Suryakant Tiwari Vs Directorate of Enforcement

For Applicant : Mr. Kishore Bhaduri, Sr. Advocate with Mr. Akshat Gupta & Mr. Shashank Mishra, Advocates. For Respondent : Dr. Sourbh Kumar Pande, Dy. Advocate General & Mr. Abhishek Singh, Panel Lawyer.

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Hon'ble Shri Justice Narendra Kumar Vyas

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CAV ORDER

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This is first bail application filed under Section 483 of the Bhartiya Nagrik Suraksha Sanhita, 2023 for grant of regular bail to the applicant, who has been arrested on 29.10.2022 in connection with Crime No. ECIR/RPZO/09/2022 dated 29.09.2022 registered at Police Station- Directorate of Enforcement, Zonal Office, Raipur (C.G.) for the offence punishable under Sections 3 & 4 of the Prevention of Money Laundering Act, 2002 (for short “the PMLA, 2002”).

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The case of the prosecution, in brief, is that on 12.07.2022, FIR No. 129/2022 was registered by Kadugodi Police Station,

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ARUN KUMAR DEWANGAN Digitally signed by ARUN KUMAR DEWANGAN Date: 2025.01.28 11:52:07 +0530

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Whitefield, Bengaluru under Sections 186, 204, 353 & 120B of IPC against the applicant & other persons on the basis of complaint filed by Deputy Director of Income Tax, Foreign Assets Investigation Unit-I Bengaluru alleging that as part of conspiracy, during course of search by Income Tax department on 30.06.2022, the applicant had obstructed the officials from carrying their official duties and destroyed crucial incriminating documents and digital evidence about the alleged illegal extortion on Coal Transportation, payments collected by the applicant and his associates.

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It is also case of the prosecution that on 13.09.2022, OM in F. No. 22-IT was forwarded by Central Board of Direct Taxes (for short “CBDT”) to the Directorate of Enforcement containing the FIR No. 1292022 Police Station- Kadugodi along with a report on the investigation conducted by the Income Tax Department on M/s Jay Ambey Group of Raipur (Applicant’s Group). In the report, it has been mentioned that during search operations on 30.06.2023 by Income Tax Department in the premises of the applicant and his associates, evidence was gathered related to a syndicated being operated and coordinated by the applicant whereby additional unauthorized cash to the tune of Rs. 25 per ton of coal was being collected over and above the legal amount against Coal Delivery Orders. It has also been alleged that pursuant to the Order F.No.4138- 47/Sankhikiya/Coal bhandaran/N.Kra 2020 dated 15.07.2020 issued by the State Government the dispatch rules of coal mines by authorities have

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been changed from an online process to introduction of manual verification. The said notification was issued under the signatures of one Sameer Vishnoi, IAS who was the Director, Geology & Mining as well as MD of CMDC. It is also case of the prosecution that it is only after the said notification the applicant in conspiracy with certain other persons started obtaining an illegal levy of Rs. 25 per ton of coal for issuance of delivery order for coal transportation. The handwritten diaries maintained by one Rajnikant Tiwari who is brother of the applicant contained entries of incoming and outgoing amounts of unaccounted cash generated, inter alia from illegal levy on coal transport revealed profits of more than Rs. 500 crores in 16 months from different kinds of levies. On 29.09.2022, ECIR/RPZ0/09/2022 was registered by Directorate of Enforcement, Raipur Zonal Office for commission of offence under Sections 120 (B) & 384 of IPC being a part of FIR No. 129/2022.

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Role of the applicant:-

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The role of present applicant is that the applicant with connivance of Saumya Chaurasia, Sameer Vishnoi and other senior bureaucrats and politicians hatched a conspiracy of illegal extortion of Rs. 25/- per ton on Coal which was transported from SECL mines & other places and the same was being carried out with the active connivance of State Mining Officials, District Officials, by using a wide network of agents which were stationed in the coal belt by maintaining a close liaison with the administration. The applicant deployed his employees namely

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Roshan Singh, Nikhil Chandrakar & Rajnikant Tiwari at Raipur, Navneet Tiwari at Korba, Moinuddin Qureshi & Parekh Kurrey at Korba and Rahul Singh & Virendra Jaiswal, Montu Jaiswal at Surajpur for collecting illegal levy on coal transportation as well as other sections. This coal syndicate had extorted illegal levy of of Rs. 540 crores approximately from Coal businessmen/ transporters and other sectors from July, 2020 to June, 2022. This system of collection of illegal cash was facilitated/coordinated by the applicant and the system ran with impunity and without any interruption because the applicant had backing of the highest powers in the State due to his close association with Smt. Saumya Chaurasia and in turn with other senior IAS/IPS officers as well as politicians. The proceeds of crime generated by this syndicate has been utilized for political funding, making bribes to Government Officials, purchasing of properties including coal washeries by the applicant, Smt. Saumya Chaurasia in the name of their benamidars and members of syndicate & their family members.

