As per the case facts, the appellant, a former Deputy Chief Minister, sought bail in prosecutions related to alleged offenses under anti-corruption and money laundering acts. Chargesheets were filed by ...
2023 INSC 956 Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 1 of 41
REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO. OF 2023
(ARISING OUT OF SPECIAL LEAVE PETITION (CRIMINAL) NO. 8167 OF 2023)
MANISH SISODIA ..... APPELLANT
VERSUS
CENTRAL BUREAU OF INVESTIGATION ..... RESPONDENT
W I T H
CRIMINAL APPEAL NO. OF 2023
(ARISING OUT OF SPECIAL LEAVE PETITION (CRIMINAL) NO. 8188 OF 2023)
J U D G M E N T
SANJIV KHANNA, J.
Leave granted.
2. Rule of law means that laws apply equally to all citizens and
institutions, including the State. Rule of law requires an equal right
to access to justice for the marginalised. The rule also mandates
objective and fair treatment to all. Thirdly, rule of law is a check on
arbitrary use of powers. It secures legitimate exercise of power for
public good.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 2 of 41
3. This is precisely the reason why we had heard arguments at some
length in these two appeals filed by the appellant – Manish Sisodia,
former Deputy Chief Minister of Delhi, who seeks bail in the
prosecutions arising from RC No. 0032022A00553, dated
17.08.2022, registered by the Central Bureau of Investigation
1
, at
CBI, ACB, New Delhi, under the Prevention of Corruption Act, 1988
2
and the Indian Penal Code, 1860
3
; and Enforcement Case
Information Report
4
No. HIU-II/14/2022, dated 22.08.2022, filed by
the Directorate of Enforcement
5
, under the Prevention of Money
Laundering Act, 2002
6
.
4. CBI has filed two chargesheets, dated 24.11.2022 and 25.04.2023,
wherein the appellant – Manish Sisodia is named and is facing trial
for the offences under Sections 7, 7A, 8 and 12 of the PoC Act and
Sections 120B, 201 and 420 of the IPC. DoE has filed a criminal
complaint dated 04.05.2023 against the appellant – Manish Sisodia
for the offences under Sections 3 and 4 of the PML Act.
5. A number of legal issues and questions were raised, and do arise,
for consideration, but we would refrain from delving into them in
1
For short, “CBI”.
2
For short, “PoC Act”.
3
For short, “IPC”.
4
For short, “ECIR”.
5
For short, “DoE”.
6
For short, “PML Act”.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 3 of 41
depth and detail. However, there is a bounded discussion in the
subsequent portion of the judgment only for deciding the present
appeals and the question as to whether the appellant – Manish
Sisodia is entitled to bail. Nevertheless, for the purpose of record,
we will delineate some of them:
(a) What is the scope and ambit of the constitutional protection
under Articles 74 and 163 of the Constitution of India on the
decisions taken by the Council of Ministers?
(b) Whether on interpretation of Section 3 of the PML Act, ‘the
act/process of generation’ or ‘the attempt to generate the
proceeds of crime’ falls within the ambit of the expressions
‘assist’, ‘acquisition’, ‘possession’ or ‘use’ under Section 3 of
the PML Act? If the answer is in affirmative, what are the legal
consequences as per the Constitution of India, under the Code
of Criminal Procedure, 1973
7
, the IPC, and the General
Clauses Act, 1897?
(c) Whether a person can be prosecuted under the PML Act only
when there is material to show that he has indulged or assisted
in any activity/process of money laundering, albeit an
7
For short, “The Code”.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 4 of 41
activity/process different and separate from the scheduled
offence?
(d) Whether an accused, who allegedly has committed the
scheduled offence, can be prosecuted under the PML Act,
when the alleged prime accused and the beneficiary of the
proceeds of crime, a juristic person, is not arrayed as an
accused in the criminal complaint filed by the DoE?
(e) Whether Sections 45 and 50 of the PML Act should be read
down in view of the constitutional scheme and mandate of
Article 20 of the Constitution of India?
6. On behalf of the appellant – Manish Sisodia, the following
submissions have been made:
• The appellant – Manish Sisodia has been in custody from
26.02.2023 in RC No. 0032022A00553 and from 09.03.2023 in
the ECIR No. HIU-II/14/2022.
• CBI had submitted charge-sheet on 25.04.2023 and the DoE had
filed the criminal complaint on 04.05.2023 against the appellant
– Manish Sisodia.
• There are 294 witnesses and about 31,000 pages of documents
in the charge-sheet filed by the CBI. There are 162 witnesses
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 5 of 41
and 25,000 pages of documents in the prosecution complaints
filed by the DoE.
• Arguments on charge have not commenced, and the trial will
take years.
• The new excise policy was validly adopted after due deliberation
by the Council of Ministers/Cabinet in larger and greater public
interest:
o Under the old excise policy there was an incentive to cheat
because of the very nature of liquor - fast selling and highly
taxed. As per the Ravi Dhawan Committee
8
Report dated
13.10.2020, the profit margins could be up to 65-70%, as
the manufacturers were able to acquire retail licenses
through proxy ownership.
o As a check, wholesale licenses were not to be issued to a
manufacturer or retail licence holder, directly or to sister
concerns or related entities.
o 272 wards in 68 Assembly Constituencies were divided into
30 zones. Each zone was to have 9-10 wards with a
maximum of 27 retail vends which were to be allotted on
the basis of auction. Each zone operator was to operate
8
For short, “R.D. Committee”.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 6 of 41
two mandatory vends in each ward. The remaining vends
were freehold vends to be operated anywhere within that
zone.
o Auction, with a reserve price equal to the existing license
fee plus sum of potential revenue, estimated VAT and 10%
additional fee for increase on year to year ensured
maximization of revenue.
o The licence fee payable by the wholesaler was raised from
Rs.5,00,000/- (rupees five lakhs only) under the old policy
to Rs.5,00,00,000/- (rupees five crores only), which is an
increase of approximately 10,000%.
o The wholesalers were entitled to a standard distribution fee
at the rate of 12% of the landed price. The landed price or
the ex-distillery price was the lowest price as declared by
the manufacturer in any market in India.
o The standard distribution fee at the rate of 12%, though
higher than the fee under the old policy, was necessary to
cover the higher level of investment required, setting up of
quality checking system, etc. The fee of 12% had also
subsumed several other charges payable under the old
policy.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 7 of 41
• The new policy was drafted in a transparent manner after
deliberation at different levels by Secretaries/Officers of the
Excise, Planning, Finance and Law departments. The revenue
generation was projected at 12%.
• Comments from general public were invited. Around 14,671 e-
mails were received. The comments were considered. As per the
prosecution, 6 e-mails were planted/prompted. This assertion to
establish a criminal offence relying on 0.04% e-mails is
assumptive and overweening.
