Ba:r & Bench (,ench.com)images.assettype.com/barandbench/import/2019/08/P-Chidambaram... · p. chidambaram petitioner . versus . directorate of enforcement respondent . paper book

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

SPECIAL LEAVE PETITION (CRL.) NO. 7523 OF 2019

IN THE MATTER OF:

P. CHIDAMBARAM PETITIONER

VERSUS

DIRECTORATE OF ENFORCEMENT RESPONDENT

PAPER BOOK INDEX

SR. NO. PARTICULARS PAGES

1. REJOINDER ON BEHALF OF THE

PETITIONER TO THE SHORT COUNTER

AFFIDAVIT FILED BY THE RESPONDENT

ALONG WITH AFFIDAVIT IN SUPPORT

ADVOCATE FOR THE PETITIONER : MS. SHALLY BHASIN

Ba:r & Bench (www.barandb,ench.com)

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

SPECIAL LEAVE PETITION (CRL.) NO. 7523 OF 2019

IN THE MATTER OF:

P. CHIDAMBARAM PETITIONER

VERSUS

DIRECTORATE OF ENFORCEMENT RESPONDENT

REJOINDER ON BEHALF OF THE PETITIONER TO THE SHORT COUNTER AFFIDAVIT FILED BY THE RESPONDENT

To, THE HON’BLE CHIEF JUSTICE AND HIS COMPANION JUSTICES OF THE HON’BLE SUPREME COURT OF INDIA

THE HUMBLE REJOINDER ON BEHALF OF THE PETITIONER

MOST RESPECTFULLY SHEWETH:

1. That before dealing with the facts of the case and responding

to the averments made in the Counter Affidavit dated

25.08.2019 filed by the Respondents, the Petitioner seeks

liberty to place on record a very disturbing development. That

even before the Counter Affidavit dated 25.08.2019 was filed

before this Hon’ble Court, the same was leaked by the

Respondent ED to the media and the contents of the said

Counter Affidavit were widely reported in various news portals.

This has been done to prejudice the Petitioner and the present

proceedings.

2. That, the Petitioner submits on oath before this Hon’ble Court

and even at risk of facing perjury, if found to be not stating the

complete truth, that he has no account or any property abroad


much less 17 accounts and 10 properties, as alleged by the

Respondent ED. It is further submitted that each and every

asset owned by the Petitioner has been disclosed in statutory

filings and he has no asset other then the assets disclosed

therein.

3. It is submitted that this Hon’ble Court may direct the

Respondent to place on record, by way of an affidavit, details

of the alleged accounts and properties along with proof of his

ownership, before this Hon’ble Court so that the Deponent of

the said Counter Affidavit can be prosecuted for having made

false averments, if the contents of said Affidavit are ultimately

found to be false.

4. That, it is submitted that the Petitioner is a law abiding citizen,

who is not a flight risk and the Petitioner undertakes that he

shall be available for investigation on any time and day as

called by the Agency.

5. That the present Rejoinder is being filed to traverse and

contradict the averments and assertions made by the

Respondent in its Counter Affidavit dated 25.08.2019 filed in

the instant petition seeking leave to appeal against the final

judgment and order dated 20.08.2019 passed by the Ld. Single

Judge of the Hon’ble High Court of Delhi in Bail Application No.

1713 of 2018.

6. That before dilating into the facts of the case and dealing with

the averments made in the Counter Affidavit, it is most humbly


submitted that the present petition raises the following legal

issues for adjudication by this Hon’ble Court:-

a. That a specific assertion has been made in the Special

Leave Petition and argued during the course of hearing

on 23.08.2019 that paras 12 to 20 of the impugned

judgment are verbatim copy of the note titled “Grounds of

opposing anticipatory bail application in respect of Shri P.

Chidambaram” placed by the Respondent ED before the

Hon’ble High Court on or after conclusion of arguments

and judgment being reserved on 25.01.2019.

• This Hon’ble Court may kindly note that this

specific averment in the Special Leave petition has

not been denied and therefore should be deemed

to be admitted. Further, even during the course of

the hearing before this Hon’ble Court on

23.08.2019, the Ld. Solicitor General for India

stated that the said note was not submitted after,

but before after conclusion of arguments and

judgment being reserved on 25.01.2019.

