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Case BriefsHigh Courts

Madhya Pradesh High Court: The Division Bench of Mohammad Rafiq, CJ. and Vijay Kumar Shukla, J., heard a petition which was in pursuance to the detailed order passed on 10-01-2014. It was in regard to the creation of the Directorate of Prosecution in terms of Section 25-A of the Code of Criminal Procedure. On 23-08-2017 the Court had disapproved the practice of appointment of Public Prosecutors on a contract basis and categorically held that it cannot be a post for appointment on contract basis as such the post is pivot for the administration of justice.

On 28-08-2019 the Government Advocate was granted a week’s time to seek instructions and apprise the Court of the steps taken by the Government to fill up the posts of Public Prosecutors and Assistant Public Prosecutors. On 29-09-2019 he informed the Court that a Gazette notification had been published in terms of Section 24 sub-section (1) of the Code of Criminal Procedure as of 07-01-2019.

Mr Siddharth R. Gupta, Advocate appearing for the High Court submitted that this matter was pending before this Court for quite some time and the practice of engaging Panel Lawyers to appear before the High Court in criminal matters even without experience of seven years was being wrongly followed and that the State Government should comply the requirement of Section 24(1) and Section 24 (7) of CrPC before authorizing any Advocate to appear as Public Prosecutor before the High Court.

The Court directed the Respondent-State to clarify certain stands,

  • Whether one Public Prosecutor is appointed for each Court in all districts of the State to attend the Criminal matters and if not whether multiple number of Courts are assigned to one available Public Prosecutor and if yes, give the details thereabout?
  • As to how many posts in the cadre of Additional District Prosecution Officers, District Prosecution Officers and Deputy Director (Prosecution) are lying vacant in the State?
  • Whether the promotions may not be granted against the unfilled posts of the quota of promotion in the cadre of the District Prosecution Officers and Deputy Director (Prosecution) to the extent not affected by order of the Hon’ble Supreme Court, with regard to which there is no dispute?
  • Can the State Government not consider appointing Additional District Prosecution Officers/District Prosecution Officers on retainership basis for fixed duration against unfilled posts of Public Prosecutors?
  • Whether a Panel Lawyer may appear in the Court before the High Court in criminal matters like Criminal Appeals, Bail Applications, Criminal Revisions, application for suspension of sentence, MCRCs etc. even without having practice of minimum of seven years and without the consultation with the High Court as required under Section 24(1) of Cr.P.C.?
  • How can appointment on contract basis without recourse to Section 24(4) of Cr.P.C. on the basis of panel proposed by the District Magistrate in consultation with the Sessions Judge particularly when Section 24(5) of Cr.P.C. provides that no person shall be appointed by the State Government as the Public Prosecutor or Additional Public Prosecutor for the district unless his name appears in the panel of names prepared by the District Magistrate under sub-section (4) of Section 24 of Cr.P.C.?

The Central Government was further asked to provide with the details with regard to compliance of Section 24(1) and Section 24(4) of Cr.P.C. as to whether the Advocates who appear on behalf of the agencies like Central Bureau of Investigation, Enforcement Directorate etc. before High Court and courts subordinate thereto, are appointed by process of consultation with the High Court or Sessions Judge, as the case may be, in terms of Section 24(1) and 24(4) of Cr.P.C. respectively.

Matter to be taken up on 26-07-2021.[Gyan Prakash v. Govt. of M.P., 2021 SCC OnLine MP 1211, decided on 22-06-2021]

Suchita Shukla, Editorial Assistant has reported this brief.

Case BriefsTribunals/Commissions/Regulatory Bodies

National Company Law Appellate Tribunal (NCLAT): A Bench comprising of Justice S.J. Mukhopadhaya (Chairperson) and Justice B.L. Bhat (Judicial member) rejected an appeal challenging an NCLT judgement where it allowed a liquidator to sell the assets of a company which had been attached by the Directorate of Enforcement (ED) during the period of ‘Moratorium’.

