‘New excise policy was made to suit other co-accused who were to pay kickbacks to applicant’: Delhi HC rejects bail plea of AAP MP Sanjay Singh in Excise Policy Scam
Justice SwaranaKanta Sharma [07-02-2024]

Read Order: SANJAY SINGH v. DIRECTORATE OF ENFORCEMENT

Tulip Kanth

New Delhi, February 9, 2024: In a case pertaining to Delhi excise policy and liquor scam where an ECIR was registered under Sections 3 and 4 of the Prevention of Money Laundering Act, 2002 (PMLA) against Aam Aadmi Party leader Sanjay Singh, the Delhi High Court has rejected his application seeking grant of regular bail.

The factual background of the case was such that a case had been registered by the Directorate of Enforcement in relation to the predicate offence case registered by the Central Bureau of Investigation (CBI). In the year 2022, an FIR had been registered by the CBI for offences punishable under Section 120B read with Section 447A of the Indian Penal Code, 1860 and Section 7 of Prevention of Corruption Act, 1988, (PC Act) on the basis of a complaint made by the Lieutenant Governor, GNCTD and the directions of competent authority conveyed by Director, Ministry of Home Affairs (MHA), in relation to the irregularities committed in framing and implementation of excise policy of GNCTD for the year 2021-2022.

Three chargesheets had been filed before the Trial Court against a total of 16 accused persons. It was the case of CBI that while the excise policy of GNCTD was at the stage of formulation or drafting, the accused persons had hatched a criminal conspiracy, in furtherance of which some loopholes had intentionally been left or created in the policy, which were meant to be utilized or exploited later on. Further, huge amount of money was paid as kickbacks in advance to the public servants involved in the commission of alleged offences and in exchange of undue pecuniary benefits to the conspirators involved in the liquor trade.

As alleged, kickbacks of around Rs. 20-30 crores in advance were paid to accused Vijay Nair, Sh. Manish Sisodia and some other persons belonging to the ruling political party in Delhi, and the other public servants involved in conspiracy by some persons in the liquor business from South India and these kickbacks were found to have been returned back to them subsequently out of the profit margins of wholesalers holding L-l licenses and also through the credit notes issued by the L-l licensees to the retail zone licensees (L-7Z) related to the South liquor lobby.

It was further alleged that as a result of criminal conspiracy, a cartel was formed between three components of the said policy, i.e. liquor manufacturers, wholesalers and retailers, by violating provisions and the spirit of liquor policy, and all the conspirators had played an active role to achieve the illegal objectives of the said criminal conspiracy, result in huge losses to the Government exchequer and undue pecuniary benefits to the public servants and other accused involved in the said conspiracy.

The present applicant was remanded to custody of Directorate of Enforcement. Tthereafter, the present applicant was sent to judicial custody and is presently confined in Central Jail, Tihar, Delhi. His application for grant of regular bail was dismissed by the Sessions Court and this order had been impugned before the Delhi High Court.

The Single-Judge Bench of Justice SwaranaKanta Sharma observed that the statements of Harinder Singh Narula and E. Chandan Reddy prima facie supported Dinesh Arora's claim of receiving Rs. 4 crores in cash from Abhishek Boinpally, on Vijay Nair's instructions. Furthermore, it was alleged that out of this amount, Rs. 1 crore was paid to the present applicant Sanjay Singh, through his close associate Sarvesh Mishra.

The investigating agency had gathered additional evidence in the form of Call Detail Records and location charts of the mobile phone numbers belonging to witnesses Raman Chawla and Sarvesh Mishra. As per ED, these records indicated that at a specific point in time, both phone numbers were found under the nearest tower to the official residence of the present applicant, when one installment of Rs. 1 crore was allegedly delivered by Dinesh Arora, through his employee Raman Chawla, to the present applicant Sh. Sanjay Singh at his official residence, facilitated by his associate Sarvesh Mishra.

Prima facie, it was clear to the Bench that the present applicant was part of preparation of the old excise policy and thereafter, the new excise policy was made to suit the co-accusedwho were to pay kickbacks to the present applicant and co-accused and the party concerned, from the profit so generated due to excise policy drafted to suit them. There were specific statements that Rs. 2 crores were paid to Sarvesh Mishra for Sh. Sanjay Singh at his official residence in lieu of the new excise policy made to suit them and generate profit for them, Noting that the role at this stage of the applicant couldn’t be completely ruled out, the Bench opined that the specific allegations with time, place and manner when the meetings and conversations took place between Dinesh Arora, Vivek Tyagi, Sarvesh Mishra, Vijay Nair, Sh. Sisodia, Sh, Sanjay Singh etc. couldn’t be disregarded at this stage.

One of the primary arguments raised on behalf of the present applicant/accused Sanjay Singh was that he was not named in the FIR of the scheduled offence case of CBI, and he had not been charge- sheeted in the said case.The Bench relied upon the observation of the Sessions Courtthat it is not a prerequisite for an individual to be named as an accused in the scheduled offence case to establish his involvement in a money laundering case. Rather, it is essential that a scheduled offence must have been committed, and proceeds of crime in connection to that offence must have been generated to invoke the applicability of Section 3 of PMLA.

The Sessions Court also noted that while the registration of a case under PMLA necessitates the commission of a scheduled offence, it is not always mandatory for an individual accused of money laundering to also be an accused in the scheduled offence. The Bench concurred with the findings of the Sessions Court, as they aligned with the judicial precedents of the  Apex Court.

The Bench also considered the issue regarding the evidentiary value of statements of the approver Dinesh Arora, witnesses namely Raman Chawla, Harinder Singh Narula and E. Chandan Reddy, as well as co-accused Amit Arora and witness Ankit Gupta, are recorded under Section 50 of PMLA. Reliance was placed upon Rohit Tandon v. Directorate of Enforcement, [LQ/SC/2017/1644]whereby theApex Court has held that such statements are admissible in nature and can make out a formidable case about involvement of accused in the offence of money laundering.

Noting that the argument that the approver had disclosed the name of the present applicant under some threat without there being any complaint or retraction of statement by the approver was bound to be rejected, the Bench said, “This Court, therefore, notes that the sanctity attached to a statement recorded under Section 164 of Cr.P.C., now termed as a statement of the approver, cannot be thrown at the threshold or disregarded for the purpose of consideration as to whether there is material on record, which within the parameters of PMLA, will disentitle the accused to grant of bail when tested on the anvil of Section 45 of PMLA to pass the test of twin conditions for grant of bail.

“The principle of equality before the law is based on the notion that justice should be blind to factors such as fame, wealth, or social standing. At the same time, orders are not passed only at the asking of the State but through legal proceedings and outcomes are determined solely based on the merits of the case and the application of relevant laws, without favouritism or discrimination”, the Bench further held while declining the bail petition. The Trial Court has also been asked to expedite the trial in the present case.