Therefore, the Respondent cannot at this belated

stage deny placing the said note before the

Hon’ble High Court. It is submitted that the fact that

the reasoning in the impugned judgment is

verbatim copy of the note of the Respondent

shows that there was no application of mind much

less any appreciation of the facts and merits of the


case by the Hon’ble High Court while passing the

impugned judgment and only on this ground itself,

the impugned judgment is liable to be set aside.

Alternatively, the matter be remanded to the

Hon’ble High Court to de novo decide the petition

for anticipatory bail filed by the Petitioner.

b. That it has been specifically argued and brought to the

knowledge of this Hon’ble Court that the Respondent did

not file any Counter Affidavit before the Hon’ble High

Court traversing or contradicting the contents of the Bail

Application No. 1713 of 2018, in spite of the fact that the

respondent was afforded two opportunities, as reflected

in the orders dated 25.07.2019 and 01.08.2018. It is

respectfully submitted that even such a contention is not

traversed or controverted in the Counter Affidavit dated

25.08.2019.

c. It is most respectfully submitted that it is but obvious that

none of the contentions raised in the Counter Affidavit

under reply forms part of the records before the Hon’ble

High Court and thus cannot be raised at this stage and

ought to be eschewed from the present proceedings.

d. That the concept of handing over document or reports /

proceedings for investigation in a sealed envelope is a

concept alien to the statutory regime, as applicable in

India. It is submitted that the provisions of Section 172 of


the Code of Criminal Procedure, 1973 (hereinafter

referred to as the “Cr.P.C.”) apply to the cases

investigated under the provisions of the Prevention of

Money Laundering Act, 2002 (hereinafter referred to as

the “PMLA”) by virtue of Section 65 of the PMLA read

with Section 4 of the Cr.P.C. It is submitted that the

Directorate of Enforcement is bound to maintain a Case

Diary in compliance of Section 172 of the Cr.P.C. Thus,

it is submitted that the Directorate of Enforcement cannot

produce any document or any report for the perusal of

any court without maintaining a Case Diary. This Hon’ble

Court in the case of Ashok Munnilal Jain vs

Directorate of Enforcement (2008) 16 SCC 158, has

held as under:

“3. …..We may record that as per the provisions of

Section 4(2) CrPC, the procedure contained

therein applies in respect of special statutes as

well unless the applicability of the provisions is

expressly barred. Moreover, Sections 44 to 46 of

the PMLA Act specifically incorporate the

provisions of CrPC to the trials under the PMLA

Act. Thus, not only that there is no provision in the

PMLA Act excluding the applicability of CrPC, on

the contrary, provisions of CrPC are incorporated

by specific inclusion. Even Section 65 of the PMLA

Act itself settles the controversy beyond any doubt

in this behalf which reads as under:

“65. Code of Criminal Procedure, 1973 to apply.—

The provisions of the Code of Criminal Procedure,

1973 (2 of 1974) shall apply, insofar as they are


not inconsistent with the provisions of this Act, to

arrest, search and seizure, attachment,

confiscation, investigation, prosecution and all

other proceedings under this Act.”

4. We may also refer to the judgment of this Court in

Directorate of Enforcement v. Deepak Mahajan

[Directorate of Enforcement v. Deepak Mahajan,

(1994) 3 SCC 440 : 1994 SCC (Cri) 785] wherein

it was held as under: (SCC p. 480, para 136)

“136. In the result, we hold that sub-sections (1)

and (2) of Section 167 are squarely applicable with

regard to the production and detention of a person

arrested under the provisions of Section 35 of

FERA and Section 104 of the Customs Act and

that the Magistrate has jurisdiction under Section

167(2) to authorise detention of a person arrested

by any authorised officer of the Enforcement under

FERA and taken to the Magistrate in compliance

of Section 35(2) of FERA.”

• It is submitted that a bare perusal of the First

Information Report dated 15.05.2017 shows that

the period of the alleged offence is 2007-08 and

each and every action constituting the alleged

offence was committed in 2007-08. It is the stated

case of the Directorate of Enforcement even in the

ECIR that:

- Application for FIPB approval was made on

13.03.2007.

- The unit of FIPB prepared a note for

approval on 11.05.2007.


- The Board of FIPB held a meeting and

recommended the proposal/ approval on

18.05.2007.

