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REPORTABLE
INTHESUPREMECOURTOFINDIA
CRIMINALAPPELLATEJURISDICTION
CRIMINALAPPEALNOS.18781879OF2017
(ArisingoutofSLP(Crl.)No.68966897of2017)
RohitTandon Appellant
:Versus:
TheEnforcementDirectorate Respondent
JUDGMENT
A.M.Khanwilkar,J.
1. BytheseappealstheorderoftheHighCourtofDelhiat
NewDelhidated5th May,2017,rejectingtheBailApplication
No.119of2017andCriminalM.B.No.121of2017hasbeen
assailed.Theappellantwasarrestedon28thDecember,2016in
Signature Not Verified
Digitally signed by
CHETAN KUMAR
connectionwithECIR/18/DZII/2016/AD(RV)registeredunder
Date: 2017.11.10
20:40:13 IST
Reason:
2002(hereinafterreferredtoastheActof2002). Thesaid
FIRNo.205/2016dated25thDecember,2016inrelationtothe
offencespunishableunderSections420,406,409,468,471,
188and120BoftheIndianPenalCode,1860(IPCforshort).
Police,NewDelhi. TheECIR,however,hasbeenregisteredat
Enforcement,empoweredtoinvestigatetheoffencespunishable
undertheActof2002.
Judge02,SouthEastSaketCourt,NewDelhiforreleasinghim
onbailbywayofanapplicationunderSection439oftheCode
ofCriminalProcedure,1973readwithSection45oftheActof
appellantthereafterapproachedtheHighCourtofDelhiatNew
No.121of2017.TheHighCourtindependentlyconsideredthe
3
meritsoftheargumentsbuteventuallyrejectedtheprayerfor
bailvideimpugnedjudgmentdated5thMay,2017.
punishableunderSections3/4oftheActof2002onthebasis
ofinformation/material,asevidentfromthepredicateoffence
accusedandunknownaccusedforoffencespunishableunder
Sections420,406,409,467,468,471,188and120BofIPC,
relevantfactsnotedintheECIRreadthus:
A. Itisreportedthatduringthecourseofinvestigationof
Case FIR No.242/16 u/s 420, 467,468,471, 120B IPC, PS
C.R.Park,Delhi,itisrevealedthatAccusedRajKumarGoel
along with associates are engaged into earning profits by
routing money into various accounts by using forged
documents and thereby receiving commission from the
prospective clients who either need money by cheque or in
cash.Inordertoobtainlargeprofits,accusedRajKumarGoel
andfewofhisassociateshaveopenedmanyBankAccounts
inKotakMahindraandICICIBankatNayaBazar,Chandni
Chowk,Delhi.
notesintonewcurrencynotes.Inthisconspiracy,thesaidCA
acted as a mediator and arranged prospective clients who
intendedtoconverttheirblackmoneyintolegitimatemoney.
Forthesame,allegedCAoffered2%commissiontotheother
accusedpersonsonallsuchtransactions.
468,471and120BofIPCarescheduledoffencesundertheAct
criminalconspiracywhichmighthaveundergonetheprocess
oflaunderingandtherebyanoffenceunderSection3oftheAct
of2002wasmadeout. Itisnotedthatprimafaciecasefor
5
Section4oftheActof2002wasmadeoutandaccordinglythe
caseisbeingregisteredandtakenupforinvestigationunder
theActof2002andrulesframedthereunder.
appellant),DineshBhola,RajKumarGoel;thestatementsof
KamalJain,DineshBholaandAshishKumar,recordedunder
Section50oftheActof2002;andanalysisofbankstatements
conspiredwithotherpersonstogetdepositedRs.38.53Crore
withintentionofgettingthemcancelledandtherebyconverting
appellantherein,byAshishKumar,RajKumarGoelandothers
Accordingtotheprosecution,alltheassociatesoftheappellant
Kumar,BranchManagerofKotakMahindraBankandothers,
tothetuneofRs.34.93CrorefromKotakMahindraBank,K.G.
commissionreceivedbyhiminoldcashcurrency.Thedemand
the custody of Kamal Jain who had kept the same on the
BankLimited,werealsorecovered.Theprosecutionsuspected
appellantforexecutingthecrime.