• The policy was sent to the Lieutenant Governor
9
of the National
Capital Territory
10
of Delhi for comments and recommendation.
The LG gave his recommendation on some aspects. The
Cabinet had considered and accepted the recommendations.
• The new excise policy report prepared by the GoM was accepted
by the Excise Department and the Cabinet of the NCT of Delhi.
It was uploaded on the website on 05.07.2021. It was
implemented only on 17.11.2021.
• Proceeds of crime is the core ingredient for the offence of money
laundering, which expression is required to be construed strictly,
as held in Vijay Madanlal Choudhary and Others v. Union of
9
For short, “LG”.
10
For short, “NCT”.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 8 of 41
India and Others
11
. The offence under the PML Act has nothing
to do with the criminal activity, subject matter of the scheduled
offence. PML Act penalises indulging in activity/process relating
to the proceeds of the crime, derived or obtained as a result of
that crime.
• Allegation regarding kickback of Rs.100,00,00,000 (rupees one
hundred crore only), and a portion of it being used for funding
the Aam Aadmi Party
12
, for its election campaign in Goa, is a
concocted story unsupported by any legal and admissible
evidence and material. The money trial is unproven and false.
• Co-accused Rajesh Joshi and Gautam Malhotra have been
granted bail for the offence under the PML Act on the ground that
there was no documentary evidence to show that proceeds of
crime were used for the election purposes.
• To establish the money trail and payment of bribe/kickback of
Rs.100,00,00,000 (rupees one hundred crore only), the DoE has
relied upon the statements made by co-accused or approvers.
These statements are hearsay and do not in any manner
implicate or connect the appellant – Manish Sisodia with the
transfer and use of the proceeds of the crime.
11
(2022) SCC Online 929.
12
For short, “AAP”.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 9 of 41
• The statements of co-accused or other witnesses relied upon by
the DoE were extracted and forced by a threat of arrest, as in the
case of Magunta Sreenivasulu Reddy, Butchi Babu and Manoj
Rai. Some of the co-accused like Arun Pillai and Sameer
Mahendru have retracted from their statements.
• Raghav Magunta, son of a Member of Parliament of the ruling
party in Andhra Pradesh, was forced to make the statement
dated 27.07.2023, which is contrary to his earlier statement
dated 16.09.2022.
• Statements obtained from Dinesh Arora, an approver, is weak
evidence and in this regard, reliance is placed upon Ravinder
Singh v. State of Haryana
13
.
• Statement of Dinesh Arora dated 12.07.2023 is contrary to his
earlier statement made on 09.04.2023.
• Allegations regarding the appellant – Manish Sisodia’s
involvement in the grant of licence to Indo Spirit is make belief
and a false assertion. Statements obtained from the officers of
the Excise Department under Section 164 of the Code, namely,
Suman, Sachin Solanki and Arava Gopi Krishna do not implicate
the appellant – Manish Sisodia.
13
(1975) 3 SCC 742.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 10 of 41
• The appellant – Manish Sisodia, in his statement dated
14.03.2023, has stated that he had not instructed the Excise
Commissioner to expedite the clearance of Indo Spirit’s license.
• Interaction and communications between the private parties viz.
business of Indo Spirit was independent, and without any
interference, knowledge and participation of the appellant –
Manish Sisodia.
• Vijay Nair was not associated with the appellant – Manish
Sisodia. There are also contradictions in the statements made
by C. Arvind, under Section 50 of the PMLA, dated 07.12.2022,
and the one under Section 164 of Cr.P.C., dated 16.02.2023.
• Allegation regarding destruction of the cabinet file is nothing but
making a mountain out of a molehill. The three legal opinions,
two by former Chief Justices of India and one by a Law Officer,
on merits or demerits of the old policy, were benign, and of no
consequence and relevance. The allegation is also contrary to
the contemporaneous records maintained by DoE.
7. The CBI and DoE have submitted as under:
• Under the old excise policy:
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 11 of 41
o There was no concept of private wholesaler and no
concept of zones.
14
o The distributor/wholesaler was entitled to 5% profit
margin.
o The retail trade was primarily undertaken by four
corporations of the Government of NCT of Delhi.
• R.D. Committee Report dated 13.10.2020
15
recommended:
o Gradual withdrawal of government presence.
o Wholesale operation under one government entity.
o Three models were examined: (i) existing model, (ii)
licenses vide lottery system, and (iii) licenses to limited
entities.
o Licenses vide lottery system was recommended since
auctioning licenses to limited entities could lead to
cartelisation.
• The R.D. Committee Report dated 13.10.2020 was not preferred
by the appellant – Manish Sisodia. Reliance is placed upon the
statement of C. Arvind
16
dated 16.02.2023 under Section 164 of
the Code, and Rahul Singh
17
dated 03.03.2023 under Section
14
As per the appellant – Manish Sisodia, under the old liquor policy there were private whole-sellers,
which assertion prima-facie appears to be correct.
15
The Expert Committee headed by Ravi Dhawan was constituted on 04.09.2020.
16
Posted as Secretary to appellant – Manish Sisodia between July, 2019 to June, 2022.
17
Erstwhile Excise Commissioner of NCT of Delhi.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 12 of 41
161 of the Code. The appellant – Manish Sisodia had not
accepted the report because of ulterior reasons.
• A conspiracy was entered viz. the new excise policy to enable
supersize profits for wholesale distributors in return for kickbacks
and bribes. To start with:
o Public comments were invited to the R.D. Committee Report
dated 13.10.2020. Some public comments vide emails were
prompted by the appellant – Manish Sisodia to influence the
decision making process. The emails
18
, statement of Zakir
Khan
19
dated 29.03.2023 recorded under Section 161 of the
Code, and screenshots of WhatsApp chats of Kartikey Azad
and Zakir Khan establish the motive. Thus, a facade of
transparency and openness in policy making was created.
o Rahul Singh
20
supports the charge. He was asked to prepare a
cabinet note in a particular manner with comments and
suggestions of the stakeholders and public. The appellant –
Manish Sisodia reprimanded Rahul Singh for annexing the
opinion of legal experts in the cabinet note.
21
C. Arvind’s
18
Emails shared by interns of the Delhi Minorities Commission as public comments to the R.D.
Committee Report.
19
Chairperson of the Delhi Minorities Commission.
20
Erstwhile Excise Commissioner of NCT of Delhi.
21
Statement of Rahul Singh
21
dated 03.03.2023, under Section 161 of the Code.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 13 of 41
statement dated 16.02.2023 under Section 164 of the Code is
similar.
o The appellant – Manish Sisodia, had issued directions to
Sanjay Goel,
22
to prepare a note without the opinion of legal
experts. Reliance is placed on the statement of Sanjay Goel
dated 17.01.2023 under Section 161 of the Code, and the letter
dated 02.02.2023 by the appellant – Manish Sisodia to the
Excise Commissioner.
