Supreme Court Affirms ‘Bail As Rule, Jail As Exception’ In PMLA Cases, Grants Bail To CM Aide

In a recent legal development in Ranchi, the Jharkhand High Court had earlier rejected Prem Prakash's bail application on March 22, 2024, related to ECIR Case No. 5 of 2023. Prakash was seeking regular bail after being implicated by the Directorate of Enforcement (ED) under Sections 3 and 4 of the Prevention of Money Laundering Act (PMLA). The case is currently being heard by the Special Judge for PMLA matters in Ranchi.

 

Case Overview and Legal Context:

 

The investigation leading to ECIR No. 5 of 2023 began with FIR No. 399 of 2022, filed at Sadar Police Station on September 8, 2022. The FIR cited several offences under the Indian Penal Code (IPC), including criminal breach of trust (Section 406), cheating (Section 420), forgery (Sections 467 and 468), and criminal trespass (Section 447). Although Prem Prakash was not initially named as an accused in this FIR, subsequent investigations by the ED brought him into the spotlight, particularly concerning fraudulent land transactions.

 

At the heart of the allegations is a plot of land in Ranchi, where it's claimed that individuals, including Rajesh Rai and Imtiaz Ahmad, forged documents to acquire and sell the property illegally. Rajesh Rai, allegedly using a fake power of attorney, transferred the land to Punit Bhargava, a close associate of Prem Prakash, for around ?1.78 crore. Shortly after, the property was reportedly sold to another accused, Bishnu Kumar Agarwal, for a similar amount. The ED contends that the proceeds from these transactions were funneled into Jamini Enterprises, a company allegedly controlled by Prem Prakash.

 

Supreme Court's Deliberations and Decision:

 

The Supreme Court, with a bench comprising Justice B.R. Gavai and Justice K.V. Viswanathan, carefully examined the stringent bail conditions under Section 45 of the PMLA, which requires the prosecution to oppose bail and for the court to be convinced that the accused is not guilty and unlikely to re-offend if released. The bench focused on how these conditions should be applied, referencing the principles set out in the landmark case of Vijay Madanlal Choudhary vs. Union of India. Justice Viswanathan emphasized that while the PMLA is tough, it doesn't create an absolute bar on granting bail. He reaffirmed the legal principle that "bail is the rule and jail is the exception," stressing the constitutional right to personal liberty under Article 21 of the Indian Constitution.

 

Justice Viswanathan remarked:

 

"Liberty of the individual is always the rule, and deprivation is the exception. Deprivation can only occur through a procedure established by law, which must be both valid and reasonable. Section 45 of PMLA, by imposing twin conditions, does not overturn this principle to mean that deprivation is the norm and liberty is the exception."

 

Supreme Court's Observations:

 

The Supreme Court noted that, despite the serious nature of the allegations, the evidence presented did not conclusively prove Prem Prakash's direct involvement in either the initial offence or the alleged money laundering. The Court found substance in the argument that the charges were primarily based on statements from co-accused individuals, which are not sufficient without independent corroboration.

 

Furthermore, the Court expressed concern over the fact that Prem Prakash had already spent more than a year in custody, with the trial yet to commence. The Court highlighted the constitutional right to a speedy trial, emphasizing that prolonged pre-trial detention could effectively become a punishment without conviction.

 

Bail Conditions:

 

The Supreme Court ordered Prem Prakash's release on bail, subject to a personal bond of ?5 lakh and two sureties of the same amount. Additional conditions included the surrender of his passport and regular reporting to the investigating officer twice a week. The Court also sternly warned that Prem Prakash should not attempt to influence witnesses or tamper with evidence.

 

Legal Representation:

 

Prem Prakash was represented by Senior Advocate Mr. Ranjit Kumar, along with Mr. Indrajit Sinha and Mr. Siddharth Naidu. The Directorate of Enforcement was represented by Additional Solicitor General Mr. S.V. Raju, supported by Mr. Zoheb Hussain and Mr. Kanu Agarwal.