Shivinder Mohan Singh v. Directorate of Enforcement

(v) that if the applicant is indicted as a promoter of the RHC

Group of Companies under section 70 of the PMLA, that cannot be the basis for the applicant’s continued incarceration, since section 70 itself grants to an accused the right to rebut such allegation during the course of the trial; (w) that since the offence under section 3 of the PMLA is punishable by only upto 7 years, it is not a grave offence as contemplated inter alia in the judgment of the Supreme 2006 SCC OnLine Del 1484; para 20 Court in P. Chidambaram vs. Directorate of Enforcement[2] and P. Chidambaram vs. CBI[3];

(x) that the applicant is neither a flight risk nor has he been shown to have any propensity to tamper with evidence or influence any witnesses, apart from the fact that the evidence is all documentary in nature and has already been collected as per the ED; (y) that although the ED has made an allegation that, while in its custody, the applicant smuggled a mobile phone into the washroom, the falsity of such allegation is demonstrated by the fact that the ED took no action thereupon, either against the applicant or against any ED officer who was tasked with monitoring the applicant; (z) that although the ED alleges that it has registered two ECIRs based on two FIRs relating to predicate offences, such cases emanate from the same set of transactions, and have been mischievously separated, in order only to create separate proceedings; which cannot be the basis to deny the applicant bail, even more so since the ED has not placed any such ECIRs on record; (aa) that a Co-ordinate Bench of this court has already granted bail to Anil Saxena, who is a co-accused in the predicate

2019 SCC OnLine SC 1380; paras 20, 27, 30 & 32 offence in FIR No. 50/2019, vidé order dated 17.06.2020 made in Bail Appl. No. 1074/2020; (bb) that by reason of his continued incarceration, now for almost 9 months, the applicant is unable to effectively instruct his lawyers and is thereby unable to effectively defend himself, in violation of his right to fair trial under Article 21 of the Constitution of India.

6. In support of his case, the applicant has cited the following judicial precedents: (a) G. Udayan Dravid & Ors vs. State & Ors (supra): to argue, that even though banks accept deposits from members of the public and extend loans and other facilities to their clients and make profit out of such transactions, that does not mean that “public money” is involved in such transactions; and that most commercial transactions involve the public, however the only possible element of public money involved in these transactions would be the sales tax or VAT collected; (b) P. Chidambaram vs. Directorate of Enforcement (supra): to argue that irrespective of the nature and gravity of the offence, the precedent of another case will not have a bearing on the grant or refusal of bail, even though it may have a bearing on the principle involved; and ultimately the consideration must be securing the presence of the accused to stand trial;

(c) P. Chidambaram vs. CBI (supra): to submit that, the

Supreme Court has observed that in the absence of any contemporaneous materials, no weight can be attached to the allegation that the accused has been influencing witnesses by approaching them (in that case);

(d) Anil Saxena vs. State of NCT of Delhi[4]: to urge that a Coordinate Bench of this court, while granting bail to Anil Saxena, who is co-accused in the predicate offence in FIR No. 50/2019, has observed that the Risk Management Committee and the RPT Committee were aware of the proposal documents on the basis of which loans were approved; and that it is not an uncommon practice for lenders to extend loans on the strength of comfort provided by creditworthy and known persons; (e) Jignesh Prakash Shah vs. State of Maharashtra[5]: to pointout that the court observed that the very fact that investigation into whether proceeds of crime or part thereof were received by the applicant from defaulting borrowers would take time, would weigh in the favour of granting bail to the applicant (in that case); (f) Paras Mal Lodha vs. Assistant Director, ED[6]: to point-out that this court had granted bail to an accused under sections 3 Bail Appl. No. 1074 of 2020, decided on 17.06.2020 by Delhi High Court; para 26 Bail Appl. No. 1263 of 2014, decided on 22.08.2014 by Bombay High Court; para 21

