the said slips are
genuine and ED has wrongly drawn an inference that the same are fake
slips.
It is further argued that no offence under the Mines &
Minerals (Regulation of Development) Act, 1957 falls within the
scheduled offence under the PMLA, therefore, the prosecution of the
petitioner is illegal. Further it is submitted that it is wrongly investigated
by ED that the petitioner, being partner of M/s Provider Overseas
Consultant Pvt. Ltd., has diverted the proceeds of crime to this firm for
earning more money and Kudratdeep Singh and Sandeep Kumar were also
the Directors of the said company, although ED could not find any trail of
money in said firm, therefore, ED changed the version of the petitioner by
recording his statement that Rs. 6/7 crores were recovered by him during
the past six months from Rakesh Chaudhary and Mohan Pal Singh for
facilitating them in their mining related works and remaining Rs.3/4 crores
were received by him for arranging transfer of the employees of the Punjab
Govt. through his political connections. Learned senior counsel submitted
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that the petitioner has already filed an appeal before the adjudicating
authority under the Act and the matter is subjudice and, therefore, at this
stage, it cannot be held that the amount recovered was proceeds of crime.
Learned senior counsel has next argued that if the statement of
the petitioner, which was recorded while in custody and is yet to be proved
during trial, is taken to be correct on the face of it, the same contradicts the
version of ED that it relates to FIR No. 26, registered on 07.03.2018,
whereas the statement of the petitioner was recorded on 18.01.2022 and
there was no FIR of illegal mining against the petitioner or against
aforesaid two persons from the year 2019 to 2022, therefore, ED could not
investigate the crime, for which no FIR regarding predicate offence has
been registered.
Learned senior counsel further argued that in fact the
petitioner has been roped in by ED, which has even tried to add provisions
of Prevention of Corruption Act (for short 'PC Act'), without there being
any FIR of predicate offence under the PC Act and the reason for the false
implication of the petitioner is that he is the nephew of Mr. Charanjit Singh
Channi, the then Chief Minister of the State of Punjab and when during
investigation, nothing was found to substantiate the allegations under the
PC Act, the same was dropped.
It is further argued that even the statement of the petitioner
was recorded under Section 50 of the PMLA on 03.02.2022, in which the
petitioner has given explanation with regard to his income tax returns from
2015 onwards, balance sheets of M/s Provider Overseas Consultant Pvt.
Ltd. and M/s Sunrise Infra. Question No. 3 and the answer to it read as
under:
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"Question 3: Please tell me the source of your income
from 2017-2018?
Answer: For the last 2 years I have been leasing JCB
and other heavy machinery used for mining work and
using it for mining work in the mining quarry. I still
have four such machines at lease which are working at
Jindapur Mining Site, which belongs to Rakesh
Chaudhary. These machines have been working on
Jindapur Mining site for the last one and a half year,
from which I earn around Rs. 2 lakh per day from these
machines. These machines are used in mining site for
the purpose of sand extraction and to load truck/tippers.
I get around Rs.2000 for loading a truck. These
machines use to load about 150 trucks and some trolleys
in a day. The running cost of these machines is Rs. 1
lakh per day, This way I save
Rs. 2,00,000/- in a day.
Apart from these I also have a truck for 2 years
which I bought from Gurjot Singh resident of Patiala in
2020. In addition to this truck I have 9-10 truck tippers
and 4-5 tractors on lease which are used in transporting
materials from Crushers and mining sites. I save Rs.
1.25 lakh a day from these trucks / tippers. I undertake
that I will submit a copy of the agreements of machines,
truck tippers and Tractors within 7 days to your office.
Apart from these I will also submit copies of the
weighment slips received during transportation. Iqbal
Singh, resident of Salapur, District Ropar, looks after all
the work of my tractor, tipper and trolly. In addition, I
state that during search conducted on 18.01.2022, In the
statement, in question number 6, the annual income was
mistakenly stated as Rs 6 lakh."
