Delhi court denies bail to former AAP Councillor Tahir Hussain in money laundering case

A Delhi court on Saturday dismissed the bail plea filed by Tahir Hussain in connection with a case of money laundering under the Prevention of Money Laundering Act, 2002 (PMLA)..Additional Sessions Judge Amitabh Rawat of Karkardooma Courts said that in view of the embargo on grant of bail laid down under Section 45(1) of the PMLA, it cannot be said that the applicant is not guilty of the alleged offences or that he is not likely to commit any such offence while on bail."Thus, in view of the above above discussion, on prima facie reading of the complaint and material placed on record and considering the embargo of Section 45(1) PMLA, it cannot be held that the applicant is not guilty of the alleged offences or that he is not likely to commit any such offence while on bail. Hence, I am not inclined to allow the present application filed on behalf of applicant for grant of bail. The bail application is accordingly dismissed," the order said. .Hussain was arrested by Enforcement Directorate (ED) in connection with a money laundering probe into alleged funding of anti-Citizenship Amendment Act (anti-CAA) protests and riots in north-east Delhi in February this year, as per Hindustan Times.ED had filed a complaint against Hussain under Sections 44 and 45 PMLA for commission of offences of money laundering as defined under Section 3 read with Section 70 and punishable under Section 4 of the PMLA.This prompted him to move court to seek bail..Hussain's counsel argued that the bail application under the PMLA needs to be treated as a regular bail application as twin conditions for bail under PMLA were struck down by the Supreme Court of India in Nikesh Tarachand Shah vs. Union of India and Another.He said that a bare look into the complaint and the investigation by the ED showed that the accused can at best be held liable and prosecuted for the offence under Section 122 of GST Act for bogus and fake invoices, and that two others namely Nitesh Gupta and Mohd. Akram have not been made accused in this case.."A new case was introduced by the agency in the present case against the accused on the basis of alleged conspiracy with others. The case was registered on the predicate offence involving Section 120B IPC in which applicant is an accused but co-accused is not. In the present case, a totally new crime was introduced involving Section 120B of IPC without any reference to a case of predicate offence," petitioner saidHe said that the witness Rahul Kasana is a planted witness and there is a major contradiction in the statement of witness Girish Pal if the statement of the witnesses in this case is read along with other IPC predicate cases.He emphasized that the maximum imprisonment under the provisions slapped on Hussain is seven years and accused cannot languish in jail for a long period as he has been in custody for almost one and a half years especially when he is in no position to influence the witnesses. .The Special Public Prosecutor (SPP) argued in favour of the twin conditions given under section 45(1) PMLA and said that the same are still in existence. Further, he said that Hussain was the main conspirator involved in the acts of criminal conspiracy, cheating and falsification/forgery of documents which resulted in fraudulent removal of money from the accounts of certain companies."Under the instructions of Tahir Hussain, funds were transferred from companies owned/controlled by him to the accounts of fictitious/bogus entities created by entry operators. The entry operators operating such entities made payments of equivalent amount in cash to him. He was the ultimate beneficiary of the money received in cash which was used for fulfillment of his ulterior motives. Fake and bogus invoices were created to cover the money trail," the SPP saidHe stated that Hussain entered into a criminal conspiracy with Amit Gupta and other persons to fraudulently transfer money from the accounts of companies owned/controlled by him."The money so obtained by Tahir Hussain as a result of criminal activity relating to the offence of criminal conspiracy qualifies as ‘proceeds of crime’. The said ‘proceeds of crime’ generated through the offence of criminal conspiracy under Section 120B of the IPC, which is scheduled offence under PMLA, was used by Tahir Hussain to commit offences under Sections 302, 307 and 385 which have been invoked in the aforesaid FIRs and which are also scheduled offences under the PMLA, 2002," it was contended. .The Court noted that the two conditions provided under the twin test are that public prosecutor must be given an opportunity to oppose the application and if he does so, then there should be a recording of satisfaction of court that there are reasonable grounds for believing that the accused is not guilty of the said offence and that he is not likely to commit any offence while on bail.It was also agreed upon by both counsel that there are conflicting judgments with regard to the twin test laid down under Section 45(1)..The Court said that if an accused directly or indirectly attempts to indulge or is actually involved in any activity connected with the proceeds of crime including its possession or use, then he is guilty of offence of money laundering and proceeds of crime would include not only property derived or obtained from the scheduled offence but also directly or indirectly derived or obtained as a result of any criminal activity relatable to the scheduled offence..The Court further held that the contention made by Hussain that if one accused person is granted pardon, then there can be no criminal conspiracy since accused cannot conspire with himself, is incorrect "What the law requires for a conspiracy is an involvement of two or more persons. The granting of pardon to one, on his statement and the stand of the prosecution, does not detract from the fact that they were accused in this matter for the offence of money laundering," the Court said."The fact that other co accused was not an accused in other FIRs does not mean that he cannot be an accused in the present matter since both IPC and PMLA are different statutes to deal with different kinds of offences and both operate in their own spheres," the Court made it clear. ."The predicate offence and the predicate case is required for initiation of complaint by the Directorate of Enforcement, which then has to investigate into the aspect of money laundering which is in its domain," the Court said..Regarding the argument that the accused can be dealt with by the GST Act, and not PMLA, the Court said that merely because the accused can be dealt with by the GST Act does not mean that he cannot be prosecuted under PMLA if the ingredients of the PMLA are made out..In view of the above, the Court dismissed his bail application..Petitioner was represented by Advocate Rizwan.Directorate of Enforcement was represented by Special Public Prosecutor NK Matta..[Read Order]