BRIEF FACTS
The case alleged against the applicant is that he had operated a firm for money laundering in conspiracy with his brother, namely, Naresh Jain. It is alleged that he along with the co-accused and other employees, had incorporated and operated 450 Indian entities and 104 foreign entities for routing proceeds of crime and also enabling purchase of offices and properties as if with untainted funds. It is alleged that the co-accused Naresh Jain had placed funds in his companies and layering was done by routing the proceeds of crime into various companies that had dummy shareholders and Directors and were used for opening bank accounts, using identity proofs and documents of real persons, but changing photographs and addresses. Naresh Jain was arrested on 1st September, 2020 under Section 19 of the PMLA.
The investigations have traced proceeds of the crime to the tune of Rs.5,65,11,22,269/-, but the extent of money laundering was more than rupees ninety six thousand crores.
The argument raised was that the officer had not recorded the “belief that any person has been guilty of an offence punishable under this Act” and therefore, there was no arrest. However, the Directorate of Enforcement had produced the file before this Court for perusal where such a satisfaction had been in fact recorded. Therefore, that objection is not available.
In the present case, at the time the bail application was moved, even before the learned Trial Court, the applicant was in custody. The grievance was that the applicant had been wrongly sent into custody and that even issuance of NBWs was wrong
COURT’S OBSERVATION
The Court rejecting the bail application observed that “the allegations against the applicant are very serious in nature. A huge amount of rupees ninety-six thousand crores is supposed to have been laundered. There has been multiple layering, calling for painstaking and detailed investigations. The applicant has fully participated in the money laundering by lending his companies accounts to his brother and making accommodating entries. A sum of Rs. 35 crores is directly traceable to the applicant. A mere exculpatory statement to the respondent can never suffice to form a ground, leave alone a reasonable ground to believe that the applicant is not guilty of the offence”
The Court ordered that an exculpatory statement to the Enforcement Directorate can never suffice to form a ground, leave alone a reasonable ground to believe that the applicant is not guilty of the offence.
The Court further observed that law by virtue of Explanation (ii) to Section 44(d) of the PMLA empowers the Directorate of Enforcement to investigate and file a charge-sheet and continue investigations, including against the named accused.
CASE: BIMAL KUMAR JAIN v. DIRECTORATE OF ENFORCEMENT
CITATION: BAIL APPLN. 2438/2022
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