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The investigation conducted under PMLA, 2002 revealed that the applicant had been using various business groups to launder and park his ill-earned money generated out of the illegal levy on coal in the safe houses of his associates namely Laxmikant Tiwari, Rajnikant Tiwari & others.

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The record of the case would show that the applicant filed an application for grant of regular bail before the learned Special Judge (PMLA Act), Fourth Additional Sessions Judge, Raipur

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(C.G.) seeking enlargement on regular bail which has been dismissed by the said Court vide order dated 04.09.2024.

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Learned Senior counsel for the applicant would submit that the applicant is innocent and has been falsely implicated in the crime in question. He would further submit that the pre-trial custody and the trial has not yet commenced and the trial is likely to take time for its final conclusion, therefore, the applicant is entitled to be released on bail. He would further submit that the right to speedy trial is a facet of the Fundamental Right of life of an accused under Article 21 of the Constitution of India as held by Hon’ble the Supreme Court in case of Manish Sisodia Vs. CBI [(2022) 10 SCC 51] and Javed Gulam Nabi Shaikh Vs. State of Maharashtra [2024 SCC OnLine SC 1693] . He would further submit that Section 436A of the Cr.P.C. should not be construed as a mandate that an accused should not be granted bail under the PMLA, 2002 till he has suffered incarceration for the specified period of half the maximum period of imprisonment. Detention or jail before being pronounced guilty of an offence should not become punishment without trial. He would further submit that the right to bail in cases of delay, coupled with incarceration for a long period should be read into Section 439 of the Cr.P.C. and Section 45 of the PMLA, 2002 as the constitutional mandate is the higher law and it is the basic right of the person charged of an offence and not convicted, that he be given a speedy trial. When the trial is not proceeding for reasons not attributable to the accused, the court unless there

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are good reasons, may well be guided to exercise the power to grant bail. He would further submit that the bail application of an accused cannot be rejected on the ground of severity of the offence or due to the bar contained in Section 45 of the PMLA, 2022 in cases where there is a violation of the accused's right to speedy trial coupled with long period of pre-trial incarceration and if the trial gets protracted and it is clear that case will not be decided within a foreseeable time, the accused person is entitled to bail. He would further submit that it is well settled position of law that the object of bail is neither punitive nor preventative and the primary purpose of bail in a criminal case is to ensure that the accused will submit to the jurisdiction of the court and be in attendance whenever his presence is required. Deprivation of liberty must be considered punishment, unless it can be required to ensure that an accused person will stand trial when called upon Punishment can only begin after conviction and necessity is the operative test. He would further submit that even if the allegation is grave of economic offence, it is not a rule that bail should be denied in every case and consideration has to be made on case to case basis on the facts. The primary object is to secure the presence of the accused to stand trial as held by Hon’ble the Supreme Court in case of P. Chidambaram Vs. ED [(2020) 13 SCC 791] .

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He would further submit that the applicant shall be severely prejudiced and pre-judged if he is continually remanded to custody and the same is imperative for the proper and effective

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defence of the applicant and as a step to ensure the fair trial of the applicant that he be on bail unless there are overwhelming considerations otherwise the applicant cannot effectively instruct counsel in the captioned matter having peculiar facts and circumstances, including complex and technical matters and financial transactions, and as such, the denial of bail shall cause grave prejudice to the applicant as held by Hon’ble the Supreme Court in case of Gurbaksh Singh Sibbia vs. State of Punjab, [(1980) 2 SCC 565] . He would further submit that the applicant has already undergone custody of a total period of more than 22 months including 12 days of ED custody. Despite filing of 3 prosecution complaints over a period of nearly 2 years and having named over 26 accused, the investigation in the alleged offence is still on going qua other persons. As many as 81 witnesses have been cited across the 3 prosecution complaints and about 293 documents have been relied upon by the Enforcement Directorate running into over 19,326 pages. The proceedings are going on at a snail's pace and is still at the stage of further investigation, even after a passage of nearly 2 years since the registration of the said ECIR arguments on charges have not yet commenced, as such, the trial is unlikely to commence any time soon, let alone conclude any time soon. He would further submit that the learned trial Court has committed error in rejecting the above contentions of the applicant on the specious ground that the delay has been occasioned due to nonappearance of other accused persons. In this regard, it is

