Calcutta High Court (Appellete Side)
Santanu Banerjee vs Enforcement Directorate on 26 November, 2024
Author: Suvra Ghosh
Bench: Suvra Ghosh
IN THE HIGH COURT AT CALCUTTA
CRIMINAL REVISIONAL JURISDICTION
APELLATE SIDE
The Hon'ble JUSTICE SUVRA GHOSH
C.R.M. (SB) 207 of 2023
Santanu Banerjee
v/s.
Enforcement Directorate
For the Petitioner: Mr. Debasish Roy, Adv,
Mr. Avik Ghatak, Adv.
Mr.Saibal Kr Dasgupta, Adv.
For the Enforcement Directorate: Mr. Phiroze Edulji, Adv.,
Ms. Anamika Pandey, Adv.
Judgment delivered on: 26-11-2024
SUVRA GHOSH, J. :-
1) Pursuant to an order passed by a Co-ordinate Bench of this Court in
W.P.A. 9979 of 2022 on 8th June, 2022, FIR was lodged under sections
7/7A/8 of The Prevention of Corruption Act, 1988 read with sections
120B/420/467/468/471/34 of the Indian Penal Code against one
Chandal Mondal @ Ranjan Mondal and other unknown persons. In course
of investigation it was revealed that in the Teachers Eligibility Test (TET-
2014) conducted by the West Bengal Board of Primary Education, the
accused persons therein were involved in illegal appointment of ineligible
candidates in lieu of extraneous consideration. Enforcement Case
Information Report (ECIR) was registered under section 4 of The
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Prevention of Money Laundering Act, 2002 (hereinafter referred to as the
Act of 2002) on 24th June, 2022. Prosecution complaint under section 44
read with section 45 of the Act of 2002 was filed on 19th September, 2022
against eight accused persons. The first supplementary prosecution
complaint was filed on 7th December, 2022 adding six new accused
besides the earlier eight persons. Search was conducted at the petitioner's
residential premises on 20th January, 2023, 25th January, 2023, 26th
January, 2023 and 27th January, 2023 and the petitioner was called for
interrogation by the Enforcement Directorate (in short the E.D.) on 10th
March, 2023 and was arrested on the same date. The second
supplementary complaint was filed on 21st March, 2023. The petitioner
was named in the third supplementary complaint filed on 8th May, 2023.
Charge sheet was submitted in connection with the predicate offence on
18th May, 2023 and provisional attachment order issued on 13th July,
2023. The fourth supplementary complaint was filed on 28th July, 2023.
2) Seeking bail of the petitioner, learned counsel for the petitioner has
canvassed his argument as hereunder:-
The petitioner is in custody since 10th March, 2023 and
investigation is still going on against twenty-five accused
persons including the petitioner. The E.D. has cited 167
witnesses, 182 statements and 210 documents which are
required to be examined by the learned Trial Court.
3) The petitioner has not been arraigned as an accused in the predicate
offence either in the First Information Report, or in the charge sheet and
supplementary charge sheet submitted by the CBI. Despite a direction
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given by an Hon'ble Division Bench of this Court in M.A.T. 1961 of 2023
and 1960 of 2023 on 5th October, 2023 directing the investigating agency
to conclude investigation within a stipulated time frame, investigation is
still going on and a fifth supplementary complaint is scheduled to be filed.
4) On searching the petitioner's house, list of non-recommended candidates
was found. It is stated in the fourth complaint that Sujoy Krishna Bhadra
gave Rs. 40,00,000/- to the petitioner for purchasing a flat in a building
which was under construction. The complaint records that statement of
one Tapas Kumar Mondal was recorded under section 50 of the 2002 Act
wherein he stated that he paid an amount of more than Rs. 19 crores to
Kuntal Ghosh on instruction of the petitioner for the purpose of illegal
appointment of candidates as teachers. The statement also records that
Tapas Kumar Mondal met the petitioner at the residence of Kuntal Ghosh
to discuss the matter of regularisation of the organized primary teachers.
