Shakti Bhog bank fraud: Delhi High Court grants bail to Raman Bhuraria in money laundering case

The Delhi High Court recently granted regular bail to Raman Bhuraria, the alleged mastermind in the money laundering case of ₹3269.42 crores related to Shakti Bhog Foods bank fraud. .In a detailed order pronounced on Wednesday, the Court noted that as many as five witnesses had retracted their statements. Single-judge Justice Jasmeet Singh said that retracted statements cannot form the basis of the guilt of the applicant and it is difficult to place the guilt of the offence under Prevention of Money Laundering Act (PMLA) on Bhuraria based on those statements.Justice Singh said that though the Enforcement Directorate (ED) accused the applicant of being the ‘mastermind’ of the fraud, it relied only on five documents to show his guilt.“The period of incarceration as well as the delay in investigation along with any reliable material which directly involved the Applicant justifies a prima facie release on bail. The only substantial evidence which is produced are the statements u/s 50 PMLA which too have been retracted,” the bench observed..Bhuraria was the internal auditor of Shakti Bhog Foods Limited (SBFL) and statutory auditor of several sister concerns of SBFL. The ED has alleged that it was through his aid and assistance that SBFL borrowed, layered and siphoned off the loan funds using the platform of about 24 known group companies and several shell entities.It was also alleged that he was directly involved in paper sale purchase transactions of SBFL without conducting any actual business transactions which resulted in inflation of their financials. It was on the strength of these audited but falsely inflated financials that SBFL was able to obtain loans from banks, the ED contended.The borrowed funds were then channelized through the bank accounts of several Shakti Bhog group entities which had provided a platform for changing the colour of the borrowed funds from liabilities to assets and then, for siphoning off the same by creating a web of complex transactions.Bhuraria was arrested in August 2021 and has remained in custody since then..In his order, Justice Singh recorded that the trial is yet to begin in the matter and the ED has listed 109 witnesses till date and the prosecution complaint run into lakhs of pages in multiple trunks.“Without a completion of investigation, no charges can be framed nor can trial cannot begin. In the light of this, the court cannot let the applicant undergo long period of detention. If this court allows the continuing pre-trial incarceration, the same will amount to deprivation of personal liberty as well as travesty of justice as the same is equivalent to punishment without trial," the Court said. It was also observed that even though the allegations against Bhuraria were serious, but the chargesheet was yet to be filed.“Assuming that the applicant was the mastermind, the respondent (ED) did not name him in the original FIR. The applicant had conducted audit of the company and had certified the fictitious accounting entries in the books of accounts of the company to inflate financials of SBFL, even then during his entire custody he has been interrogated only on one occasion on 13.11.2021.”.The bench, therefore, ordered Bhuraria to be released on bail on the condition he furnishes a personal bond of ₹50,000 and a surety of the same amount..Advocates Arshdeep Singh Khurana, Ayush Agarwal and Harsh Mittal appeared for Bhuraria.Advocates Zoheb Hossain and Vivek Gurnani appeared for the ED. .[Read Order]