Dismissed

Arvind Rajta v. Directorate of Enforcement

Himachal Pradesh HC8 Nov 2024CRMPM/1842/2024

Case brief

AI extract

What is this about?

The High Court of Himachal Pradesh dismissed a bail application filed under Section 483 of BNSS by Arvind Rajta. The Court held that the applicant failed to satisfy the twin conditions under Section 45 of the PMLA, and no inordinate delay in trial was established at the stage of the application.

What did the court decide?

Bail application dismissed; applicant not released on bail.

Arvind Rajta Vs Directorate of Enforcement — Money Laundering | Himachal Pradesh HC (2024)

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IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA

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CrMP(M) No. : 1842 of 2024 Reserved on : 16.09.2024 Decided on : 08.11.2024 Arvind Rajta …Applicant Versus Directorate of Enforcement (ED) …Respondent

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Coram

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The Hon’ble Mr. Justice Virender Singh, Judge.

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Whether approved for reporting?¹

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For the applicant : Mr. Ajay Kochhar, Senior Advocate, with Mr. Anubhav Chopra, Advocate. For the respondent : Mr. Balram Sharma, Deputy Solicitor General of India, with Mr. Ajeet Singh Saklani, standing counsel, assisted by Mr. Sunil Kumar, Enforcement Officer and Mr. Mayank Kumar, Assistant Enforcement Officer.

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Virender Singh, Judge.

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By way of the present application, filed, under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (hereinafter referred to as the ‘BNSS’), a prayer has

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1 Whether Reporters of local papers may be allowed to see the judgment? Yes.

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been made to release applicant-Arvind Rajta, on bail, in case No. ECIR/SHSZO/04/2019, dated 22.07.2019, registered with Police Station Sub Zonal Office, Directorate of Enforcement, Shimla, Himachal Pradesh.

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It is the case of the applicant that all the records, pertaining to the present ECIR, are already in the possession of ED and the entire case rests upon the documentary evidence.

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According to the applicant, he is in custody for more than one year and there is no progress in the trial, pending against him, as till the date of filing of the present application, the prosecution has not been able to supply the entire record to the accused persons.

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As per the applicant, the conclusion of the trial against him is likely to take considerable time and his fundamental right to speedy trial is being infringed, without there being any fault on his part.

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It is the further case of the applicant that he has nothing to do with the alleged offences and he has falsely been implicated, in the said case.

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Apart from this, the applicant has given certain undertakings, for which, he is ready to abide by, in case, he is ordered to be released on bail.

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Earlier, the applicant had filed CrMP (M) No. 2444 of 2023 for grant of regular bail, before this Court, however, the same was dismissed, by this Court, vide order dated 12.01.2024.

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Thereafter, vide order dated 08.04.2024, passed by this Court in CrMP (M) No. 658 of 2024, the applicant was ordered to be released on interim bail with effect from 15.04.2024 to 20.04.2024.

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On the basis of above facts, a prayer has been made to allow the present application.

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When put to notice, the status report/reply, on behalf of ED, has been filed, mentioning therein that the applicant has been arrested, under Section 19 of the PMLA, as per the procedure, established, under law.

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In the status report, filed by the respondent, the grounds, upon which, the case has been registered, have been reiterated by pleading that:

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11.1. The matter revolves around a scam, involving the allocation of scholarships to SC, ST and OBC students, in the State of Himachal Pradesh, under the Post Matric Scheme. In this fraudulent activity, officials from the Department of Higher Education, alongwith private Educational Institutions and Banks, were involved, which has resulted into misappropriation of scholarship funds of more than ₹ 200 crore.

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11.2. The applicant, according to the stand, taken by ED, along with others, has played a major role in the scam, wrongfully withholding the rightful scholarship entitlement of the scholarships of the students, belonging to SC, ST and OBC categories of Himachal Pradesh. According to ED, they have diverted the said funds into their pockets/ accounts. 22 institutions are stated to be involved. In this regard, ED has relied upon the charge sheet submitted by CBI. The investigation is stated to be going on to unearth the illicit money and ascertain the proceeds of crime (PoC), obtained by way of this scam.

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11.3. After recording the reasons to believe in writing, the applicant and his co-accused were arrested by ED on

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30^th August, 2023, under Section 19 of PMLA, in the said ECIR. Thereafter, they were produced before the Special Designated Court (PMLA), Shimla, on 31^st August, 2023, and the learned Special Court, after perusal of all the documents, including the arrest memo, grounds of arrest, reasons to believe and material for formation of such belief, has granted five days’ ED custody, with a direction, to produce the accused persons before the Special Court on 4^th September, 2023, on which date, they were produced before the Special Court and were remanded to judicial custody.

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11.4. It is the further case of the ED that investigation is on-going and is at crucial stage, which requires gathering of additional evidence, examination of voluminous records and recording of statements of several persons associated with the applicant and other accused persons related to the case.

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11.5. The prayer, so made by the applicant, has further been opposed, on the ground that the offences, under the PMLA, are different offences, as such, constitute

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class apart and need to be dealt with different approach, in the matter of bail.

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11.6. According to the ED, the offence, under investigation, requires detailed investigation to unearth the material and in such circumstances, if bail is granted, it would defeat the case of the prosecution. The twin conditions, as per Section 45 of the PMLA, are also stated to be not satisfied, in this case.

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11.7. Elaborating their stand, it is the case of the ED that CBI registered FIR No. RC0962019S0002, dated 7^th May, 2019, under Sections 409, 419, 465, 466 and 471 IPC, against the unknown persons. As per the allegations of the said case, there were complicity of individuals from State Government Education Department, Bank Officials and private institutions. Misappropriation in the disbursement of scholarship funds, in large scale, has also been alleged. The offences, under Sections 419 and 471 IPC, are also stated to be scheduled offences, mentioned in the schedule, appended to PMLA and as such, inquiry was initiated.