• The draft GoM Report on new excise policy, as retrieved from the
computer under the control of the appellant – Manish Sisodia was
typed/uploaded on 15.03.2021 and was last modified at 11.27 a.m.
The wholesalers were entitled to a minimum 5% commission on the
landed price. As no upper limit was prescribed, the manufacturers
and wholesale distributors could negotiate and settle for a higher
commission.
• Big manufacturers with high market share and turnover, would not
have agreed to a commission higher than 5%, or commission at the
@ 12% of the landed cost.
• A liquor group from Hyderabad stayed in Delhi from 16.03.2021 to
18.03.2021. Arun Pillai, Abhishek Boinpally, and Sarath Reddy from
22
Excise Commissioner of NCT of Delhi, who had replaced Rahul Singh.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 14 of 41
the liquor group had several meetings with Vijay Nair, who was the
middleman, a member of the AAP, and a close confidant of the
appellant – Manish Sisodia. He was residing in a government
bungalow allotted to a Cabinet Minister, who was a part of GOM.
23
The agenda of the meetings were to decide changes in the excise
policy, to enable them to earn super-profits in return for kickbacks.
o On the evening of 16.03.2021, Abhishek Boinpally and Butchi
Babu, who were staying at Hotel Oberoi, travelled to another
Oberoi hotel in Civil Lines, where they met Vijay Nair, who was
staying in a close proximity. The travel to the Oberoi Hotel in
Civil Lines is established by an invoice
24
, call record details and
statement of an employee of the Oberoi.
25
o A print/photocopy of a 36 page document was made on
16.03.2021 at Hotel Oberoi, Civil Lines, Delhi.
26
o The document/print was taken by Vijay Nair, and handed over
to the appellant – Manish Sisodia. The appellant – Manish
Sisodia gave ‘the print’ to his secretary C. Arvind.
o The altered GoM report dated 18.03.2023 consists of 36 pages,
if one excludes the index and the title page. Reference is made
23
Reliance is placed upon statements made by Arun Pillai, Butchi Babu and Dinesh Arora. Reliance is
also placed on screenshots found in the phone of Manoj Rai, an employee of Pernod Ricard.
24
On 16.03.2021, Rs. 3,000/- had been billed under the description, “Logistic Charges”.
25
Statement of Ibrahim Magdum dated 03.02.2023, under Section 161 of the Code.
26
On 16.03.2021, Rs. 360/- had been billed under the description, “Print/Photocopy”.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 15 of 41
to the statement of C. Arvind dated 16.02.2023, under Section
164 of the Code.
o Screenshots of WhatsApp chats of Butchi Babu dated
20.03.2021, which is prior to submission of the GoM report to
the Cabinet on 22.3.2022, refers to the creation of the new post
of the Director, Wholesale Operation. Based on the
print/document prepared by the liquor group, the GoM report to
the Cabinet was modified to create this post.
o Further, the minimum wholesaler fee of 5% under the draft
dated 15.03.2021, was modified to mandatory and fixed fee of
12% in the altered GoM report submitted to the Cabinet.
• The GoM did not meet between 15.03.2021 and 19.03.2021. There
are neither any deliberations/discussions nor any noting/
calculations by the GoM for increasing the wholesale commission/
fee from 5% to 12%. Reliance is placed on the statement of Arava
Gopi Krishna under Section 164 of the Code. Reliance is also placed
on the statement of Sanjay Goel, dated 11.04.2023, under Sections
50(2) and 50(3) of the PML Act.
• The appellant – Manish Sisodia was unable to provide any rational
explanation for increasing the commission from 5% to 12%.
27
He
27
Statement of Manish Sisodia dated 07.03.2023, under Section 50(2) and 50(3) of the PML Act.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 16 of 41
had stated that even under the old regime there was no calculation
for the 5% margin.
• The appellant – Manish Sisodia had used his influence for grant of
wholesale licence to Indo Spirit, a firm in which the liquor group had
substantial interest. Reliance is placed on the statements made
under Section 164 of the Code by Arava Gopi Krishna, and C.
Arvind, dated 16.02.2023. Reliance is also placed on the statement
of Dinesh Arora, dated 24.11.2022, recorded under Section 306 of
the Code.
• License to Indo Spirit was granted in spite of existing complaints of
cartelisation against the partners of Indo Spirit, namely, Sameer
Mahendru and his wife. The complainant was asked to take back
his complaint.
28
• The license fee payable by the wholesale distributor was fixed at
Rs.5,00,00,000/- (rupees five crores only). The license fee was
deliberately not fixed on the turnover, to facilitate and at the behest
of the liquor group.
• Three big manufacturers held 85% market share. The entire
scheme was a pretence to recoup and get bribe and kickback from
the big wholesale distributors, who acted as the middlemen and
28
Statement of Jagbir Sidhu dated 19.09.2022, under Section 161 of the Code.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 17 of 41
were entitled to fixed commission @ 12% of the landed price on the
turnover, but were required to pay a fixed license fee of
Rs.5,00,00,000/- (rupees five crores only) to the government.
• The manufacturers could appoint and enter into a distributorship
agreement with only one wholesale distributor. They were not
entitled to appoint multiple wholesale distributors. However, the
wholesaler could enter into a contract with more than one
manufacturer. New excise policy was clearly lopsided and favoured
the big wholesale distributors.
• Mahadev Liquor, a contender and wholesale distributor of 14 small
manufacturers having about 20% market share, was forced to
surrender their licence since they were not ready to pay kickbacks.
Mahadev Liquor had business in Punjab and the state machinery of
Punjab Excise Department was used to arm-twist them.
29
• Pernod Ricard, the largest manufacturer, was directed to do
business through Indo Spirit. Reliance is placed upon evidence
collected from the mobile chats, including screenshots, as well as
statements of an employee
30
.
• The plea that the appellant – Manish Sisodia was not in possession
of the proceeds of the crime, should not be accepted as the
29
Statement of Jasdeep Kaur Chadha dated 23.08.2022 under Section 50(2) and 50(3) of the PML Act.
30
Statement of Manoj Rai dated 31.12.2022, under Sections 50(2) and 50(3) of the PML Act.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 18 of 41
expression ‘possession’ includes constructive possession. A person
need not be in actual possession. When a person exercises
dominion or control over a thing, directly or indirectly, through
another person, he is in ‘possession’ over the said thing. The
appellant – Manish Sisodia was a key to the processes and activities
dealing with the proceeds of the crime and in using proceeds of the
crime. He had created an eco-system for generating, concealing
and projecting the tainted money, used subsequently by AAP.
