DELHI HIGH COURT REJECTS APPLICATION FOR GRANT OF POLICE CUSTODY OF RESPONDENT, AS POLICE FLOUTED THE PROCESS OF LAW

INTRODUCTION

A Single Judge Bench of the Hon’ble High Court, Delhi comprising of Justice Amit Sharma passed an Order dated 17.10.2023 in Directorate Of Enforcement Vs. Sh. Dev Inder Bhalla in CRL.REV.P. 246/2023 & CRL.M.A. 6428/2023 (stay) and held that the Respondent was produced before the Ld. Special Court in terms of Section 73(3) (Warrant may be directed to any person) of the Code of Criminal Procedure, 1973 (“Cr. PC”) and not under Section 19 of the Prevention of Money Laundering Act, 2002 (“PMLA”) (Power to Arrest) and further, the Police flouted other procedures established under law while arresting the Respondent. Hence, the High Court upheld the decision given by Ld. Special Court rejecting the Appellant’s Application for remand / police custody of the Respondent.

FACTS

1) An Enforcement Case Report numbered ECIR/09/DLZO/2016 was initiated by the Appellant, Directorate of Enforcement against 11 Accused persons including Sh. Dev Inder Bhalla, the Respondent herein, who was stated to be the Director of M/s Interdev Aviation Services Pvt. Ltd. Singapore.

2) It is the case of the Appellant that during the course of investigation in the aforesaid ECIR, summons was issued to the Respondent under Section 50(2) of PMLA (Powers of authorities regarding summons, production of documents and to give evidence, etc.) and Section 50(3) of PMLA (Powers of authorities regarding summons, production of documents and to give evidence, etc.) on various dates to join the investigation, however, the Respondent did not appear.

3) The Appellant filed an Application for open-ended bailable warrants against the Respondent and the same was issued by Mr. Naresh Kumar Malhotra, Special Judge, New Delhi (“Special Court”), vide Order dated 12.01.2018.

4) Further, it is the case of the Appellant that on completion of the investigation, a Complaint was filed against 11 persons including the Respondent under Section 44 of the PMLA (Offences triable by Special Courts) for the commission of offences under Section 3 /70 (Offence of money-laundering) (Offences by companies) punishable under Section 4 (Punishment for money-laundering) of the PMLA Act.

5) That, after filing of the said Complaint, summons was issued to 11 persons including the Respondent vide Order 19.03.2021 passed by the Ld. Special Judge (PC Act) of the District Court, New Delhi.

6) That, as per the records of the present case, the Respondent arrived in India at Netaji Subhash Chandra Bose International Airport, West Bengal on the night of 13.02.2023 at 23:15 hours. In view of the open-ended non-bailable warrants, a look-out Circular was in operation and the Respondent was detained at the said Airport. Subsequently, the said non-bailable warrants were executed by the Department on 14.02.2023 at 2100 hours. Thereafter, the Respondent was produced before the Ld. Special Court on 15.02.2023 and was sent to judicial custody.

7) Subsequently, on the same day, an Application was moved by the Appellant seeking Police Custody of the Respondent.

8) The Ld. Special Judge via Order dated 16.02.2023 dismissed the Application and released the Respondent on interim bail.

9) Aggrieved by the Order dated 16.02.2023 of the Ld. Special Court, the Appellant filed REV.P. 246/2023 & CRL.M.A. 6428/2023 (stay) before the High Court of Delhi.

HIGH COURT ANALYSIS

The Hon’ble High Court vide Order dated 17.10.2023 made the following observations:

(i) The High Court after hearing both sides held that in the present case, the Complaint filed against the Respondent before the Special Court does not show him as an absconder. That, as per the scheme of the Code of Criminal Procedure, 1973 (Cr. PC), after issuance of warrants under Part B of Chapter VI of the said Code (Warrant of arrest), if the same are not executed, then the next step is “Proclamation of Attachment” as provided in Part C of Chapter VI.

(ii) In the present case, the non-bailable warrants issued on 12.01.2018 remained on the file of the investigating agency and no steps were taken to execute them. That, a perusal of the said non-bailable warrants reflected that the columns provided to enumerate the steps taken in furtherance of the said warrants are blank except that there is an endorsement that the warrants were executed and the Respondent was arrested on 14.02.2023 at 2100 Hours.

(iii) Further, the Hon’ble High Court opined that normally, warrants are issued by the concerned Court during the course of an investigation when an accused person is not available despite efforts, or after filing of the chargesheet, when the person who has been summoned by trial court, does not appear to face the trial.

