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Judgment
S.K. Saxena, J.—1. Since both these bail applications arise out of the same complaint case number, these are being decided together by a common order.
Heard learned counsels for the applicants and learned Public Prosecutor for the Enforcement Directorate.
These bail applications have been filed in Complaint Case No. 2 of 2014 arising out of ECIR/01/PMLA/LKZO/2009, under Section 45 of Prevention of Money Laundering Act 2002.
It appears that applicant- Hinish Ramchandani is borrower of the Bank and had regular business transaction. Bank had given him overdraft facility and applicant failed to pay the amount withdrawn from the Bank, whereupon Bank moved for recovery before the Debts Recovery Tribunal. Applicant admitted his liability in the Debts Recovery Tribunal proceedings, which finds mention in the order passed by the Tribunal. In the meantime, FIR was also lodged on 20.08.2009 with the CBI complaining that between June 2008 to August 2009, applicant withdrew a huge amount. CBI filed charge-sheet on 25.03.2011.
In the meantime, Enforcement Directorate (hereinafter referred to as ''E.D.'' in short) also registered an ECIR on 18.12.2009. A complaint was filed by E.D. before the court on 28.03.2014.
Submission is that Debts Recovery Tribunal had issued recovery certificate on 03.09.2013 in pursuance of which recovery can be made. PMLA (Prevention of Money Laundering Act) Tribunal passed an order on 17.07.2013, which was challenged by means of FAFO in Allahabad High Court filed by State Bank of India in pursuance of proceedings under SARFAESI Act. E.D. had attached the entire property of the applicant vide order dated 31.03.2012, which attachment is engaging the attention of Appellate Tribunal, New Delhi under Sections 25 & 26 of PMLA 2002.
In pursuance of order passed by this Court, State Bank of India got the properties revalued and it was found that total value of the property attached is Rs. 54 crore.
Submission of learned counsel is that in the principal offence, wherein charge-sheet has been filed by CBI, bail has been granted by CBI court on 5.10.2010. Offence under the PMLA is almost consequential in nature as it tracks the crime proceed (tainted property). Maximum punishment provided under the Act is seven years.
Submission of learned counsel for the E.D. is that Section 45 of the Act prohibits grant of bail even if maximum sentence awardable is seven years. Applicant has tainted property to the tune of Rs. 49 crores.
Sri Shiv P. Shukla, learned Public Prosecutor has relied upon the following decisions, which are as under:--
"1. Union of India v. Hasan Ali Khan, Supreme Court of India order
dated 30.09.2011 passed in Crl. Appeal No. 1883 of 2011;
V. Suryanarayhana Prabhakara Gupta and another v. Union of India, High Court of Andhra Pradesh, order dated 25.08.2011;
Gautam Kundu v. Manoj Kumar, Asst. Director, Eastern Region, Directorate of Enforcement (PMLA), Govt. of India (Criminal Appeal No. 1706/2015;
Vinod Kumar v. State of Jharkhand & Others (Civil Appeal No. 2689 of 2011);
Rakesh Manekchand Kothari v. Deputy Director, Enforcement Directorate & Anr.;
Union of India v. Shiv Shankar Kesari;
Customs, New Delhi v. Ahmadalieva Nodira;
Gujarat High Court- Rakesh Manekchand Kothari v. Union of India and three others;
B. Rama Raju v. Union of India, Andhra Pradesh High Court at Hyderabad Order dated 04.03.2011;
Bhura Singh v. State of Uttar Pradesh, Allahabad High Court, 1992 CrLJ page 2294"
In none of the cases, this question has been directly answered whether the rigors imposed on the right of bail will apply with retrospective effect to the offence committed, before amendment.
Section 45 of PMLA is being quoted below:--
"45. Offences to be cognizable and non-bailable.--
(1) 1[Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), no person accused of an offence punishable for a term of imprisonment of more than three years under Part A of the Schedule shall be released on bail or on his own bond 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 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, 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 State Government authorised in writing in this behalf by the Central Government by a general or a special order made in this behalf by that Government.
28 [(1-A) 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."