& 4 of the PMLA, as in the present case, where the alleged sum of money was connected to the accused (in that case) on the basis of statements of co-accused and his employees, which statements the court said are to be tested during trial; (g) Sanjay Chandra vs. CBI[7]: to argue that seriousness of the charge, though a relevant condition, is not the only factor that needs to be considered while granting bail; and that the object of bail is not punitive but to secure the presence of the accused for trial; and that the Supreme Court had granted bail to the accused in that case being conscious that the accused was charged with economic offences of huge magnitude; (h) Nikesh Tarachand Shah vs. Union of India & Anr.8: to argue that the twin conditions for granting bail under section 45 PMLA were held to be unconstitutional, and matters where bail was denied by reason of section 45 were remanded for consideration on merits without application of section 45 PMLA;

(i) Gaurav Gupta vs. Director of Enforcement[9]: to say that statements of the accused recorded under section 50 of the PMLA after his arrest were inadmissible in evidence as being hit by Article 20(3) of the Constitution (in that case);

(j) Raj Kumar Goel vs. Directorate of Enforcement10: to urge that the twin conditions under section 45 PMLA were not to be applied to bail applications; (k) Upendra Rai vs. Directorate of Enforcement11: to argue that mere introduction of the words “under this act” in section 45 PMLA would not revive the twin conditions as imposed under the said section for grant of bail. Respondent’s submissions

7. Mr. Amit Mahajan, learned CGSC appearing for the ED has opposed the grant of bail essentially on the following grounds: (a) that at the time when the offences were committed, REL owned 99.99% of RFL and the two promoters, namely the applicant and his brother Malvinder Mohan Singh, owned more than 50% shareholding in REL and the remaining about 49% shareholding vested in the public at large. Accordingly, the applicant was one of the promoters with substantial shareholding in REL, which in-turn owned 99.99% of the shareholding in RFL; (b) that the 19 major defaulters in repayment of loans to RFL are part of a cluster of companies either owned or controlled by the applicant or by various individuals and entities who are the applicant’s family members, friends or staff members and

2019 SCC OnLine Del 9086; para 22 who were made directors and shareholders of such companies only as ‘front’ persons for the applicant. In this behalf, the ED has filed a chart depicting the ownership structure of the various defaulting companies, from which the ED shows that the money-trail and investigation in respect of 03 companies has been completed; while investigation in respect of the remaining 16 companies is still on-going;

(c) that in essence and substance, the wrongdoing alleged against the applicant is that loans were taken from RFL by several companies, which were acting as ‘front’ companies for the applicant, which monies were thereafter transferred to RHC group companies and other companies and entities that were owned/controlled by the applicant; and these companies then repaid the same monies to RFL towards discharge of loans taken by them from RFL. In this manner, the ED contends, the applicant indulged in ‘evergreening’ of loans;

(d) that in the process, while the monies owed by the applicant were repaid to RFL, the ‘front’ companies subsequently defaulted in paying back their loans to RFL, by reason of which not only RFL but other outside shareholders of RFL have also lost money; (e) that the nature of the transactions may be explained by taking the example of one of the companies, which typifies what was done: it is alleged that on 24.08.2017, RFL gave an unsecured loan of INR 150 crores to one M/s Star Artworks Pvt. Ltd., which amount was immediately transferred by M/s Star Artworks Pvt. Ltd. to RHC, which is a private company owned by the applicant and his brother. RHC in-turn utilized the said amount of INR 150 crores for repaying its existing liability to RFL. In this manner an unsecured loan given by RFL to M/s Star Artworks Pvt. Ltd. was used for ‘evergreening’ of a previous loan taken by RHC from RFL. And this loan was taken by RHC on 10.02.2017 and 15.02.2017 when the applicant and his brother were controlling REL as well as the RHC Group of Companies; (f) that it is further the ED’s allegation that at the relevant time, when loans were approved and further routing of money was done, the applicant was holding a position whereby he could control the decisions taken by the respective companies; (g) that it is also the ED’s allegation that similar transactions were conducted by the applicant, or at his instance, through a number of companies, whereby ultimately RFL lost money; and RFL’s other shareholders also suffered losses; (h) that the ED also says that directors of most of these companies have recorded statements under section 50 of the PLMA to the effect that they became directors only at the request and insistence inter alia of the applicant and that they had no knowledge of, nor any interest in, the management and affairs of these companies. The directors are stated to have said that they were persuaded to become directors only because they were family members, friends and/or close associates of the applicant. Some of these companies have no individual shareholders but were held by other companies, which were under the ownership or control inter alia of the applicant;

