IN THE HIGH COURT AT CALCUTTA

CRIMINAL MISCELLANEOUS JURISDICTION

APPELLATE SIDE

CRM (R) 13 OF 2026

ENFORCEMENT DIRECTORATE, GOVERNMENT OF INDIA,

KOLKATA ZONAL OFFICE-I

-VS-

JITENDRA PRASAD VERMA ALIAS J. P. VERMA

BEFORE:

THE HON’BLE JUSTICE RAJARSHI BHARADWAJ

AND

THE HON’BLE JUSTICE UDAY KUMAR

For the Petitioner : Mr. Arijit Chakrabarti, Ld. Adv.

Ms. Swati Kumari Singh, Ld. Adv.

For the Opposite Party : Mr. Vikram Chaudhury, Ld. Sr. Adv.

Mr. Sajjal Yadav, Ld. Adv.

Ms. N Ahmed, Ld. Adv.

Ms. P. Banerjee, Ld. Adv.

Reserved on : 10.07.2026

Pronounced on : 24.07.2026

Uday Kumar, J:-

1. The rule of law cannot be reduced to an empty incantation or a

procedural platitude when this Court, sitting as a Division Bench

specially assigned to adjudicate systemic financial mischiefs and Ponzi

matters, is called upon to address deep-rooted white-collar

depredations. Such crimes systematically hollow out the financial

CRM (R) 13 OF 2026 2

foundations of the common wealth, derail the state's economic stability,

and breach public trust.

2. This application, preferred by the Directorate of Enforcement under

Section 439(2) of the Code of Criminal Procedure, 1973 (now

corresponding to Section 483 of the Bharatiya Nagarik Suraksha

Sanhita, 2023), seeks the cancellation of an order of regular bail dated

14th November, 2025. The order was passed by the learned Chief

Judge, City Sessions Court, Calcutta, acting as the Designated Special

Court under the Prevention of Money Laundering Act, 2002 (hereinafter

referred to as the 'PMLA'), in connection with ML Case No. 11 of 2025.

3. The underlying prosecution arises out of a formal complaint alleging an

offense under Section 3, punishable under Section 4 of the PMLA. By

the impugned order, the learned Special Judge enlarged the opposite

party/accused, Jitendra Prasad Verma, on regular bail. In doing so, the

court completely bypassed the mandatory statutory boundaries and

explicit commands embedded in Section 45(1) of the Act.

4. This case requires us to re-examine the structural boundaries of

judicial discretion in anti-money laundering bail proceedings.

Specifically, we must evaluate the standard for resetting a citizen's

liberty when a special Court ignores vital material evidence and

bypasses statutory bars.

5. To fully grasp the structural and anatomical perversity attributed to the

impugned order, it is necessary to lay out the factual landscape. The

genesis of the present money laundering probe lies in the multi-city

systemic collapse of the Sahara Group of Companies. The scheduled or

CRM (R) 13 OF 2026 3

predicate offenses involve a deep-rooted criminal conspiracy. Hundreds

of Crores of rupees were collected from everyday retail depositors under

the false pretence of real estate development, housing projects, and

high-yield money circulation ventures. Instead of being deployed in

legitimate investments, these public funds were systematically layered,

integrated, and siphoned off through an underground network of

shadow companies, artificial real estate agents, and cash couriers.

6. The specific allegations brought against the opposite party, Jitendra

Prasad Verma (designated as Accused No. 1), in the formal Prosecution

Complaint are neither thin nor peripheral. Far from being a detached,

independent freelance "land broker" as painted by the defence, the

investigation carried out by the Enforcement Directorate reveals that

the opposite party operated as the chief financial conductor for the

illicit cash operations of this criminal enterprise within this jurisdiction.

7. During searches conducted under Section 17 of the PMLA at the

residential premises of the opposite party, the investigating agency

recovered extensive, multi-city physical and digital cash ledgers. These

ledgers provide a detailed, un-booked record of parallel cash

transactions amounting to a staggering ₹214.66 Crores. Further

analysis of the seized materials and bank channels established that the

opposite party actively coordinated illicit cash movements across 28

cities, totalling ₹76.29 Crores. Most damagingly, the agency recovered a

localized transaction slip from the Faizabad sector, which explicitly

documents a personal illicit commission or "cut" of ₹5.75 Crores paid

directly to the opposite party for facilitating these secret transfers.

CRM (R) 13 OF 2026 4

8. Despite this clear paper and digital trail, the learned Chief Judge, City

Sessions Court, Calcutta, chose to release the opposite party on regular

bail. A perusal of the inner logic of the impugned order dated 14th

November, 2025 reveals that the learned Special Judge was swayed by

three entirely unsustainable and extraneous considerations:

First, the Special Court observed that because the opposite

party was not an official employee or a director listed on the

formal corporate payroll of the Sahara Group, he could not be

held responsible for the core corporate default.