Kuntal Ghosh stated before the E.D. that he paid an amount of more than
Rs. 1 crore in cash to the petitioner for the purpose which was collected
by him through Tapas Kumar Mondal. The complaint also states that the
petitioner was examined under section 50 of the Act and was unable to
provide the source of the properties purchased by him in the name of his
wife as well as firms/companies. He appears to be an employee of the
W.B.S.E.D.C.L. and earns around Rs. 2 to 6 lakhs per annum. The
property amassed by him is not commensurate with his income profile.
The allegation against him is that he indulged in the offence of money
laundering by way of generating the proceeds of crime.
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5) Even if the petitioner owns huge disproportionate wealth, it does not
amount to money laundering. Tapas Kumar Mondal who stands on a
graver footing than the petitioner has been granted bail by the E.D. No
allegation was levelled against the petitioner by Tapas Kumar Mondal or
Kuntal Ghosh in the CBI case though both the cases arose out of the
same alleged offences/incidents. There is no proof of any money trail to
substantiate that the petitioner is the recipient of any amount as alleged.
6) The petitioner was appointed to the post of Vice-President of West Bengal
Pradesh Trinamool Youth Congress in August 2020 and as
Karmadakshya of Hooghly Zilla Parishad in 2018, i.e., much after the
period when the scheduled offence pertaining to TET-2014 could have
been committed. TET-2014 examination was held on 11th October, 2015
and results were declared on 14th September, 2016. Therefore the
petitioner was not an influential person at the relevant time.
7) Though in his statement before the E.D. the petitioner has accepted that
he gave details of the admit card of one Rahul Dev Ghosh to Kuntal
Ghosh and the said candidate was selected for the post of primary
teacher, the petitioner also gave the details of his wife and sister-in-law
who were not selected. Much emphasis has been laid by the E.D. on the
statement of one Gunadhar Khanra who has not been named as an
accused or cited as a witness in the complaint. Therefore his statement
does not merit consideration. There is also no independent material to
prove that the petitioner has any nexus whatsoever with the prime
accused persons of the case. In course of investigation of the offence of
money laundering, it is beyond the domain of the E.D. to hold that
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predicate offences were in fact committed. Since the CBI has no allegation
against the petitioner, the E.D. cannot claim that the petitioner is guilty of
generation of proceeds of crime in connection with the predicate offence.
The amount received from Sujoy Krishna Bhadra to the tune of Rs.
40,00,000/- was an advance for booking a flat which was to be
constructed by D.I.P. developers, a firm under indirect control of the
petitioner. The entire allegation against the petitioner stands on the
statements of co-accused Kuntal Ghosh and Tapas Kumar Mondal which
cannot be safely relied upon. The petitioner stands on a much better
footing than Tapas Kumar Mondal who is on bail. The petitioner seeks
bail on merit as well as on the ground of prolonged incarceration.
8) Learned counsel for the petitioner has placed reliance on the following
authorities in support of his contention:-
1.