• The kickback or the proceeds of the crime of Rs.100,00,00,000
(rupees one hundred crore only) were received from the liquor
group, and used by the associates of the appellant – Manish Sisodia
and other leaders of AAP.
o Portions of these proceeds of crime were used in the Goa
election campaign through multiple persons and entities. The
attempt was to conceal the true nature of the proceeds of the
crime and to project them as untainted money.
o Part of the proceeds of crime of Rs.100,00,00,000 (rupees
one hundred crore only) were transferred through a complex
web of transactions through hawala route, which have been
traced in spite of erasure of digital and documentary evidence.
• The appellant – Manish Sisodia was unable to produce his two
mobile phones out of three mobile phones used between the period
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 19 of 41
01.01.2021 to 19.08.2022. Only one phone was seized by the CBI
on 19.08.2022, which was being used only since 22.07.2022. He
has deliberately destroyed the evidence.
• The appellant – Manish Sisodia, given his power and political clout,
and being the main accused in the conspiracy, may have the
evidence destroyed, and the witnesses and documents may be
exposed.
• Dinesh Arora’s statement to the DoE dated 14.08.2023, under
Sections 50(2) and 50(3) of the PML Act, had revealed that he had
taken Rs. 2,20,00,000 (rupees two crore twenty lakhs only) from
Amit Arora, for the appellant – Manish Sisodia. This was on account
of favourable change and tweak in the new excise policy.
Analysis
8. Referring to Section 45
31
of the PML Act, in Vijay Madanlal
Choudhary (supra), the three Judges’ Bench has opined that the
31
Section 45 reads:
“45. Offences to be cognizable and non-bailable.— (1) Notwithstanding anything contained in the
Code of Criminal Procedure, 1973 (2 of 1974), no person accused of an offence under this Act shall be
released on bail or on his own bond unless—
(i) the Public Prosecutor has been given an opportunity to oppose the application for such release; and
(ii) where the Public Prosecutor opposes the application, the court is satisfied that there are reasonable
grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence
while on bail:
Provided that a person, who, is under the age of sixteen years, or is a woman or is sick or infirm or is
accused either on his own or along with other co-accused of money-laundering a sum of less than one
crore rupees, may be released on bail, if the Special Court so directs:
Provided further that the Special Court shall not take cognizance of any offence punishable under
Section 4 except upon a complaint in writing made by—
(i) the Director; or
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 20 of 41
provision does not require that to grant bail, the court must arrive at
a positive finding that the applicant has not committed an offence
under the PML Act. Section 45 must be construed reasonably as
the intent of the legislature cannot be read as requiring the court to
examine the issue threadbare and in detail to pronounce whether
an accused is guilty or is entitled to acquittal. Further, an order on
an application for bail is passed much before the end of trial and
sometimes even before commencement of trial. Lastly, it is trite, that
for the purpose of considering an application for bail, although
detailed reasons are not necessary to be assigned, and, therefore,
the evidence need not be weighed meticulously, a tentative finding
should be recorded on the basis of broad probabilities. The order
granting bail must demonstrate application of mind at least in
serious cases where the applicant has been granted or denied bail.
The findings recorded by the Court for grant or refusing bail being
(ii) any officer of the Central Government or a State Government authorised in writing in this behalf by
the Central Government by a general or special order made in this behalf by that Government.
(1-A) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), or any
other provision of this Act, no police officer shall investigate into an offence under this Act unless
specifically authorised, by the Central Government by a general or special order, and, subject to such
conditions as may be prescribed.
(2) The limitation on granting of bail specified in sub-section (1) is in addition to the limitations under
the Code of Criminal Procedure, 1973 (2 of 1974) or any other law for the time being in force on
granting of bail.
Explanation.—For the removal of doubts, it is clarified that the expression ‘Offences to be cognizable
and non-bailable’ shall mean and shall be deemed to have always meant that all offences under this
Act shall be cognizable offences and non-bailable offences notwithstanding anything to the contrary
contained in the Code of Criminal Procedure, 1973 (2 of 1974), and accordingly the officers authorised
under this Act are empowered to arrest an accused without warrant, subject to the fulfilment of
conditions under section 19 and subject to the conditions enshrined under this section.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 21 of 41
tentative, will not have any bearing on the merits of the case, and
the trial court would proceed and decide the case on the basis of
evidence produced during trial without in any manner being
prejudiced thereby.
9. We have copiously referred to the assertions, arguments and
contentions of both sides, and in terms of the mandate in Vijay
Madanlal Choudhary (supra), we will be examining the allegations
and the legal position to form our tentative opinion. However, we
must notice and take on record at some aspects upfront.
10. First, the assertion that Rs. 2,20,00,000 (rupees two crores twenty
lakhs only) was paid as bribe to the appellant – Manish Sisodia by
Amit Arora, through middleman Dinesh Arora, is not a charge or an
allegation made in the chargesheet filed by the CBI. It may be
difficult to regard the alleged payment as a ‘proceed of crime’ under
the PML Act.
11. Secondly, it has been submitted by the DoE that AAP is a trust and
is a “person” under Section 2(1)(s) of the PML Act. Being a juristic
person, it acts through natural persons. The assertion made is that
a portion of the proceeds of crime were used for the purpose of the
artificial judicial person to fund the election in Goa. The DoE has
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 22 of 41
stated at the Bar, and in the written submissions, that once the
quantum of amount used in the election in Goa is ascertained, a
decision to consider AAP as an accused under Section 3 will be
taken. It is stated by the DoE that the matter in this regard is being
processed. In the written submissions, the DoE states:
“...some of the PoC (Proceeds of Crime) has been used
for the purpose of artificial juridical person through its
office bearers in the election funding of the AAP in Goa
as well for the benefit of office bearers as indicated
above. Once the quantum of amount used for election in
Goa is ascertained a decision to consider AAP as
accused under Section 3 read with Section 70 of the
PMLA (PML Act) shall be taken at that point of time.”
12. Thirdly, the assertion in the complaint filed with the DoE that
kickback of Rs.100,00,00,000 (rupees one hundred crore only) was
actually paid by the liquor group is somewhat a matter of debate.
However, there is an assertion, and the DoE has relied on evidence
and material, that a portion thereof, that is, Rs. 45,00,00,000 (rupees
forty five crores only) was transferred through Hawala for the Goa
election and used by AAP, a political party, which is a juristic
person.
32
AAP is not being prosecuted. The charge that the
appellant – Manish Sisodia is vicariously liable in terms of Section
70 of the PML Act cannot be alleged and has not been argued.
33
32
We are not commenting on the material and evidence relied by the DoE or CBI.
