Delhi court expresses anguish over ED's 'casual and cavalier' approach in its probe

New Delhi: A Delhi court has expressed anguish over the casual and cavalier approach in which investigation was conducted by the Enforcement Directorate in a money laundering case.

Special Judge Dharmender Rana made these observations while granting bail to a businessman Jatinder Pal Singh in a case of money laundering related to an corruption deal, as it found various discrepancies in the investigation and the arguments made before the court.

Before proceeding to deal with the issue on merits, in pains, I must admit at the very outset that the conduct of ED in the instant matter is highly disappointing, if not deplorable as suggested by the defence.

"In its zeal to ensure the sustained detention of the applicant/accused, ED seems to have thrown out the baby with the water, the judge said.

According to the ED, Singh purchased cloth worth Rs 6.60 crore from Astonishing Pvt Ltd and sold it to Shree Shyam Dhani Trading Company, a proprietorship concern of one Sanjay Kumar, for Rs 12.23 crore.

ED claimed that both -- Astonishing Private Limited and Shree Shyam Dhani Trading Company - are sham companies and were not traceable.

In my considered opinion, the activities ascribable to accused are merely layering activities and accused appears to be a mere cog in the wheel, the judge said in the order passed on January 17.

He said that under such circumstances, the focus of investigation should in fact be the 'source of money' used to purchase the fabric, so as to decide the crucial issue as to if the money came from a tainted source or not.

However, unfortunately, instead of focusing upon the source of money, accused is the focus of investigation in the instant matter, the judge noted.

He further observed that having failed to detect the source of money and apprise the court if it came from a tainted source or not, ED, during the course of arguments, improved upon its own case and came up with an altogether different contention that the 'commission generated' by the accused on account of fabric shown to have sold off by them to Shree Shyam Dhani Trading Company was in fact the proceeds of crime in the instant case.

However, if the said contention is accepted to be correct and the proceeds of crime in the instant matter is admitted to be the commission generated, the very arrest of accused in the case at hand becomes seriously questionable, the judge said.

The court further noted that as per ED records while the knowledge about the generation of commission came into the notice of ED only on January 12, 2022, the permission to accused's arrest was accorded on December 30, 2021 and was made on December 31, 2021 itself.

A fact which came into the notice of ED on January 12, 2022 only could obviously not have been a reason to grant permission to sanction the arrest of accused.

Therefore, it is apparent that either the source of money till date remains undetected or the contention now adopted by the ED regarding the proceeds of crime is merely an after thought and the arrest of the accused was absolutely unjustified on December 31, 2021, the judge held. The judge held that in either case, the accused deserved to

be admitted on bail.