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Page 8 of 27 submitted that firstly , the delay has been occasioned not due to any act/omission of the applicant, as such, the delay is not attributable to the applicant, and secondly , non-appearance of the other accused persons cannot be a ground to keep the applicant under indefinite pre-trial incarceration especially since the applicant has already been in custody for over 22 months. He would further submit that Hon’ble the Supreme Court in so many cases has granted benefit of bail to the accused on the ground of long custody and delay in conclusion of trial, in identical facts where the delay was occasioned due to other accused persons not appearing/ having been declared proclaimed offenders. He would further submit that since further investigation is going on in the instant case, no charges can be framed and the trial cannot commence. The trial does not even seem likely to commence in the near future let alone conclude in the near future. Thus, the applicant is entitled to be granted bail and released from custody at the earliest.

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He would further submit that the investigation qua the applicant is complete and the prosecution complaint stands filed, therefore, there is no necessity for continued incarceration of the applicant. He would further submit that the custody of an accused is required primarily for the purpose of investigation. In the instant case, the applicant has already undergone a period of 13 days of ED custody during which period a thorough investigation was conducted by the ED. The applicant has cooperated with the ED during the course of its investigation. No

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further investigation is continuing as against the applicant in the instant case. He would further submit that there is no underlying scheduled offence on which the said ECIR is premised and the proceedings being carried out by the respondent are completely without jurisdiction as it is well settled position of law that the existence of a scheduled offence is a sine qua non for an offence under PMLA, 2002 to be made out in fact, to initiate "prosecution" for offence under Section 3 of the PMLA, 2002, registration of scheduled offence is a prerequisite as held by Hon’ble the Supreme Court in case of Vijay Madanlal Chaudhary Vs. Union of India [SCC OnLine SC 929] and Yash Tuteja Vs. Union of India [2024 SCC OnLine SC 533] .

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He would further submit that it is settled law that there cannot be any "proceeds of crime without the existence of any underlying scheduled offence since" only such property which is derived or obtained directly or indirectly, as a result of criminal activity relating to a scheduled offence can be regarded as proceeds of crime". Thus evidently, the existence of proceeds of crime is intrinsically linked and is derived only from an alleged scheduled offence Simply put, there cannot be any proceeds of crime without the commission of any alleged scheduled offence. In the present case, there is no underlying scheduled offence, thus there cannot be any proceeds of crime derived from the scheduled offences. Any alleged commission of a non-scheduled offence would not render any property, purportedly obtained or derived as a result thereof, as "proceeds of crime or give

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Page 10 of 27 jurisdiction to the Enforcement Directorate. He would further submit that the other co-accused persons namely Sunil Kumar Aggarwal, Deepesh Taunk & Ms. Ranu Sahu have been granted bail by Hon’ble the Supreme Court and the same is a ground for grant of bail to the applicant also as there cannot be any discrimination between two similarly placed accused persons in terms of granting bail, therefore, the applicant is entitled for grant of regular bail.

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He would further submit that the crux of the allegation against the applicant is that he was involved in running an alleged extortion racket wherein an amount of Rs 25/- per ton of coal was extorted for its transportation out of the coal mine fields However, the offence of extortion under Section 384 of IPC was not alleged in the Bengaluru FIR initially upon its registration on 12.07.2022 and was only added subsequently on 03.09 2022 Further, after due investigation, the Bengaluru Police dropped the offence of Section 384 IPC from its charge-sheet filed on 08.06. 2023 and even the concerned court in Bengaluru only took cognizance of offences under Sections 353 and 204 IPC and not of Section 384 of IPC. Furthermore, even the EOW, Raipur did not include Section 384 of IPC in its FIR registered on 17.01.2024. Thus, it is clear that the offence of extortion under Section 384 of IPC is not made out against the applicant, therefore, the very basis of the entire case against the applicant is non-existent. He would further submit that the applicant is not involved in any extortion racket and has neither demanded nor

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Page 11 of 27 received any unlawful amount from any person as alleged levy for transportation of coal out of the coal mine fields. The applicant has also not indulged in any activity relating to the alleged proceeds of crime and the applicant has neither given any money to any politician or any State functionary nor caused any obstruction in the discharge of duties by a public servant. He would further submit that it is settled law that mere diary entries cannot be read into evidence and the same are inadmissible in law especially without independent evidence of their trustworthiness and the same cannot be relied upon as held by Hon’ble the Supreme Court in case of CBI Vs. V.C. Shukla [(1998) 3 SCC 410] , L.K. Advani Vs. Central Bureau of Investigation [Criminal Revision Petition No. 265 of 1996] , Common Cause Vs. Union of India [(1998) 3 SCC 410] .