The Resolution Professional had filed an application before the NCLT for releasing the attachment of certain assets of Varrsana Ispat Limited (Corporate Debtor) by the ED. The NCLT held that ordering the release of the attached assets would not be maintainable since the attachment order was issued before the order of declaration of ‘Moratorium’ in the present case. The aforesaid NCLT order had been challenged in this appeal.

The Tribunal rejected the appellant’s contentions that Section 14 of the Insolvency and Bankruptcy Code, 2016 would have an overriding effect over the Prevention of Money Laundering Act, 2002 and that creditors and investigative agencies could not disrupt the ‘Corporate Insolvency Resolution Process’ during the period of ‘Moratorium’. The bench observed that since the provisions of the Prevention of Money Laundering Act, 2002 pertained to ‘proceeds of crime,’ Section 14 of the I&B Code would not be applicable to such a proceeding.

The Order stated that the offence of money-laundering has nothing to do with the ‘Corporate Debtor’ but will be applicable to individuals such as ex-Directors and shareholders of the ‘Corporate Debtor,’ who cannot be given protection from the Prevention of Money Laundering Act, 2002 by taking advantage of Section 14 of the I&B Code. Rather, it held that both the Acts would be invoked simultaneously. Since the attachments were made by the ED long before the initiation of the Corporate Insolvency Resolution Process, this would disallow the ‘Resolution Professional’ from taking advantage of Section 14 of the I&B Code. [Varrsana Ispat Limited v. Deputy Director, Directorate of Enforcement, Company Appeal (AT) (Insolvency) No. 493 of 2018, decided on 27-07-2020]

Case BriefsHigh Courts

Delhi High Court: Anup Jairam Bhambhani J., granted bail to an accused in a money-laundering case involving a sum of more than INR 2000 crores. Upholding the legal principle of the presumption of innocence of an accused until proven guilty, the Court found that in the absence of compelling grounds and reasons, the under-trial accused could not be detained in judicial custody.

The applicant sought regular bail after being arrested in the complaint case arising from an Enforcement Case Information Report (ECIR). According to the Enforcement Directorate’s (ED) allegations, the applicant owns 50% shares in a company which in turn owns 50% of an RBI recognized non-banking financial company Religare Enterprises Ltd. (REL). It is alleged that the applicant misappropriated money, amounting to over INR 2036 crores, lent by REL to entities controlled or owned by the applicant.

The Court opined that the applicant was not in a position to tamper with evidence, since the allegedly offending transactions cannot be altered by virtue of their being reflected in several records, including those of regulatory bodies such as the RBI, SEBI, etc. and also because all records of such transactions had already been seized by the ED. Since the ED had confirmed that it would not interrogate the applicant while he was in judicial custody, it found the applicant’s detention unreasonable, especially as there was no foreseeable timeline within which the ED was to complete its investigations.

Bench held that the applicant had deep roots in society and was not a flight-risk, so “no purpose would be served by keeping him in judicial custody.” The nature of an offence should have a limited role in determining the merits of a bail application, and even though the applicant is accused of committing an offence whose financial implications are large in quantum, such losses cannot be compensated for by keeping the under-trial applicant in prolonged custody. It emphasized on the importance of time-bound investigations, stating that “criminal investigation is not a metaphorical fishing-rod handed to an investigating agency, to indulge its penchant for ‘fishing around’ for evidence.”

Highlighting the dire situation of undertrials in prisons, it reiterated Sanjay Chandra v. CBI’s (2012) 1 SCC 40 ruling that every man is innocent until duly tried and found guilty, and that it would be inappropriate to refuse bail to an undertrial simply to give him “a taste of imprisonment as a lesson.” It approved the bail application and directed the applicant to be released, subject to certain conditions laid down in the order. [Shivinder Mohan Singh v. Directorate of Enforcement, 2020 SCC OnLine Del 766 , decided on 23-07-2020]

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Supreme Court: The bench of R Banumathi, A S Bopanna and Hrishikesh Roy, JJ has  sought a response from the Enforcement Directorate (ED) on an appeal filed by former union finance minister P Chidambaram challenging the Delhi High Court ‘s order dismissing his bail petition in the INX Media money laundering case. The Court issued a notice to the probe agency and posted the matter for hearing to November 26.