33
See – Aneeta Hada v. Godfather Travels and Tours Private Limited, (2012) 5 SCC 661, and
Sharad Kumar Sanghi v. Sangita Rane, (2015) 12 SCC 781.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 23 of 41
13. Fourthly, the contention of the DoE that generation of proceeds of
crime is itself ‘possession’ or ‘use’ of the ‘proceeds of crime’, prima
facie, appears to be unclear and not free from doubt in view of the
ratio in Vijay Madanlal Choudhary (supra). Further, the DoE’s
contention that ‘generation’ amounts to possession and the
expression ‘possession’ includes constructive possession, for which
reliance is placed upon Mohan Lal v. State of Rajasthan
34
, is not
assured.
14. On the other hand, the appellant – Manish Sisodia relies on
paragraphs 251, 269 and 270 of Vijay Madanlal Choudhay
(supra), to contend that money laundering is an independent
offence regarding the process or activity connected with the
proceeds of crime derived as a result of criminal activity relating to
or in relation to a scheduled offence. It is submitted that Vijay
Madanlal Choudhry (supra) has held that PML Act is an
independent and distinct Act which deals with offences relating to
only proceeds of crime, and not with the crime itself which generates
the proceeds of the crime. In particular, paragraph 406 in Vijay
Madanlal Choudhary (supra) states:
“406…The fact that the proceeds of crime have been
generated as a result of criminal activity relating to a
34
(2015) 6 SCC 222.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 24 of 41
scheduled offence, which incidentally happens to be a
non-cognisable offence, would make no difference. The
person is not prosecuted for the scheduled offence by
invoking provisions of the 2002 Act, but only when he
has derived or obtained property as a result of criminal
activity relating to or in relation to a scheduled offence
and the indulges in process or activity connected with
such proceeds of crime...”
Paragraph 407 similarly states:
“407…the offence under this Act in terms of Section 3 is
specific to involvement in any process or activity
connected with the proceeds of crime which is
generated as a result of criminal activity related to the
scheduled offence…”
15. In Mohan Lal (supra), the expression ‘possession’, it is held,
consists of two elements. First, it refers to corpus of physical control
and second it refers to the animus or intent which has reference to
exercise of self-control. In the context of narcotics laws, a person is
said to possess control over the substance when he knows the
substance is immediately accessible and exercises dominion or
control over the substance. The power and dominion over the
substance is, therefore, fundamental. The stand of the DoE as to
the constructive possession, will be satisfied only if the dominion
and control criteria is satisfied. If the proceeds of crime are in
dominion and control of a third person, and not in the dominion and
control of the person charged under Section 3, the accused is not in
possession of the proceeds of the crime. It would be a different
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 25 of 41
matter, when an accused, though not in possession, is charged for
use, concealment or acquisition of the proceeds of the crime, or
projects or claims the proceeds of crime as untainted property. The
involvement of an accused may be direct or indirect. Prima facie,
there is lack of clarity, as specific allegation on the involvement of
the appellant – Manish Sisodia, direct or indirect, in the transfer of
Rs. 45,00,00,000 (rupees forty five crores only) to AAP for the Goa
elections is missing.
16. This Court in Y. Balaji v. Karthik Desari and Another
35
, while
examining contours of Section 3 of the PML Act
36
, referred to the
drafting note on self-laundering contained in the U.N. Model Law
2009, which states that the third party would be liable for money
35
(2023) SCC Online SC 645.
36
Section 3 of the PML Act reads:
Section 3 of the PML Act reads:
“3. Offence of money-laundering.—Whosoever directly or indirectly attempts to indulge or knowingly
assists or knowingly is a party or is actually involved in any process or activity connected with
the proceeds of crime including its concealment, possession, acquisition or use and projecting or
claiming it as untainted property shall be guilty of offence of money-laundering.
Explanation.—For the removal of doubts, it is hereby clarified that,—
(i) a person shall be guilty of offence of money-laundering if such person is found to have directly or
indirectly attempted to indulge or knowingly assisted or knowingly is a party or is actually involved in
one or more of the following processes or activities connected with proceeds of crime, namely—
(a) concealment; or
(b) possession; or
(c) acquisition; or
(d) use; or
(e) projecting as untainted property; or
(f) claiming as untainted property,
in any manner whatsoever;
(ii) the process or activity connected with proceeds of crime is a continuing activity and continues till
such time a person is directly or indirectly enjoying the proceeds of crime by its concealment or
possession or acquisition or use or projecting it as untainted property or claiming it as untainted property
in any manner whatsoever.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 26 of 41
laundering even where the fundamental principles of domestic law
require that it will not apply to persons who commit the predicate
offence. In some countries, constitutional principles prohibit
prosecuting a person both for money laundering and a predicate
offence. However, in most common law countries, the fundamental
principles do not prohibit application of money laundering offence to
self-launderers. On dissection of the main part of Section 3, it is held
that it postulates three ‘p’s, namely, the person, the process or
activity, and the product. The process or activity consists of six parts
– concealment, possession, acquisition, use, projecting or claiming
the proceeds of crime as untainted property. The product, that is,
the proceeds of the crime, has been defined in Section 2(u) of the
PML Act, as a property derived or obtained directly or indirectly by
a person as a result of criminal activity relating to a scheduled
offence or the value of such property.
37
As far as ‘person’ is
concerned, it means those who directly or indirectly attempt to
indulge; those who knowingly assist, or those who are knowingly a
party, or those who are actually involved. On the above
interpretation, this court held that the offence under Section 3 of the
37
Section 2(u) of the PML Act reads:
“‘proceeds of crime’ means any property derived or obtained, directly or indirectly, by any person
as a result of criminal activity relating to a scheduled offence or the value of any such property or
where such property is taken or held outside the country, then the property equivalent in value
held within the country or abroad;”
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 27 of 41
PML Act includes both the persons who commit the predicate or
schedule offence and third party launderers.
38
17. The judgment in Y. Balaji (supra), it is submitted by the appellant –
Manish Sisodia, does not specifically examine whether ‘generation’
will be included in the six activities covered under the head ‘process
or activity’. The second ‘p’ must relate to the activity or process with
the third ‘p’, that is, the product, which is the proceeds of crime.
However, we need not, in the present case, definitively pronounce
on the said aspects as these issues and contentions will have to be
examined threadbare by the trial court, or in an appropriate case by
this Court.
18. The offence of conspiracy and abetment, in terms of Sections 120/
120B and Sections 107/108 of the IPC, are not applicable to
offences under the PML Act. At the same time, Section 3 of the PML
Act is wide and encompassing as it uses the words, “directly or
indirectly”, with reference to the person involved, and knowingly
assists, or knowingly is a party in an offence in relation to the
concealment, possession, acquisition, use, projecting or claiming
the proceeds of crime as untainted property.