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He would further submit that it is alleged that the applicant does not satisfy the triple-test for grant of bail i.e. the applicant is a flight risk or would influence any witness or would tamper with any evidence. In any event, there is no material on record to suggest that the applicant does not satisfy the triple-test. He would further submit that there is no allegation that the applicant would either tamper with any evidence or influence any witness, if granted bail. Learned trial Court has erroneously observed that there is an apprehension that if the applicant is released on bail, he may influence witnesses or tamper with evidence, is well settled in law that mere apprehensions of influencing witnesses or tampering with evidence can never be a ground to decline bail

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to any accused accused, unless there is cogent supporting material as held by Hon’ble the Supreme Court in case of P. Chidambaram Vs. CBI [2020 13 SCC 337] .

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He would further submit that the applicant is suffering from various serious medical conditions however, he has not been provided proper medical treatment by the authorities in jail and in absence of providing medical treatment to the applicant, he has undergone severe weight loss and has become extremely weak during the duration of his custody. He would further submit that the applicant is ready and willing to furnish adequate surety and shall abide by all the directions and conditions which may be imposed by this Court and would pray for releasing he applicant on bail.

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The applicant has also filed application for taking additional documents on record contending that health condition of the applicant is deteriorating and was admitted in the hospital for treatment and subsequently discharged but still there is no substantial recovery in the health of the applicant. To substantiate his submission, he has annexed the medical report. Considering this submission, this Court has directed the prosecution to submit the medical report which was not clarified whether the health condition of the applicant is deteriorating or not, as such, this Court has directed the Dean, Government Medical College, Raipur to constitute a committee of Neurologist, Gastrologist and Cardiologist by 20th December, 2024 and submit its report within a week. Thereafter, the matter

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was listed on 2nd January, 2025. On 2 nd January, 2025, a report was submitted but it does not speak why the applicant’s blood pressure is not being controlled, therefore, this Court further directed for ascertaining the reason why the blood pressure of the applicant is not being controlled and to ascertain the reason, an angiography as well neurology test were also directed to be carried out and the matter was listed on 6th January, 2025. On 6 th January, 2025, learned Senior counsel for the applicant has informed to the Court that the applicant is not willing for angiography, accordingly, the matter was heard finally without further medical examination of the applicant regarding his alleged poor medical conditions.

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Learned Senior counsel for the applicant would submit that the trial is delayed, therefore, his bail application be considered. Considering this submission, this Court vide order dated 12.12.2024 directed the parties to file an affidavit whether the delay is attributable to the applicant or the prosecution. To demonstrate this fact, the Enforcement Directorate has filed certified copy of the order-sheet.

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To substantiate his submission, learned senior counsel for the applicant would refer to the judgment rendered by Hon’ble the Supreme Court in case of Vijay Nair Vs. ED [SLP (Crl.) Dy. No. 22137 of 2024, decided on 02.09.2024] , Neeraj Singal vs. ED [SLP (Crl) No. 8439 of 2024, decided on 06.09.2024], Kalvakunta Kavitha Vs. ED [SLP (Crl) No 10778 of 2024, decided on 27.08 2024], Prem Prakash vs. ED [SLP (Crl.) No

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5416 of 2024 decided on 28.08.2024], Ramkripal Meena Vs. ED [SLP (Crl.) No. 3205 of 2024 decided on 30.07.2024], Javed Gulam Nabi Shaikh Vs. State of Maharashtra [2024 SCC OnLine SC 1693], Jainam Rathod v. State of Haryana [2022 OnLine SC 1506], Sujay U. Desai vs. SFIO [2022 SCC OnLine SC 1507], P. Chidambaram Vs. ED [(2020) 13 SCC 791], Gudikanti Narasimhulu Vs. Public Prosecutor, High Court of Andhra Pradesh [(1978) 1 SCC 240], Gurbaksh Singh Sibbia Vs. State of Punjab [(1980) 2 SCC 565], Bibhav Kumar Vs. State of NCT of Delhi [SLP (Crl.) No. 9817 of 2024, decided on 02.09 2024], Kalvakunta Kavitha Vs. ED [SLP (Crl.) No. 10778 of 2024, decided on 27.08 2024], Krishnan Subramanian Vs. State NCT of Delhi [2022 SCC OnLine Del 1384], Paras Mal Lodha Vs. ED [(2017) SCC OnLine Del 8676], Haricharan Kurmi Vs. State of Bihar [AIR 1964 SC 1184], Sanjay Jain Vs. ED [2024 SCC OnLine SC 656] & Pankaj Bansal Vs. Union of India [(2023) SCC OnLine SC 1244].