(i) that it is also the ED’s case that sometime in 2017, some of these companies were purchased by RHC; (j) that though the ED has filed a complaint under section 44 of the PLMA before the concerned court, the essential nature of investigation in a crime under the PMLA, such as the present case, is very different from the investigation of a conventional penal offence, inasmuch as in cases like this, the accused persons set-up a labyrinth of corporate entities and accounts, with a number of directors, shareholders and complex cross-holdings and structures, including by settingup 'front' companies and 'shell' companies, to obfuscate the true nature of the transactions between the parties; (k) that it is alleged that in cases such as this, the accused persons are the ultimate beneficiaries but in order to create a distance between the actual beneficiaries and the purported entities that carry-out these transactions, the accused persons also create a complex web of transactions. By reason of that, this kind of a matter requires in-depth and prolonged investigation to trace-out the transactions right upto the ultimate beneficiary. In the present case for example, it is contended that more than INR 2000 crores has been siphoned-off inter alia by the applicant through a very complex and intricate web of corporate entities and transactions, both within and outside India, which will require a long time to trace in order to pin the blame on the accused persons. By reason thereof, such investigation by its very nature takes a long time;

(l) that so far, the ED has been able to trace transactions aggregating to about INR 450 crores, whereas investigation in respect of the remaining about INR 1600 crores is still underway. It is argued however, that if the applicant is enlarged on bail, he would most definitely, whether directly or indirectly, ensure that persons who were in the know of things, including banks, financial institutions and others with whom investigation is being followed-up, do not disclose the true state of affairs to the investigating agency. It is further stated that the applicant may, if enlarged on bail, destroy evidence and records and thereby defeat the investigation process;

(m) that there are a total of 50 prosecution witnesses in the case and there is reasonable apprehension that the applicant would attempt to influence witnesses; and (n) that since the on-going investigation involves foreign assets, such assets may be disposed of or evidence may be otherwise tampered with.

8. In opposition to the grant of bail, the ED has relied upon the following judicial precedents: (a) Directorate of Enforcement vs. Upendra Rai12: to argue that in this case, bail was granted to a PMLA accused observing that the twin conditions as imposed by section 45 were not revived by the amendment to the statute; but that this order was stayed by the Supreme Court, attempting to urge that thereby the Supreme Court implies that the twin conditions for bail under PMLA do stand revived; (b) Vidyut Kumar Sarkar vs. The State of Bihar & Ors13: to say that in view of the stay of operation of order of the Delhi High Court in Upendra Rai (supra) by the Supreme Court, that judgment in any case cannot be applied to other cases;

(c) State of Bihar vs. Amit Kumar14: to argue that where chargesheet had been filed but the investigating agency intended to file an additional charge-sheet, presence of the accused in custody may be necessary;

(d) Y.S. Jagan Mohan Reddy vs. CBI 15 and Nimmagadda Prasad vs. CBI 16: to argue that while considering the question of bail in economic offences, a different approach needs to be visited since such offences constitute a class SLP (Crl.) 2598/2020, order dated 03.06.2020 MANU/BH/0297/2020; paras 19 and 20 apart and have deep-rooted conspiracies and involve huge loss of public funds, thereby posing grave threat to the economic health of the country; (e) Serious Fraud Investigation Office vs. Nittin Johari & Anr. 17: to argue that in this case, the Supreme Court remanded the matter to the High Court to reconsider the bail granted to the accused in consonance with the twin mandatory conditions for grant of bail laid down in section 212 of the Companies Act 2013 and other general provisions of bail; (f) State of Gujarat vs. Mohanlal Jitamalji Porwal & Anr.18: to stress that economic offences are committed with cool calculation and deliberate design with an eye on personal profit while disregarding consequence to the community; (g) Sunil Dahiya vs. State(Govt. of NCT of Delhi)19: to submit that grant of bail in a case involving large magnitude of money would not only have an adverse effect on the progress of the case but also on people’s trust in the criminal justice system; and that despite the filing of charge-sheet, bail was denied to the accused in this case.

