Summary
A chartered accountant arrested by the Enforcement Directorate in a money-laundering case arising from an allegedly fraudulent Global Depository Receipt issue sought bail; the predicate FIR of 2013 had produced no final report in nine years, the complainant himself had been sought to be arrested as an accused, and the prosecution complaint attributed to the appellant a coordinating role in the offering. The Supreme Court granted bail, holding that on these undisputed facts the prosecution complaint gave room for a valid argument that the second condition in Section 45(1)(ii) of the PMLA was satisfied and his continued incarceration was not justified, subject to surrender of passport and regular attendance.
Issues
- Whether an accused under the Prevention of Money-laundering Act, 2002, in custody for several months while no chargesheet has been filed in the nine-year-old predicate offence, is entitled to bail having regard to the twin conditions in Section 45 of the Act.
Provisions considered
- Section 45(1), Prevention of Money-laundering Act, 2002The Court examined the specific role attributed to the appellant in the prosecution complaint and the undisputed facts, and found room for a valid argument that the condition in clause (ii), that there are reasonable grounds for believing he is not guilty, was satisfied. (¶¶ 11, 13, 14)
- Sections 3, 4 and 44, Prevention of Money-laundering Act, 2002The prosecution complaint alleged that the appellant was directly involved in the process connected with the proceeds of crime by coordinating the GDR offering and hiding the subscriber list; the Court did not decide the merits. (¶¶ 6, 8, 9, 13)
- Sections 406, 407, 415 to 420 and 120B read with Section 34, Indian Penal Code, 1860Offences in the predicate FIR of 2013 registered on a Magistrate's order under Section 156(3) CrPC, in which no final report had been filed for more than nine years. (¶¶ 3, 4, 5, 14)
Held
- Where the ECIR and prosecution complaint of 2022 were a sequel to a 2013 FIR in which no final report had been filed for nine years, the de facto complainant himself was sought to be arrested as an accused but remand was refused, the appellant is a chartered accountant who had been in custody since September 2022, and the role attributed to him in the complaint gives room for a valid argument that Section 45(1)(ii) is satisfied, his continued incarceration is not justified. (¶ 14)
- The Enforcement Directorate's apprehension that the appellant is a flight risk is to be addressed by conditions, including surrender of his passport and regular appearance before the Special Court. (¶¶ 15, 16)
Result
Appeal allowed; appellant directed to be released on bail in ECIR No. HYZO/26/2022 on terms to be fixed by the Special Court under the PMLA, Hyderabad, including surrender of passport and regular attendance whenever the prosecution complaint is listed. No costs.