Chidambaram sought bail in a case pertaining to the Foreign Investment Promotion Board (FIPB) clearance given to INX Media to the tune of Rs 305 crore in 2007 by Chidambaram when he was the Finance Minister. He was arrested by the ED on October 16 and is currently in judicial custody. Denying bail  to Chidambaram in the case, the High Court had stated that prima facie allegations against him are “serious in nature” and he played an “active and key role” in the offence.

Senior advocates Kapil Sibal and Abhishek Manu Singhvi, appearing on behalf of Chidambaram today, submitted before the top court that their client has been in jail for over 90 days and has cleared the triple test criterion to avail the bail. Chidambaram had sought bail on the health grounds. The Congress leader also asserted that no part of the triple test, which includes flight risk, influencing witnesses and tampering with evidence, has been made out against him. He stated that there was no allegation that he was a flight risk following the issuance of a Look out Circular (LOC).

On October 22, 2019, the bench had granted bail to former Finance Minister and senior Congress leader P Chidambaram in connection with the INX Media case registered by the Central Bureau of Investigation (CBI).

The Court noticed that Chidambaram was neither a “flight risk” nor there was possibility of his abscondence and said that Chidambaram

“being the Member of Parliament and a Senior Member of the Bar has strong roots in society and his passport having been surrendered and “look out notice” issued against him, there is no likelihood of his fleeing away from the country or his abscondence from the trial.”

(Source: ANI)

Case BriefsSupreme Court

Supreme Court: The 3-judge bench of R Banumathi, AS Bopanna and Hrishikesh Roy, JJ has granted bail to former Finance Minister and senior Congress leader P Chidambaram in connection with the INX Media case registered by the Central Bureau of Investigation (CBI).

Chidambaram is currently in the custody of Enforcement Directorate (ED) till October 24 in the INX Media money laundering case. Chidambaram, who is currently in judicial custody in Tihar jail, had filed a Special Leave Petition (SLP) in the apex court days after the High Court dismissed his bail plea contending that he might influence the witnesses in the case.

When the Solicitor General  Tushar Mehta submitted before the Court that “flight risk” of economic offenders should be looked at as a national phenomenon and be dealt with in that manner merely because certain other offenders have flown out of the country, the Court said that the same cannot, be put in a straight-jacket formula so as to deny bail to the one who is before the Court, due to the conduct of other offenders, if the person under consideration is otherwise entitled to bail on the merits of his own case. Hence, such consideration including as to “flight risk” is to be made on individual basis being uninfluenced by the unconnected cases, more so, when the personal liberty is involved.

The Court noticed that Chidambaram was neither a “flight risk” nor there was possibility of his abscondence and said that Chidambaram

“being the Member of Parliament and a Senior Member of the Bar has strong roots in society and his passport having been surrendered and “look out notice” issued against him, there is no likelihood of his fleeing away from the country or his abscondence from the trial.”

On the allegation of possibility of influencing the witnesses, the Court noticed,

“Till the date, there has been no allegation regarding influencing of any witness by the appellant or his men directly or indirectly. In the number of remand applications, there was no whisper that any material witness has been approached not to disclose information about the appellant and his son. It appears that only at the time of opposing the bail and in the counter affidavit filed by the CBI before the High Court, the averments were made.”