9. In rejoinder to the submissions made on behalf of the ED, Mr. Hariharan further submits the following: (a) laying emphasis on the factual matrix contained in the case of P. Chidambaram vs. Directorate of Enforcement (supra), it is argued that though the monetary sum involved in that case was about INR 305 crores, the 'gravity' of the offence was much higher since the allegations were against a former Finance Minister, in relation to what was allegedly done while he held public office, which would therefore have a greater impact on public faith in the system. Yet, the Supreme Court was pleased to enlarge the accused on bail after about 04 months of his initial arrest in the predicate offence; (b) that in P. Chidambaram vs. Directorate of Enforcement (supra), the Supreme Court has considered earlier decisions as also the ‘tripod test’ before enlarging the accused on bail;

(c) that it has been pointed-out that some of the other decisions cited by the ED are not cases under the PMLA but were cases involving offences attracting life sentence or even capital punishment;

(d) to allay the apprehension expressed by the ED as to influencing witnesses or tampering with evidence, senior counsel contends that for one, unlike the statement recorded under section 161 Cr.P.C. which is not admissible in evidence, the witness statements recorded under section 50 of the PMLA are admissible and therefore witnesses will not be able to renege on what they have said in such statements; (e) that while the ECIR in the case was recorded on 24.07.2019, the applicant was arrested several months later on 12.12.2019, and there is no allegation that during this period of about 05 months, the applicant made any attempt to tamper with evidence, influence witnesses or interfere in the investigation in any manner; (f) that since the alleged offences are premised on financial transactions, all of which have taken-place through banking channels; therefore the evidence in the matter is essentially documentary. Senior counsel submits that the applicant has handed-over to the ED all records, whether physical or electronic, including computer systems, hard disks and other electronic equipment which contains the material that forms the basis of the allegations. In view of all such records having been handed-over, now there is no scope for alleging that the applicant may destroy any records or otherwise hamper further investigation, if any; (g) that the transactions in question were conducted with RFL, which is a registered NBFC regulated by the RBI. Senior counsel points-out that a reading of the complaint would show that the RBI was cognizant of the transactions at the relevant time, but took no steps to either bar such transactions or to supersede the Board of RFL by reason of such transactions or indeed to revoke the licence of RFL as an NBFC. This, according to counsel, was because there was nothing illegal in such transactions; (h) that statements recorded under section 50 of PMLA are per se admissible, in support of which senior counsel relies upon the judgment of a learned single Judge of this Court in Raj Kumar Goel (supra);

(i) that the confusion sought to be created by the ED as regards stay of this court's decision in Upendra Rai (supra) by the Supreme Court is unnecessary, inasmuch as the stay of the judgment by the Supreme Court has not wiped-out the view taken by the High Court. Infact, it is contended that the Delhi High Court has followed the same view in subsequent cases also while the matter in Upendra Rai (supra) is pending before the Supreme Court; (j) that the present case is covered by the latest judgment in P. Chidambaram vs. Directorate of Enforcement (supra), which considers all earlier decisions; (k) that most importantly, the Explanation to section 3 of the PMLA was added with effect from 01.08.2019, while the ECIR in the present case was recorded on 24.07.2019 i.e. before 01.08.2019 and is therefore not covered by the amendment, namely that the offence alleged against the applicant is not a continuing offence; and

(l) that keeping the applicant in custody any longer will seriously impact his right to defence in consultation with his lawyers and would thereby impact his fundamental right to a fair trial. Recap of the law and principles of bail:

10. Section 45 of PMLA, which is the provision governing bail in that statute recites as under: “Section 45. Offences to be cognizable and non-bailable. - (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), no person accused of an offence under this Act shall be released on bail or on his own bond unless--

(i) the Public Prosecutor has been given a 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 grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail: Provided that a person, who, is under the age of sixteen years, or is a woman or is sick or infirm, or is accused either on his own or along with other co-accused of money-laundering a sum of less than one crore rupees may be released on bail, if the Special Court so directs: Provided further that the Special Court shall not take cognizance of any offence punishable under section 4 except upon a complaint in writing made by-

(i) the Director; or

(ii) any officer of the Central Government or a State Government authorised in writing in this behalf by the Central Government by a general or special order made in this behalf by that Government. (1A) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), or any other provision of this Act, no police officer shall investigate into an offence under this Act unless specifically authorised, by the Central Government by a general or special order, and, subject to such conditions as may be prescribed. (2) The limitation on granting of bail specified in sub-section (1) is in addition to the limitations under the Code of Criminal Procedure, 1973 (2 of 1974) or any other law for the time being in force on granting of bail.”