39
38
For the purpose of the present decision, we need not examine whether there is a conflict in the ratio
in Y. Balaji (supra) and the ratio in Vijay Madanlal Choudhary (supra).
39
Scope and ambit of these words/expressions has not been examined by us.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 28 of 41
19. We must also record that the DoE has not urged and argued before
us the contention that the new liquor policy is vitiated on the ground
that retail vends had to be and were auctioned, though the R.D.
Committee’s Report dated 13.10.2020 has suggested retail vends
should be allotted by lottery.
40
Normally, auction and allotment to the
highest bidder would be fair and beneficial for revenue generation,
though in certain circumstances allotment by other modes may be
more fair and better.
41
We will not go into the said aspect. Neither
are we examining whether this plea can be taken by the DoE, in
view of Articles 74(2)
42
and 163(3)
43
of the Constitution of India, as
this relates to the wisdom or merits of the choice that every elected
government has while formulating a policy.
44
However, we should
not be understood to mean that no policy decision would fall foul as
40
Relevant portion of the R.D. Committee Report dated 13.10.2020 reads: “1.3.4…. The lottery
applications will be against the pool of all 846 vends and will be randomly allotted in wards, NDMC area
and airports…” In the written submissions filed by the prosecution several assertions have been made.
41
In Indian Medicines Pharmaceuticals Corporation Ltd. v. Kerala Ayurvedic Cooperative Society
Ltd. And Ors., 2023 SCC OnLine SC 5, this Court held that:
“17. This Court has consistently held that government contracts must be awarded by a transparent
process. The process of inviting tenders ensures a level playing field for competing entities. While
there may be situations which warrant a departure from the percept of inviting tenders or
conducting public auctions, the departure must not be unreasonable or discriminatory. In Centre
for Public Interest Litigation v. Union of India, the ‘first-cum- serve’ policy was held to be arbitrary
while alienating natural resources. However, the Court observed that though auction is ‘preferred’
method of allocation, it cannot be construed to be a constitutional requirement.”
42
Article 74(2) of the Constitution of India reads: “…(2) The question whether any, and if so what,
advice was tendered by Ministers to the President shall not be inquired into in any court.”
43
Article 163(3) of the Constitution of India reads: “…(3) The question whether any, and if so what,
advice was tendered by Ministers to the Governor shall not be inquired into in any court.”
44
See In Yashwant Sinha and Ors. v. Central Bureau of Investigation, (2019) 6 SCC 1, State of
Uttar Pradesh v. Raj Narain, (1975) 4 SCC 428, Doypack Systems (P) Ltd. v. Union of India, (1988)
2 SCC 299 and other cases.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 29 of 41
to be covered as an offence under Section 7 of the PoC Act. We
shall subsequently examine Section 7 of the PoC Act viz. the facts
alleged. We need not go into the questions in detail as the argument
with reference to Article 163(3) has not been specifically raised on
behalf of the appellant – Manish Sisodia, though the plea that the
CBI, the DoE and the Court should not examine merits and wisdom
behind the choice of policy decision have been raised.
20. The appellant – Manish Sisodia, it is claimed, had deliberately
destroyed the two mobile phones so as to prevent any investigation.
Further, he had changed his mobile phone on 22.07.2022, the date
on which the media had covered the news of the complaint sent by
the LG of NCT of Delhi to the CBI for investigation. The appellant –
Manish Sisodia states that people do change mobile phones
frequently, and old phones need not be retained. Whether or not
the allegation as to deliberate destruction of mobile phones is
correct would be decided post recording of evidence, but this would
not be a weighty factor for deciding the question of bail, given the
period of detention undergone by the appellant – Manish Sisodia.
45
45
See Section 201 of the IPC, which reads:
“201. Causing disappearance of evidence of offence, or giving false information to screen offender.—
Whoever, knowing or having reason to believe that an offence has been committed, causes any
evidence of the commission of that offence to disappear, with the intention of screening the offender
from legal punishment, or with that intention gives any information respecting the offence which he
knows or believes to be false,
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 30 of 41
21. However, there is one clear ground or charge in the complaint filed
under the PML Act, which is free from perceptible legal challenge
and the facts as alleged are tentatively supported by material and
evidence. This discussion is equally relevant for the charge-sheet
filed by the CBI under the PoC Act and IPC. We would like to
recapitulate the facts as alleged, which it is stated establish an
offence under Section 3 of the PML Act and the PoC Act. These are:
• In a period of about ten months, during which the new excise
policy was in operation, the wholesale distributors had earned
Rs. 581,00,00,000 (rupees five hundred eighty one crores
only) as the fixed fee.
• The one time licence fee collected from 14 wholesale
distributors was about Rs.70,00,00,000 (rupees seventy
crores only).
• Under the old policy 5% commission was payable to the
wholesale distributors/licensees.
if a capital offence.—shall, if the offence which he knows or believes to have been committed is
punishable with death, be punished with imprisonment of either description for a term which may extend
to seven years, and shall also be liable to fine;
if punishable with imprisonment for life.—and if the offence is punishable with imprisonment for life, or
with imprisonment which may extend to ten years, shall be punished with imprisonment of either
description for a term which may extend to three years, and shall also be liable to fine;
if punishable with less than ten years' imprisonment.—and if the offence is punishable with
imprisonment for any term not extending to ten years, shall be punished with imprisonment of the
description provided for the offence, for a term which may extend to one-fourth part of the longest term
of the imprisonment provided for the offence, or with fine, or with both.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 31 of 41
• The difference between the 12%; minus 5% of the wholesale
profit margin plus Rs.70,00,00,000/-; it is submitted, would
constitute proceeds of crime, an offence punishable under the
PML Act. The proceeds of crime were acquired, used and
were in possession of the wholesale distributors who have
unlawfully benefitted from illegal gain at the expense of the
government exchequer and the consumers/buyers.
46
Relevant
portion of the criminal complaint filed by the DoE dated
04.05.2023, reads:
“One of the reasons given by Sh Manish Sisodia is to
compensate the wholesaler for increased license fee
from Rs 5 lacs to Rs. 5 Cr. During this policy period, 14
LI licences were given by Excise Department, by
raising the license fee for LI to Rs. 5 Cr in the entire
period of operation of the Delhi Excise Policy 2021- 22,
the Govt. has earned Rs. 75.16 Cr from the license fee
of LI (as per Excise department communication dated
11.04.2023) (RUD 34). On the other hand the excess
profit earned by the wholesalers during this period is to
the tune of Rs. 338 Cr. (7% additional profit earned due
to increase from 5% to 12%, Rs. 581 Cr being the total
profit of LI as informed by Excise department).
Therefore there 1s no logical correlation between the
license fee increase and the profit margin increase.