The Court observed that CBI has no direct evidence against Chidambaram regarding the allegation of appellant directly or indirectly influencing the witnesses. It further noticed that the conclusion of the learned Single Judge of Delhi High Court “…that it cannot be ruled out that the petitioner will not influence the witnesses directly or indirectly……” is not substantiated by any materials and is only a generalised apprehension and appears to be speculative. It, hence, held,

“Mere averments that the appellant approached the witnesses and the assertion that the appellant would further pressurize the witnesses, without any material basis cannot be the reason to deny regular bail to the appellant; more so, when the appellant has been in custody for nearly two months, co-operated with the investigating agency and the charge sheet is also filed.”

Setting aside the Delhi High Court judgment, the Court, hence, directed that Chidambaram be released on bail if not required in another case subject to the condition of his executing bail bonds for a sum of Rs.1,00,000/- with two sureties of like sum to the satisfaction of the Special CBI Judge. The Court further directed,

“The passport if already not deposited, shall be deposited with the Special Court and Chidambaram shall not leave the country without leave of the Special Court and subject to the order that may be passed by the Special Judge from time to time. He shall make himself available for interrogation as and when required.”

[P. Chidambaram v. Central Bureau of Investigation, 2019 SCC OnLine SC 1380, decided on 22.10.2019\

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Supreme Court: Senior Congress leader P Chidambaram on Thursday moved the Supreme Court against the order of the Delhi High Court that dismissed his bail plea in the INX Media case. Chidambaram, who is currently in judicial custody in Tihar jail, filed a Special Leave Petition (SLP) before the Supreme Court earlier today, days after the High Court dismissed his bail plea contending that he might influence the witnesses in the case.

Refuting the contentions put forth by the high court, Chidambaram asserted that he has not influenced any witness or accused in the case.

“A mere apprehension without there being substantial evidence and particulars of an accused approaching any witness is not enough to deny bail to an accused,”

Alluding to certain inputs submitted by the Central Bureau of Investigation (CBI) to the court in a sealed cover, the petition stated,

“The liberty has thus been denied on the basis of the baseless, anonymous and unverified allegation made behind the petitioner’s back.”

Chidambaram said that the submissions made by the agency in the sealed cover were “highly objectionable and against all canons of fair play and justice”. The petition also stated that the FIR registered in 2015, did not name Chidambaram. The plea asserted that there was no reference or allegation against him in the FIR.

Chidambaram is facing probe for alleged irregularities in the Foreign Investment Promotion Board (FIPB) clearance given to INX Media to the tune of Rs 305 crore in 2007 when he was the Union finance minister. While the CBI is probing the corruption allegations, the Enforcement Directorate (ED) is looking into money laundering allegations against him in the case. The CBI had arrested Chidambaram on August 21 following which he was sent to judicial custody, which is slated to end today.

(Source: ANI)

Case BriefsSupreme Court

Supreme Court: In a major blow to Senior Congress leader P Chidambaram, the Court has rejected his plea against the Delhi High Court order rejecting his anticipatory bail plea in the INX Media case being probed by Enforcement Directorate (ED). The bench of R Banumathi and AR Bopanna, JJ said,

“In a case of money-laundering where it involves many stages of “placement”, “layering i.e. funds moved to other institutions to conceal origin” and “interrogation i.e. funds used to acquire various assets”, it requires systematic and analysed investigation which would be of great advantage.”

The Court was hearing Chidambaram’s plea against the Delhi High Court order rejecting his anticipatory bail plea in the INX Media case involving alleged irregularities in Foreign Investment Promotion Board (FIPB) clearance given to the INX Media for receiving foreign investment to the tune of Rs.305 crores against approved inflow of Rs.4.62 crores.

Delhi High Court had denied the bail on 2 factors, namely, (i) gravity of the offence; and (ii) the appellant was “evasive” to deny the anticipatory bail. Taking strong exception against the said grounds, Senior Advocate Abhishek Manu Singhvi, argued that,

  • the “gravity of the offence” cannot be the perception of the individual or the court and the test for “gravity of the offence” should be the punishment prescribed by the statute for the offence committed.
  • Insofar as the finding of the High Court that “the appellant was evasive to the questions”, the investigating agency Enforcement Directorate cannot expect an accused to give answers in the manner they want and that the accused is entitled to protection under Article 20(3) of the Constitution of India.