Second, the court laid heavy emphasis on the fact that no

individual depositor or public witness had given an oral

statement naming the opposite party directly, concluding that

there was a lack of direct ocular evidence connecting him to the

fraud.

Third, the learned Special Judge noted that because the

primary investigations into the predicate and scheduled offenses

were stalled, and because the opposite party had spent 124

days in pre-trial detention, his continued custody would violate

his personal liberty under Article 21 of the Constitution.

9. Mr. Arijit Chakrabarty, learned Counsel appearing on behalf of the

Enforcement Directorate, has mounted an exhaustive attack against the

impugned order. He submits that the order of the learned Special Court

is not merely an erroneous exercise of judicial discretion, but a

structural nullity. It is patently perverse, demonstrably capricious, and

CRM (R) 13 OF 2026 5

passed in open defiance of the mandatory statutory boundaries drawn

by Section 45 of the PMLA.

10. He further submitted that the learned Special Court completely failed to

appreciate the legal landscape within which the present offense

germinated. The entire exercise of liquidating the real estate assets of

the Sahara Group was not an ordinary commercial venture, but a

strictly conditioned, judicially monitored restitution process mandated

by the Hon’ble Supreme Court by its order dated 11th July 2016 passed

in SEBI VS. SAHARA INDIA REAL ESTATE CORPN. LTD. & ORS. The

Apex Court, while permitting the sale of these properties to satisfy the

compelling demands of thousands of systemic fraud victims, erected

unyielding statutory guards, that the sales could not fall below 90% of

the stipulated circle rates, and the entirety of the proceeds, clear of bare

tax liabilities, had to be faithfully secured in the designated SEBI-

Sahara Account. This judicial framework was designed as a remedial

mechanism to protect public savings; it was never intended to be

weaponized as a conduit for generating parallel, unrecorded liquid

wealth.

11. Learned Counsel indicated that far from respecting this holy command,

the opposite party systematically subverted the Apex Court's mandate

by transforming a court-sanctioned liquidation into an active, multi-

layered money laundering enterprise. Masquerading under the benign

description of a mere "land broker," the opposite party acted as the vital

operational gear in a shadow economy, deliberately generating under-

the-table cash components and diverting them away from the SEBI-

CRM (R) 13 OF 2026 6

Sahara Account. By actively assisting the principal offenders in

siphoning off and concealing these parallel cash flows, the opposite

party directly facilitated the generation of fresh, undocumented black

money under the very nose of the administration, thereby committing a

blatant fraud upon the court and the thousands of helpless investors

awaiting restitution.

12. The learned Counsel submitted that the criminal footprint of this

subversion is not a matter of speculative inference but stands starkly

quantified by overwhelming documentary evidence recovered from the

exclusive possession of the opposite party. The recovery of a multi-city

cash ledger detailing illicit transactions to the tune of ₹214.66 Crores,

alongside concrete evidence of parallel cash components totalling₹76.29

Crores across 28 cities and a specific personal "cut" of ₹5.75 Crores in

the Faizabad sector, demonstrates a deep-rooted, calculated

involvement in the handling of the proceeds of crime. By entering the

market to liquidate these assets through parallel cash channels, the

opposite party committed a distinct, fresh infraction under Section 3 of

the PMLA. This generation and circulation of unrecorded cash post-

2016 constitutes a continuing offense that persists as long as these

illicit gains remain in active circulation, completely stripping the

opposite party of any claim to casual visual innocence or structural

detachment.

13. In this backdrop, Mr. Chakrabarti, has emphasized that the impugned

order of the learned Special Court suffers from a profound and manifest

perversity, having proceeded on an impermissible, microscopic

CRM (R) 13 OF 2026 7

dissection of verbal statements while turning a blind eye to this

undeniable documentary trail. The court fundamentally misdirected

itself in law by treating the PMLA offense as a mere tail of the predicate

crime, erroneously concluding that a delay in the primary FIR or the

opposite party's omission therein diluted the rigors of the special

statute. Under the settled matrix of the law, an independent money

laundering investigation stands on its own legs, completely insulated

from the status of the predicate offense. By ignoring the statutory

inversion of the burden of proof under Section 24 and bypassing the

mandatory twin conditions of Section 45(1) of the PMLA, the Special

Court flipped settled legal commands on their head, delivering a casual

and cryptic order that shocks the judicial conscience. Individual liberty

under Article 21 cannot be viewed in total isolation from the collective

financial ruin of thousands of defrauded citizens, and an order so

thoroughly steeped in legal perversity cannot be permitted to stand.