7
appellantthattheinvestigationoftheoffenceregisteredagainst
theappellantandothersunderSection3/4oftheActof2002
predicateoffenceregisteredbytheDelhiPolice.Itthusopined
thatthematteronhandmustbeexaminedonlyinreferenceto
theregistrationofECIRbytheEnforcementDirectorate. The
SessionsCourtalsofoundthatasperSection19oftheActof
2002,theonlyconditiontobesatisfiedforarrestofapersonis
thereasonablebeliefoftheauthoritygatheredonthebasisof
accusedwasarrestedbythecompetentauthorityonthebasis
ofmaterialinhispossessiongivingrisetoareasonablebelief
offencepunishableundertheActof2002.Assuchthearrest
illegal.Afterhavingdealtwiththosecontentions,theSessions
prosecutionandanalysedthesameinthefollowingwords:
23. Lastly,itwassubmittedbylearnedseniorcounselfor
accusedthataccusedfullycooperatedwiththeinvestigating
agencyandtherewasnoneedtoarresthiminthiscase.He
further submitted that the actions of Accused persons as
mentioned in the FIR attract implications and as such the
correct authority to investigate into the same is the Income
TaxDepartmentandnottheED.Percontra,learnedSpecial
ProsecutorforEDsubmittedthataccusedonlycooperatedin
the investigation in ECIR No.14/16 and not in ECIR No.
18/16.Hefurthersubmittedthatassufficientmaterial
surfacedonrecordagainstthepresentaccusedandhe
did not cooperate in the investigation in the present
case,therefore,accusedRohitTandonwasarrestedin
this case. He submitted that he does not dispute the
jurisdictionofIncomeTaxDepartmentsofarasotheraspects
ofthematterareconcerned.
24. Aspersection45ofPMLA,whileconsideringgrantof
bailtoaccused,thecourthastosatisfythat:
ii. Heisnotlikelytocommitanyoffence,whileon
bail.
25. Inthepresentcase,accusedhasfailedtosatisfy
this court that he is not guilty of alleged offence
punishable under section 3 of PMLA. He has not been
able to discharge the burden as contemplated under
section24oftheAct.
offencesconstituteaclassapartandneedtobevisitedwitha
differentapproachinthematterofbail.Theeconomicoffence
having deep rooted conspiracies and involving huge loss of
public,fundsneedstobeviewedseriouslyandconsideredas
grave offences affecting the economy of the country as a
whole and thereby posing serious threat to the financial
healthofthecountry.
(emphasissupplied)
investigationwasattheinitialandcrucialstageandthatthe
sourceoffundsofproceedsofcrimewasyettobeascertained
tillthenandthattherecoveryofbalanceproceedsofcrimewas
intheprocess,thequestionofenlargingtheappellantonbail
doesnotarise,moreso,whentherewaseverypossibilitythat
rejectedbytheSessionsCourtvidejudgmentandorderdated
7thJanuary,2017.
Cr.P.C.readwithSection45oftheActof2002.TheHighCourt
appellantandafteradvertingtotherelevantmaterials,rejected
11
theapplicationforgrantofbailpreferredbytheappellant.The
HighCourtfoundthattheActof2002doesnotprescribethat
investigationinrelationtotheoffencesunderSections3&4of
the proceedings under the Act of 2002 are distinct from the
thennotedthatSection44oftheActof2002isanenabling
conflictingandmultipleopinionsoftheCourts.Butproceeded
to hold that the said possibility would arise only when the
chargesheetisfiledaftercompletionofinvestigationinrelation
concernedCourt. TheHighCourtheldthatSection44ofthe
provisionstipulatingthatthetrialofoffenceunderSection3/4
oftheActof2002andanyscheduledoffenceconnectedtothe
Courtconstitutedfortheareainwhichtheoffencehasbeen
theHighCourtanalysedthesameinthefollowingwords:
15. ProsecutionunderSection45ofPMLAforcommissionof
offenceunderSection3punishableunderSection4ofPMLA
hasalreadybeeninitiatedbyEDintheSpecialCourt.Byan
order dated 25.02.2017, learned Addl. Sessions Judge /
Special Court (PMLA) has taken cognizance against Rohit
Tandon (present petitioner), Ashish Kumar and Raj Kumar
Goel. Dinesh Bhola and Kamal Jain have also been
summonedtofacetrialunderSection4ofPMLA.RajKumar
GoelandAshishKumarcontinuetobeincustodyinthesaid
proceedings.