11. It would be useful at this point to give a conspectus of the law and the principles for grant or denial of bail. Extracts from some of the most relevant and topical judgements on this point are set-out in the paragraphs that follow.

12. Commenting on the consequences of pre-trial detention, in Moti Ram vs. State of M.P.20 the Supreme Court said:

13. In Babu Singh vs. State of U.P.21 the Supreme Court observed: “18. We must weigh the contrary factors to answer the test of reasonableness, subject to the need for securing the presence of the bail applicant. It makes sense to assume that a man on bail has a better chance to prepare or present his case than one remanded in custody. And if public justice is to be promoted, mechanical detention should be demoted.......... The considerable public expense in keeping in custody where no danger of disappearance or disturbance can arise, is not a negligible consideration. Equally important is the deplorable condition, verging on the inhuman, of our sub-jails, that the unrewarding cruelty and expensive custody of avoidable incarceration makes refusal of bail unreasonable and a policy favouring release justly sensible.”

14. Outlining the considerations for bail, in Ash Mohammad vs. Shiv Raj Singh & Anr.22 the Supreme Court expressed itself as follows:

15. In Ashok Sagar vs. State28 the Delhi High Court has said this:

16. In a recent decision in Sanjay Chandra vs. CBI (supra) the Supreme Court has held that:

17. Most recently, in P. Chidambaram vs. CBI (supra) the Supreme Court has held:

18. Furthermore in P. Chidambaram vs. Directorate of Enforcement (supra), the Supreme Court has explained the concept and application of ‘gravity’ of an offence in the following way:

19. It is also important to allude to section 45 of the PMLA while deciding this bail application. Now, the constitutional validity of the twin conditions laid down in section 45 for grant of bail has been expressly struck down by the Supreme Court in a recent decision in Nikesh Tarachand Shah (supra) where the Supreme Court has held as under:

20. When viewed with plain objectivity, the following position emerges in this case: (a) All alleged offending acts and omissions, with which the applicant is charged, arise from financial transactions, done in the course of commercial dealings, through banking channels; (b) Almost 05 months passed between recording of the ECIR (24.07.2019) and the applicant's arrest by the ED (12.12.2019) in the present case. Even if it be said that the applicant had already been arrested on 10.10.2019 in the FIR for the predicate offences, that only makes it worse since the applicant’s arrest in the FIR was more than 06 months after the FIR was registered on 27.03.2019. Substantial time had therefore elapsed before the ED considered it necessary to arrest the applicant in the ECIR. There is no allegation that during this phase, the applicant either tampered with evidence or influenced any witnesses or destroyed any records;

(c) The allegedly offending transactions cannot be undone, reversed, modified or altered in any manner since they are recorded and reflected in several records, including those of complainant in the FIR viz. RFL, regulatory bodies such as the RBI, Securities & Exchange Board of India, Registrar of Companies and the banks and financial institutions that processed these transactions;

(d) The records pertaining to the allegedly offending transactions, both physical and electronic, including equipment and hardware, have already been seized by the ED and are in its custody and control. In such a case, where the prosecution would turn mainly on documentary evidence, which has already been collected and the complaint has been filed, no purpose would be served by keeping the applicant is judicial custody (cf. Sanjay Chandra and P Chidambaram, supra); (e) Statements under section 50 PMLA have been recorded which are admissible in court; and in view inter alia of section 50(3) and the fact that proceedings before the empowered officers under section 50(2) and (3) are deemed to be judicial proceedings within the meaning of section 193 IPC, giving false or fabricated evidence in such proceedings would invite imprisonment upto 07 years as well as fine. It is therefore unlikely that witnesses would renege on such statements; (f) Since a complaint under section 44 PLMA has been filed arising from ECIR dated 24.07.2019, it must be taken that investigation relating to that ECIR stands completed and closed; (g) The ED has not indicated any foreseeable timeline for completing investigation in respect of the alleged remaining about INR 1600 crores and therefore to link the applicant's judicial custody to completion of that on-going investigation, if at all, would leave the key to the applicant’s custody with the ED, which is not acceptable to this court; (h) Upon being queried, the ED has confirmed that it never sought to interrogate the applicant during his judicial custody;