14. The learned Counsel referred the authoritative pronouncement of the

Apex Court in Vijay Madanlal Choudhary & Ors. v. Union of India & Ors.

[(2023) 12 SCC 1], in which it has been held that the twin conditions in

Section 45(1) of PMLA, following the legislative amendment of 2018,

stand as an unyielding, mandatory, and constitutionally valid statutory

command. The Special Court at the stage of hearing bail application is

required to maintain a delicate balance, not weighing the evidence

meticulously as if conducting a mini-trial, but assessing whether the

accused has discharged the heavy burden of showing a lack of mens rea

on broad probabilities. The learned Special Court flipped this principle

CRM (R) 13 OF 2026 8

on its head. By observing that "not a single witness has ventured to link

the petitioner," the Special Court engaged in a meticulous dissection of

verbal statements while completely ignoring the overwhelming

documentary trail of the ₹214.66 Crores cash ledger found in the

exclusive possession of the accused.

15. Furthermore, Contradicting the reasoning of the Special Court that the

status of the predicate offense mitigates the need for custody, the

learned Counsel relied on the view of the supreme court that the

investigation for the predicate offense and the investigation by the

Enforcement Directorate for offenses under the PMLA are distinct and

independent as held in Directorate of Enforcement v. Aditya Tripathi

[(2024) 20 SCC 545]. Mere filing of a closure report or delay in the

investigation of the predicate crime cannot be a ground to release an

accused on bail in the PMLA case if the independent money laundering

investigation is still actively continuing.

16. Referring Tarun Kumar v. Assistant Director, ED [(2024) 13 SCC 788] and

Union of India through the Assistant Director v. Kanhaiya Prasad [2025

SCC OnLine SC 306], Mr. Chakrabarti submitted that economic offenses

involving public money constitute a "class apart" and must be viewed

through a completely different judicial prism as the white-collar crimes

are committed with cool calculation and deliberate design and any

casual, cursory, or cryptic order granting bail in such matters, without

entering the thicket of Section 45, causes immense damage to the

collective financial health of the nation. The 124 days spent in custody

by the opposite party fall far short of the thresholds set by Section 436A

CRM (R) 13 OF 2026 9

of the Cr.P.C. (now Section 479 of the BNSS, 2023),and individual

liberty under Article 21 cannot be viewed in isolation from the collective

interests of thousands of defrauded investors. For money-launderers,

jail is the rule and bail is an exception.

17. As reiterated in Tarun Kumar (supra), once the possession of proceeds of

crime is shown, the court must presume the involvement of the accused

in money laundering unless the contrary is proved, the learned counsel

has stated that by looking for direct ocular evidence from individual

depositors, the Special Court not only turned a blind eye to the inverted

burden of proof set out in Section 24 of the Act but also engaged in an

impermissible mini-trial at the stage of consideration of bail in a PMLA

offence.

18. Mr. Chakrabarti further submitted that to assess whether the

requirement for cancellation of bail is satisfied in this case, a clear

distinction must be maintained between the two pathways recognized

by law. The first pathway concerns traditional post-release misconduct,

which looks for supervening factors such as witness tampering,

threatening vectors, active evasion of the due process of law, or an

immediate flight risk. The second independent pathway addresses

inherent perversity in the order itself, which is triggered when the court

below has ignored material evidence, ignored statutory bars, or relied

on arbitrary and capricious logic. As per Learned Counsel, the case at

hand falls squarely within the realm of inherent perversity as the

learned Special Court has erroneously held that the accused was a

mere land broker outside the formal corporate structure of Sahara,

CRM (R) 13 OF 2026 10

ignoring the wide statutory sweep of Section 3 which uses the

expression "whosoever directly or indirectly attempts to indulge."When a

subordinate court grants bail by ignoring vital material on record,

taking into account completely irrelevant factors, and bypassing

mandatory statutory bars, a superior court is not only empowered but

constitutionally obligated to set aside such an unjustified and illegal

order.

19. As settled in Pradeep Nirankarnath Sharma v. ED & Anr. [2025 SCC

OnLine SC 560] and Basudeb Bagchi & Anr. v. ED [2026 SCC OnLine Cal

375], money laundering is a persistent process that continues as long

as the illicit gains remain in circulation or are actively utilized. The

generating of unrecorded parallel cash components post-2016

constitutes a distinct and continuing offense that cannot be shielded by

claims of cooperation or brief historical detention. The opposite party’s

ongoing handling of these funds means he remains actively engaged in

the process of money laundering.

