A special PMLA court in Mumbai while allowing bail to two accused in the Cox and Kings case has come down heavily on the Enforcement Directorate (ED) for keeping the duo as undertrial prisoners for 3 years and 6 months and both the accused are deemed to have been convicted without framing charges and without a legitimate trial.
The court was hearing the bail matter of Anil Khandelwal, the CFO and Naresh Jain, internal auditor, of Cox & Kings, in connection with the money laundering case linked to the group’s loan defaults amounting to ₹3,642 crore.
The ED registered the case in 2020, alleging that the Cox & Kings Group (CKG) had defaulted on loans borrowed from Yes Bank, by the bank’s former MD and CEO, Rana Kapoor, bypassing norms and it was further alleged that CKG promoter Ajay Ajit Peter Kerkar, with the assistance of Khandelwal and Jain, diverted the loan amount to other group companies by submitting forged balance sheets and board resolutions.
While granting bail to Khandelwal and Jain on Tuesday, special judge M G Deshpande said in a 29 page long order copy that the failure on the part of the ED to uphold the constitutional rights of citizens is glaring.
“This is the glaring reality at the grass-root level of the trial Court which is designated as Special Court under the PML Act. This complex and exceptional procedure provided for the trial of the PMLA case under the Prevention of Money Laundering Act, makes each and every trial of the PMLA case gigantic. Such complex procedure for trial is rarely found in any other Criminal Law and Statutes. As of today, technically both applicants have already undergone more than the period of the minimum sentence of 3 years under Section 4 of the PML Act. Hence, both of them are deemed to have been convicted without framing charges and without a legitimate trial, thus frustrating their right to be tried as expeditiously as possible,” the order said.
While getting tough on the ED, the court further observed that it was evident that the trial was never delayed at the behest of the applicants (Khandelwal and Jain), negating any grounds for denial of relief based on their conduct, as established in the first part of principle.
“Both of them are deemed to have been convicted without framing charges and without a legitimate trial, thus frustrating their right to be tried as expeditiously as possible. Even after such circumstances, the ED wants to keep them behind bars for an uncertain period by putting a clog and creating hurdle by filing a draft charge. Such modus operandi of the ED and the way they opposed bail applications on its basis raise serious concern. The ED, despite its duty and obligation under had not taken any steps even until 31.05.2023 and wasted near about 2 years, 7 months, and 26 days from the date of arrest of both applicants. Abundantly clear that as of today, both applicants (Khandelwal and Jain), have undergone 6 months more than the minimum sentence period (3 years) provided for the offense alleged against them, without framing charges and without trial, which is very serious,” the order copy reads.
The court observed that such modus-operandi of the ED and the way they opposed bail applications on its basis raise serious concerns.
“Instead of doing so and taking proper steps as per Sec.44(1)(c), the ED knowingly obstructed the path of applicants (Khandelwal and Jain), by putting a clog of “draft charge” creating hurdles, who were attempting to exercise their fundamental rights.
Considering their prolonged incarceration without trial, there is no justification for denying them the lesser relief of considering their prayer for release on bail, as stipulated in principle. The law, particularly Sec. 44(1)(c), never permits the ED to take such a long time of 2 years, 7 months and 26 days for taking steps at the cost of undue incarceration of both applicants by keeping them in jail for an uncertain period,” the order said.
The court further posed questions on the investigative agency and asked:
1) Can the ED blame the accused persons for their own (ED’s) mistakes?
2) Can the ED make the applicants (A3 and A4) remediless by pointing out the explanation to Sec. 436A of the Cr.P.C. and ignoring the direction given by the Hon’ble Supreme Court for claiming rejection of their applications?
3) Who, either the ED or the applicants, are responsible for the ED’s lapses?
4) Who is violating the fundamental rights of both undertrial applicants (A3 and A4) by not being tried expeditiously?
“Unfortunately, ED compelled me to note that rather than being fair with the true situation and facing their miserable failure,” special judge M G Deshpande said.