MahindraBankintheaccountsoftheGroupofCompanies.
ItgivesdetailsofDemandDraftsissuedduring15.11.2016to
19.11.2016 from eight bank accounts in the name of Sunil
Kumar, Dinesh Kumar, Abhilasha Dubey, Madan Kumar,
MadanSaini,SatyaNarainDagdiandSeemaBaionvarious
dates. Most of the Demand Drafts issued have since been
recovered.ItsdetailfindsmentioninTableNo.2giveninthe
complaint.
unaccountedmoney/income.Inmyconsideredview,mere
paymentoftaxontheunaccountedmoneyfromanysource
whateverwouldnotconvertitintolegalmoney.Needlessto
say,huge deposit wasasinisterattempt/strategybythe
petitionerandotherstoconverttheoldcurrencyintonewone
to frustrate the Demonetization Policy primarily meant to
unearthblackmoney.
(emphasissupplied)
8. TheHighCourtopinedthatkeepinginmindtherigorsof
chargedunderPartAoftheSchedule,onbail,coupledwiththe
antecedentsoftheappellantofbeinginvolvedinothersimilar
crimeregisteredasFIRNo.197/2016,foroffenceunderSection
CrimeBranchandECIRNo.14/DZ/II/2016registeredon16 th
December,2016byEnforcementDirectorateforoffencesunder
Departmenton10th December,2016ataround10.00P.M.at
theofficepremisesoftheappellant,currencyofRs.13.62Crore
wasrecoveredincludingnewcurrencyinthedenominationof
credibledocumentswereforthcomingfromtheappellantabout
thesourcefromwherehehadobtainedsuchahugequantityof
rejected.Asaconsequence,thependingapplicationwhichwas
consideredalongwiththebailapplicationwasalsodisposedof
passedbytheHighCourt.
16
Theyhavealsofiledwrittensubmissions.
impugnedjudgment,theCrimeBranchfiledthechargesheet
beforetheappropriateCourtinrelationtoFIRNo.205/2016on
filedsupplementarycomplaintCCNo.700/2017inrelationto
concernedaccusedinthecrimeforoffencepunishableunder
Section3oftheActof2002.Acomprehensivesupplementary
2017.
appellantpreferredsecondbailapplicationinthepresentcase
17
ApplicationNo.1361/2017. Thisapplicationwasfiledon12 th
July,2017.Alongwiththesaidbailapplicationtheappellant
filedanapplicationbeingCriminalM.A.No.1293of2017for
seriouslyillandrequiredimmediatemedicalattentionbecause
interimreleaseapplicationwasallowedon10 th August,2017.
thus:
BAILAPPLN.1361/2017
Crl.M.A.No.1293/2017(applicationforinterimbail)
Ithasbeensubmittedonbehalfofthepetitionerthathe
istheonlysonofhismotherwhohassufferedafallandhas
got a fracture in her neck. The sister of the petitioner is
stationedabroad.Thepetitionerhasasonwhoisofyoung
age.ThepetitionerhasalsodrawntheattentionofthisCourt
tothemedicalreportwhichindicatesthataplasterhasbeen
put on the fracture but she has been suffering from acute
pain.
Ithasbeenfurthersubmittedthatthechargesheetin
themaincasehasbeensubmittedandthatthepetitionerhas
remainedinjailformorethansevenmonthsbynow.