20. Learned Counsel further brings to our notice the administrative orders

passed by the Hon'ble the Chief Justice and the coordination directives

of the Vacation Division Bench dated 05.06.2026. It is pointed out that

this application for cancellation (CRM(R)-13/2026) has been aligned

with the regular bail petition (CRM(R)-16/2026) before the Regular

Division Bench taking up Ponzi matters to avoid any conflict of views.

This administrative consolidation underscores the structural continuity

of the investigation and the danger of allowing a perverse order of bail

to stand.

CRM (R) 13 OF 2026 11

21. In conclusion, Mr. Chakrabarti submitted that individual liberty under

Article 21 cannot be viewed in total isolation from the collective

interests of thousands of defrauded investors whose life savings have

been siphoned off through deep-rooted financial conspiracies. The

opposite party has totally failed to overcome the twin conditions of

Section 45. The order of the learned Special Judge is unsustainable in

law, shocks the judicial conscience, and if allowed to stand, would

derail a highly sensitive and ongoing investigation.

22. Therefore, it is prayed that the order dated 14.11.2025 be quashed and

set aside, and the opposite party be directed to surrender immediately

to custodial custody.

23. Conversely, Mr. Vikram Chaudhury, learned Senior counsel for the O.P.

submitted that the entire factual matrix surrounding the disposal of the

Sahara Group's properties must be viewed through the precise legal

prism of the Hon’ble Supreme Court’s order dated 11th July 2016

passed in SEBI VS. SAHARA INDIA REAL ESTATE CORPN. LTD. & ORS.

The opposite party did not independently engineer or illicitly execute the

sale of these real estate assets; rather, every transaction facilitated by

him was initiated and carried out directly under the protective

structural framework and explicit mandates established by the Apex

Court to satisfy depositors' demands. Acting strictly within the

boundaries of this judicially sanctioned liquidation exercise, the

opposite party committed no wrong whatsoever, performing the

legitimate commercial role of a freelance facilitator in the ordinary

course of business.

CRM (R) 13 OF 2026 12

24. Resisting the prayer for cancellation, the learned Senior Counsel

appearing on behalf of the opposite party/accused person has argued

that the present revisional application seeking the cancellation of

regular bail is fundamentally misconceived and legally untenable. As

settled by the Apex Court in Dolat Ram v. State of Haryana [(1995) 1

SCC 349] and Himanshu Sharma v. State of Madhya Pradesh [(2024) 4

SCC 222], there exists a well-defined jurisprudential chasm between the

rejection of a bail application at inception and the cancellation of a

liberty already judicially secured. An order of regular bail, once validly

granted, cannot be interfered with in a routine or mechanical manner.

He contended that the investigating agency has failed to demonstrate

any supervening circumstances born post-release, such as tampering

with evidence, subversion of the judicial process, or intimidation of

witnesses, or any ex-facie perversity in the impugned order that would

shock the conscience of this Court to warrant a recall of the bail.

25. Navigating through the factual matrix, the learned Senior Counsel

argued that the opposite party is but a mere external, freelance land

broker who stood completely outside the corporate and administrative

hierarchy of the Sahara Group. He wielded no corporate control,

possessed no administrative dominion, nor played any part in the

strategic decision-making processes orchestrated by the management

from Lucknow. While dealing with the sweeping nomenclature of the

word "whosoever" in Section 3 of the PMLA, the learned senior counsel

submits that mere legislative breadth does not absolve the prosecution

of its primary burden to establish a direct, proximate nexus between

CRM (R) 13 OF 2026 13

the accused and the alleged proceeds of crime and a living scheduled

offense. He merely facilitated the disposal of lands under the protective

umbrella and explicit structural framework permitted by the directions

issued by the Hon’ble Supreme Court of India, earning legitimate

brokerage commissions in the ordinary course of business.

26. He vehemently contradicted the Petitioner-Directorate’s attempt to

colourably transmute these transactions into an offense of money

laundering is fundamentally flawed in law. The monies received from

third-party purchasers constituted valuable commercial consideration

for the lands sold under the Supreme Court's directives, not the tainted

fruits of a scheduled offense. At highest, an undeclared cash component

in a real estate transaction constitutes an infraction of fiscal statutes

under the Income Tax Act, 1961, which cannot be colourably

transmuted into an offense of money laundering under the principles of

Arnab Manoranjan Goswami v. State of Maharashtra [(2021) 2 SCC 427].

Ld. Counsel pointed out that out of the ₹50 Croress deposited in the

designated account of the Supreme Court, only ₹30 Crores were

disbursed, while ₹20 Croress remain fully secured, thereby dispelling

the agency's narrative of an unmitigated and complete siphoning of

capital.

