The Allahabad High Court recently refused to quash criminal proceedings initiated in Uttar Pradesh against former Chhattisgarh bureaucrat Anil Tuteja, Anwar Dhebar (brother of Raipur's mayor) and two others in connection with the Chhattisgarh liquor scam case [Anil Tuteja v. State of Uttar Pradesh and Others + 3 connected matters].
Justices Siddhartha Verma and Ram Manohar Narayan Mishra opined that even if the Supreme Court had quashed a money laundering case in a related matter, it would not prevent the continuation of criminal proceedings initiated in Uttar Pradesh against Tuteja and others.
The Court said that the witness statements collected by the Enforcement Directorate (ED) under Section 50 of the Prevention of Money Laundering Act, 2002 (PMLA) and shared with the Uttar Pradesh police can continue to form the basis of criminal proceedings initiated in Uttar Pradesh (UP).
"It will be very unsafe to accept the arguments of the learned counsel for the petitioners (accused) that for all initiation of criminal cases, statements made before the authorities under Section 50 of the PML Act, 2002 could never be used. Such statements which are in the knowledge of an investigating agency can always be used for initiating or for furthering of any pending investigation. It of course need not be used for the purposes of a trial and definitely they could not be categorized as confessions or admissions," the Court said in its October 4 judgment.
The case against Tuneja and others involves allegations of a ₹2,000 crore liquor syndicate racket operating in Chhattisgarh during the Chief Ministership of Congress leader Bhupesh Baghel.
The ED registered a money laundering case in the matter on July 4, 2023. During its probe, the ED also found that there was a UP link to the case.
Witness statements recorded by the ED allegedly revealed details about a company in Noida which was illegally granting tenders to supply holograms (which are fixed to liquor bottles for its authentication and to confirm excise duty payments) to the Excise Department of Chhattisgarh.
Based on communication by ED dated July 28, 2023, a first information report (FIR) was registered by Uttar Pradesh on July 30, 2023 against Tuteja and others.
Later, on April 8 this year, the Supreme Court quashed the ED's July 2023 money laundering complaint on the ground that there was no predicate offence (the ED's complaint was based on certain provisions of the Income Tax Act which did not fall in the PMLA's list of scheduled offences).
Four of the accused in the case - namely Anil Tuteja, Anwar Dhebar, Arun Pati Tripathi and Niranjan Das - then filed petitions before the Allahabad High Court to quash the UP police's FIR as well.
The question before the High Court was whether the FIR registered in Uttar Pradesh could continue based on witness statements recorded by the ED under Section 50 of the PMLA when the Supreme Court has already quashed ED's July 2023 prosecution complaint.
The High Court concluded that the UP police's FIR would survive and declined to quash the case in UP against Tuteja and the other petitioners.
"In the instant case, so far as the petitioners Anil Tuteja, Arun Pati Tripathi and Niranjan Das are concerned we do find that against them a definite allegation is there in the FIR and they disclose cognizable offences under sections 420, 468, 471 473, 484 and 120-B IPC," the Court held.
As with regard to Anwar Dhebar, the Court added that the evidence gathered after the lodging of the FIR definitely showed complicity of the Dhebar in the alleged crime.
On a related note, the ED launched fresh money laundering proceedings against Tuteja days after the Supreme Court's April 8 decision to quash its earlier complaint.
Senior Advocate Siddharth Dave assisted by advocates Saksham Srivastava and Vinayak Mithal and advocates Iman Ullah, Rajiv Lochan Shukla, Shishir Prakash, appeared for Tuteja and other petitioners.
Additional Advocate General PK Giri assisted by Additional Government Advocate Pankaj Kumar, appeared for the State of Uttar Pradesh.
Advocate Zoheb Hossain assisted by advocate Sikandar Bharat Kochar, appeared for the ED.
[Read Judgment]