Opposingtheaforesaidprayerforgrantofinterimbail,
Mr.Mahajan,learnedSr.StandingCounselsubmitsthatthis
isacaseofseriousfiscalimproprietyofgreatmagnitudeand
thereisapossibilityofthepetitionertamperingwithevidence
if he comes out from the jail even for a short period. No
definite reasons, however, have been assigned by
Mr.Mahajan,forsuchapresumptionthatthepetitionerwould
tamperwiththeevidencespeciallywhenchargesheetinthe
maincasehasalreadybeensubmitted.
onhisfurnishingabondinthesumofRs.25,000/withtwo
suretiesofthelikeamounttothesatisfactionofspecialcourt.
Thepetitionershallnot,unnecessary,seekextensionof
the interimbailgrantedtohim.Itisalsospecified that the
petitionershallnotleavethecountryunderanycircumstances
whatsoever. Should the petitioner intend to go out of the
territorial confines of NCR of Delhi, permission would be
required to be taken from the Special Court. The petitioner
shallalsodeposithispassportbeforetheSpecialcourtwhile
furnishinghisbonds.
Applicationisdisposedofaccordingly.
Dasti.
(emphasissupplied)
interimreleaseoftheappellantwasconfirmedbythisCourton
12thAugust,2017.
13. Theappellantwasthereafteradvisedtofilethepresent
appealstoassailthejudgmentandorderdated5 th May,2017
ApplicationNo.119of2017andCriminalM.B.No.121of2017.
appellantwasadvisedtoalsofileawritpetitionunderArticle
32oftheConstitutionofIndiatochallengethevalidityofthe
August,2017,beingWritPetition(Civil)No.121of2017. The
reliefsclaimedinthesaidwritpetitionreadthus:
PRAER
(i) Issueawritofmandamusoranyotherappropriate
writ, order or direction declaring that the
conditions/limitationscontainedinSection45(1)of
PreventionofMoneyLaunderingAct,2002(Act15of
2003)totheextentthatitimposesrigors/restrictions
inthegrantofbailinanyoffencepunishableupto7
yearsundertheprovisions ofPreventionofMoney
Laundering Act, 2002 (Act 15 of 2003) as
unreasonable,arbitraryand unconstitutional being
violativeofthefundamentalrightsofthePetitioner
guaranteedandprotectedunderArticles14and21
oftheConstitutionofIndia;
(ii) Inthealternativetoprayer(i)above,issueawritof
mandamus oranyotherappropriatewrit,orderor
direction reading down the scope and ambit of
Section45(1)ofthePreventionofMoneyLaundering
Act,2002(Act15of2003),sothattherigorsingrant
of bail are not applicable in the case of the
Petitioner,wheretheallegedscheduledoffencesin
CCNo.41of2017arisingoutofchargesheetNo.1
dated24.06.2017filedbytheCrimeBranch,New
DelhiallegingcommissionofoffencesunderSections
420/188/109/120B/34IPCandSection12ofthe
Prevention of Corruption Act, 1988 (none of which
were under Part A of the Schedule prior to the
Prevention of Money Laundering (Amendment) Act,
2012(Act2of2013)andformedpartofPartBof
theSchedule;
(iii) Issueawritofmandamusoranyotherappropriate
writ, order or direction declaring the continued
incarceration of the Petitioner since 28.12.2016 in
21
14. Theaforementionedwritpetitionwaslistedtogetherwith
fairness,statedthatthegroundsurgedinthesaidwritpetition
preferredagainsttheimpugnedjudgmentandorderdated5 th
May,2017beexaminedonthebasisoftheprevailingstatutory
2002.Inotherwords,thechallengetotheimpugnedjudgment
willhavetobeconsideredaspertheprevailingprovisionsand
thereof.
thereasonswhichweighedwiththelearnedSingleJudgeofthe
wouldapplypropriovigoreforconsideringtheregularbail.In
that, the learned Single Judge vide order dated 10th August,
2017notedthefollowingcircumstances:
i) Petitionernevertriedtoevadetheinvestigation;
ii) Theperiodofincarceration(7months);
iii) Submission of chargesheet in the main case on
24/6/17;
iv) IllnessofthemotherofthePetitioner;
23
v) NodefinitereasonsassignedbytheCounselforthe
Respondent to substantiate allegation that
Petitioner would tamper with evidence especially
when chargesheet in the main case has been
submitted.