- The Finance Minister ratified the decision of

the Board of FIPB on 28.05.2007.

- The investigating wing of the Income Tax

Department sought clarification from the

then Director, FIPB regarding such approval

on 25.02.2008 and 22.04.2008.

- The then Under Secretary sought

clarification/ information regarding excess

inflow of Rs. 263 crores approximately on

26.05.2008.

- That all the investments allegedly came in

INX Media in 2007-08.

- That the alleged payment of Rs. 10 lakhs to

M/s Advantage Strategic Consulting Private

Limited by INX Media was made on

15.07.2008.

- That FIPB sought fresh application for

downstream investment in INX News on

21.08.2008 and such an application was

made on the said date.


- That the then Additional Secretary on

22.09.2008 clarified that it is the percentage

of equity investment that is approved in

consonance with Press Note No. 7 (1999

series).

- That the aforesaid application was approved

by the Board of FIPB on 21.11.2008.

- That even as per the chart submitted along

with the note of the Directorate of

Enforcement, before the Hon’ble High

Court, and as reflected in Para 12 & 13 of

the Impugned Judgment, the last alleged

payment was allegedly in the year 2008.

- It is thus submitted that even as per the case

of the ED, there is no transaction and no

application or approval post 2008. It is thus

submitted that each and every action

constituting the alleged crime u/s 420 and

120B of the Indian Penal Code, 1860

(hereinafter referred to as the “IPC”) or

Section 13(1)(d) of the Prevention of

Corruption act, 1988 (hereinafter referred to

as the “PC Act”) was completed in the year

2008 itself and no action constituting any

crime has taken place post 2008.


- It is submitted that Section 420 and 120B of

the IPC and Section 13 of the PC Act were

not part of the scheduled offence of the

PMLA in 2008 and were only introduced by

a Notification dated 01.06.2009.

- It is submitted that there can never be a

retrospective operation of a criminal/ penal

statute and the test is not whether the

proceeds are retained by the person but the

test as laid down by the Constitution bench

of this Hon’ble Court is the test of “actions

constituting an offence”. The Constitution

Bench of this Hon’ble Court in the case of

Rao Shiv Bahadur Singh and another

verses The State of Vindhya Pradesh”

reported in “A.I.R 1953 SC 394” wherein this

Hon’ble Court held as under:-

“9.....It follows that if the appellants are able

to substantiate their contention that the acts

charged as offences in this case have

become such only by virtue of Ordinance 48

of 1949 which has admittedly been passed

subsequent to the commission thereof, then

they would be entitled to the benefit of Article

20 of the Constitution and to have their

convictions set aside....”


- It is submitted that the said judgment has

been followed by the Hon’ble High Court of

Hyderabad in “Tech Mahindra Limited

verses Joint Director, Directorate of

Enforcement and others” in Writ Petition

No.17525 of 2014 vide it’s judgment dated

22.12.2014, wherein the Hon’ble High Court

has held that when the alleged actions were

committed they were not scheduled offence

and hence prosecution under the PMLA is

not maintainable and even the Special

Leave Petition against the said judgment

has been dismissed.

e. It is submitted that there cannot be any reasons to

believe for being satisfied under Section 19 PMLA that

the Petitioner is required to be arrested for the following

reasons:-

A. That, admittedly, the Petitioner was summoned by

the Respondent on three occasions and he

appeared on each and every occasion and was

questioned for several hours;

B. That, the Petitioner was last questioned on

21.01.2019 and thereafter he has not been

summoned;


C. That, each and every objection raised and the

alleged material, oral or documentary sought to be

produced was available with the Respondent since

2017 but the Petitioner was never confronted with

the same;

D. That, bald averments that the Petitioner has been

trying to influence witnesses, which never formed

part of even the note before the Hon’ble High

Court, may kindly be rejected. It is submitted that

the law is settled that mere bald and vague

averments regarding influencing the witness or

having capacity to influence the witness or having

capability to tamper with evidence cannot be a

ground to reject the bail till the time cogent material

has been placed on record to show that the

accused has influenced the witness or tampered

with the evidence.

E. That, in any case there is no allegation of demand

by the Petitioner and even as per the case of the

prosecution, no monies have come into any known

accounts of the Petitioner.