27. Crucially, he submitted that even if it is assumed for the sake of

argument that the conditions governing the sale price or the deposit of

funds were breached, such actions would exclusively attract liability for

civil or criminal contempt before the Hon’ble Supreme Court for

violating its specific order. Such deviations cannot legally generate

CRM (R) 13 OF 2026 14

"proceeds of crime" or form the basis for independent criminal

proceedings under the PMLA. The Directorate cannot arrogate to itself

the jurisdiction to police the execution of the Apex Court's decrees,

especially when it has chosen not to array a single third-party

purchaser as an accused in the Prosecution Complaint, thereby treating

the source transactions as legally sound.

28. Addressing the evidentiary contours of the case, the learned counsel

has underscored the Directorate’s heavy reliance upon statements

recorded under Section 50 of the PMLA to argue that the opposite party

was evasive and failed to make a "full disclosure" regarding an

additional ₹76 Crores appearing in digital data seized from a co-

accused, labelling the same as "non-cooperation" is a manifest attempt

to validate testimonial compulsion and extract a forced confession. To

counter this contention, the learned counsel reminds this Court that

the statutory power of investigation cannot be weaponized to extract a

forced confession or validate testimonial compulsion. Relying heavily on

the recent exposition of law in Arvind Kejriwal v. Central Bureau of

Investigation [2024 SCC OnLine SC 2370] , he argued that the

constitutional right against self-incrimination under Article 20(3)

occupies an exalted status. An investigating agency cannot justify the

continued or renewed incarceration of an individual by merely branding

his refusal to confess or echo the prosecution’s narrative as “non-

cooperation” or “evasiveness.” He submitted that such statements

(Section 50) may only be looked into to form a prima facie opinion at the

stage of bail, whereas their ultimate admissibility, reliability, and weight

CRM (R) 13 OF 2026 15

remain matters for full-dress adjudication at the trial, and cannot be

used as a lever to disrupt an existing liberty.

29. The learned Senior Counsel next raised a structural challenge regarding

the survivability of the PMLA prosecution, as it cannot float in a legal

vacuum detached from an active, living scheduled offence. Relying on V.

Senthil Balaji v. State [(2024) 3 SCC 51], he underlined that the

existence of an active scheduled offense is a sine qua non for the

generation of "Proceeds of Crime." In the instant case, the structural

base of the Kolkata ECIR was FIR No. 142 of 2020 registered at

Bhubaneshwar, involving a disputed amount of a mere ₹52,187. The

local police filed a Closure Report in the said predicate offense on

27.08.2020, on the ground of a "mistake of fact," which was formally

accepted by the Jurisdictional Magistrate vide an order dated 14th

September, 2024.The learned counsel forcefully argued that with the

absolute judicial dissolution and closure of this primary predicate

offense and given the admitted fact that the opposite party is not an

arrayed accused in any of the other 300 regional FIRs, the derivative

PMLA proceedings against the opposite party must suffer a natural legal

eclipse, as recognized by the Telangana High Court in its order dated 8

th

September 2022 passed in M/s Bharti Cement Corp. Pvt. Ltd. v. ED

[CRLRC 84/2021].

30. On the anvil of Article 21 of the Constitution of India, the learned

counsel has forcefully submitted that the right to a speedy trial is an

inalienable facet of personal liberty that must be protected when the

trial process itself becomes the punishment. Relying on the

CRM (R) 13 OF 2026 16

constitutional imperatives laid down in Manish Sisodia v. Directorate of

Enforcement (2024) 12 SCC 660] he emphasized that the massive

procedural labyrinth of this case encompassing (over 300 clubbed FIRs,

16 co-accused persons, 33 primary witnesses, and over a thousand

underlying complaints), renders the prospect of an early trial wholly

illusory, thereby justifying the lower court's protection of his liberty.

Keeping an aged individual incarcerated indefinitely in such a complex

matrix would constitutes an unmerited, advance punishment, thereby

doing violence to the constitutional mandate.

31. Finally, touching upon the post-bail conduct of the opposite party, it is

submitted that his actions remain entirely unimpeachable and

exemplary. Assuaging any apprehensions of a flight risk, the learned

counsel highlighted that the opposite party, despite being a resident of

New Delhi, has meticulously adhered to the geographical embargo

imposed by the Special Court by residing continuously in transient

accommodations in Kolkata to satisfy local residency restrictions. It is

pointed out that even when faced with the acute medical emergency of

his ailing mother, a terminal patient of plasma cell myeloma (blood

cancer), he sought the leave of the Court, travelled to New Delhi under

the strict constraints of a seven-day relaxation (from 03.04.2026 to

09.04.2026), and returned to the jurisdiction with clockwork precision

to report before the investigating officer on 09.04.2026 and appearing

before the Court on 10.04.2026. There is absolutely no ground to

interfere with the well-reasoned order of the learned Special Judge.

