Bail order perverse, Kejriwal neck deep in money laundering: ED to HC

NEW DELHI: The Enforcement Directorate on Monday told the Delhi High Court that the trial court order granting bail to Chief Minister Arvind Kejriwal was based on "perverse" findings as it did not consider the material demonstrating his "neck deep involvement" in the offence of money laundering linked to the alleged excise scam.

In a written note filed in relation to its plea seeking a stay on the trial court’s decision, the agency contended the order suffers from a "jurisdictional defect" since it was not given a proper opportunity to argue its case.

It also said the trial judge did not record her satisfaction that “there are reasonable grounds for believing that he is not guilty of such offence” as per section 45 of the Prevention of Money Laundering Act (PMLA).

On June 20, Special Judge Niyay Bindu, who sat as the vacation judge, granted bail to Kejriwal in the money laundering case, saying the Enforcement Directorate (ED) failed to furnish direct evidence linking him to the proceeds of crime in the money laundering case.

On July 21, high court's vacation bench of Justice Sudhir Kumar Jain, however, put an interim stay on the trial court order as it reserved verdict on the issue of stay on a plea moved by the ED.

"Considering the factual and legal perversities in the impugned order granting bail, which fails to consider a single relevant material placed before the learned Vacation Judge demonstrating the neck deep involvement of the accused Arvind Kejriwal in the offence of money laundering including the generation of proceeds of crime and its subsequent utilization as well as his vicarious role as National Convener of AAP which was the ultimate beneficiary of the major part of proceeds of crime to the tune of at least Rs 45 crores, the impugned order deserves to be stayed and ultimately set aside," the note said.

The ED said the trial court asked its counsel to "cut short" his arguments and its right to avail the legal remedies was also curtailed as the bail order was not uploaded until after 11 a.m. on the next day.

It said the bail is liable to be cancelled as it is "illegal and perverse", is based on irrelevant considerations, and ignores relevant material.

The trial court could not have deviated from the findings given by the high court in another case pertaining to the AAP leader, it said.

"The impugned order dated 20.06.2024 passed by the Ld. Special Judge (Vacation Judge), Rouse Avenue, has been passed in breach of both the mandatory twin conditions which any Court considering bail under the PMLA is bound to follow and therefore, the impugned order suffers from a jurisdictional defect," the note said.

"The Vacation Judge commits a fundamental jurisdictional error by holding that grant of bail to an accused under Section 45 of the PMLA is a matter of discretion of the court. On the contrary, several Supreme Court judgments hold that the twin conditions are mandatory and only upon the satisfaction of the Court that there exist reasonable grounds for believing that the accused is not guilty of the offence of money laundering and that he will not commit such offence while on bail can he be released," it added.

The note further said the trial court completely disregarded Kejriwal's vicarious role as the head of the political party which is the "major beneficiary of the proceeds of crime generated in the Delhi Liquor Scam" and the "concession" given to him for holding a constitutional chair is also perverse.

"In para 26, the (trial) court records a completely perverse finding when it holds that ED is silent about the facts as to how the proceeds of crime have been utilized in the Assembly Elections at Goa by AAP. The entire end-to-end money trail was not only placed before the Court, both in the reply as well as the Prosecution Complaint with (evidence and material)...

"However, despite placing all these materials and adverting to them during arguments, despite repeated attempt on the part of the Judge to “cut short”, there is no such discussion on the above material," the ED said in the note.

"A person who is a Chief Minister commits a serious offence of money laundering can never take refuge under the law and seek immunity from the applicable law on the ground of holding a constitutional chair. Moreover, no such exception is carved out for any constitutional chair either under Section 3 of the PMLA.. Therefore, the concession given to the applicant on account of holding a constitutional chair is perverse and contrary to settled canons of law," it argued.

The note also objected to the trial court referring to a speech by Chief Justice of India D Y Chandrachud at an event to justify hurrying up the proceedings, saying it was "wholly extraneous to the case at hand".

It also said the prayer of the ED counsel to stay the bail order to enable it to avail the legal remedies was orally rejected by the trial court.

On June 21, the high court had put in abeyance the operation of the bail order till the pronouncement on the issue of stay and asked the parties to file written submissions by June 24. The order will be pronounced tomorrow.

Kejriwal has approached the Supreme Court against the interim stay on his bail. On Monday, the top court fixed June 26 for hearing his plea, saying it would like to wait for the pronouncement of the high court order on the issue.