Offences under the Indian Penal Code were mentioned in Part-B by amendment dated 01.06.2009. Sections 120-B & 420 IPC were included in Part-B in the Schedule of Offence, which Schedule was further amended w.e.f. 15.02.2013 and Sections 120-B & 420 IPC were included in Part-A of the Schedule.
Submission of Sri Purnendu Chakravarty, learned counsel is that period of offence is June 2008 to August 2009. E.D. has filed complaint on 28.03.2014 and ECIR was registered by E.D. on 18.12.2009.
Submission of learned counsel is that since offence was committed before the amendment in Section 45 of the Act i.e. 15.02.2013, the bar contained in Section 45 of the Act cannot be applied in the case.
High Court of Andhra Pradesh has specifically dealt with this question. Relevant paragraph of the judgment in the case of V. Suryanarayhana Prabhakara Gupta and another v. Union of India is being reproduced below:--
"The Hon''ble High Court has not appreciated the correct position for Schedule ''A'' and Schedule ''B'' and amendment carried out on 1.6.2009. The findings in para 13 and 18 are incorrect as per the amendment of Schedule as Sections 120-B and 420 IPC were introduced in part ''B'' and not in Part ''A''. This judgment being contrary to the amending Act No. 21 of 2009 brought into force w.e.f. 1.6.2009 is not applicable in the present case."
In the case of Barai v. Henry AH HOE and another, , 1983, SCC (Cri) Page 143, it has been held in para 22 that "Every law that takes away or impairs rights vested agreeably to existing laws is retrospective and is generally unjust and may be oppressive".
Similarly in the case of State through CBI, Delhi v. Gian Singh , 1999 SCC (Cri) Page 1512, Hon''ble Apex Court comments that "No Ex Post Facto Legislation is permissible for escalating the severity of the punishment".
Some other judgments cited by Sri Purnendu Chakravarty are being reproduced below:--
"1. Rattan Lal v. State of Punjab , AIR 1965 page 444;
E. Eapen Chacko v. The Provident Investment Co. 1976, AIR Page 2610;
Sundeep Kumar Bafna v. State of Maharashtra and Others , 2015, 3 SCC (Cri), Page 558;
Sanjay Chandra v. CBI , 2012, 1 SCC, Page 40"
Bail has been held to be a right, which is to be considered in the light of the particular statute. Section 45 of the Act as it existed and a type of offence, did not contain the rigor of the offence under which applicant is being tried and the said offence have been included on 15.02.2013. Prima facie argument has substance.
Since this Court is considering the bail application, it is not found apt to delve into the question and give some conclusive decision in the matter as Section 44 of the Act preserves the power of the High Court as conferred under Section 439 Cr.P.C. Section 44(2) of the Act is being reproduced below:--
"44.(2) Nothing contained in this section shall be deemed to affect the special powers of the High Court regarding bail under section 439 of the Code of Criminal Procedure, 1973 (2 of 1974) and the High Court may exercise such powers including the power under clause (b) of sub-section (1) of that section as if the reference to "Magistrate" in that section includes also a reference to a "Special Court" designated under section 43."
Even otherwise in the main offence, applicant- Hinish Ramchandani has been granted bail. Applicant did have the business transaction with the bank. His entire property has been attached and he has no property at his disposal, as jointly submitted by Sri Chakravarty and Sri Kush Saxena.
Property attached by the Enforcement Directorate cannot be auctioned by the Bank. Although, it has a recovery certificate issued by the Tribunal. Property is attached and money is blocked, which serves nobody''s purpose.
Sri Kush Saxena, learned counsel for the State Bank of India has submitted that applicant- Hinish Ramchandani is a partner in the firms M/s. S.R.S. Investment Company, M/s. SRS Developers, M/s. SRS Laminator and Director of M/s. Rajiv Filling Station Pvt. Ltd. whereas his wife and other relatives are also the partners of the aforesaid Partnership Firms and applicant requested the Bank for opening of a Current Account in the name of M/s. SRS Investment Company. Accordingly, the Bank opened a Current A/c bearing No. 30413491236 on 28.06.2008 in the name of M/s. SRS Investment Company. Subsequent thereto a request was made for grant of overdraft facility, which was allowed by the Bank.