CRM (R) 13 OF 2026 17

32. On this conspectus of facts, the learned senior counsel submitted that

the prayer for cancellation is devoid of any merit and ought to be

dismissed in-limine.

33. We have heard the learned counsel for both sides at length, analysed

the rival submissions, and examined the record with anxious care. The

primary issue before us is whether the strict, legally demarcated

parameters for the cancellation of bail under Section 439(2) of the

Cr.P.C. (now Section 483 of the BNSS, 2023) have been satisfied.

34. To arrive at a lawful and logically consistent finding, it is necessary to

first delineate the structural topography of the law governing the

cancellation of bail. Our criminal jurisprudence draws a sharp,

qualitative distinction between two independent and mutually exclusive

judicial pathways for taking away an accused person's liberty after

regular bail has been granted: firstly, the occurrence of supervening

circumstances born post-release, and secondly, the presence of

inherent perversity and foundational illegality in the order granting bail

itself.

35. The first pathway, governing "supervening circumstances," applies to

situations where an order enlarging an accused on bail was legally

unassailable and properly within jurisdiction at the time it was passed,

but subsequent post-release developments demonstrate that the

accused has abused his liberty. As established by the Supreme Court of

India in landmark decisions such as State of Delhi v. Sanjay Gandhi

[(1978) 2 SCC 411], Dolat Ram (supra), and reinforced down to State of

Haryana v. Dharamraj [(2023) 17 SCC 510] , this track requires the

CRM (R) 13 OF 2026 18

prosecution to prove definitive post-release misconduct. This includes

actions such as active attempts to tamper with evidence, intimidation or

coercion of prosecution witnesses, an immediate and demonstrable

flight risk to evade trial, or the repetition of identical crimes.

36. In the present case, the opposite party has established that his post-

release conduct has been cooperative; he has respected the

geographical embargo imposed upon him, returned precisely from a

medical relaxation to report before the investigating officer, and has not

shown any overt supervening misconduct. If the challenge preferred by

the Enforcement Directorate were grounded solely on this first track of

post-bail supervening misconduct, the application would undoubtedly

fail.

37. However, our jurisprudence recognizes a second, entirely distinct

pathway for cancellation that does not rely on post-release

developments. As established by the Apex Court in Puran v. Rambilas

[(2001) 6 SCC 338], Narendra K. Amin v. State of Gujarat [(2008) 13 SCC

584], and consistently applied in Neeru Yadav v. State of Uttar Pradesh

[(2014) 16 SCC 508] and Deepak Yadav v. State of Uttar Pradesh [(2022)

8 SCC 559], if the underlying order granting bail is patently perverse,

illegal, or operates in direct violation of mandatory statutory bars, the

prosecution is not required to prove any post-bail misconduct or

supervening circumstances. When a subordinate court grants bail by

ignoring vital material on record or by bypassing absolute statutory

limitations, the order is legally broken from its inception (ab initio void).

In such instances, a superior court is constitutionally obligated to set

CRM (R) 13 OF 2026 19

aside the order immediately, as allowing an inherently flawed order to

remain in force constitutes an independent and severe miscarriage of

justice.

38. The case before us falls squarely within this second category of inherent

perversity. A review of the inner logic of the impugned order dated 14th

November, 2025 reveals that the learned Chief Judge, City Sessions

Court, Calcutta, committed a grave legal error by completely bypassing

and misinterpreting the strict statutory commands embedded in

Section 45(1) and Section 24 of the PMLA. The learned Special Judge

completely inverted these principles, creating an order that is

structurally broken in the ways discussed below:

i. Firstly, the Special Court completely lost sight of the fact that

the entire exercise of liquidating the real estate assets of the

Sahara Group was not an ordinary commercial venture, but a

strictly conditioned, judicially monitored restitution process

mandated by the Hon’ble Supreme Court by its order dated

11th July 2016 passed in SEBI VS. SAHARA INDIA REAL

ESTATE CORPN. LTD. & ORS. The Apex Court, while

permitting the sale of these properties to satisfy the compelling

demands of thousands of systemic fraud victims, erected

unyielding statutory guards: the sales could not fall below

90% of the stipulated circle rates, and the entirety of the

proceeds, clear of bare tax liabilities, had to be faithfully

secured in the designated SEBI-Sahara Account. This judicial

framework was designed as a remedial mechanism to protect

CRM (R) 13 OF 2026 20

public savings; it was never intended to be weaponized as a

conduit for generating parallel, unrecorded liquid wealth.

