Vijay Mallya, Nirav Modi, Mehul Choksi fled due to agencies' delay: Court

Mumbai: A Special PMLA Court recently highlighted the failures of investigative agencies in arresting high-profile economic offenders such as Nirav Modi, Vijay Mallya, and Mehul Choksi, allowing them to flee the country. Special Judge MG Deshpande made these remarks on May 29, 2024, while addressing objections raised by the Enforcement Directorate (ED) to an application filed by accused Vyomesh Shah seeking permission to travel abroad.

The court noted that these individuals managed to escape due to the investigative agencies’ failure to arrest them promptly. Judge Deshpande emphasized that the ED often does not arrest accused persons under Section 19 of the Prevention of Money Laundering Act (PMLA) and then expects the court to prevent them from travelling abroad.

“It is simply because it is the ED who allows such a person to be scot-free without any apprehensions of his travelling abroad, tampering and hampering evidence, flight risk, apprehension of dealing with POC and assisting the said process etc. But for the first time when such a person appears before the Court all such contentions and objections astonishingly crop up before the Court. So, this Court has repeatedly taken a firm stand that, the Court cannot do what the ED failed to do,” remarked Judge Deshpande.

The court granted permission to Vyomesh Shah, the Managing Director of Hub Town Ltd., to travel abroad until the conclusion of the trial in his money laundering case. Shah's application sought the deletion of a bail condition restricting his travel. The ED opposed the application, citing risks of evidence tampering and flight.

Shah's defence referred to the recent Supreme Court judgment in Tarsem Lal v. Directorate of Enforcement Jalandhar Zonal Office, arguing that Shah’s business responsibilities required frequent international travel. The court noted that the ED had previously failed to arrest Shah under Section 19, merely issuing a summons, and only raised objections when he appeared in court.

Judge Deshpande emphasized that the court cannot impose conditions on individuals who have not been arrested under Section 19 and appear in response to a summons. The court reaffirmed its consistent stance that such individuals should be released on a personal bond under Section 88 of the CrPC, rather than being taken into judicial custody.

The court criticized the ED's objections as legally impermissible, noting that if the agency was concerned about flight risks, it should have arrested Shah under Section 19. The court underscored that the case of Vyomesh Shah, who voluntarily appeared before the court, cannot be equated with those of Nirav Modi, Vijay Mallya, and Mehul Choksi.

Highlighting the frequent travel required by many accused in ED cases, the court acknowledged the hardship of repeatedly seeking travel permission. To address this, the court modified its previous order, allowing Shah to travel abroad with additional conditions to safeguard against ED's concerns. These conditions include informing the ED of travel schedules, maintaining any cash security previously deposited, undertaking to appear in court for every date or filing an exemption application, and ensuring that the trial's progress is not affected by his absence.

The court concluded that its order should not hinder the liberty and fundamental rights of the accused, thereby permitting Vyomesh Shah to continue his professional travel without undue restrictions.