The Court, however, noticed that ordinarily, arrest is a part of the process of the investigation intended to secure several purposes. There may be circumstances in which the accused may provide information leading to discovery of material facts and relevant information. Grant of anticipatory bail may hamper the investigation.

“Pre-arrest bail is to strike a balance between the individual’s right to personal freedom and the right of the investigating agency to interrogate the accused as to the material so far collected and to collect more information which may lead to recovery of relevant information.”

Stating that Section 438 Cr.P.C. is to be invoked only in exceptional cases where the case alleged is frivolous or groundless, the Court noticed that in the case in hand, there are allegations of laundering the proceeds of the crime and that the Enforcement Directorate claims to have certain specific inputs from various sources, including overseas banks. It, hence, held that grant of anticipatory bail, particularly in economic offences would definitely hamper the effective investigation.

“Having regard to the materials said to have been collected by the respondent-Enforcement Directorate and considering the stage of the investigation, we are of the view that it is not a fit case to grant anticipatory bail.”

The Court, however, clarified that

“As and when the application for regular bail is filed, the same shall be considered by the learned trial court on its own merits and in accordance with law without being influenced by any of the observations made in this judgment and the impugned order of the High Court.”

Meanwhile, the CBI special court has sent former union minister P. Chidambaram to judicial custody till 19 September in the money-laundering and corruption case related to the INX Media scam.

[P. Chidambaram v. Directorate of Enforcement, 2019 SCC OnLine SC 1143, decided on 05.09.2019]

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Supreme Court: The Enforcement Directorate has told the Court that custodial interrogation of senior Congress leader P Chidambaram in the INX media case is required as if his plea for anticipatory bail is given it would affect cases involving Vijay Mallya, Mehul Choksi, Neerav Modi and Zakir Naik.

Disputing the contention of Chidambaram’s lawyers, the agency also argued that the offence of money laundering is against the society, nation and the economy. Solicitor General Tushar Mehta appearing for the probe agency told a Bench of Justice R Banumathi and Justice AS Bopanna,

“Money laundering is an offence against society, nation and economy. Economic offences are gravest offences irrespective of quantum of sentence,”

Countering the arguments of Chidambaram’s advocates Kapil Sibal and Abhishek Manu Singhvi that Prevention of Money Laundering Act (PMLA) offences with seven years of punishment is not a grave offence because as per the Code of Criminal Procedure grave offences entail death penalty and life, Mehta said money laundering offences are “grave”. He said,

“Chidambaram’s counsels have argued that gravity of an offence is subjective. PMLA offences may not be grave for them but the Courts have consistently held that economic offences are grave in nature. Gravity is a relative concept. Quantum of punishment is not relevant. What’s important is what will be the impact of your offence in society. Money laundering is an offence against the society, nation and economy. Economic offences are gravest offences irrespective of quantum of sentence,”

The Court was hearing Chidambaram’s plea against Delhi High Court’s order denying anticipatory bail to him in a case being probed by the ED.

SG also objected to the proposition made by Chidambaram’s counsel Kapil Sibal to confront him with evidence before presenting it in the court, saying it is “absurd” and would have “devastating results” and is “preposterous”. He added,

“Whether the accused’s reply was evasive or not is decided by investigating agency and not by the court”

SG also contended that if accused at large is confronted with the evidence collected, then the agency will have exposed its evidence and witnesses and it will give a chance to the accused to tamper with evidence and erase the money trail.

“The investigating agency has absolute discretion to what extent to reveal the evidence to the accused. It is best to confront the accused with evidence when he is in custody,”

He further said that investigation is an art where the agency brings the accused to divulge details and not a mere question and answer format or an interview. He also argued that if given an anticipatory bail, Chidambaram may erase the money trail, influence the witnesses and tamper with evidence.