releaseoftheappellantwasprimarilyonaccountoftheillness
ofhismother.Nomoreandnoless.Theotherobservationsin
controversyandrequiredtobereckonedwhilstconsideringthe
prayerforgrantofregularbail. Forthat,theappellantmust
succeedinovercomingthethresholdoftherigorsofSection45
oftheActof2002.Indubitably,theappellanthavingwithdrawn
prayerforgrantofinterimreleasecouldnothavebeentaken
forward.Besides,inthebackdropoftheopinionrecordedby
theCoordinateBenchoftheHighCourt(initsdecisiondated
5th May,2017)whilstconsideringtheapplicationforgrantof
regularbail,whichwasafterfilingoftheinitialcomplaintCC
24
reversedoradifferentviewcouldbetakenbecauseofchanged
circumstances.Sufficeittoobservethatindulgenceshownto
theappellantintermsoforderdated10 thAugust,2017willbe
ofnoavail.Inthat,thefactssuchastheappellantnevertried
toevadetheinvestigationorthathehassufferedincarceration
forover7monthsorthatthechargesheethasbeenfiledin
thepredicateoffenceregisteredunderFIRNo.205/2016orthe
observationthatnodefinitereasonhasbeenassignedbythe
respondentsforsubstantiatingtheallegationthattheappellant
wouldtamperwiththeevidence,maybecomerelevantonlyif
thethresholdstipulationenvisagedunderSection45oftheAct
of2002wastobefulfilled.Thesaidprovisionreadsthus:
45. Offencestobecognizableandnonbailable.(1)
NotwithstandinganythingcontainedintheCodeof
Criminal Procedure, 1973 (2 of 1974), no person
accused of an offence punishable for a term of
imprisonmentofmorethanthreeyearsunderPartA
oftheScheduleshallbereleasedonbailoronhis
ownbondunless
(i)thePublicProsecutorhasbeengivenanopportunityto
opposetheapplicationforsuchrelease;and
25
(i)theDirector;or
(emphasissupplied)
ThesweepofSection45oftheActof2002isnomoreres
paragraphs2830.Itwillbeusefultoadverttoparagraphs28
to30ofthisdecisionwhichreadthus:
28. Beforedealingwiththeapplicationforbailonmerit,it
istobeconsideredwhethertheprovisionsofSection45ofthe
PMLA are binding on the High Court while considering the
applicationforbailunderSection439oftheCodeofCriminal
Procedure.ThereisnodoubtthatPMLAdealswiththeoffence
ofmoneylaunderingandtheParliamenthasenactedthislaw
as per commitment of the country to the United Nations
GeneralAssembly.PMLAisaspecialstatuteenactedbythe
Parliament for dealing with moneylaundering. Section 5 of
theCodeofCriminalProcedure,1973clearlylaysdownthat
theprovisionsoftheCodeofCriminalProcedurewillnotaffect
any special statute or any local law. In other words, the
provisionsofanyspecialstatutewillprevailoverthegeneral
provisionsoftheCodeofCriminalProcedureincaseofany
conflict.
(i) Thattheprosecutormustbegivenanopportunity
toopposetheapplicationforbail;and
30. TheconditionsspecifiedunderSection45ofthePMLA
are mandatory and needs to be complied with which is
furtherstrengthenedbytheprovisionsofSection65andalso
1 (2015)16SCC1
27
(emphasissupplied)
17. Inparagraph34,thisCourtreiteratedasfollows:
ThedecisionsofthisCourtinthecaseof SubrataChattoraj
Vs.UnionofIndia,2Y.S.JaganMohanReddyVs.CBI3,and
UnionofIndiaVs.HassanAliKhan4 havebeennoticedin
theaforesaiddecision.