REJOINDER TO PARAWISE REPLY

7. At the outset, it is submitted that the Counter Affidavit is nothing

but a compendium of self contradicting statements. The

contents of the Counter Affidavit are denied in toto and nothing


contained therein should be deemed to be admitted by the

Petitioner by reason of specific non traverse unless admitted

herein.

8. With reference to Para Nos.1 & 2 of the Counter Affidavit, it is

denied that the Respondent has any cogent reasons to arrest

the Petitioner and/ or to seek his custodial interrogation to

unearth the alleged wider and larger case of money laundering.

It is submitted that with reference to Paragraph 1 & 2 the

contention of the Petitioner is that the reasons as disclosed in

the order of the High Court for rejecting anticipatory bail cannot

be the basis for arresting the Accused u/s 19 of the PMLA. The

facts set out in Paragraphs 12 to 20 of the Order Impugned do

not connect the Petitioner with any alleged transaction nor is

there any disclosure of any wrong doing either directly or

indirectly by the Petitioner. The transactions as set out in

various charts are qua companies in which the Petitioner is

neither a shareholder nor a director, and the Petitioner has any

association of any nature with any of these companies. The

reasons to arrest must have been formed prior to the first

hearing before the High Court. Consequently, the only material

available was as reflected in the note handed over before the

High Court, which sets out the alleged transactions reflected in

Paragraphs 12 to 20, copy of which was handed over to the

Petitioner’s Counsel in Court.

9. It is submitted that in the present Counter Affidavit under reply,

the Respondent now seeks custodial interrogation to unearth a


wider and larger case of money laundering which is not a

reason stated in the High Court. Consequently, there cannot be

any strong prima facie case to deny pre- arrest bail, and/or

arrest the Petitioner especially in the light of the fact that at no

stage prior to today, any of the documents or transactions

referred to in Paragraphs 12 to 20 of the High Court have ever

been put to the Petitioner.

10. With reference to Para 3 and 4, it is submitted as under. The

averments in Paragraph 3 to the effect that it is neither proper,

possible nor desirable for the investigating agency to place the

evidence regarding serious offence of money laundering which

have emerged is an erroneous statement in law. Such

documents as are referred to as evidence can never be part of

a case diary. A reading of section 172 and 167 of the Code of

Criminal Procedure will indicate what a case diary contains.

Consequently the set of documents sought to be handed over

in sealed cover to the court can never be part of the case diary

and should never be looked at for the purpose of rejection of

anticipatory bail. There is nothing that prevents the Respondent

from interrogating the accused in respect of any documentary

evidence that is in the possession of the respondent while not

arresting him. The contention that the Petitioner should be in

custody for the purposes of confronting him with the

documentary evidence is completely misplaced in law. The

only reasonable way of dealing with this situation is to allow the

Petitioner to be interrogated by confronting him with the


documents relied upon by the Respondent and if the

interrogation reveals that because of the responses elicited

custodial interrogation is necessary then alone can the

Petitioner be arrested for that purposes. Notwithstanding and

without prejudice to what is set out above, the court may never

grant custody when all that is relied upon by the prosecution is

documentary evidence and where no recovery is to be affected.

Till date neither of the agencies have made any assertion that

the custody of the Petitioner is necessary on the ground that

some recovery is required to be made. It may further be

mentioned that the rational for seeking custody of the Petitioner

on the ground that he is to be confronted allegedly with some

documents as otherwise they will not be able to elicit responses

is in law misplaced. In effect, the same objective can be

achieved by summoning the Petitioner and confronting him with

the documents. The contention that custodial interrogation is

qualitatively different merely because the accused happens to

be in custody of the Respondent and such an averment

suggests that some coercive methods may be used by the

Respondent to elicit responses. In this context it may also be

stated that any response to a questionnaire is admissible as

evidence under Section 50 of the PMLA and can be used

against the Petitioner in a judicial proceeding, as per the case

of the Respondent. Consequently, it is even more hazardous to

allow custody since that would jeopardize the constitutional

right of the accused under Article 21 of the Constitution. Such


a procedure would not be fair and reasonable under Article 21

of the Constitution. It is therefore respectfully prayed that these

issues of far reaching importance be considered by this Hon’ble

Court in the context of the rights of an accused protected under

Article 21 of the Constitution and the free hand given to

agencies in an environment to elicit responses under custody

which can then be used against the Petitioner.

