The background of P. Chidambram:
P.Chidambram is a Senior Advocate practicing in the Hon’ble Supreme Court of India with 49 years of standing at the Bar, of which 35 years as a Senior Advocate. Currently, he is Member of Parliament (RS). He was formerly Union Minister of Finance (1996-1998, 2004-2008 and 2012-2014) and Union Minister of Home Affairs (2008-2012). He is a member of the Indian National Congress, which is the principal Opposition Party in Parliament, and has been in public life for over 40years. The Petitioner is also a senior Spokesperson of the Congress Party as well as a prominent and widely-read columnist.
The allegations against P. Chidmbram:
It is alleged that during the period from 15.11.2016 to 19.11.2016 huge cash to the tune of Rs. 31.75 crores was deposited in eight bank accounts in Kotak Mahindra Bank in the accounts of “group of companies”. The statements recorded during investigation have evidentiary value under Section 50 PMLA. Prima facie, the version given by them is in consonance with the prosecution case.
The stated activity allegedly indulged into by the accused named in the commission of predicate offence is replete with mens rea. In that, the concealment,possession, acquisition or use of the property by projecting or claiming it as untainted property and converting the same by bank drafts, would certainly come within the sweep of criminal activity relating to a scheduled offence. That would come within the meaning of Section 3 and punishable under Section 4 of the Act.
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. The purpose of scheduling the offences under the PMLA appears to be to enlist the various crimes through which the proceeds of crime may be generated.
The Respondent ED is not investigating the Scheduled offences but the offence of Money Laundering which is a distinct/separate offence committed after the commission of scheduled offence and is continuing to be committed even now.
The offence of money laundering is a continuing offence, inasmuch as, by its very definition, the offence continues as long as accused is in possession, acquisition of the ill gotten wealth since the projection is not one time offence and continues till such time person is in possession of ill gotten wealth. Thus the time of its generation is of no consequence but the possession, acquisition and its projection as untainted is as long as the projection as untainted continues, the offence will continue and cannot be said to have been applied retrospectively. The investigation under PMLA after the year 2009 would not be treated as applying the Act retrospectively for the reason of ill gotten wealth being generated prior to the amendment coming into force because accused at the time of investigation under PMLA was in possession, acquisition and projecting such proceeds of crime as untainted. (relying upon Hari Narayan Rai vs.The Union of India (UOI) through Directorate of Enforcement:2010SCC ONLINE (JHAR) 1066.)
Why bail is denied to Chidmbram:
At this stage, when complaint is almost ready to be filed, there is no chance to influence any witnesses.
As alleged, during investigation, it is revealed that layering of proceeds of crime by use of web of shell companies most of which are in abroad, which companies are only on paper, having no business and used only for laundering of proceeds of crime. There is cogent evidence collected so far that these shell companies are incorporated by persons who can be shown to be closed and connected with the petitioner and his co-conspirators/co-accused all of whom are acting in tandem with each other. The proceeds of crime are thereafter routed through the web of shell companies so incorporated for the purpose of laundering of proceeds of crime and the movement of such proceeds of crime from one company to another company (all of which are not doing any business and exist only on paper), just to make tracing of money trail difficult. The said companies are incorporated and located in different countries so that it become difficult for the law enforcing agencies to follow the trail of money laundering.
The investing agency has found out several such shell companies, 17 benami foreign bank accounts through which money is laundered and are invested in several properties out of which, 10expensive properties situated outside India have been identified so far. Several other shell companies,many more bank accounts and properties abroad have been identified on the basis of intelligence inputs which are received by the investigators working abroad under the PMLA and the investigation is still continuing.
The Economic offences in itself are considered to be the gravest offence against the society at large and hence are required to be treated differently in the matter of bail. The courts have successively held that a murder may be committed in the heat of moment upon passions being aroused. An economic offence is committed with cool calculation and deliberate design with an eye on personal profits regardless of the consequence to the community. A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the community in the system to administer justice in an evenhanded manner without fear of criticism from the quarters which view white collar crimes with a permissive eye, unmindful of the damage done to the national economy and national interest.
It is evident that not only the company had not rendered any services but had created fake invoices to camouflage proceeds of crime as receipt of payment in lieu of services
Keeping in view the discussion above, prima facie, allegations are serious in nature and the petitioner has played active and key role in the present case. It cannot be disputed that entire community is aggrieved if the economic offenders who ruin the economy of the State are not brought to book, as such offences affects the very fabric of democratic governance and probity in public life. No doubt, bail is right and Jail is exception, but,if bail is granted in such case, a wrong message goes to the public at large.