(i) The applicant certainly has deep roots in society, what with his myriad business interests, vast properties, and large family. He is a business tycoon, too well known to go missing without trace. This, apart from the fact that requisite conditions can be imposed to prevent his unannounced exit from the country. The applicant is therefore not a flight-risk; (j) While the financial implication of the alleged offence is no doubt large in quantum, and even accepting the ED’s contention that several individual shareholders of RFL who had nothing to do with the applicant or his family, friends or associates, have suffered losses, it is not as if such losses can be compensated by keeping the applicant in judicial custody as an undertrial; (k) Though the offences as alleged, if proved, are serious economic offences, that in itself cannot be the basis for denying bail since the nature of offence has a limited role to play while examining a bail application (cf. Ashok Sagar and Sanjay Chandra, supra);

(l) Although the ED claims that further investigation is going-on in the matter, no supplementary complaint has been filed since 10.01.2020, which is when the complaint in the present case was filed;

(m) While it may indeed take long and painstaking effort to unravel the entire alleged crime, when there is no real and probable risk of the applicant interfering in further investigation, as displayed by the past conduct of the applicant, that cannot be reason for denying bail; (n) As observed by this court in its recent decision dated 18th June 2020 in Bail Application No. 913/2020 titled Navendu Babbar vs. State of NCT of Delhi, criminal investigation is not a metaphorical fishing-rod handed to an investigating agency, to indulge its penchant for ‘fishing around’ for evidence, at its own leisure and in the fullness of time. Investigation has to be a time-limited process, to be conducted strictly within the structure and framework of applicable law; (o) This court does not perceive any grave threat to the interests of the society or the public at large if, after the complaint has been filed, the accused is enlarged on bail, pending trial.

21. Sanctity must attach to filing of a complaint pursuant to an ECIR. It must, as a matter of law, be taken to be the culmination of investigation into the offence to the extent the offence is defined in that complaint. No one is seeking to prevent or forestall further investigation but for the sake of on-going investigation, this court cannot warp the entire concept of pre-trial imprisonment and bail.

22. Nowhere is it the law that an accused, yet to be tried, is to be kept in custody only on a hunch or a presumption that he will prejudice or impede trial; or to send any message to the society. If anything, the only message that goes-out to the society by keeping an accused in prison before finding him guilty, is that our system works only on impressions and conjectures and can keep an accused in custody even on presumption of guilt. While in certain cases such message may even quench the thirst for revenge of the lay society against a person they believe to be guilty, such action would certainly not leave our criminal justice system awash in glory. An investigating agency must come to court with the confidence that they have arrested an accused, based on credible material, and have filed a complaint or a chargesheet with the certainty that they will be able to bring home guilt, by satisfying a court beyond reasonable doubt. But when an investigating agency suggests that an accused be detained in custody as an undertrial for a prolonged period, even after the complaint or chargesheet has been filed, it appears that the investigating agency is not convinced of its case and so it fears that the accused may ‘get-off’ by discharge or acquittal; and that therefore the only way to ‘punish the accused’ is to let him remain in custody as an undertrial.

23. After all, the Supreme Court has said that it would be improper for any court to refuse bail as a mark of disapproval of former conduct whether the accused has been convicted for it or not or to refuse bail to an unconvicted person for the purpose of giving him a taste of imprisonment as a lesson (cf. Sanjay Chandra vs. CBI, supra). How does one carry forward the Supreme Court precept that punishment begins after conviction, and that every man is deemed to be innocent until duly tried and duly found guilty, if we deny bail without cogent reason (cf. Sanjay Chandra vs. CBI, supra).

24. People’s trust in the criminal justice system must rest on surer footing than on pre-trial punishment by keeping accused persons in prison. Statistics available on the Delhi Prisons website as on 31.12.2019 show that the proportion of undertrials to convicts in Delhi prisons is about 82 percent to 18 per cent. These numbers are telling. Prison is a place for punishment; and no punishment can be legitimate without a trial. There must be compelling basis, grounds and reasons to detain an undertrial in judicial custody, which this court does not discern in the present case.