Whereas this excess profit margin benefit could have
been passed on to the consumers in form of lower
MRP. Contrary to the claim that the policy was meant
to benefit the public or the exchequer, it was rather a
conspiracy to ensure massive illegal gains to a select
few private players/individuals/entities.”
46
We wish to clarify that not all distributor licensees may be involved or have committed an offence
under Section 3 of the PML Act. The figures quoted above relate to the 14 licensees, and have to be
watered down/lowered to the sales made by the delinquent whole-sale distributor licensees who are
being prosecuted.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 32 of 41
22. The charge-sheet under the PoC Act includes offences for unlawful
gains to a private person at the expense of the public exchequer.
Reference in this regard is made to the provisions of Sections 7, 7A,
8 and 12 of the PoC Act.
23. Clauses (a) and (b) to Section 7 of the PoC Act
47
apply: (a) when a
public servant obtains, accepts or intends to obtain from another
person undue advantage with the intent to perform or fail to
improperly or to forbear or cause forbearance to cause by himself
or by another person; (b) obtains or accepts or attempts to obtain
undue advantage from a person as a reward or dishonest
performance of a public duty or forbearance to perform such duty,
47
Section 7 of PoC Act reads:
“7. Offence relating to public servant being bribed.—Any public servant who,—
(a) obtains or accepts or attempts to obtain from any person, an undue advantage, with the intention to
perform or cause performance of public duty improperly or dishonestly or to forbear or cause
forbearance to perform such duty either by himself or by another public servant; or
(b) obtains or accepts or attempts to obtain, an undue advantage from any person as a reward for the
improper or dishonest performance of a public duty or for forbearing to perform such duty either by
himself or another public servant; or
(c) performs or induces another public servant to perform improperly or dishonestly a public duty or to
forbear performance of such duty in anticipation of or in consequence of accepting an undue advantage
from any person,
shall be punishable with imprisonment for a term which shall not be less than three years but which
may extend to seven years and shall also be liable to fine.
Explanation 1.—For the purpose of this section, the obtaining, accepting, or the attempting to obtain an
undue advantage shall itself constitute an offence even if the performance of a public duty by public
servant, is not or has not been improper.
Illustration.—A public servant, ‘S’ asks a person, ‘P’ to give him an amount of five thousand rupees to
process his routine ration card application on time. ‘S’ is guilty of an offence under this section.
Explanation 2.—For the purpose of this section,—
(i) the expressions ‘obtains’ or ‘accepts’ or ‘attempts to obtain’ shall cover cases where a person being
a public servant, obtains or ‘accepts’ or attempts to obtain, any undue advantage for himself or for
another person, by abusing his position as a public servant or by using his personal influence over
another public servant; or by any other corrupt or illegal means;
(ii) it shall be immaterial whether such person being a public servant obtains or accepts, or attempts to
obtain the undue advantage directly or through a third party.”
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 33 of 41
either by himself or by another public servant. Explanation (2)
construes the words and expression, “obtains, accepts or attempts
to obtain”, as to cover cases where a public servant obtains, accepts
or intends to obtain any undue advantage by abusing his position as
a public servant or by using his personal interest over another public
servant by any other corrupt or illegal means. It is immaterial
whether such person being a public servant accepts or attempts to
obtain the undue advantage directly or through a third party.
24. On this aspect of the offences under the PoC Act, the CBI has
submitted that conspiracy and involvement of the appellant –
Manish Sisodia is well established. For the sake of clarity, without
making any additions, subtractions, or a detailed analysis, we would
like to recapitulate what is stated in the chargesheet filed by the CBI
against the appellant – Manish Sisodia:
• The existing excise policy was changed to facilitate and get
kickbacks and bribes from the wholesale distributors by
enhancing their commission/fee from 5% under the old policy
to 12% under the new policy. Accordingly, a conspiracy was
hatched to carefully draft the new policy, deviating from the
expert opinion/views to create an eco-system to assure unjust
enrichment of the wholesale distributors at the expense of
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 34 of 41
government exchequer or the consumer. The illegal income
(proceeds of crime, as per the DoE) would partly be recycled
and returned in the form of bribes.
• Vijay Nair, who was the middleman, a go-between, a member
of AAP, and a co-confident of the appellant – Manish Sisodia,
had interacted with Butchi Babu, Arun Pillai, Abhishek Boinpally
and Sarath Reddy, to frame the excise policy on conditions and
terms put forth and to the satisfaction and desire of the liquor
group.
• Vijay Nair and the members of the liquor group had meetings
on different dates, including 16.03.2021, and had prepared the
new excise policy, which was handed over to Vijay Nair.
Thereupon, the commission/fee, which was earlier fixed at
minimum of 5%, was enhanced to fixed fee of 12% payable to
wholesale distributor.
• The appellant – Manish Sisodia was aware that three liquor
manufacturers have 85% share in the liquor market in Delhi.
Out of them two manufacturers had 65% liquor share, while 14
small manufacturers had 20% market share. As per the term in
the new excise policy - each manufacturer could appoint only
one wholesale distributor, through whom alone the liquor would
be sold. At the same time, the wholesale distributors could enter
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 35 of 41
into distribution agreements with multiple manufacturers. This
facilitated getting kickbacks or bribes from the wholesale
distributors having substantial market share and turnover.
• The licence fee payable by the wholesale distributor was a fixed
amount of Rs.5,00,00,000/- (rupees five crores only). It was not
dependant on the turnover. The new policy facilitated big
wholesale distributors, whose outpour towards the licence fee
was fixed.
• The policy favoured and promoted cartelisation. Large
wholesale distributors with high market share because of
extraneous reasons and kickbacks, were ensured to earn
exorbitant profits.
• Mahadev Liquor, who was a wholesale distributor for 14 small
manufacturers, having 20% market share, was forced to
surrender the wholesale distributorship licence.
• Indo Spirit, the firm in which the liquor group had interest, was
granted whole distributor licence, in spite of complaints of
cartelisation etc. which were overlooked. The complainant was
forced to take back his complaint.
• The excess amount of 7% commission/fee earned by the
wholesale distributors of Rs.338,00,00,000/- (rupees three
hundred thirty eight crores only) constitute an offence as
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 36 of 41
defined under Section 7 of the PoC Act, relating to a public
servant being bribed. (As per the DoE, these are proceeds of
crime). This amount was earned by the wholesale distributors
in a span of ten months. This figure cannot be disputed or
challenged. Thus, the new excise policy was meant to give
windfall gains to select few wholesale distributors, who in turn
had agreed to give kickbacks and bribes.
• No doubt, VAT and excise duty was payable separately.
However, under the new policy the VAT was reduced to mere
1%.
• Vijay Nair had assured the liquor group that they would be
made distributor of Pernod Ricard, one of the biggest players in
the market. This did happen.