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On the other hand, learned counsel for the Enforcement Directorate would refer to the ECIR and would submit that a notification dated 15.07.2020 was issued by Shri Sameer Vishnoi, IAS at the instance of extortion cartel led by the applicant, modified the pre-existing transparent online process of getting e-permits for transporting coal from mines to users, into a system which made it prone to massive corruption. He would further submit that FIR No. 129/2022 dated 12.07.2022 was

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registered by Kadugodi Police Station, Whitefield, Bengaluru under Sections 186, 204, 353 & 120 (B) of IPC against the applicant and others on the basis of complaint filed by the Deputy Director of Income Tax, Foreign Assets Investigation Unit-1, Bengaluru, stating that as part of a conspiracy, during the course of search by Income Tax Department on 30.06.2022 at Room No. 664, Hotel Sheraton Grand, Whitefield, Bengaluru, the applicant obstructed the officials from carrying their official duties and had destroyed crucial incriminating documents and digital evidences which supposedly contained important information about the illegal extortion, payments collected and persons involved. The said FIR is under investigation. Thereafter, vide O.M in F.No. 289/ED/36/2022-IT (Inv.II) dated 13.09.2022, CBDT has forwarded the copy of the above FIR No. 129/2022 dated 12.07.2022 under Sections 186, 204, 353, 384 & 120 (B) of IPC against the applicant along with a report on the investigation conducted by Income Tax Department on M/s Jay Ambey Group of Raipur (applicant’s Group) to the Directorate of Enforcement for initiating money laundering investigation. From perusal of aforementioned O.M, it was learnt that a search and seizure action was carried out by the Income Tax Department at multiple premises of the applicant and his associates. During the course of search and seizure, large number of incriminating evidences were seized which are in the forms of hand written diaries, loose papers and digital devices like mobile phones, laptops etc. These evidences disclose numerous cash

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transactions relating to an organized syndicate being operated and coordinated by the applicant along with six associates and other persons wherein additional unauthorized cash was being extorted, over and above the legal amount fixed against the Coal Delivery Order issued by SECL (South Eastern Coalfields Limited), from various entities who were lifting and transporting the coal throughout the State of Chhattisgarh. The applicant deployed his following associates in the Coal producing districts and these associates had liaisons with Collectorate Office, Mining officers and other users to collect the illegal coal levy from their employees. He would further submit that once the employees of the applicant, received the illegal amount of Rs. 25/- tonne on coal to be transported, the message was then communicated to the Mining Officer and thereafter the delivery orders (DOs) were cleared for transport by Mining Officers by issue of manual NOC against the delivery orders. During the search operations of Income Tax Department, certain evidences were seized from possession of members of this syndicate and statements of various persons have been recorded by the authorities which will reveal that illegal collection of levy on transport of coal was being done on the direction of the applicant.

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He would further submit that the present applicant has played specific role in commission of alleged offence. Investigation revealed that the applicant acquired coal washeries from M/s Indus Udyog & Infrastructure Pvt. Ltd. and M/s Satya Power and

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Ispat Ltd. These coal washeries were acquired for an amount of Rs. 96 Crore, out of which Rs. 34 Crore was the registered value and was paid through banking channel and rest of the amount was to be paid in cash. Thus, large amount of illegally acquired cash was layered in these transactions. He would further submit that after the Income Tax raids, the other co-accused person has made sham paper transactions to show that he was the owner of these two washeries. These transactions were nothing but a futile attempt to alienate the ill-gotten proceeds of crime and take them far away from the arms of Income Tax & Enforcement Department and to prevent their attachment and to claim them as untainted assets. The said accused knowingly and willingly participated in these transactions to layer and obfuscate the real ownership of these tainted properties despite being a man of means and business standing, be knowingly acted as a benami for present applicant and has assisted in the money laundering process. He would further submit that apart from the above two washeries, after the income tax raids on the applicant and his associates, Indermani Group purchased all the benami properties of the applicant to safeguard the ill-gotten proceeds of crime and to frustrate the efforts of Enforcement Directorate to attach the proceeds of crime in future. He would further submit that all these transactions are sham transactions.