18. TheconsistentviewtakenbythisCourtisthateconomic
lossofpublicfundsneedtobeviewedseriouslyandconsidered
wholeandtherebyposingseriousthreattothefinancialhealth
ofthecountry. Further,whenattemptismadetoprojectthe
allegationsmaynotultimatelybeestablished,buthavingbeen
made, the burden of proof that the monies were not the
proceedsofcrimeandwerenot,therefore,taintedshiftsonthe
accusedpersonsunderSection24oftheActof2002.
provisionintheMaharashtraControlofOrganisedCrimeAct,
consideringtheapplicationforgrantofbail,shallconsiderthe
possessedoftherequisitemensrea.TheCourtisnotrequired
torecordapositivefindingthattheaccusedhadnotcommitted
commencementoftrial.ThedutyoftheCourtatthisstageis
findingonthebasisofbroadprobabilities.Further,theCourt
accusedcommittingacrimewhichisanoffenceundertheAct
5 (2005)5SCC294
6(2012)10SCC561
30
(supra),inparagraphs44to46ofthesaiddecision,thisCourt
observedthus:
44. ThewordingofSection21(4),inouropinion,doesnot
leadtotheconclusionthattheCourtmustarriveatapositive
finding that the applicant for bail has not committed an
offence under the Act. If such a construction is placed, the
courtintendingtograntbailmustarriveatafindingthatthe
applicant has not committed such an offence. In such an
event, it will be impossible for the prosecution to obtain a
judgmentof convictionof theapplicant.Suchcannotbe the
intention of the Legislature. Section 21(4) of MCOCA,
therefore, must be construed reasonably. It must be so
construedthattheCourtisabletomaintainadelicatebalance
betweenajudgmentofacquittalandconvictionandanorder
granting bail much before commencement of trial. Similarly,
the Court will be required to record a finding as to the
possibility of his committing a crime after grant of bail.
However,suchanoffenceinfuturomustbeanoffenceunder
theActandnotanyotheroffence.Sinceitisdifficulttopredict
thefutureconductofanaccused,thecourtmustnecessarily
consider this aspect of the matter having regard to the
antecedentsoftheaccused,hispropensitiesandthenature
and manner in which he is alleged to have committed the
offence.
46. Thedutyofthecourtatthisstageisnottoweighthe
evidencemeticulouslybuttoarriveatafindingonthebasisof
broad probabilities. However, while dealing with a special
statutelikeMCOCAhavingregardtotheprovisionscontained
inSubsection(4)ofSection21oftheAct,theCourtmayhave
toprobeintothematterdeepersoastoenableittoarriveata
finding that the materials collected against the accused
during the investigation may not justify a judgment of
conviction.ThefindingsrecordedbytheCourtwhilegranting
31
SinhVs.CentralBureauofInvestigation,7weholdthatthe
sameisonthefactsofthatcase. Eveninthesaiddecision,
theCourthasnotedthatthegrantordenialofbailisregulated
toalargeextentbythefactsandcircumstancesofeachcase.
Investigation,8theCourtwasnotcalledupontoconsiderthe
enactment.
wefindnodifficultyinupholdingtheopinionrecordedbythe
SessionsCourtaswellastheHighCourtinthisregard.Inour
punishableunderSection3/4oftheActof2002.TheCourts
7(2017)5SCC218
8(2012)1SCC40
32
havemaintainedthedelicatebalancebetweenthejudgmentof
commendustotakeacontraryview.
22. Realizingthisposition,thelearnedcounselappearingfor
theappellantwouldcontendthateveniftheallegationsagainst
complaint,bynostretchofimagination,wouldtakethecolour
bytheappellantisasaresultofcriminalactivity.Absentthis
appellantwouldnotbecomeproceedsofcrime.Toexaminethis
contention,itwouldbeusefultoadverttoSections3and4of
theActof2002.Thesamereadthus:
Providedthatwheretheproceedsofcrimeinvolvedin
moneylaundering relates to any offence specified under
paragraph2ofPartAoftheSchedule,theprovisionsofthis
section shall have effect as if for the words "which may
extendtosevenyears",thewords"whichmayextendtoten
years"hadbeensubstituted.