25. In view of the aforesaid discussion and for the reasons stated, we
are not inclined to accept the prayer for grant of bail at this stage.
26. However, we are also concerned about the prolonged period of
incarceration suffered by the appellant – Manish Sisodia. In P.
Chidambaram v. Directorate of Enforcement
48
, the appellant
therein was granted bail after being kept in custody for around 49
48
(2020) 13 SCC 791.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 37 of 41
days
49
, relying on the Constitution Bench in Shri Gurbaksh Singh
Sibbia and Others v. State of Punjab
50
, and Sanjay Chandra v.
Central Bureau of Investigation
51
, that even if the allegation is one
of grave economic offence, it is not a rule that bail should be denied
in every case. Ultimately, the consideration has to be made on a
case to case basis, on the facts. The primary object is to secure the
presence of the accused to stand trial. The argument that the
appellant therein was a flight risk or that there was a possibility of
tampering with the evidence or influencing the witnesses, was
rejected by the Court. Again, in Satender Kumar Antil v. Central
Bureau of Investigation and Another
52
, this Court referred to
Surinder Singh Alias Shingara Singh v. State of Punjab
53
and
Kashmira Singh v. State of Punjab
54
, to emphasise that the right
to speedy trial is a fundamental right within the broad scope of
Article 21 of the Constitution. In Vijay Madanlal Choudhary
(supra), this Court while highlighting the evil of economic offences
like money laundering, and its adverse impact on the society and
citizens, observed that arrest infringes the fundamental right to life.
49
In P. Chidambaram v. Central Bureau of Investigation, (2020) 13 SCC 337, the appellant therein
was granted bail after being kept in custody for around 62 days.
50
(1980) 2 SCC 565.
51
(2012) 1 SCC 40.
52
(2022) 10 SCC 51.
53
(2005) 7 SCC 387.
54
(1977) 4 SCC 291.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 38 of 41
This Court referred to Section 19 of the PML Act, for the in-built
safeguards to be adhered to by the authorised officers to ensure
fairness, objectivity and accountability.
55
Vijay Madanlal
Choudhary (supra), also held that Section 436A of the Code
56
can
apply to offences under the PML Act, as it effectuates the right to
speedy trial, a facet of the right to life, except for a valid ground such
as where the trial is delayed at the instance of the accused himself.
In our opinion, Section 436A should not be construed as a mandate
that an accused should not be granted bail under the PML Act till he
has suffered incarceration for the specified period. This Court, in
Arnab Manoranjan Goswami v. State of Maharashtra and
Others
57
, held that while ensuring proper enforcement of criminal
law on one hand, the court must be conscious that liberty across
human eras is as tenacious as tenacious can be.
55
See also Pankaj Bansal v. Union of India and Ors., 2023 SCC OnLine SC 1244.
56
436A of the Code reads:
“436-A. Maximum period for which an undertrial prisoner can be detained.—Where a person has,
during the period of investigation, inquiry or trial under this Code of an offence under any law (not being
an offence for which the punishment of death has been specified as one of the punishments under that
law) undergone detention for a period extending up to one-half of the maximum period of imprisonment
specified for that offence under that law, he shall be released by the Court on his personal bond with or
without sureties:
Provided that the Court may, after hearing the Public Prosecutor and for reasons to be recorded by it in
writing, order the continued detention of such person for a period longer than one-half of the said period
or release him on bail instead of the personal bond with or without sureties:
Provided further that no such person shall in any case be detained during the period of investigation,
inquiry or trial for more than the maximum period of imprisonment provided for the said offence under
that law.
Explanation.—In computing the period of detention under this section for granting bail, the period of
detention passed due to delay in proceeding caused by the accused shall be excluded.”
57
(2021) 2 SCC 427.
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 39 of 41
27. The appellant – Manish Sisodia has argued that given the number
of witnesses, 294 in the prosecution filed by the CBI and 162 in the
prosecution filed by the DoE, and the documents 31,000 pages and
25,000 pages respectively, the fact that the CBI has filed multiple
charge sheets, the arguments of charge have not commenced. The
trial court has allowed application of the accused for furnishing of
additional documents, which order has been challenged by the
prosecution under Section 482 of the Code before the High Court.
It was stated at the Bar, on behalf of the prosecution that the said
petition under Section 482 will be withdrawn. It was also stated at
the Bar, by the prosecution that the trial would be concluded within
next six to eight months.
28. Detention or jail before being pronounced guilty of an offence should
not become punishment without trial. If the trial gets protracted
despite assurances of the prosecution, and it is clear that case will
not be decided within a foreseeable time, the prayer for bail may be
meritorious. While the prosecution may pertain to an economic
offence, yet it may not be proper to equate these cases with those
punishable with death, imprisonment for life, ten years or more like
offences under the Narcotic Drugs and Psychotropic Substances
Act, 1985, murder, cases of rape, dacoity, kidnaping for ransom,
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 40 of 41
mass violence, etc. Neither is this a case where 100/1000s of
depositors have been defrauded. The allegations have to be
established and proven. The right to bail in cases of delay, coupled
with incarceration for a long period, depending on the nature of the
allegations, should be read into Section 439 of the Code and Section
45 of the PML Act. The reason is that the constitutional mandate is
the higher law, and it is the basic right of the person charged of an
offence and not convicted, that he be ensured and given a speedy
trial. When the trial is not proceeding for reasons not attributable to
the accused, the court, unless there are good reasons, may well be
guided to exercise the power to grant bail. This would be truer where
the trial would take years.
29. In view of the assurance given at the Bar on behalf of the
prosecution that they shall conclude the trial by taking appropriate
steps within next six to eight months, we give liberty to the appellant
– Manish Sisodia to move a fresh application for bail in case of
change in circumstances, or in case the trial is protracted and
proceeds at a snail’s pace in next three months. If any application
for bail is filed in the above circumstances, the same would be
considered by the trial court on merits without being influenced by
the dismissal of the earlier bail application, including the present
Criminal Appeal a/o. of SLP (Crl.) No. 8167 of 2023 & Anr. Page 41 of 41
judgment. Observations made above, re.: right to speedy trial, will,
however, be taken into consideration. The appellant – Manish
Sisodia may also file an application for interim bail in case of ill-
health and medical emergency due to illness of his wife. Such
application would be also examined on its own merits.
30. Recording the aforesaid, the appeals are dismissed. However, we
clarify that the observations made in this judgment, either way, are
only for disposal of the present appeals, and these would not
influence the trial court on the merits of the case, which would
proceed in accordance with law, and decided on the basis of the
evidence led. All disputed factual and legal issues are left open.
......................................J.
(SANJIV KHANNA)
…...................................J.
(S.V.N. BHATTI)
NEW DELHI;
OCTOBER 30, 2023.
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