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He would further submit that the applicant is unable to fulfill the twin conditions of Section 45 of the PMLA, 2002 as from the above factual matrix, it is quite vivid that the possibility of the

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accused being not guilty of the offence of money laundering is highly impossible. To substantiate the submission, he would refer to paragraph 135 of the the judgment rendered by Hon’ble the Supreme Court in case of Vijay Madanlal Choudhary (supra) . He would further submit that the applicant with proceed of crime and having deep roots in the society, is in a position to influence witnesses. To substantiate this submission, he has referred to the judgment of Hon'ble Allahabad High Court in case of Pankaj Grover v. ED [Criminal Misc. Anticipatory Bail Application U/S 438 Cr.P.C. No. 7661 of 2021] wherein Hon’ble the High Court has held that the accused in economic offences/ PMLA cases are in possession of huge proceeds of crime and may use those to influence witnesses. Further the Court also held that since such offences are committed mostly by influential persons, there is a high likelihood of their using influence to tamper with evidence and influence witnesses.

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He would further submit that economic offence constitute a separate class of offence and in the present case, the amount involved in the offence of money laundering is Rs. 540 crores approximately and in view of well settled position of law that economic offence constitutes a separate class of offence and bail should not normally be granted in such cases and would pray for rejection of bail application.

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To substantiate his submission, he would refer to the judgment rendered by Hon’ble the Supreme Court in case of Nimmagadda Prasad Vs. CBI , [(2013) 7 SCC 466] , State of

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Bihar Vs. Amit Kumar [(2017) 13 SCC 751] , Gautam Kundu Vs. Manoj Kumar [(2015) 16 SCC 1] , Mohd. Arif Vs. Directorate of Enforcement, Govt. of India, BLAPL No. 8882/2021 (decided on 31.05.2022) , Soumya Chaurasia Vs. Directorate of Enforcement Special Leave Petition (Crl.) No. 8847/2023 , Radha Mohan Lakhotia Vs. The Deputy Director, PMLA, Department of Revenue [MANU/MH/1011/2010] , Anirudh Kamal Shukla Vs. Union of India [Criminal Misc. Anticipatory Bail Application under Section 438 Cr.P.C. No. 307/2022, decided on 21.03.2022] , Naib Singh Vs. State of Haryana [CRM-M-29466-2022, decided on 15.11.2022] .

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I have heard learned counsel for the parties and perused the documents placed on record including ECIR with utmost satisfaction.

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From the above discussion, the point to be emerged for determination by this Court is :-

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“Whether the applicant fulfills twin conditions of Section 45 of the PMLA, 2002 for grant of bail?”

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Before adverting to the facts of the case, it is expedient for this Court to extract Section 45 of the PMLA, 2002, which reads as under:-

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“ Section 45 of PMLA, 2002- 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—]

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(i) the Public Prosecutor has been given an opportunity to oppose the application for such release; and

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(ii) where the Public Prosecutor opposes the application, the court is satisfied that there are reasonable grounds for

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believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail:

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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:

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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—

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(i) the Director; or

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(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.

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[(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.]

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(2) The limitation on granting of bail specified in [* * *] subsection (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.”

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From perusal of the ECIR, it is prima facie vivid that present

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applicant with connivance of Saumya Chaurasia, Sameer Vishnoi and other senior bureaucrats and politicians hatched a conspiracy of illegal extortion of Rs. 25/- per tonne on Coal which was transported from SECL mines & other places and the same was being carried out with the active connivance of State Mining Officials, District Officials, by using a wide network of agents which were stationed in the coal belt by maintaining a close liaison with the administration. The applicant deployed his employees namely Roshan Singh, Nikhil Chandrakar & Rajnikant Tiwari at Raipur, Navneet Tiwari at Korba, Moinuddin Qureshi & Parekh Kurrey at Korba and Rahul Singh & Virendra