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11.8. The applicant is stated to be the Dealing Assistant in the Scholarship Branch of Department of Higher Education, for the scholarship under PMS Scheme for SC/ST/OBC students of Himachal Pradesh. He is stated to have verified all the claims made by KC Group of Institutions at Pandoga, and Nawashehar, for the academic sessions 2013-14 to 2016-17, without pointing out the irregularities, including change of caste category.

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11.9. According to the ED, the applicant even verified the claims made by KC Group of Institutions at Pandoga, and Nawashehar, whose complete documents were not uploaded on HP-ePass, after holding a meeting with coaccused Hitesh Gandhi, outside the office and taking money in cash from him, for verifying the fake/forged claims of KC Group of Institution at Pandoga. He is also stated to have intentionally and dishonestly verified the claims and sent the file for disbursement of scholarship without taking any approval from the higher authorities.

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11.10. As per the status report, in July, 2013, the applicant, through his wife-Babita Rajta, alongwith coaccused Rajdeep Singh and Krishan Kumar, formed three

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shell entities, in the name and style of (i) M/s ASA Marketing Solutions (later on, whose name has been changed to ASAMS Education Group), (ii) M/s Skills Development Society, and (iii) M/s Skill Development School.

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11.11. These shell companies opened office-cum-study centres at various locations, in Himachal Pradesh, namely, Nurpur, Nahan, Fatehpur, Una, Kangra, Rohru and Rampur. Through these study centres, the candidates, belonging to SC/ST/OBC categories, were allured of free education in post matric diploma and degree courses, through open and distance learning mode, offered by Lovely Professional University and Karnataka State Open University. The marketing teams were also instructed to collect the data of families below the poverty line (BPL) from Panchayat offices and contact the potential candidates for enrolling them in study centres. The documents of the desirous candidates, with their signatures appended on the bank account opening forms, were collected. Such documents were sent by the centre heads to the applicant and co-accused Krishan Kumar at

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Mohali office, on the basis of which bank accounts in the name of shell entities were opened. According to the ED, the amount of scholarship was transferred to the accounts of the shell companies without the consent and knowledge of the students.

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11.12. It is the further allegation of the ED that the applicant, alongwith other co-accused, so far, has obtained proceeds of crime to the tune of 2₹ 9 crore, as a result of criminal activity of cheating and making false claims of students, on the basis of forged affiliation and fee structure letters of Lovely Professional University and Karnataka State Open University.

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11.13. Apart from this, it has been apprehended that the applicant may influence the witnesses and also hamper the investigation to trace remaining proceeds of crime.

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On the basis of above facts, a prayer has been made to dismiss the application.

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First of all, coming to the arguments of the learned senior counsel, appearing for the applicant, that non-supply of the copy of the ‘reasons to believe’ is violative of Section 19 of the PMLA Act, admittedly, the

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applicant has not challenged his arrest. When, the applicant himself has not challenged his arrest, there is no need for this Court to adjudicate upon this issue.

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The applicant has earlier also sought the similar relief, by filing CrMP (M) No. 2444 of 2023, which was dismissed, by this Court, vide order, dated 12^th January, 2024, whereby, this Court has specifically held that it cannot be said that the mandatory provisions of Section 19 of the PMLA have not been complied with, by the ED, in this case.

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So far as the plea of the applicant, regarding delay in trial, is concerned, at this stage, it cannot be said that there is any delay in trial. As such, the applicant cannot take benefit of the decisions of the Hon’ble Supreme Court, in SLP (Crl.) No. 3205 of 2024, titled as Ramkripal Meena vs. Directorate of Enforcement; SLP (Crl) No. 1164411645 of 2023, titled as Benoy Babu vs. Directorate of Enforcement; Raman Bhuraria vs. Directorate of Enforcement, reported in 2023 SCC OnLine Del 657; Criminal Appeal arising out of SLP (Crl) No. 8167 of 2023, titled as Manish Sisodia vs. CBI; Criminal Appeal arising out

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of SLP (Crl) No. 8781 of 2024, titled as Manish Sisodia vs. Directorate of Enforcement; SLP (Crl) No. 5416 of 2024, titled as Prem Prakash vs. UOI through the Directorate of Enforcement; Criminal Appeal No. 2493 of 2024, titled as Arvind Kejriwal vs. Directorate of Enforcement. In those cases, the Hon’ble Supreme Court has accepted the prayer for bail, on the basis of the peculiar facts and circumstances of the said cases.

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The applicant has also placed on record the zimni orders, passed by the learned Special Judge, Shimla, according to which, the charges have not been framed. However, it cannot be said that there is inordinate delay, as, before, putting the charge, the Special Judge is duty bound to comply with the mandatory provisions of BNSS. Perusal of order, dated 22^nd July, 2024, passed by the learned Special Judge, Shimla, shows that the case was adjourned for checking of copies.

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Considering all these facts, it cannot be said that the twin conditions, as enumerated in Section 45 of the PMLA, are existing in favour of the applicant, at this stage.

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In view of the above discussion, in the considered opinion of this Court, the applicant is not able to make out a case for grant of bail, at this stage. Consequently, the bail application is dismissed.

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Any of the observations, made hereinabove, shall not be taken as an expression of opinion, on the merits of the case, as, these observations, are confined,

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only, to the disposal of the present bail application.

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( Virender Singh ) Judge

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November 08, 2024

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( rajni )

Arvind Rajta v. Directorate of Enforcement

Case brief

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Arvind Rajta v. Directorate of Enforcement

Case brief

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