Dr. lakhwinder Singh v/s. Directorate of Enforcement, Government
of India reported in 2022 SCC OnLine HP 6166
2. Manish Sisodia v/s. Central Bureau of Investigation reported in
2023 SCC OnLine SC 1393
3. Prakash Industries Ltd. v/s. Union of India and Anr. reported in
(2023) 1 High Court Cases (Del) 399
4. Vijay Madanlal Choudhary & Ors. v/s. Union of India & Ors.
reported in 2022 SCC OnLine SC 929
5. Pankaj Bansal v/s. Union of India & Ors. reported in 2023 SCC
OnLine SC 1244
6. Santosh v/s. State of Maharashtra reported in (2017) 9 Supreme
Court Cases 714
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7. S Martin v/s. Directorate of Enforcement reported in Special Leave
to Appeal (Crl.) No. 4768/2024
8. M/S Bharathi Cement Corporation Private Limited v/s. The
Directorate of Enforcement & Ors. reported in Criminal Revision
Case No. 87 of 2021
9. Sanjay Jain v/s. Enforcement Directorate reported in 2024 SCC
OnLine Del 1656
10. Chandra Prakash Khandelwal v/s. Directorate Enforcement
reported in 2023 SCC OnLine Del 1094
11. Ajay Kumar Chandraprakash Baheti v/s. Directorate of
Enforcement reported in 2022 SCC OnLine Bom 1451
12. P. Chidambaram v/s. Directorate of Enforcement (2020) 13
Supreme Court Cases 791
13. Vijay Agrawal v/s. Directorate of Enforcement reported in (2023) 2
High Court Cases (Del) 651
14. Manish Sisodia v/s. Directorate of Enforcement reported in 2024
SCC OnLine SC 1920
15. Manik Bhattacharya v/s. Enforcement Directorate reported in
C.R.M (SB) 72 of 2024
16. Prem Prakash v/s. State (NCT of Delhi) reported in 2024 SCC
OnLine SC 2270
17. Ramkripal Meena v/s. Director of Enforcement reported in Special
Leave to Appeal (Crl.) No (s). 3205/2024
18. Sheikh Javed Iqbal @ Ashfaq Ansari @ Javed Ansari v/s. State of
Uttar Pradesh reported in 2024 SCC OnLine SC 1755
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19. Javed Gulam Nabi Shaikh v/s. State of Maharashtra and Another
reported in 2024 SCC OnLine SC 1693
20. Vijay Nair v/s. Directorate of Enforcement reported in Special
Leave Petition (Criminal) Diary No (s.) 22137/2024
21. Kalvakuntla Kavitha v/s. Directorate of Enforcement reported in
2024 SCC OnLine SC 2269.
9) Speaking for the E.D. and vehemently opposing the prayer, learned
counsel has submitted that the petitioner being the former Vice-President
of the ruling party and an employee of W.B.S.E.D.C.L is an influential
person who is in a position to intimidate witnesses and tamper with
evidence. Referring to statement of witnesses under section 50 of the Act
of 2002, learned counsel has submitted that huge amount of money was
paid by Tapas Kumar Mondal and Kuntal Ghosh on instruction of the
petitioner who played an active role in the illegal appointments.
Immovable property worth Rs. 1,08,76,840/- and movable property/bank
deposits worth Rs. 47,94,610.32/- were recovered from the petitioner.
Upon conducting search in the residential premises of the petitioner,
several incriminating documents and digital evidence including a
handwritten list of 26 aspiring candidates of TET-2014 and upper primary
and a list of 346 candidates with TET roll numbers from different districts
of West Bengal were recovered and seized. Statement of the petitioner
recorded under section 50 of the 2002 Act reveals that these documents
were received in his office from the family members of the candidates
seeking illegal appointments. Proceeds of crime have been accumulated
by the petitioner from candidates who were recommended for
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appointment and also from those who were not recommended despite
shelling out substantial amount of money. The property accumulated by
the petitioner and his family members is not commensurate with his
income profile. The petitioner has indulged in the offence of money
laundering by generating proceeds of crime upon arranging for
appointment of ineligible candidates. Several companies were registered
by the petitioner in the name of his wife for laundering of funds which
were operated by the petitioner himself. A whatsapp chat sent to the
petitioner indicates that the sender demanded an amount of Rs.
1,39,00,000/- given to him in advance for appointment of relatives of the
sender through TET-2014. It was revealed during investigation that the
phone belonged to Gunadhar Khanra who has admitted payment of the
said amount in his statement recorded under section 50 of the 2002 Act.
10) Referring to section 24 of the Act, learned counsel has submitted that in
the present proceeding relating to proceeds of crime under this Act, it may
be presumed that the proceeds of crime are involved in money laundering
unless the contrary is proved. The petitioner having failed to prove the
contrary, it can be concluded that the petitioner is guilty of the offence of
money laundering. In view of the restrictions laid down under section 45
of the Act, the petitioner is not entitled to be released on bail.
11) Learned counsel has referred to the following authorities in support of his
contention.
1. Maru Ram Etc. vs. Union of India & Anr reported in 1981 SCR
(1)1196.
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2. Karan Singh vs. State of Haryana & Anr reported in 2013 (12) SCC
529.
3. Satyendar Kumar Jain vs. Enforcement Directorate reported in
2024 SCC OnLine SC 317.
4. Partha Chatterjee vs. Enforcement Directorate [CRM (SB) 180 of
2023].
5. Kuntal Ghosh vs. C.B.I. [C.R.M (DB) 681 of 2024].
6. Manish Sisodia vs. C.B.I reported in 2023 SCC OnLine SC 1393.
7. Tarun Kumar vs. Enforcement Directorate reported in 2023 SCC
OnLine SC 1486.
