Bail order should be stayed only in rare, exceptional cases: SC to ED

“The courts should stay bail order only in rare and exceptional cases like somebody is involved in terrorist cases, where order is perverse or provisions of law have been bypassed. You cannot restrict liberty like this. This will be disastrous. Where will Article 21 go,” the bench observed.

The Supreme Court had previously stayed the Delhi HC’s June 2023 order on June 7, 2024, and restored the bail granted by the trial court, stating, “We make it clear that the order granting bail to the petitioner on 17.06.2023 shall enure to the benefit of the petitioner.”

On July 11, the court took note of the Enforcement Directorate’s “extraordinary request to make further submissions” and granted it 10 minutes to argue on the next day, “only by way of indulgence”.

Parvendar Singh Khurana, the owner of M/s Access Credit Solutions, was arrested on January 20, 2023 by the ED for allegedly having “knowingly assisted” the money laundering activities of Sandeep Singh Madhok and Satender Singh Madhok — the directors of M/s Jay Polychem India Limited. The Madhok brothers have been accused of committing bank fraud and misappropriation of funds to the tune of Rs 1,800 crore.

At the High Court, the ED claimed that the trial court order granting bail to Khurana did not satisfy the twin conditions for bail in money laundering cases that is provided under Section 45 of the Prevention of Money Laundering Act, 2002 — that there should be prima facie (at first glance) proof that he did not commit the offence and that he is not likely to commit further offences while on bail.

On June 23, 2023, less than a week after the trial court granted bail to Khurana, Justice Amit Mahajan of the Delhi High Court passed a short order stating “the effect of impugned order 17.06.2023 shall remain stayed till the next date of hearing” and providing the next date of hearing. This order remained in effect until the Supreme Court stayed in June 2024.

During the trial court proceedings, Khurana claimed that he did not know that the funds he received from the Madhok brothers were allegedly the “proceeds of crime” as a result of money laundering activities. He also claimed that he was only an accused in the supplementary complaint filed on March 18, 2023, even though the investigation was incomplete.

The ED on the other hand, argued that there is no restriction against them conducting further investigation and filing supplementary complaints after gathering more evidence. Further, even prior to the supplementary complaint the trial court already dismissed Khurana’s earlier bail application on March 10, 2023, and there was no change in circumstance besides the supplementary complaint being filed.

Trial court judge Neelofer Adiba Perveen, while granting bail on June 17, observed that the allegations against Khurana “has now gained context and perspective with the filing of the supplementary complaint” and held that “the entire material brought on record against him fails to show that he had knowingly and intentionally assisted the Madhok brothers in laundering of the proceeds of crime”. She also held that Khurana satisfied the twin conditions for bail, stating “on broad probabilities it cannot be absolutely ruled out that the acts attributed were not related to the POC and were not done with the requisite knowledge or intention”.

With PTI inputs