11. It is also unthinkable that an investigating agency in para 4 of

the Affidavit states that the Respondent seeks to “unearth a well

crafted scheme of money laundering devised by the Petitioner/

accused along with his close confidence and co-conspirators”.

This means that the Respondent has already come to the

conclusion that the alleged money laundering scheme has been

devised by the Petitioner. If the Respondent has already come

to this conclusion it would be mockery of the entire procedure

to ascertain the truth. It is further submitted that the placing of

material, without the same having been shown to the accused

during pre-arrest interrogation, and that also in a sealed

envelope, to satisfy this Hon’ble Court that the Petitioner

requires to be arrested and interrogated based on alleged

cogent evidence, both documentary as well as oral, is alien to

law and a procedure which does not satisfy the test of

reasonableness. It is denied that serious miscarriage of justice

will be caused if the Respondent is not permitted to arrest and

interrogate the Petitioner in custody for unearthing an alleged


well-crafted scheme of money laundering devised by the

Petitioner along with his close confidants and co-conspirators.

12. That the contents of Para 6 are false and hence denied. It is

submitted that the Respondent may be called upon to place on

record the names of the companies and the alleged co-

conspirators and not make bald and vague allegations. It is

submitted the term “Crucial Stage of Investigation” has been

used by the Respondent for last more than 2 years but till date

no complaint has been filed. It is submitted that the Petitioner is

not the beneficial owner or creator/ incorporator of any foreign

company.

13. In Para 6 of the Counter Affidavit it is alleged that the accused

by using his public office along with his close confidante and

co-conspirator clearly created a web of shell companies both in

India and other companies by routing/ layering and laundering

proceeds of time. This averment suggests that the Respondent

has already arrived at this conclusion that a web of shell

companies both in India and in other countries was created by

the Petitioner along with others. That being the case the

minimum that was required was for the Respondent to confront

the Petitioner with the alleged acts during the three occasions

when he was interrogated. It is clear from the counter affidavit

that the basis of such a conclusion was available with the

Respondent agency prior to his interrogation. Yet no such

question was put to the Petitioner either on 19.12.2018,

01.01.2019 and 21.01.2019. In any event, even after January


21, 2019 the Petitioner has never been called for interrogation

on any of the material that is already in possession of the

Respondent and has never been asked any question relating to

the averments made in this Counter Affidavit or even the

material placed on record before the High Court. The further

averment in paragraph 6 is that those persons who have

created such shell companies are also close to the Petitioner

and that the Respondent has substantial evidence to support

the aforesaid facts. That evidence of proximity should have

been put to the Petitioner at the time of interrogation since such

evidence is already in possession of the Respondent. The fact

that they have never put such substantial evidence of proximity

to the Petitioner at any stage shows that this is merely an

averment made to prejudice the Petitioner and the proceedings.

14. That the contents of para 7 are false and denied. It is submitted

that except making bald allegation, the said assertion is not

supported by any document. It is submitted that the

Respondent may be directed to produce the document by way

of an affidavit for the Petitioner to deal with the same. It is

alleged by the Respondent in Paragraph 7 that those who

incorporated the shell companies in India and abroad were in

touch with the Petitioner/ accused. This must be reflected in

some document which fact should be asked/ elicited from the

Petitioner.

15. That the Contents of para 8 are false and hence denied. It is

submitted that yet again a bald allegation is being made. It is


submitted that the Respondent be directed to place the name

and material on record to substantiate the said allegation. In

para 8 the Petitioner mentions that two individuals are found to

be acted as agents of the Petitioner/ accused, the minimum

expected of the interrogating agency is to ask the Petitioner

about those individuals who are alleged to have acted as an

agent of the Petitioner/ accused, but no such question was ever

been put to him to elicit the response. Again, these are wild

allegations made without any basis, without putting it to the

Petitioner, and in any event, none of this can be part of the case

diary.

