The Delhi High Court, in Anand Chauhan vs Directorate of Enforcement, has held that as the applicant is accused of a scheduled offence under the Prevention of Money Laundering Act, 2002 (PMLA), the court is bound by conditions relating to bail u/s 45 of the PMLA.
Justice Vipin Sanghi was considering a bail application filed by LIC agent Anand Chauhan, co-accused in a money laundering case involving Himachal Pradesh Chief Minister Virbhadra Singh.
The CBI registered an FIR under S.13(2) & 13(1)(e) [criminal misconduct by public servant] of the Prevention of Corruption Act, 1988 (PCA) r/w S. 109 of IPC, against the applicant, Virbhadra, Pratibha Singh, Chunni Lal Chauhan and others.
On the basis of information, it was alleged that the applicant, with the help of Chunni Lal Chauhan, brought unaccounted money of Virbhadra Singh back into regular books of accounts by investing huge amount of money in LIC polices in the name of Virbhadra Singh and his family members.
The court, while answering the applicant’s submission that he has been only charged with abatement of the scheduled offence, therefore, the PMLA cannot be invoked against him, or that the rigours of Section 45(1)(ii) would not apply to him, observed that “the offence of “criminal misconduct” is defined in Section 13 of the P.C. Act to mean, inter alia, the possession of the public servant “or any person on his behalf … … … at any time during the period of his office … … … of pecuniary resources or property disproportionate” to the known sources of income of the public servant, which the public servant cannot specifically account for. Thus, even a person who is not a public servant has been noticed in the said definition of “criminal misconduct” as defined in Section 13(1)(e) of the PC Act.”
The court further observed that allegations against the applicant were that the proceeds of crime of Virbhadra Singh were laundered by him.
Thus, even if the applicant has not committed offence under Section 13(2) read with Section 13(1)(e) of the PC Act, nevertheless, he is a person charged with abetting the said offence and with the laundering of the proceeds of the crime of Virbhadra Singh. Therefore, the court held that “the proceeds of crime may be acquired by another person who commits one of the scheduled offences, and the person charged with money laundering may have only, directly or indirectly, assisted or knowingly become a party, or may be actually involved in the process or activity of, inter alia, concealing, possessing, acquiring or using and projecting or claiming the said proceeds of crime as untainted property.”
Read the Judgment here.