23. AsthefulcrumofSection3quotedabove,isexpression
proceedsofcrime,thedictionaryclauseintheformofSection
2(1)(u)isofsomerelevance.Thesamereadsthus:
2(1)(u) proceedsofcrimemeansanypropertyderivedor
obtained,directlyorindirectly,byanypersonasaresultof
criminalactivityrelatingtoascheduledoffenceorthevalueof
anysuchpropertyorwhere such propertyis takenorheld
outsidethecountry,thenthepropertyequivalentinvalueheld
withinthecountry;
thus:
instrumentsevidencingtitleto,orinterestin,suchpropertyor
assets,whereverlocated;
TheexpressionscheduledoffencehasbeendefinedinSection
2(1)(y)oftheActof2002.Thesamereadsthus:
2(1)(y)scheduledoffencemeans
(i) theoffencesspecifiedunderPartAoftheSchedule;or
(ii) theoffencesspecifiedunderPartBoftheScheduleif
thetotalvalueinvolvedinsuchoffencesisonecrorerupees
ormore;or
(iii) theoffencesspecifiedunderPartCoftheSchedule;
paragraph1oftheScheduleintheActof2002,inparticular
expressioncriminalactivityhasnotbeendefined.Byitsvery
naturetheallegedactivitiesoftheaccusedreferredtointhe
demonetizedcurrencyinonesense,ostensibly,mayappearto
repletewithmensrea.Inthat,theconcealment,possession,
35
acquisitionoruseofthepropertybyprojectingorclaimingit
asuntaintedpropertyandconvertingthesamebybankdrafts,
relatingtoascheduledoffence.Thatwouldcomewithinthe
meaningofSection3andpunishableunderSection4ofthe
Act,beingacaseofmoneylaundering.Theexpressionmoney
launderingisdefinedthus:
2(1)(p) moneylaunderinghasthemeaningassignedtoit
insection3;
24. Theappellantthenreliesuponthedecisioninthecaseof
Haryana High Court which has taken the view that Section
45(1)oftheActof2002requirestobereaddowntoapplyonly
tothosescheduledoffenceswhichwereincludedpriortothe
amendmentin2013intheSchedule.Itiscontendedthatthe
offence,inparticular,underSections420,467and471ofIPC,
maynotbetreatedashavingbeenincludedinthescheduled
otherviewwastobetaken,theprovisionwouldberendered
ultravires.Weareinagreementwiththestandtakenbythe
9 (2016SCCOnlineP&H3428
36
respondentsthattheappellantcannotbepermittedtoraisethe
groundsurgedinthewritpetition,hearingwhereofhasbeen
deferredontherequestoftheappellant. Inotherwords,the
appellantshouldbeinapositiontopersuadetheCourtthat
Section3readwiththescheduleoftheActof2002asinforce.
passedonthesaidcriminalappealreadsthus:
ThoughtheHighCourthasgrantedcertificatetoappeal,
afterarguingthematterforsometime,learnedcounselforthe
petitionerconcedesthattheimpugnedjudgmentoftheHigh
Courtiscorrect.
Thisappealis,accordingly,dismissed.
readsthus:
ThoughtheHighCourthasgrantedcertificatetoappeal,
wehaveheardthelearnedcounselforsometimeandareof
theopinionthattheimpugnedjudgmentoftheHighCourtis
correct.
37
Thisappealis,accordingly,dismissed.
Atthesametimetherespondentshavedrawnourattentionto
thus:
26. Forthetimebeing,itisnotnecessaryforustoexamine
theissuesarisingfromthedecisionofthePunjabandHaryana
againstthatdecision.TheconstitutionalvalidityofSection45
oftheActof2002 willhavetobeexaminedbythisCourtin
thewritpetitiononitsownmerits.Thesummarydismissalof
Courts.