16. The contents of para 9 & 10 are false and are denied. The

Respondent in para 9 & 10 alleges that the web of shell

companies are only on paper having no business and are used

for only for laundering proceeds. It is submitted that these shell

companies (these allegations are vague and bereft of any

details) have nothing to with the Petitioner. The allegation that

these alleged shell companies are incorporated by persons who

can be shown to be close to and connected to the Petitioner

and his co-conspirator is completely false and can be no basis

for seeking custodial interrogation The Petitioner may be

summoned and responses elicited. As far as the issue of

alleged money trail is concerned, though false, this can be

demonstrated from documents and does not require the

custodial interrogation of the Petitioner. it is unfortunate in the

last more than 2 years since the ED has been investigating this


case, at no point in time despite the Respondent claiming that

it has a wealth of ‘evidence’ in its possession has such

‘evidence’ ever been put to the accused/ Petitioner. All that is

claimed was available with the Respondent even prior to

December 19, 2018

17. With respect to Para 11 to 13 the Petitioner denies any

connection with the alleged allegations made in the paragraph

in the same terms as set out in the above stated paragraphs.

The specific case of the Petitioner is that there is no occasion

for the Respondent to seek custodial interrogation especially

when the Respondent has already allegedly collected

substantial material in its possession. That itself should be

enough for the Respondent to file a complaint. If however, the

Respondent is unsure of whatever is stated here then the only

reasonable procedure is for the Respondent to summon the

Petitioner and elicit responses on the basis of the alleged

substantial material that has been collected by the Respondent.

There is no correlation between collection of alleged substantial

material by the Respondent and its natural corollary that the

Petitioner must be arrested. If the material is sufficient to

implicate the Petitioner a complaint should be filed; if it is not

enough to implicate the Petitioner he should be summoned and

responses elicited. Since in such cases there is no question of

any recovery to be made, the question of custodial interrogation

does not arise. And if for any reason the Respondent claims

that the responses of the Petitioner is evasive that should be


demonstrated to the Court, but bald allegations of this nature

are only intended to prejudice the Petitioner and the instant

proceedings. The malice of black money and its laundering

must certainly be dealt with at all levels and there are lots of

people in public life who need to be dealt with an even hand.

This does not mean that the Respondent targets individuals,

violates due procedure of law, and make an averment that it is

performing a public duty when in fact according to the

Petitioner, the Respondent is proceeding malafide against the

Petitioner, targeting him when he has publically stated that he

has no asset other than what is disclosed by him in his returns

both to the income tax authorities and in his filings before the

Election Commission, which is required under law, and what is

disclosed by him as a Member of Parliament either in the Lok

Sabha or Rajya Sabha from time to time. It is unfortunate that

despite this public statement wild allegations are being made to

destroy the reputation of the Petitioner even before a complaint

is lodged by the ED. As far as alleged benami bank accounts

are concerned, unless the Respondent is able to establish

through documentary evidence the link of the Petitioner with

any account of benami such an allegations should not be made.

In any case all this can be proved by documents and do not

require the custodial interrogation of the Petitioner.

18. It is surprising that in para 13 the Respondent states that the

relationship of the Petitioner accused with co-conspirator can

be pointed out to this Hon’ble Court from the investigation


papers when such a question can easily be put to the Petitioner

during the course of examination, in which event the Petitioner

would have clarified the facts and responded to the allegations.

It is not understood how such averments can be part of any

case diary. All that is set out in previous paragraphs are

incriminating statements sought to be made the basis of

conclusion without ever asking the Petitioner about any of the

alleged incriminating material. In any event, in the entire

counter affidavit there is no reference to any transactions in

relation to INX which also shows that the nature of averments

have nothing to do with the transactions alleged in the FIR/

ECIR.

19. That the contents of para 13 are wrong and hence denied. That

the assertion is bereft of any particulars. It is submitted that the

Petitioner has no benami bank account, properties and

holdings, directly or indirectly, in any shell companies. It is

submitted that the Respondent is put to strict proof thereof.

20. That the contents of para 14 are false and hence denied. That,

the Petitioner, at the cost of repetition, submits that the

Petitioner has no foreign bank account and does not own any

property abroad. It is submitted that the allegation regarding 17

bank accounts and 10 properties abroad is denied. It is

submitted that each and every asset owned by the Petitioner

has been disclosed in his statutory filings before Competent

Authorities.


