Delhi HC: Bail Protection in Predicate Offence Not Automatic for PMLA Cases

The Delhi High Court has ruled that protection granted to an accused in a predicate offence FIR does not automatically extend to separate proceedings under the Prevention of Money Laundering Act (PMLA). The court made the observation while dismissing an anticipatory bail plea filed by a businessman in a money laundering case.

Justice Madhu Jain, in an order dated August 18, rejected the petitioner's argument that his apprehension of arrest must be viewed in light of the protection given by the Supreme Court in the predicate offence FIR. The court clarified that such protection is limited to the specific FIR and cannot be carried over to independent PMLA proceedings.

"The protection granted in the predicate offence operates in the context of the said FIR and cannot, by itself, be construed as extending to the distinct and independent proceedings under the PMLA. The petitioner cannot claim pre-arrest protection in the present proceedings merely on the ground that such protection has been granted to him in the predicate offence," the court said.

The court also emphasised that economic offences form a distinct category and require a different approach when bail is considered. It noted that the Supreme Court has consistently stressed the need for a serious approach in matters involving economic offences, especially those with deep-rooted conspiracies and substantial financial implications that affect the country's economic health.

The petitioner, Ram Singh of Babaji Finance Group, was seeking anticipatory bail in a case registered by the Enforcement Directorate (ED). The agency had conducted a search at his residence in Delhi and recorded reasons to believe that he was the key conspirator in the money laundering case.

Singh's counsel argued that the allegations in the scheduled offences primarily involved cheating, inducement, forged documents, and transactions related to SARFAESI properties, with the principal allegations directed against co-accused persons. It was submitted that there was no allegation that Singh personally induced any complainant, forged documents, or participated in the property transactions.

The ED counsel opposed the bail plea on several grounds. It was argued that Singh should have first approached the sessions court and that he had failed to join the investigation despite repeated summons. The agency also contended that his personal presence was necessary for effective collection of evidence and confrontation with documentary and digital material. Granting anticipatory bail at this stage would seriously impede the investigation, the counsel said.

The High Court, while dismissing the plea, noted that the material on record traced proceeds of crime amounting to around ₹26.18 crore to the petitioner. The court observed that despite summons issued on multiple dates, neither Singh nor his authorised representatives appeared before the ED. Instead, a written reply was furnished through counsel, which the court said reflected an attempt to avoid the inquiry.

"In view of the aforesaid material, this court finds that the condition required under the PMLA is not satisfied and the petitioner has not been able to demonstrate that there are reasonable grounds for believing that he is not guilty of the offence alleged against him," the court stated.

The ruling underscores that anticipatory bail protection in one case does not create a blanket shield against arrest in other connected but distinct proceedings, particularly where the investigation is ongoing and the accused has not cooperated.