27. Sufficeittoobservethattheappellanthasnotsucceeded
presentcase,weareinagreementwiththeviewtakenbythe
SessionsCourtandbytheHighCourt.Wehaveindependently
appellantindisclosingthesourcefromwheresuchhugevalue
acquiredbyhim. Theprosecutionisrelyingonstatementsof
39
admissibleinevidence,inviewofSection50oftheActof2002.
Thesamemakesoutaformidablecaseabouttheinvolvement
oftheappellantincommissionofaseriousoffenceofmoney
satisfactionthattherearereasonablegroundsforbelievingthat
theappellantisnotguiltyofsuchoffence.Further,theCourts
belowhavejustlyadvertedtotheantecedentsoftheappellant
forconsideringtheprayerforbailandconcludedthatitisnot
possibletoholdthattheappellantisnotlikelytocommitany
offenceascribabletotheActof2002whileonbail. Sincethe
pointsurgedbytheappellanttopersuadetheCourttofavour
theappellantwiththereliefofregularbailwillbeofnoavail.In
No.700/2017iscompleted;andthattheproceedsofcrimeis
provisionalattachmentorderinrelationtheretopassedon13 th
February,2017hasbeenconfirmed;orthatchargesheethas
custodysince2ndJanuary,2017andhasnotbeeninterrogated
thesewillbeofnoconsequence.
DemonetizationNotificationdated8thNovember,2016imposes
nolimitinKYCcompliantaccountsonthequantumofdeposit
portionofthesaidnotificationreadsthus:
(iii)thereshallnotbeanylimitonthequantityorvalueof
specifiedbanknotestobecreditedtotheaccountmaintained
withthebankbyaperson,wherethespecifiedbanknotes
aretendered;however,wherecompliancewithextantKnow
YourCustomer(KYC)normsisnotcompleteinanaccount,the
maximumvalueofspecifiedbanknotesasmaybedeposited
shallbeRs.50,000/;
(vii) thereshallbenorestrictionontheuseofanynoncash
method of operating the account of a person including
cheques,demanddrafts,creditordebitcards,mobilewallets
andelectronicfundtransfermechanismsorthelike;
41
countenanced.Thefactthatnolimitfordepositwasspecified,
fromwheresuchhugeamounthasbeenacquired,possessed
orusedbyhim.Thevolumeofdemonetizedcurrencyrecovered
alsothenewcurrencynotesforhugeamount,leavenomanner
ofdoubtthatitwastheoutcomeofsomeprocessoractivity
connectedwiththeproceedsofcrimeprojectingthepropertyas
appellanttodispelthelegalpresumptionofthepropertybeing
proceedsofcrime. Similarly,thefactthattheappellanthas
madedeclarationintheIncomeTaxReturnsandpaidtaxas
per law does not extricate the appellant from disclosing the
sourceofitsreceipt.Noprovisioninthetaxationlawshasbeen
appellantfromprosecutionforanoffenceofmoneylaundering.
scheduledoffence.Theargumentoftheappellantthatthereis
42
noallegationinthechargesheetfiledinthescheduledoffence
activity,willnotcometotheaidoftheappellant.Thatwillhave
tobenegativedinlightofthematerialsalreadyonrecord.The
dispelthe legalpresumptionthathewasinvolvedinmoney
launderingandthepropertywasproceedsofcrime.
29. Takingoverallviewofthematter,therefore,wearenot
Sessions Court and the High Court rejecting the prayer for
grantofregularbailtotheappellant.However,consideringthe
factthattheappellantisincustodysince28 thDecember,2016
extendingtosevenyearsonly,butnotlessthanthreeyears,
theTrialCourtwillbewelladvisedtoproceedwiththetrialon
daytodaybasisexpeditiously.WeclarifythattheTrialCourt
43
mustexaminetheevidence/materialbroughtonrecordduring
observationsinthisdecisionwhicharelimitedforconsidering
theprayerforgrantofregularbail.
terms.
.CJI.
(DipakMisra)
...J.
(A.M.Khanwilkar)
...J.
(D.Y.Chandrachud)
NewDelhi,
Dated:10thNovember,2017.