21. With reference to Para 14 & 15 it is again reiterated that

allegation of 17 benami Foreign Bank Accounts has come for

the first time in these proceedings. The allegation regarding ten

expensive properties situated outside India, other shell

companies, more bank accounts and properties abroad

allegedly identified by the Investigating Agency have been

averred for first time in this counter affidavit. All this has never

been put to the Petitioner in any form. Such averments cannot

be treated as facts and if they cannot be treated as facts, no

inference can be drawn on the basis of these alleged

averments. Such allegations according to the Respondent form

part of the case diary. However, it is submitted that such

allegations can never form part of the case diary and cannot

ever be looked at by the Court for adjudication of bail. If these

allegations are genuine, the same would eventually form part of

the complaint. However, the fair procedure would have been for

Respondent to elicit a response from the Petitioner during the

questioning on the aforesaid three days or thereafter. The

allegation that the Petitioner was evasive and non cooperative

on 19.12.2018, 07.01.2019, 21.01.2019 assumes that such

material was put to the Petitioner. The Petitioner is moving a

separate application before this Hon’ble Court to request for the

respondent to place before it the questions asked of the

Petitioner on these dates and the responses elicited from him.

This will prove that the statement here is far removed from the

truth. Had any answers of the Petitioner been evasive in terms


of Section 172 the investigating officer would have incorporated

it in his daily diary. The Respondent should be asked to produce

before this Hon’ble Court the daily diary wherein the

investigating officer has recorded that the answers of the

Petitioner have been found by him to be evasive and the

reasons thereof.

22. The allegation that the investigating agency has cogent

evidence qua the accused directly as well as indirectly indulging

and /or knowing assisting and become a party in the process/

activity connected with proceeds of crime is vehemently denied.

23. That, it is submitted that a statement of the Petitioner was

recorded by the Investigating Officer on the aforesaid three

dates. That, this Hon’ble Court may call for the said statements

and peruse the same so as be satisfied that the investigation is

being conducted in a free and fair manner or whether the same

is being stage monitored by the political dispensation.

24. That, the contents of para 16 are matter of record and does not

relate to the Petitioner and hence requires no comment from

the Petitioner.

25. As far as paragraph 17 is concerned the allegations made

therein are rhetorical. The alleged case record which can only

be in the form of case diary cannot possibly contain the material

relied upon. The Court must appreciate that what is

incorporated in the case diary is the day to day recordings of

the investigating officer dealing with the steps taken by him in


the course of investigation. Any recovery of any documents

recovered by him, are never part of the case diary and only a

reference to them will be a part of the case diary. It is

respectfully submitted that none of this can be treated as

evidence since the term ‘ evidence’ has a definite meaning

under the Evidence Act and Section172 clearly states that

entries in case diary are not evidence in a court of law. On the

one hand the Respondent states that this is a statutory

investigation and believes that anything stated in the course of

investigation is evidence in the eyes of law. This is a complete

misapplication of accepted principles of law in the matter of

appreciating entries in the case diary.

26. As far as para 17 is concerned the Petitioner states that again

the Respondent has misapplied the law by suggesting that the

High Court has perused the official record of investigation and

some more evidence as if the alleged recorded investigation is

evidence. Indeed, the notes from paragraph 12 to 20 are

conclusions in respect of alleged facts stated therein and can

never be a part of case diary. Consequently, the High Court has

misapplied the law and rendered an order behind the back of

the Petitioner. The High Court therefore erroneously rejected

the prayer for anticipatory bail.

27. That the contents of para 18 are false and denied. In Para 18

the Respondent states that the Hon’ble High Court perused the

official record of investigation. The official record of

investigation if perused by the Hon’ble High Court, which was


not to the knowledge of the Petitioner, reflected in the

conclusion from para 12 to 20 of the impugned judgment, can

never be part of any case diary. These are conclusions arrived

at by the Respondent and submitted as part of a note in

opposition as stated earlier. It is interesting to note that the

Hon’ble High Court states that it has perused the case diary and

has looked at the material on record, however, the case diary

and the material on record cannot possibly be what is set out in

paragraph 12 to 20, which is the basis of the order of the

Hon’ble High Court in rejecting anticipatory bail. The

respondent itself in paragraph 18 of the Counter Affidavit

considers what is set out from paras 12 to 20 of the impugned

judgment as evidence. Since, the Respondent states that after

the High Court perused the official record some more evidence

has come to light. Obviously, therefore, what is set out in paras

12 to 20 of the impugned judgment has nothing to do with any

case diary. The Hon’ble High Court misdirected itself and its

refusal to grant anticipatory bail was erroneous.