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Jaiswal, Montu Jaiswal at Surajpur for collecting illegal levy on coal transportation as well as other sections. This coal syndicate had extorted illegal levy of of Rs. 540 crores approximately from Coal businessmen/ transporters and other sectors from July, 2020 to June, 2022. This system of collection of illegal cash was facilitated/coordinated by the applicant and the system ran with impunity and without any interruption because the applicant had backing of the highest powers in the State and due to his close association with Smt. Saumya Chaurasia and in turn with other senior IAS/IPS officers as well as politicians. The proceeds of crime generated by this syndicate has been utilized for political funding, making bribes to Government Officials, purchasing of properties including coal washeries by the applicant, Smt. Saumya Chaurasia in the name of their benamidars and members of syndicate & their family members. The ECIR further prima facie reveals that the present applicant has played specific role and he is kingpin of the offence. The investigation revealed that the applicant acquired coal washeries from M/s Indus Udyog & Infrastructure Pvt. Ltd. and M/s Satya Power and Ispat Ltd. These coal washeries were acquired for an amount of Rs. 96 Crore, out of which Rs. 34 Crore was the registered value and was paid through banking channel and rest of the amount was to be paid in cash. Thus, large amount of illegally acquired cash was layered in these transactions. From the material so collected by the Enforcement Directorate, it is prima facie reflected that after the Income Tax raids, the other co-accused person has

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made sham paper transactions to show that he was the owner of these two washeries. These transactions were nothing but a futile attempt to alienate the ill-gotten proceeds of crime and take them far away from the arms of Income Tax & Enforcement Department and to prevent their attachment and to claim them as untainted assets. The said accused knowingly and willingly participated in these transactions to layer and obfuscate the real ownership of these tainted properties and acted as a benami for of present applicant. The ECIR would further reflect that all these transactions are sham transactions. He has only blocked his capital in these assets and the remaining entire cash transactions were still done by the applicant only. The record would further reflect that several properties in the names of companies of the applicant herein viz., M/s Indermani Minerals Pvt. Ltd. & M/s KJSL Coal & Power Pvt. Ltd. which were acquired using proceeds of crime have been attached under Section 5(1) of the PMLA, 2002 on 09.12.2022 and 29.01.2023 and the same were subsequently confirmed by the learned Adjudicating Authority (PMLA), vide orders dated 01.06.2023 & 17.07.2023. Thus, the applicant is unable to fulfill the twin condition of Section 45 of the PMLA, 2002.

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The further submission of learned Senior counsel for the applicant that the other co-accused persons have been granted bail by Hon’ble the Supreme Court on the count of long incarceration, therefore, the applicant is also entitled to be released on bail on this count alone, is being considered by this

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Court. The record of the case clearly demonstrates that the proceedings were installed by other co-accused person by filing various applications as such, prima facie it cannot be said that the trial has been installed due to delay on the part of the prosecution. As such, the submission made by learned Senior counsel for the applicant that due to delay in conclusion of trial, the applicant is entitled to get bail, deserves to be rejected. Even otherwise, it is well settled position of law that the delay is always no ground for grant of bail as while granting bail on account of delay, the Court has to consider the gravity of the offence, role played by the accused and whether the delay is attributed to the prosecution or not. In the present case, none of the ingredients is available on record to grant bail to the accused on the count of delay. It is pertinent to mention here that the prosecution has submitted order-sheet of the trial Court which clearly demonstrates that various applications have been filed by the other co-accused persons before learned trial Court, which have been decided by the trial Court causing delay in conclusion of trial. As such, this ground deserves to be rejected and accordingly, it is rejected.

¶94

Learned Senior counsel for the applicant would submit that Hon’ble the Supreme Court has granted bail to the other coaccused person on the count of delay, therefore, the applicant should also be considered for releasing him on bail, deserves to be rejected looking to the role played by the applicant as he is the kingpin as mastermind of the offence.

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¶96

Further submission of learned Senior counsel for the applicant that the applicant is entitled to get bail on medical ground is being considered by this Court. This Court considering this submission has issued various directions for medical examination and this Court finally directed for angiography and other tests to find out the reason for applicant’s alleged deteriorate medical condition, which he refused to undergo. Therefore, I am of the view that the ground for grant of bail on medical also deserves to be rejected and accordingly, it is rejected.

¶97

Considering the above stated factual legal matrix, it is quite vivid that the applicant is unable to fulfill twin conditions for grant of bail as per Section 45 of the PMLA, 2002 and also considering the submission that the applicant has not prima facie reversed the burden of proof and dislodged the prosecution case which is mandatory requirement to get bail. Hon'ble the Supreme Court in case of Directorate of Enforcement Vs. Aditya Tripathi (Criminal Appeal No. 1401/2023) decided on 12.05.2023 has held at paragraph 6 & 7 as under:-

¶98

“6. At the outset, it is required to be noted that respective respondent No. 1 – accused are facing the investigation by the Enforcement Directorate for the scheduled offences and for the offences of money laundering under Section 3 of the PML Act punishable under Section 4 of the said Act. An enquiry/investigation is still going on by the Enforcement Directorate for the scheduled offences in connection with FIR No. 12/2019. Once, the enquiry/investigation against respective respondent No. 1 is going on for the offences under the PML Act, 2002, the rigour of Section 45 of the PML Act, 2002 is required to be considered. Section 45 of the PML Act, 2002 reads as under:-

¶99

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¶100

“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—]

¶101

(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:

¶102

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 moneylaundering a sum of less than one crore rupees], may be released on bail, if the Special Court so directs:

¶103

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—

¶104

(i) the Director; or

¶105

(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.