8. Vijay Madanlal Choudhary vs. Union of India reported in 2022
SCC OnLine SC 929.
9. State of Gujarat vs. Mohanlal Jitamalji Porwal reported in (1987) 2
SCC 364.
10. Y.S Jagan Mohan Reddy vs. C.B.I reported in (2013) 7 SCC 439.
11. Nimmagadda Prasad vs. C.B.I reported in (2013) 7 SCC 466.
12. Gautam Kundu vs. Directorate of Enforcement (Prevention of
Money-Laundering Act) reported in (2015) 16 SCC 1.
13. State of Bihar vs. Amit Kumar reported in (2017) 13 SCC 751.
14. Anil Kumar Yadav vs. State (NCT of Delhi) reported in (2018) 12
SCC 129.
15. Tofan Singh vs. State of T.N. reported in (2021) 4 SCC 1.
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16. Subires Bhattacharyya vs. C.B.I. reported in 2022 SCC OnLine
Cal 4307.
17. Anubrata Mondal vs. C.B.I, reported in 2023 SCC OnLine Cal 23.
18. Ranjitsing Brahmajeetsing Sharma vs. State of Maharashtra
reported in (2005) 5 SCC 294.
19. Union of India vs. Varinder Singh reported in (2018) 15 SCC 248.
20. Directorate of Enforcement vs. Aditya Tripathi reported in 2023
SCC OnLine SC 619.
21. Saumya Chaurasia vs. Enforcement Directorate reported in 2023
SCC OnLine SC 1674.
22. Pavana Dibbur vs. Enforcement Directorate reported in 2023 SCC
OnLine SC 1586.
12) In reply, learned counsel for the petitioner has submitted that though the
statement of Gunadhar Khanra has been relied upon heavily, he has not
been impleaded either as an accused or as a witness and as such, his
statement does not merit any consideration. No material has transpired
during investigation to substantiate the statements recorded under
section 50 of the Act. Allegations against the petitioner are primarily
based on statements of co-accused persons which are not admissible in
evidence.
13) I have considered the rival submission of the parties and material on
record.
14) The twin conditions laid down under section 45 of the Act which are
required to be satisfied by the petitioner for grant of bail are as follows:-
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(i) The public prosecutor should be given an opportunity to
oppose the application for release and ;
(ii) The Court is satisfied that there are reasonable grounds for
believing that he is not guilty of such offence and that he is
not likely to commit any offence while on bail.
15) Learned counsel for the petitioner has pointed out that the petitioner was
not arraigned as an accused in the predicate offence. The Hon’ble
Supreme Court, in the authority in Vijay Madanlal Choudhary and
Another (supra) has held that “the offence under section 3 of the 2002 Act
is dependent on illegal gain of property as a result of criminal activity
relating to a scheduled offence. It is concerning the process or activity
connected with such property, which constitutes the offence of money
laundering. The Authorities under the 2002 Act cannot prosecute any
person on notional basis or on the assumption that a scheduled offence
has been committed, unless it is so registered with the jurisdictional
police and/or pending enquiry/trial including by way of criminal
complaint before the competent forum.” Since the petitioner is admittedly
not an accused in the predicate offence, his further detention in the
present case is not warranted.
16) The factors which are to be borne in mind while considering an
application for bail as laid down by the Hon’ble Supreme Court in the
authority in Prosanta Kumar Sarkar v/s. Ashis Chatterjee and Another
reported in (2010) 14 Supreme Court Cases 496 are as hereunder:-
i) whether there is any prima facie or reasonable ground to
believe that the accused had committed the offence;
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ii) nature and gravity of the accusation;
iii) severity of the punishment in the event of conviction;
iv) danger of the accused absconding or fleeing, if released on
bail;
v) character, behaviour, means, position and standing of the
accused;
vi) likelihood of the offence being repeated;
vii) reasonable apprehension of the witnesses being influenced;
and
viii) danger, of course, of justice being thwarted by grant of bail.