“It’s impossible to investigate when he’s armed with anticipatory bail. It’s ED’s right and duty to unearth the truth. It would be difficult for the ED to catch him if he is under a protective umbrella and best way to elicit truth is when an accused is not under a protective umbrella,”

In 2017, the Central Bureau of Investigation  had registered an FIR alleging irregularities in the Foreign Investment Promotion Board (FIPB) clearance was given to INX Media to the tune of Rs 305 crore in 2007 when Chidambaram was the Union finance minister.

Following the FIR filed by CBI, ED had filed a case of money laundering against him.

(Source: ANI)

Hot Off The PressNews

Supreme Court: The bench of R Banumathi and A S Bopanna, JJ has extended till tomorrow the interim protection from arrest granted to senior Congress leader P Chidambaram in a money laundering case filed by the Enforcement Directorate in the alleged INX media scam.

The Court was hearing a Special Leave Petition (SLP) moved by Chidambaram against the Delhi High Court order denying him anticipatory bail in the ED case. The hearing in the case will continue tomorrow.

Solicitor General Tushar Mehta is likely to make submissions on the application filed by the Kapil Sibal, counsel of Chidambaram, seeking a direction to the Enforcement Directorate (ED) to produce his client’s statement recorded by them in the case.

A Special court had yesterday extended the CBI remand of the Congress leader by four days in a corruption case filed by the CBI in INX media scam. The agency had sought an extension contending that they have to “unravel the larger conspiracy”.

In 2017, the CBI had registered an FIR alleging irregularities in the Foreign Investment Promotion Board (FIPB) clearance given to INX Media to the tune of Rs 305 crore in 2007 when Chidambaram was the Union finance minister. Following the FIR filed by CBI, ED had filed a case of money laundering against him.

(Source: ANI)

Hot Off The PressNews

Supreme Court:  The bench of R Banumathi and A S Bopanna, JJ has extended the protection from arrest given to former finance minister P Chidambaram in the INX Media money laundering case lodged by the Enforcement Directorate till Tuesday. The bench also dismissed the petition filed by senior Congress leader P. Chidambaram for anticipatory bail in the corruption case lodged by the Central Bureau of Investigation (CBI), saying the plea has become “infructuous” as he had already been arrested.

The bench will continue hearing on Tuesday the petition of Chidambaram challenging the Delhi High Court order which had rejected his anticipatory bail plea in the money laundering case.

Senior advocate Kapil Sibal, appearing for Chidambaram completed his arguments and said he will file the rejoinder to the ED’s counter affidavit.

Solicitor General Tushar Mehta, appearing for ED, said he will advance his arguments Tuesday and the bench posted the matter for hearing at noon tomorrow.

During the pre-lunch session, Sibal said that fair trial and fair investigation were part of Article 21 and the court must protect the fundamental right of liberty of Chidambaram. He strongly objected to Mehta’s argument to place on record certain documents in sealed cover for the perusal of the bench.

He said that Chidambaram was examined thrice by the ED — on December 19, 2018, January 1, 2019 and January 21, 2019 — but the questions related to the allegations levelled by the ED against him were not put to him.

The CBI had registered an FIR on May 15, 2017, alleging irregularities in the Foreign Investment Promotion Board (FIPB) clearance granted to the INX Media group for receiving overseas funds of Rs 305 crore in 2007 during Chidambaram’s tenure as the finance minister.

Thereafter, the ED lodged a money laundering case against him in 2017.

Sibal said FIPB consisted of six secretaries of the government, and Chidambaram had only signed the approval as the then finance minister. He further argued,

“The ED has alleged the use of shell companies in the matter but no such firm is directly or indirectly connected to Chidambaram,”

He also said that Chidambaram was not named in the ED’s FIR and no allegations were levelled against him.

Chidambaram, 73, headed the ministries of finance and home during the UPA regime.

(Source: India Today)