Far from respecting this holy command, the opposite party

systematically subverted the Apex Court's mandate by

transforming a court-sanctioned liquidation into an active,

multi-layered money laundering enterprise. The defense's

contention that a violation of the Apex Court’s order merely

attracts the penalty of contempt is a flawed argument that

misconstrues the intersection of civil obedience and criminal

culpability. Armed with the knowledge of this directive, the

opposite party actively chose to operate under its shadow,

utilizing the protective cover of a Supreme Court-sanctioned

sale as an unprecedented opportunity to generate, launder,

and conceal massive quantities of undocumented cash

components. This is not a mere technical flouting of regulatory

conditions; it represents a deliberate, fraudulent deception

practiced upon the highest Court of the land. The opposite

party colourably used the judicial machinery as a structural

shield to siphon off capital that belonged to defrauded

investors, transmuting a process meant for restitution into a

fresh, distinct offense under the PMLA.

ii. Secondly, the Special Court's finding is that the opposite party

was insulated from the crime because he was an independent

"land broker" outside the formal corporate payroll or

directorate of the Sahara Group represents a significant

CRM (R) 13 OF 2026 21

misdirection in law. Section 3 of the PMLA is intentionally

broad, explicitly targeting any person who "whosoever directly

or indirectly attempts to indulge" in any process connected with

the proceeds of crime. One does not need to be a salaried

executive or a registered director to launder the proceeds of a

corporate fraud. By treating the opposite party's freelance

status as a legal shield, the Special Court ignored the wide

statutory scope of the offense. Freelance brokers and external

financial conductors are fully integrated into the statutory net

the moment they knowingly facilitate the generation,

circulation, or layering of the proceeds of crime.

iii. Thirdly, the Special Court's insistence on direct oral evidence

from individual retail depositors demonstrates a fundamental

misunderstanding of financial crime prosecutions. Money

laundering schemes are driven by paper trails, ledger

balances, and digital footprints, not by oral agreements with

everyday investors. During searches conducted under Section

17 of the PMLA at the residence of the opposite party, the

investigating agency recovered an extensive, multi-city

physical and digital cash ledger detailing un-booked

transactions worth a staggering ₹214.66 Crores, alongside

localized transaction slips showing a parallel cash layout of

₹76.29 Crores and a personal illicit "cut" of ₹5.75 Crores made

to the Opposite party. Faced with such substantial physical

and digital evidence, the statutory presumption under Section

CRM (R) 13 OF 2026 22

24 was fully triggered. The opposite party offered no credible

explanation to account for these exclusive ledgers, and the

defence’s argument that these transactions merely constitute

an infraction under the Income Tax Act, 1961 is legally

untenable. Generating vast parallel cash components out of a

collapsed public deposit scheme cannot be colourably excused

as simple tax evasion. By ignoring this unexplained

documentary trail and focusing instead on the lack of direct

oral statements from individual depositors, the Special Court

engaged in an impermissible, microscopic dissection of verbal

evidence, arriving at a conclusion on facts that no reasonable

court could have reached.

iv. Fourthly, the Special Court committed a grave error by

treating the status or delay in the investigation of the predicate

offense as a reason to dilute the PMLA case. The defence’s

reliance on the closure of the Bhubaneshwar FIR involving a

minor sum cannot rescue the opposite party. As ruled in

Aditya Tripathi (supra), a PMLA prosecution is standalone and

distinct from the scheduled offense. The fact that the predicate

investigation is delayed or that the accused was not named in

the initial FIR does not affect the independent statutory

requirements of Section 45. Furthermore, the opposite party’s

ongoing orchestration and handling of multi-city cash

components constitutes a persistent process that continues as

long as the illicit gains remain in circulation, as settled in

CRM (R) 13 OF 2026 23

Pradeep Nirankarnath Sharma (supra) and Basudeb Bagchi

(supra). Generating unrecorded parallel cash components on

top of judicially managed asset sales constitutes a fresh,

continuing offense under the PMLA that is entirely separated

from the structural timeline of the primary scheduled FIR.

v. Fifthly, the Special Court's reliance on 124 days of custody of

the opposite party to satisfy Article 21 represents a clear

statutory bypass of the legislative framework. While prolonged

pre-trial detention can become a factor under Section 436A of

the Cr.P.C. (now Section 479 of the BNSS, 2023), it only

applies when the accused has served at least half of the

maximum sentence prescribed for the offense. A period of 124

days falls far short of this threshold. As emphasized in

Kanhaiya Prasad (supra) and Basudeb Bagchi (supra) ,

economic offenses and white-collar crimes affecting public

funds must be treated as a "class apart," and personal liberty

under Article 21 cannot be used to override the clear statutory

bars enacted by Parliament when the accused has failed to

show innocence on broad probabilities.

