Court grants interim anticipatory bail to M3M Group promoter Basant Bansal in alleged money laundering case involving IREO Group.

Key Takeaways:

- The court held that it has concurrent jurisdiction to entertain anticipatory bail applications under Section 438 of the Code of Criminal Procedure (CrPC), even if the applicant has not approached the Sessions Court first.

- The court emphasized the importance of personal liberty and the presumption of innocence, stating that arrest should be the last resort.

- While the twin conditions under the Prevention of Money Laundering Act (PMLA) are important, the court held that they do not impose an absolute restraint on granting bail, especially at the anticipatory stage.

- The court found that the ED has not yet been able to implicate Basant Bansal in any scheduled offenses under the PMLA or link him directly to the alleged money laundering case.

Issue:

Whether the Delhi High Court should grant anticipatory bail to Basant Bansal, the promoter of the M3M Group, in the alleged money laundering case involving the IREO Group of companies.

Facts:

- The Enforcement Directorate (ED) registered an Enforcement Case Information Report (ECIR) in 2021 against the IREO Group of companies for alleged money laundering offenses under the PMLA.

- Initially, the ECIR did not name Basant Bansal or the M3M Group as accused parties.

- In 2022, the ED filed a prosecution complaint against seven accused, including the IREO Group promoter Lalit Goyal, for offenses under the PMLA.

- In May 2023, the ED issued summons to M3M India Pvt. Ltd. and Basant Bansal, seeking information and documents related to transactions between M3M and certain companies.

- On June 1, 2023, the ED conducted raids on the premises of M3M and its group companies, seizing various assets and freezing bank accounts.

- Basant Bansal approached the Delhi High Court seeking anticipatory bail, apprehending arrest in connection with the ECIR.

Arguments:

On behalf of Basant Bansal (Applicant):

- The applicant cooperated with the ED's investigation and responded to summons.

- The applicant was not named as an accused in the predicate offenses or the prosecution complaint filed by the ED.

- The seized assets and frozen bank accounts do not belong to the applicant personally

- The applicant has not been linked to any scheduled offenses under the PMLA, and the proceedings against him are illegal and non-est.

- The applicant's fundamental right to life and personal liberty under Article 21 of the Constitution would be violated if arrested.

- The primary accused, Lalit Goyal, has already been granted regular bail, which the ED has not challenged.

On behalf of the Enforcement Directorate (Respondent):

- The applicant should have approached the Sessions Court first for anticipatory bail, as per the concurrent jurisdiction under Section 438 of the CrPC.

- The twin conditions under Section 45 of the PMLA need to be satisfied even for granting anticipatory bail.

- The ED alleged that the M3M Group received funds diverted from the IREO Group through shell companies controlled by the M3M Group.

- The ED claimed that the applicant and other M3M Group officials did not cooperate with the investigation and provided misleading information.

- The ED argued that the applicant's arrest is necessary to prevent tampering with evidence and influencing witnesses.

Key Legal Precedents:

1. Gurbaksh Singh Sibbia v. State of Punjab** (1980): The Supreme Court held that the object of anticipatory bail is to protect personal liberty and that the provision should be interpreted liberally.

2. Sushila Aggarwal v. State of NCT of Delhi** (2020): The Supreme Court clarified the principles for granting anticipatory bail, emphasizing that arrest should be the last resort and that conditions should not be imposed routinely.

3. Vijay Agrawal through Parokar v. Directorate of Enforcement** (2023): The Delhi High Court held that the twin conditions under Section 45 of the PMLA do not impose an absolute restraint on granting bail, especially at the anticipatory stage.

4. Sanjay Raghunath Aggarwal v. Directorate of Enforcement** (2023): The Delhi High Court reiterated that the twin conditions under Section 45 of the PMLA should not be applied mechanically at the anticipatory bail stage.

5. Directorate of Enforcement v. Gopal Reddy** (2023): The Supreme Court held that the rigors of Section 45 of the PMLA shall be applicable even for anticipatory bail applications, and the nature of allegations and seriousness of offenses must be considered.

Judgement:

The Delhi High Court granted interim anticipatory bail to Basant Bansal, subject to certain conditions, including furnishing a personal bond of Rs. 10,00,000/- with two sureties of the same amount, surrendering his passport, cooperating with the investigation, and appearing before the Investigating Officer as and when required.

The court reasoned that the ED has not yet been able to implicate Basant Bansal in any scheduled offenses under the PMLA or link him directly to the alleged money laundering case. The court also considered the fact that the primary accused, Lalit Goyal, has already been granted regular bail, which the ED has not challenged.

However, the court clarified that its observations are limited to the interim protection and shall not prejudice the final outcome of the case. The court granted one week's time to the ED to file a status report and other supporting documents, and one week thereafter for Basant Bansal to file a reply, if any

FAQs:

Q1. What is the significance of the court's decision?

A1. The court's decision highlights the importance of personal liberty and the presumption of innocence, particularly in cases involving economic offenses. It also clarifies the application of the twin conditions under the PMLA at the anticipatory bail stage, emphasizing that they should not be applied mechanically.

Q2. Can the ED challenge the court's decision?

A2. Yes, the ED can challenge the court's decision by filing an appeal before a higher court or by presenting additional evidence or arguments during the next hearing, as directed by the court. Q3. What happens if Basant Bansal violates the conditions of the anticipatory bail?

A3. If Basant Bansal violates any of the conditions imposed by the court, the ED can move the court to seek his arrest under Section 439(2) of the CrPC for non-compliance.

Q4. Does the court's decision exonerate Basant Bansal from the alleged money laundering charges?

A4. No, the court's decision is limited to granting interim anticipatory bail and does not exonerate Basant Bansal from the alleged charges. The final outcome of the case will depend on the evidence presented and the court's assessment of the merits of the case.

Q5. What is the significance of the legal precedents cited by the court?

A5. The legal precedents cited by the court, such as Gurbaksh Singh Sibbia v. State of Punjab and Sushila Aggarwal v. State of NCT of Delhi, establish the principles and guidelines for granting anticipatory bail, emphasizing the importance of personal liberty and the presumption of innocence. The precedents also clarify the application of the twin conditions under the PMLA in anticipatory bail cases.