17) The Hon’ble Supreme Court, in the authority in Vijay Madanlal
Choudhary (supra) has held as follows:-
“388. … The successive decisions of this Court dealing with analogous
provision have stated that the Court at the stage of considering the
application for grant of bail, is expected to consider the question from the
angle as to whether the accused was possessed of the requisite mens rea.
The Court is not required to record a positive finding that the accused had
not committed an offence under the Act. The Court ought to maintain a
delicate balance between a judgment of acquittal and conviction and an
order granting bail much before commencement of trial. The duty of the
Court at this stage is not to weigh the evidence meticulously but to arrive at
a finding on the basis of broad probabilities. Further, the Court is required
to record a finding as to the possibility of the accused committing a crime
which is an offence under the Act after grant of bail.” (emphasis supplied)
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18) Whether seizure of incriminating articles/documents from the petitioner’s
house and property, both movable and immovable, worth crores of rupees
allegedly acquired by the petitioner discloses an unbroken money trail,
i.e., generation of proceeds of crime which eventually leads to the
petitioner shall be decided in trial.
19) Section 24 of the Act of 2002 calls for a presumption that proceeds of
crime in any proceeding relating thereto are involved in money laundering
unless the contrary is proved by the person charged with offence. Such
presumption comes into play only when the E.D. establishes three
foundational facts:-
(i) that a criminal activity relating to a scheduled offence has been
committed;
(ii) that the property in question has been derived or obtained directly
or indirectly, by any person as a result of such criminal activity;
and
(iii) that the person concerned is directly or indirectly involved in any
process or activity connected with the said property which
constitutes proceeds of crime.
Therefore it is for the E.D. to establish these foundational facts after
which the onus shifts upon the petitioner to rebut the presumption
under section 24.
20) The allegations primarily rest on the statement of the co-accused recorded
under section 50 of the Act, the truth and veracity of which need to be
weighed during trial. The material collected by the E.D. prima facie
suggests that the petitioner was allegedly in liason with Manik
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Bhattacharyya and Kuntal Ghosh who were actively involved in the
offence. Both of them have been granted bail by this Court. The petitioner
is similarly circumstanced.
21) With regard to prolonged incarceration of the petitioner and delay in trial,
the petitioner has submitted that he is in custody since 10th March, 2023,
i.e., for about twenty months.
22) Section 479 of the Bharatiya Nagarik Suraksha Sanhita, 2023 as it
stands after amendment of section 436A of the Code of Criminal
Procedure spells out that the first time offender (who has never been
convicted for any offence in the past) shall be released on bond by the
Court if he has undergone detention for the period extending up to one-
third of the maximum period of imprisonment specified for such offence
under that law. The Hon’ble Supreme Court, in the order passed on 23rd
August, 2024 in writ petition (Civil) no. 406 of 2013 has made the
amended provision applicable to all under-trials in pending cases
irrespective of whether the case was registered against them before 1st
July, 2024 when the new legislation came into effect.
23) In the judgment in Manish Sisodia (supra), the Hon’ble Supreme Court
has held that the right to bail in cases of delay coupled with incarceration
for a long period should be read into section 439 of The Code of Criminal
Procedure and section 45 of the 2002 Act. The Hon’ble Court has referred
to the authority in Javed Gulam Nabi Shaikh v/s. State of Maharashtra
and another reported in 2024 Supreme Court Cases OnLine SC 1693
wherein the Hon’ble Court has dealt with the law laid down in the
judgments in Gudikanti Narasimhulu and others v/s. Public Prosecutor,
15
High Court of Andhra Pradesh reported in (1978) 1 Supreme Court Cases
240, Shri Gurbaksh Singh Sibbia and Others v/s. State of Punjab
reported in (1980) 2 Supreme Court Cases 565, Hussainara Khatoon and
Others (I) v/s. Home Secretary, State of Bihar reported in (1980) 1
Supreme Court Cases 81, Union of India v/s. K.A. Najeeb reported in
(2021) 3 Supreme Court Cases 713 and Satender Kumar Antil v/s.