28. That, the contents of para 19 are false and hence denied. For

the first time in paragraph 19 the Respondent now alleges that

the Petitioner is trying to tamper and destroy evidence and is

also trying to influence witnesses. It is unfortunate that this

averment is made for the first time at this stage, without any

basis or material. No such allegation was made during the

course of proceedings before the Hon’ble High Court. This is a

clear afterthought and if this was so, the Respondent must


place on record the details thereof since this is not part of any

case diary. These allegations are only made to prejudice the

Petitioner and the proceedings. It is false to allege that the

Petitioner has anything to do with any shareholding pattern with

any company and has made any changes as to Directors of any

company. The Petitioner has never opened and operated any

bank account abroad. The allegation qua the co-conspirator of

allegedly opening an bank account of shell company has

nothing to do with the Petitioner. The Petitioner is not involved

directly, indirectly or in any way to the sale of property

purchased out of laundered money by one shell company to

another shell company. These allegations are false. It is denied

that the Petitioner has in any way influenced any witnesses or

has attempted or has made attempts to falsify or tamper with

documents. It is shocking that such an averment is made

without any basis. All this should have been put to the Petitioner

in the course of interrogation. These false statements are

meant only to prejudice the Petitioner and the proceedings.

29. That the contents of 20 are wrong and hence denied. As far as

Para 20 to 29 are concerned the conscious of this Hon’ble Court

can be satisfied if the statement of the Petitioner recorded is

directed to be placed before this Hon’ble Court which would

show each and every question asked of the Petitioner and

responses given. The same would amply demonstrate that

none of the averments in the Counter Affidavit have any basis

whatsoever, since no question in regard to any of the


allegations made therein have been ever put to the Petitioner.

The Petitioner does not deny the right of the Respondent to

arrest an accused but the process of arresting an accused must

be consistent with Article 21 of Constitution. The fact that the

PMLA is a salutary legislation has no relevance to the facts and

circumstances of the present case. Circumstances in the

instant case, suggest, that the Respondent is persecuting the

Petitioner and is not dealing to the Petitioner fairly and

reasonably. It is denied that the Petitioner is involved in

laundering of any money as alleged in para 22 and that the

Petitioner in any way directly or indirectly or in any other manner

has anything to do with laundering proceeds of crime and is a

beneficiary of such proceeds. This argument has no substance.

30. That, the contents of para 21 are wrong and denied. It is

submitted that intent and salutary legislation is no ground to

curtail judicial review especially when it relates to the liberty of

a citizen.

31. The Petitioner is not claiming that because of parity with any

other accused the Petitioner should be granted anticipatory bail.

The Petitioner has merely stated before the Court the status of

all the other accused in the case. Allegations that the Petitioner

has anything to do with alleged valuable property and bank

accounts in the company set out in para 28 are vehemently

denied. It is unbelievable that the Financial Intelligence Unit has

specific inputs of Petitioner having anything to do with the

alleged investment to shell companies in the countries


mentioned. This is yet another allegation made without basis

merely to prejudice the Petitioner and the proceedings.

32. That the contents of para 29 are wrong and hence denied. That,

at the cost of repetition, it is submitted that the Petitioner has no

accounts/ valuable properties in Argentina, Austria, British

Virginia Island, France, Greece, Malaysia, Monaco, Philippines,

Singapore, South Africa, Spain and Sri Lanka, as alleged or

otherwise. It is submitted that each and every averment made

in the para under reply is false and false to the knowledge of

the Deponent of the Counter Affidavit.

33. In view of the above facts and circumstances, it is most humbly

prayed that this Hon’ble Court may be pleased to grant special

leave to appeal against the impugned judgment dated

20.08.2019 passed by the Ld. Single judge of the Hon’ble High

Court of Delhi in Bail Application no. 1713 of 2018 and may be

further pleased to set aside the impugned order and while

reposing faith in the Petitioner, be pleased to grant the

Petitioner the benefit of pre-arrest bail on such terms and

conditions as this Hon’ble Court may deem fit and proper in the

facts and circumstances of the present case.

Filed by

Ms. Shally Bhasin

Advocate for the Petitioner


Ba:r & Bench (,ench.com)images.assettype.com/barandbench/import/2019/08/P-Chidambaram... · p. chidambaram petitioner . versus . directorate of enforcement respondent . paper book

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