vi. Finally, this Court must note the administrative background of

this matter. By order of the Hon'ble the Chief Justice, and as

directed by the Vacation Division Bench on 5th June, 2026,

this cancellation application (CRM(R)-13/2026) was properly

aligned and consolidated with the main bail application

(CRM(R)-16/2026) before this Bench to avoid any conflict of

CRM (R) 13 OF 2026 24

views. Having considered both matters through a single,

comprehensive lens, it is clear that the lower court's casual

approach fails to safeguard the collective interests of

thousands of defrauded investors. The opposite party has

totally failed to overcome the twin conditions of Section 45

PMLA, and allowing a perverse order of bail to stand would

derail a highly sensitive and ongoing investigation into the

parallel cash networks of this scheme.

39. On a comprehensive synthesis of the statutory framework of the PMLA

and the binding precedents of the Supreme Court analysed above, we

arrive at the following foundational legal principles:

i. The offense of money laundering under Section 3 of the

PMLA is a standalone, independent crime. Its statutory

vitality is not dependent on the continuous survival, speed,

or structural outcome of the predicate/scheduled offense.

The delay, stay, or formal closure of a primary FIR by a local

investigative agency does not automatically dissolve or dilute

the independent statutory requirements for bail under

Section 45 of the PMLA.

ii. In the prosecution of complex financial frauds and white-

collar crimes, the existence of unrecorded parallel cash

ledgers and digital transaction footprints found in the

exclusive possession of an accused carries primary

evidentiary weight at the stage of bail. A court cannot bypass

the statutory presumption inverted by Section 24 of the

CRM (R) 13 OF 2026 25

PMLA by demanding direct oral statements from retail

depositors implicating the opposite party, as money

laundering is essentially an offense documented by paper

and digital trails rather than oral pacts.

iii. The legislative use of the expression "whosoever directly or

indirectly attempts to indulge" in Section 3 PMLA strips away

any formal corporate shield. Freelance brokers, independent

contractors, and external financial conductors are fully

integrated into the statutory net if they knowingly facilitate

the circulation, layering, or integration of the proceeds of

crime. Commercial nomenclatures cannot be used to bypass

the rigors of Section 3.

iv. Section 45 of the PMLA imposes an absolute constitutional

and statutory limitation on judicial discretion. General

considerations of pre-trial custody periods or standard

discretionary parameters under Section 439 of the Cr.P.C.

must bend before the mandatory command of the twin

conditions under Section 45. Liberty under Article 21 is

structurally balanced by the legislature; hence, a court has

no jurisdiction to grant bail unless it explicitly records a

finding on broad probabilities that the accused is not guilty

of such offence and that he is unlikely to commit any offence

while on bail.

CRM (R) 13 OF 2026 26

40. For the reasons we discussed above, the challenge brought by the

Enforcement Directorate must succeed. The order dated 14th

November, 2025 passed by the learned Chief Judge, City Sessions

Court, Calcutta, acting as the Designated Special Court under the

PMLA in ML Case No. 11 of 2025, suffers from inherent and patent

perversity, ignores substantial documentary and digital evidence, and

operates in direct violation of the mandatory provisions of Section 45

and Section 24 of the PMLA.

41. Because the underlying bail order was legally broken from its inception,

the prosecution is not required to establish any post-bail supervening

misconduct or witness tampering to justify its cancellation. The

opposite party has failed to discharge the heavy statutory burden

required to justify the grant of bail, rendering the Special Court's

exercise of discretion a structural nullity.

42. Accordingly, C.R.M. (R) No. 13 of 2026 is allowed.

43. No order as costs.

44. The impugned order of bail dated 14th November, 2025 is hereby

quashed and set aside.

45. The opposite party, Jitendra Prasad Verma, is directed to surrender

before the learned Designated Special Court within a period of 72 hours

from the delivery of this judgment. Should the opposite party fail to

surrender within the stipulated time, the petitioner/Enforcement

Directorate is directed to take him into custody immediately in

accordance with the law.

46. The application is disposed of.

CRM (R) 13 OF 2026 27

47. Urgent certified copies of this judgment, if applied for, be supplied to

the parties upon compliance with all necessary legal formalities.

I AGREE

(RAJARSHI BHARADWAJ, J.) (UDAY KUMAR, J.)

Later:

1. After pronouncement of the judgment, the Advocate appearing for the

petitioner prays stay of operation of the judgment.

2. The prayer for stay is considered and rejected.

(RAJARSHI BHARADWAJ, J.) (UDAY KUMAR, J.)