Central Bureau of Investigation and Another reported in (2022) 10
Supreme Court Cases 51 and observed as follows:-
“If the State or any prosecuting agency including the Court
concerned has no wherewithal to provide or protect the fundamental right
of an accused to have a speedy trial as enshrined under Article 21 of the
Constitution then the State or any other prosecuting agency should not
oppose the plea for bail on the ground that the crime committed is
serious. Article 21 of the Constitution applies irrespective of the nature of
the crime.” The Hon’ble Court has also observed that the principle bail is
a rule and refusal is an exception is, at times, followed in breach and it is
high time that the trial Courts and the High Courts should recognize the
principle that bail is rule and jail is exception.
24) The Hon’ble Supreme Court has time and again held that prolonged
incarceration before being pronounced guilty of an offence should not be
permitted to become punishment without trial and in such a case Article
21 applies irrespective of the seriousness of the crime. The right to life
and personal liberty enshrined under Article 21 of the Constitution is
overarching and sacrosanct. A constitutional Court cannot be restrained
from granting bail to an accused on account of restrictive statutory
16provisions in a penal statute if it finds that the right of the accused-under
trial under Article 21 of the Constitution has been infringed. Even in the
case of interpretation of a penal statute, howsoever stringent it may be, a
constitutional Court has to lean in favour of constitutionalism and the
rule of law of which liberty is an intrinsic part.
25) With regard to the apprehension that the petitioner shall influence
witnesses or may abscond if released on bail, stringent conditions may be
imposed upon him to address the concern.
26) Section 4 of the Act of the 2002 provides for rigorous imprisonment for a
term which shall not be less than three years but which may extend to
seven years and also fine. According to the E.D., investigation qua the
petitioner is complete but charge is yet to be framed.
27) The petitioner cannot be held entirely responsible for the delay in trial.
The case involves 182 statements, 210 documents and 167 witnesses to
be examined in order to substantiate the charges levelled against twenty-
five accused persons including the petitioner. There is remote chance of
conclusion of trial in near future. Since the case primarily depends on
documentary evidence which is in custody of the E.D., there is no scope
for the petitioner to tamper with the same. The petitioner is little short of
completing one-third of the maximum period of imprisonment laid down
under section 479 of the 2023 Act.
28) It is not in dispute that he is a first-time offender and has not been
convicted of any offence earlier. Keeping in view the voluminous evidence
to be considered by the learned Trial Court, chance of conclusion of trial
within the time frame for incarceration during trial laid down in section
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479 is bleak. Rejecting the prayer of the petitioner at this stage and
granting him liberty to renew his prayer upon completion of the said time
frame shall serve no purpose at all. Article 21 of the Constitution and
section 479 of the 2023 Act read in harmony speak in favour of grant of
bail to the petitioner on the ground of prolonged detention without trial as
well as delay in trial.
29) In view of the above, this Court is inclined to release the petitioner on bail
subject to stringent conditions.
30) Accordingly, the application for bail being C.R.M. (S.B) 207 of 2023 is
allowed.
31) The petitioner be released on bail upon furnishing bond of Rs.
10,00,000/- (Rupees Ten lakhs) with adequate sureties, half of whom
should be local, subject to the following conditions:-
a. The petitioner shall surrender his passport with the
learned trial Court at once.
b. He shall not leave the territorial jurisdiction of the learned
trial Court without leave of the trial Court.
c. He shall appear before the learned trial Court on every
date of hearing fixed before the learned Court.
d. He shall not tamper with evidence or intimidate witnesses
in any manner whatsoever.
e. He shall not indulge in any criminal activity and shall not
communicate with or come in contact with the witnesses.
18f. He shall provide his mobile number before the learned
trial Court and shall not change the said number without
prior intimation to the Court.
32) In the event the petitioner violates any of the bail conditions as stated
above, the learned trial Court shall be at liberty to cancel his bail in
accordance with law without further reference to this Court.
33) It is made clear that the observation made in this judgment is for the
limited purpose of deciding the bail application and shall not be
construed as an expression of opinion on the merits of the case. The
learned trial Court shall deal with the matter independently in accordance
with law without being influenced by any observation which may have
been made in this judgment.
34) All parties shall act on the server copy of this judgment duly downloaded
from the official website of this Court.
35) Urgent certified website copies of this judgment, if applied for, be supplied
to the parties expeditiously on compliance with the usual formalities.
(Suvra Ghosh, J)