¶106

[(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.]

¶107

(2) The limitation on granting of bail specified in [* * *] subsection (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.”

¶108

By the impugned judgment(s) and order(s) and while granting bail, the High Court has not considered the rigour of Section 45 of the PML Act, 2002.

¶109

6.1 Even otherwise, the High Court has not at all considered the nature of allegations and seriousness of the offences alleged of money laundering and the offences under the PML Act, 2002. Looking to the nature of allegations, it can be said that the same can be said to be very serious allegations of money laundering which are required to be investigated thoroughly.

¶110

6.2 Now so far as the submissions on behalf of the respective respondent No. 1 that respective respondent No. 1 were not named in the FIR with respect to the scheduled offence(s) and/or that all the other accused are

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discharged/acquitted in so far as the predicated offences are concerned, merely because other accused are acquitted/discharged, it cannot be a ground not to continue the investigation in respect of respective respondent No. 1. An enquiry/investigation is going on against respective respondent No. 1 with respect to the scheduled offences. Therefore, the enquiry/investigation for the scheduled offences itself is sufficient at this stage.

¶113

6.3 From the impugned judgment(s) and order(s) passed by the High Court, it appears that what is weighed with the High Court is that chargesheet has been filed against respective respondent No. 1 – accused and therefore, the investigation is completed. However, the High Court has failed to notice and appreciate that the investigation with respect to the scheduled offences under the PML Act, 2002 by the Enforcement Directorate is still going on. Merely because, for the predicated offences the chargesheet might have been filed it cannot be a ground to release the accused on bail in connection with the scheduled offences under the PML Act, 2002. Investigation for the predicated offences and the investigation by the Enforcement Directorate for the scheduled offences under the PML Act are different and distinct. Therefore, the High Court has taken into consideration the irrelevant consideration. The investigation by the Enforcement Directorate for the scheduled offences under the PML Act, 2002 is till going on.

¶114

As observed hereinabove, the High Court has neither considered the rigour of Section 45 of the PML Act, 2002 nor has considered the seriousness of the offences alleged against accused for the scheduled offences under the PML Act, 2002 and the High Court has not at all considered the fact that the investigation by the Enforcement Directorate for the scheduled offences under the PML Act, 2002 is still going on and therefore, the impugned orders passed by the High Court enlarging respective respondent No. 1 on bail are unsustainable and the matters are required to be remitted back to the High Court for afresh decision on the bail applications after taking into consideration the observations made hereinabove.”

¶115

Learned Senior counsel for the applicant would submit that since

¶116

the applicant remained in jail for more than two years and maximum sentence which can be awarded is seven years, therefore, he should be released on bail. This submission also deserves to be rejected looking to gravity and seriousness of the

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offence and the role played by the applicant as there is chance of influencing or tampering with the witness and evidence. As such, he is not entitled to be released on bail on the count that he remained in custody for more than two years which is long incarceration.

¶119

Considering the ECIR and other material placed on record, which prima facie shows involvement of the applicant in crime in question and also considering the law laid down by Hon’ble the Supreme Court, it is quite vivid that the applicant is unable to fulfill the twin conditions for grant of bail as provided under Section 45 of the PMLA, 2002. Thus, the Point is answered against the applicant.

¶120

Considering the above stated factual and legal matrix, the role played by the applicant, I am not inclined to enlarge the applicant on bail.

¶121

Accordingly, the bail application filed under Section 483 of the Bhartiya Nagrik Suraksha Sanhita, 2023 is liable to be and is hereby rejected.

¶122

The observation made by this Court is not bearing any effect on the trial of the case. The learned trial court will decide the criminal trial in accordance with evidence, material placed on record, without being influenced by any of the observations made by this Court while deciding the present bail application.

¶123

Sd/(Narendra Kumar Vyas) Judge

¶124

Arun

Suryakant Tiwari v. Directorate of Enforcement

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Suryakant Tiwari v. Directorate of Enforcement

Case brief

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