(iv) That, another possible situation can be where warrants issued against a person during the course of investigation could not be executed and a chargesheet/complaint is filed with respect to the other accused persons and the person against whom warrants have been issued is shown as absconding. In Dawood Ibrahim Kaskar (supra), the Hon‘ble High Court was dealing with a similar situation where an application was moved on behalf of the Central Bureau of Investigation for the issuance of non-bailable warrants and publication of proclamation under Section 8(3)(a) of the Terrorist and Disruptive Activities (Prevention) Act, 1987 against the absconding accused named in the chargesheet. Further, in Dawood Ibrahim Kaskar (supra), the chargesheet was filed showing the said accused persons as absconders. It was in this factual backdrop of the aforesaid case that the Hon‘ble High Court held that if such a person is subsequently arrested and brought before Court, in a case where chargesheet has been filed and cognizance has been taken with respect to other accused persons, power to grant police custody of absconding accused can be exercised by the concerned Court under Section 167 of the Cr.PC (Procedure when investigation cannot be completed in twenty-four hours).

(v) The High Court held that in the present case, open-ended nonbailable warrants remained unexecuted till the Complaint was filed and cognizance was taken by the Ld. Special Court. Also, the said non-bailable warrants (“NBWs”) were never returned to the Ld. Special Court.

(vi) That, in the present Complaint, the Respondent is not being shown as an absconder. There is no mention of NBWs being issued, during the course of investigation, in the Complaint. The non-bailable warrants, technically, did remain in force but once the Respondent had been charge-sheeted without showing him as an absconder, the NBWs should not have been executed and rather should have been returned unexecuted before the Ld. Special Court at the time of filing of the Complaint. Article 21 of the Constitution of India provides that no person shall be deprived of his life and personal liberty, except according to procedure established by law. It is further settled law that the procedure established by law should be just, fair, reasonable and not arbitrary.

(vii) That, the arrest of the Respondent in pursuance of the non-bailable warrants cannot be termed as just, fair and reasonable. Even if the Respondent was detained on the basis of a lookout circular in pursuance of the said non-bailable warrants, there was no compulsion for the Department to arrest the Respondent on the basis of the same.

(viii) Further, the Hon’ble High Court held that the Complaint unequivocally stated that the investigation pertaining to the named Respondent was still in progress. However, subsequent to the filing of this Complaint, no formal application had been submitted to the Ld. Special Court, seeking the issuance of non-bailable warrants in lieu of summons issued for the Respondent.

(ix) That, apart from averments made in paragraph 14 of the said Application seeking police custody that “having reached a very objective satisfaction that the arrest and interrogation of Sh. Dev Inder Bhalla is absolutely necessary as the accused is required to be confronted with the material/evidence against him and other known and unknown accused person”, there is no mention that the said arrest was made in pursuance of Section 19 of PMLA (“Power to Arrest”).

(x) The Hon’ble High Court relied on the principles culled out from the Judgments of Senthil Balaji v. State Represented by Deputy Director and Others, 2023 SCC OnLine SC 934 and Pankaj Bansal v. Union of Indian and Ors’ (2023INSC866) that when a person is arrested in exercise of powers under Section 19 of the PMLA, the provisions of Section 167 of the CrPC have to be complied with and “if Section 167 of the CrPC, 1973 is not applicable, then there is no role for the Magistrate either to remand or otherwise”.

(xi) The High Court further held that, it is admitted that upon completion of investigation, the Complaint was filed, in pursuance of which summons had been issued against the Respondent. If the unexecuted non-bailable warrants issued prior to the filing of the Complaint had been duly returned to the Court, the Petitioner could not have arrested the Respondent when only summons for appearance had been issued. The Appellant, after issuance of summons, in such a case, could not have arrested the Respondent unless warrants were issued by the Ld. Special Court on requisite grounds.

(xii) Further, the Respondent was produced before the Ld. Special Court in terms of Section 73(3) of the CrPC and not under Section 19 of the PMLA, as per their own Application.

(xiii) Applying the aforesaid principle to the present case, the Single Bench held that Ld. Special Court had rightly rejected the Appellant’s Application for remand / police custody of the Respondent at the present stage.

CONCLUSION

Thus, after considering all the facts and circumstances of the case, the Hon’ble High Court upheld the Order dated 16.02.2023 of the Ld. Special Court rejecting the Application for remand / police custody of the Respondent and thereby, dismissed the Appellant’s Petition. Further, the High Court directed that the Application for regular bail of the Respondent pending before the Ld. Special Court has to be decided as expeditiously as possible, in accordance with law.

 

Kartik Khandekar

Associate

The Indian Lawyer