Learned senior counsel further argued that the petitioner has
properly explained that the money recovered from him was in fact earned
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by providing different type of machineries to mining sites and he never
obtained any money for the transfer of any employee of the Govt. of
Punjab. Further submitted that in fact in a statement dated 06.02.2022, the
petitioner has also explained that Rakesh Chaudhary and his friend Mohan
Pal Singh wanted some favour from Chief Minister but the Chief Minister,
instead of giving favour, reduced the price of sand and due to this, both of
them got annoyed.
Learned senior counsel further argued that ED could not
found any evidence to connect the then Chief Minister of Punjab,
therefore, on 31.03.2022, ED filed a formal complaint before the
competent Court of law only against the petitioner and Kudratdeep Singh
only. It is further submitted that in para 3.1 of this complaint, again there is
a reference of FIR No. 26 dated 07.03.2018 as well as three weighment
slips dated 16.03.2018, which were allegedly found to be fake.
It is further submitted that though in the FIR No. 26, challan
was presented against 56 persons, however, in the complaint, only
Kudratdeep Singh was arraigned as accused despite the fact that he was
found innocent by the Punjab Police in 2018 itself and later on, his mining
lease/license was also suspended on 06.02.2018 but ED has not taken into
consideration all these documents showing that Kudratdeep Singh was
innocent and the petitioner was neither named in the FIR nor the challan
was presented against him.
Learned senior counsel has referred to reply filed by ED
before the Court of Sessions, where regular bail application was filed by
the petitioner, to submit that the role of the petitioner as given in para 6 of
the reply is that he is a childhood friend of Kudratdeep Singh @ Lovie and
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assisted him in arranging funds through his friends for the purpose of
making payment in relation to Malikpur sand mine. In para 6.2, it is stated
that in the statement dated 04.03.2022, Kudratdeep Singh @ Lovie stated
that the petitioner used to supervise the mining operation. In para 6.3, there
is a reference of three statements of the petitioner dated 08.02.2022,
09.02.2022 and 10.02.2022, where the petitioner has stated that he assisted
Kudratdeep Singh @ Lovie in handling mining related work with
concerned Govt. Department like Mining Department, Ropar, Nawanshahr
and in taking some inputs from police officials as well as officials of the
Mining Department regarding weighment slips. It is further stated in para
6.4 that as per statement dated 21.02.2022 of Harminder Singh @ Pinka,
he used to communicate with the petitioner through Whatsapp/Email with
regard to Malikpur mining site and in para 6.5, there is a reference to the
statement dated 18.02.2022 of Subash Bath that the petitioner was looking
after the mining affairs of Kudratdeep Singh @ Lovie. Further in para 6.6,
there is a reference of recovery effected from the three residences of the
petitioner and it is stated that the petitioner could not produce any
legitimate source of the seized cash, which was much below the income
shown in his income tax returns from 2017 to 2021. The net conclusion of
the investigation is given in para 6.14 and 6.15, which are reproduced
herein below:
"6.14 Therefore, in view of the above, it has been
clearly established that applicant used to assist
Sh. Kudratdeep Singh @ Lovie in mining
activities at Malikpur mine, used to handle works
of Malikpur mining site on behalf of Kudratdeep
Singh @ Lovie, used to co-ordinate/liaison with
various government departments, used to assist in
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illegal sand mining activities by obtaining early
raid alerts. Aplicant was found to be in possession
of fake weighment slips pertaining to Malikpur
mining site and was in possession of illegitimate
cash suspected to be proceeds of crime which is
relatable to illegal mining activities in relation to
scheduled offence.
6.15 Thus, Applicant was found actually involved
in the offence of money laundering and has
committed offence of money laundering defined
under section 3 of the Prevention of Money
Laundering Act, 2002, which is punishable under
section 4 of the Prevention of Money Laundering
Act, 2002."