Additional overdraft facility was also granted by the Bank. A sum of Rs. 44,22,15,270.92/- was withdrawn from the Bank causing loss to the tune of Rs. 46.90 crores, besides interest. Bank lodged an FIR with the CBI under Sections 120-B & 420 IPC read with Section 13 (2) & 13(1)(d) of Prevention of Corruption Act. An original application was also filed for recovery under Section 19 of the Act for recovery of due to Bank before Debts Recovery Tribunal, Allahabad. This application was allowed by Debts Recovery Tribunal on 03.09.2013.
Tribunal also passed order dated 05.10.2010, restraining defendants from transferring any property.
Submission of learned counsel for the Bank is that despite rigorous efforts, applicant did not refund any amount in the name of M/s. SRS Company, which is a public money. This Court should not grant bail as has been done in the case of Sahara India, Subroto Roy. Para 27 of the affidavit filed by Chief Manager, State Bank of India, Main Branch, Kanpur is being reproduced below:--
"That the Hon''ble Supreme Court is also of the view that no relief can be granted to the economic offenders who has misappropriated the funds e.g., in case of Sahara India, Subroto Roy, who is still in jail and no bail has been granted by the Hon''ble Supreme Court so far."
From the above affidavit, it is apparent that taking advantage of the procedure, applicant was able to withdraw the money to the tune of Rs. 44 crore approximately. Fact remains that even under Sections 420 & 120-B IPC, maximum sentence prescribed is seven years and in the said offence, applicant has been granted bail. Entire property is already lying attached. As such, it cannot be said that crime proceed is being enjoyed by applicant.
Bank is making efforts to recover this amount through Debts Recovery Tribunal, which it is free to do in accordance with the orders of tribunal. Applicant has admitted his liability and has given in writing before the Debts Recovery Tribunal that his property be auctioned, which amount (according to SBI) is more than the amount allegedly overdrawn.
In these circumstances, no useful purpose would be served by detaining the applicant any more in jail, especially when in the main offence, applicant has been granted bail, charge-sheet has been filed and maximum sentence provided is seven years imprisonment. There is no chance of tempering with evidence or his fleeing away.
In the case of Ashish Sewani (Crl. Misc. Case No. 6764 of 2015), it is contended by learned counsel for the applicant that applicant- Ashish Sewani is neither borrower nor guarantor. He has been implicated in this case only because he is relative (brother-in-law) of Hinish Ramchandani and in account a sum of Rs. One crore approx was transferred. He is not an accused under Sections 420 & 120-B IPC.
Let the applicants-Hinish Ramchandani and Ashish Sewani involved in Complaint Case No. 2 of 2014, arising out of ECIR/01/PMLA/LKZO/2009, under Section- 45 of Prevention of Money Laundering Act 2002, District- Lucknow be released on bail on their furnishing a personal bond with two sureties each in the like amount to the satisfaction of the court concerned with the following conditions:--
"i) Applicant- Hinish Ramchandani will deposit a sum of Rs. 1,00,000,00/- (one crore) with the State Bank of India, towards his liability within a month of release.
ii) Applicants will deposit the passport with the court concerned.
iii) Applicants will not leave India.
(iv) Applicants shall file an undertaking to the effect that they shall not seek any adjournment on the dates fixed for evidence when the witnesses are present in court. In case of default of this condition, it shall be open for the trial court to treat it as abuse of liberty of bail and pass orders in accordance with law.
(v) The applicants shall remain present before the trial court on each date fixed, either personally or through their counsel. In case of their absence, without sufficient cause, the trial court may proceed against them under Section 229-A of the Indian Penal Code.
(vi) In case, the applicants misuse the liberty of bail during trial and in order to secure their presence proclamation under Section 82 Cr.P.C. is issued and the applicants fail to appear before the court on the date fixed in such proclamation, then, the trial court shall initiate proceedings against them, in accordance with law, under Section 174-A of the Indian Penal Code.
(vii) The applicants shall remain present, in person, before the trial court on the dates fixed for (i) opening of the case, (ii) framing of charge and (iii) recording of statement under Section 313 Cr.P.C. If in the opinion of the trial court absence of the applicants is deliberate or without sufficient cause, then it shall be open for the trial court to treat such default as abuse of liberty of bail and proceed against them in accordance with law."