25. It is beyond contention that the consequences of pre-trial detention are deleterious; and that keeping an undertrial in jail seriously jeopardises the preparation of his legal defence. If kept in custody, the applicant will not be able to effectively brief and consult with his lawyers, collate evidence in his defence and thereby defend himself effectively. Thereby the applicant will be denied his right to fair trial guaranteed under Article 21 of the Constitution (cf. Moti Ram and Babu Singh, supra).

26. In light of the above, there seems to be no rationale for continuing the applicant’s judicial custody as an undertrial in this case. As far as the possibility of the applicant committing any further offence is concerned, that ground is purely speculative and conjectural. So is the possibility of the applicant offering any inducement, threat or promise to any prosecution witness or other such person. As observed above, the possibility of the applicant absconding also appears to be farfetched and can be addressed by imposing appropriate conditions of bail.

27. It goes without saying that, if and once convicted, the applicant would have to suffer requisite imprisonment as well as confiscation of his assets, in accordance with law.

28. It may also be recorded in the passing, that co-accused Anil Saxena has already been granted bail by a Co-ordinate Bench of this court in the predicate offence in FIR No. 50 of 2019; which order has also been upheld by the Supreme Court in Special Leave Petition (Criminal) Diary No(s). 13106/2020 vidé order dated 17.07.2020 though with some observations, which however do not detract from the grant of bail.

29. As a sequitur to the aforesaid discussion, this court is persuaded to the applicant to regular bail in the proceedings arising from ECIR No. ECIR/05/DLZO-II/2019 dated 24.07.2019 registered under sections 3/4 of the Prevention of Money Laundering Act 2002 upon the following conditions:

(i) The applicant shall furnish a personal bond in the sum of

INR 1,00,00,000/- (INR One Crore Only) with 02 sureties of INR 25,00,000/- (INR Twenty-five Lacs Only) each from two family members, to the satisfaction of the Designated/Special Court;

(ii) The applicant shall surrender his passport to the

(iii) The applicant shall not leave the country without permission of the Designated/Special Court and shall ordinarily reside in his place of residence as per prison records;

(iv) The applicant shall furnish to the Investigating Officer a cell phone number on which the applicant may be contacted at any time and shall ensure that the number is kept active and switched-on at all times;

(v) The applicant shall cooperate in any further investigation, as and when required;

(vi) The applicant shall not, whether directly or indirectly, contact nor visit nor offer any inducement, threat or promise to any of the prosecution witnesses or other persons acquainted with the facts of the case. The applicant shall not tamper with evidence nor otherwise indulge in any act or omission that is unlawful or that would prejudice the proceedings in the matter;

(vii) In addition to the condition at (vi) above, it is specifically directed that the applicant shall also not, whether directly or indirectly, contact or visit or have any transaction with any of the officials/employees of the banks, financial institutions, entities etc., who are concerned with the complaint in this case, whether in India or abroad. ED is also directed to issue written intimation to such officials/employees to not engage in any manner with the applicant;

(viii) The applicant shall disclose to the Investigating Officer in writing if the applicant engages, whether directly or indirectly, in opening or closing of bank accounts, or in incorporation, dissolution or closure of companies, whether in India or abroad; and shall furnish to the Investigating Officer such details as the Investigating Officer may require. This, the applicant shall do within 7 (seven) days of undertaking any such transaction. It is made clear that the applicant will not require any prior permission to engage in any of the aforesaid, except that he shall be under obligation to disclose the same to the Investigating Officer as above;

(ix) The Investigating Officer is further directed to issue a request to the Bureau of Immigration, Ministry of Home Affairs of the Government of India or other appropriate authority to forthwith open a ‘Look-out-Circular’ in the applicant’s name, to prevent the applicant from leaving the country, without the permission of the Designated/Special Court.

30. Nothing in this judgment is to be taken as an expression of opinion on the merits of the pending complaint. It is also clarified that the observations in this judgment shall have no bearing on the cases against other accused persons, which cases shall be considered on their own merits.

31. The bail application is allowed in the above terms and the applicant is directed to be released subject to the above conditions, if not required in any other case.

32. The application stands disposed of.

33. Other pending applications, if any, also stand disposed of.

34. A copy of this order be sent to the concerned Jail Superintendent.

ANUP JAIRAM BHAMBHANI, J.

2. JULY 23, 2020 uj/Ne/j