Learned senior counsel has referred to (2020) 13 Supreme
Court Cases 791, P. Chidambaram vs. Directorate of Enforcement to
submit that Hon'ble Supreme Court has granted bail in a complaint filed
by ED by observing as under:
"23. Thus, from cumulative perusal of the judgments
cited on either side including the one rendered by the
Constitution Bench of this Court, it could be deduced
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. However,
while considering the same the gravity of the offence is
an aspect which is required to be kept in view by the
Court. The gravity for the said purpose will have to be
gathered from the facts and circumstances arising in
each case. Keeping in view the consequences that
would befall on the society in cases of financial
irregularities, it has been held that even economic
offences would fall under the category of "grave
offence" and in such circumstance while considering
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the application for bail in such matters, the Court will
have to deal with the same, being sensitive to the nature
of allegation made against the accused. One of the
circumstances to consider the gravity of the offence is
also the term of sentence that is prescribed for the
offence the accused is alleged to have committed. Such
consideration with regard to the gravity of offence is a
factor which is in addition to the triple test or the tripod
test that would be normally applied. In that regard what
is also to be kept in perspective is that even if the
allegation is one of grave economic offence, it is not a
rule that bail should be denied in every case since there
is no such bar created in the relevant enactment passed
by the legislature nor does the bail jurisprudence
provides so. Therefore, the underlining conclusion is
that irrespective of the nature and gravity of charge, the
precedent of another case alone will not be the basis for
either grant or refusal of bail though it may have a
bearing on principle. But ultimately the consideration
will have to be on case to case basis on the facts
involved therein and securing the presence of the
accused to stand trial.
24. In the above circumstance it would be clear that
even after concluding the triple test in favour of the
appellant the learned Judge of the High Court was
certainly justified in adverting to the issue relating to
the gravity of the offence. However, we disapprove the
manner in which the conclusions are recorded in
paragraphs 57 to 62 wherein the observations are
reflected to be in the nature of finding relating to the
alleged offence. The learned senior counsel for the
appellant with specific reference to certain observations
contained in the above noted paragraphs has pointed out
that the very contentions to that effect as contained in
paragraphs 17, 20 and 24 of the counter affidavit has
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been incorporated as if, it is the findings of the Court.
The learned Solicitor General while seeking to
controvert such contention would however contend that
in addition to the counter affidavit the respondent had
also furnished the documents in a sealed cover which
was taken note by the learned Judge and conclusion has
been reached."
Learned senior counsel has lastly argued that the petitioner is
not maintaining good health as he is suffering from heart problems and
even in custody, he was examined by the jail doctor and he needs urgent
medical treatment and has relied upon the medical prescription issued by
the Medical Officer, Central Jail, Kapurthala.
Learned counsel, appearing for the respondent-ED, has filed
the custody certificate, according to which, the petitioner is in judicial
custody for the last 04 months and 18 days. Learned counsel for the
respondent-ED has referred to Section 2(u) of the PMLA, which reads as
under:
"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."
Learned counsel for the respondent-ED has further argued that
under the provisions of Section 45 of the PMLA, no person accused of any
offence under the PMLA shall be released on bail or on his own bonds
unless (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
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grounds for believing that accused is not guilty of such offence and that he
is not likely to commit any offence while on bail. It is further submitted
that limitation of granting bail as specified in sub-Section (i) is in addition
to limitation provided under the Criminal Procedure Code.
Learned counsel for respondent-ED has further submitted that
offence under PMLA is a stand alone offence and a person need not
necessarily be booked of a scheduled offence and even can be prosecuted
under Sections 5 and 8 of the PMLA, if he is found in possession of the
proceeds of crime.
In reply, learned senior counsel has submitted that as per
custody certificate, the petitioner is a first offender and is in substantive
judicial custody of about 05 months as he was arrested on 03.02.2022 and
since a complaint has already been filed, no purpose will be served by
keeping him in judicial custody anymore as the conclusion of trial is likely
to take a long time.
After hearing learned counsel for the parties, I find merit in
the present petition for the following reasons:
(a) The primary objection raised by learned counsel for the
respondent-ED is that the petitioner does not qualify the
triple test laid down under Section 45 of the PMLA.
The said three conditions laid down under Section 45
are that the public prosecutor should be given an
opportunity of hearing, which has been given in the
present case; secondly, if the public prosecutor opposes
the application, a reasoned order be passed that the
person is not guilty of offence and not likely to commit
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offence while on bail and thirdly that in addition to
provisions of PMLA, the provisions of Cr.P.C.,
regarding grant of bail, shall apply. Section 45 (1) (ii) is
akin to Section 37 of the NDPS Act, wherein the Court,
while granting bail, has to form an opinion. In a case
under the NDPS Act, it is easy for an accused, who has
been released on bail to repeat such offence, however,
in a case under the PMLA like the present case, it is not
easy for an accused to commit the offence again as he
will always be in radar of E.D.
(b) It is the admitted case of ED that after registration of the
aforesaid FIR in 2018, a complaint has been filed by ED
in 2022 i.e. after a period of about 04 years and in the
intervening period, there was no further complaint or
FIR regarding illegal mining to suggest that the
petitioner is a habitual offender and is involved in any
other case even prior to registration of the aforesaid
FIR, especially when he is not named either in FIR No.
26 or report submitted under Section 173(2) Cr.P.C.
(c) As per own investigation of ED, the petitioner was
helping Kudratdeep Singh @ Lovie, who was allotted
the lease license, in his mining work and there is no
direct allegation against him that he was looking into
the finance of the Kudratdeep Singh @ Lovie, therefore,
the Court is convinced that the petitioner qualify the
triple test laid down under Section 45 of PMLA as the
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Court has nothing to presume adverse to the conduct of
the petitioner and since all the documents are already in
the custody of the investigating agency, therefore, there
is no possibility for the petitioner to tamper with the
same.
(d) A perusal of the ECIR dated 30.11.2021 reveals that the
same is registered under Sections 420, 467 and 471 of
the IPC with reference to FIR No. 26 dated 07.03.2018
as scheduled offence, however, nothing could be found
regarding the role of the then Chief Minister and the
proceedings under the PC Act were dropped.
(e) Even there is a force in the arguments raised by learned
senior counsel regarding the timing of registration of
the FIR i.e. after 04 years of the registration of FIR No.
26 dated 07.03.2018, is due to political reasons
especially in view of the fact that the same has been
registered after the uncle of the petitioner took over as
Chief Minister of the State of Punjab and also in view
of the fact that from 2018 till 2022, neither any further
FIR was registered nor any proceedings were initiated
by ED.
(f) In view of the judgment of Hon'ble Supreme Court in
P. Chidambaram's case (supra), there is no absolute
bar in granting regular bail to an accused facing trial
under the PMLA as the allegations are yet to be proved
and the petitioner has raised a probable defence that he
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has already filed an appeal before the appropriate
authority to explain and prove that the recovery effected
from him is not the proceed of crime and the final
adjudication is yet to be made by the appropriate
authority.
(g) It is well settled principles of law that when the
investigation is complete and charge sheet is filed in the
Court, conclusion of trial is likely to take a long time, a
person/accused like the present petitioner, who is aged
about 36 years old, can be released on bail, subject to
his furnishing bail/surety bonds and with a condition
that his passport shall remain deposited with the
Court/Prosecuting Agency and he will not leave the
country without seeking prior permission of the Court.
(h) As per record of the Medical Officer, Central Jail,
Kapurthala, the petitioner is under treatment for his
heart ailments and he needs further treatment from
specialized doctors, which itself is a ground for
releasing the petitioner on bail.
(i) Even otherwise, the petitioner is in custody since
03.02.2022 and in judicial custody w.e.f. 11.02.2022, as
per custody certificate filed in Court, and a period of
about 05 months has lapsed, therefore, the petitioner
cannot be kept in judicial custody for unlimited period
in the light of judgment in P. Chidambaram's case
(supra).
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Accordingly, it is held that the petitioner qualifies the triple
test under Section 45 of the Act and, therefore, the present petition is
allowed. The petitioner is ordered to be released on regular bail, subject to
following conditions:
(i) The petitioner will furnish bail and two sureties to
the satisfaction of the trial Court/Illaqa Magistrate,
out of which, one surety will be a local surety.
(ii) The passport of the petitioner will remain in the
custody of the prosecuting agency or the trial Court
and the petitioner will not leave India without prior
permission of this Court.
(iii) The petitioner will furnish an undertaking that he
will appear before the Investigating Agency as well
as the trial Court as and when he is required and in
case, he defaults in appearance, it will be open for
the prosecution to apply for cancellation of his bail.
01.07.2022 (ARVIND SINGH SANGWAN)
Waseem Ansari JUDGE
Whether speaking/reasoned Yes/No
Whether reportable Yes/No
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