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Synopsis

The Delhi High Court, on Tuesday, granted bail to Christian Micheal James, a British national accused of allegedly acting as the ‘middleman’ and accepting bribes to facilitate India’s acquisition of 12 helicopters from the Italian company Finmeccanica. The court had reserved the order on Friday. 

The bench of Justice Swarana Kanta Sharma held, “the prolonged incarceration of the accused, of about six years and two months, and the fact that investigation is not yet complete and trial has not yet begun, and there are more than 100 witness to be examined in this case, would entitle him to grant of regular bail, thereby overriding the statutory bar under Section 45 of PMLA and proviso to Section 436A of Cr.P.C”. 

The case originated from a disclosure by the then Head of External Relations of M/s Finmeccanica, the parent company of M/s AgustaWestland International Ltd. (AWIL). Based on this, Italian authorities initiated an investigation in 2011 into alleged bribe payments through middlemen, including Guido Ralph Haschke and the applicant, Christian James Michel, concerning AWIL’s supply of 12 VVIP helicopters to India. Surveillance by Italian prosecutors revealed that AWIL had disguised bribes as engineering payments. 

In February 2013, India’s Ministry of Defence filed a complaint with the CBI, leading to an FIR under IPC and Prevention of Corruption Act provisions. The investigation revealed that the original 6000-meter altitude requirement in 2002 had been lowered to 4500 meters after Air Chief Marshal S.P. Tyagi took over, making AWIL eligible. AWIL won the contract in 2010, but bribery allegations led to its cancellation in 2014.  

James was accused of laundering money through his firms, receiving Euro 42 million as kickbacks. Following extradition from the UAE in 2018, he was arrested and faced multiple prosecution complaints.

Advocate Aljo K. Joseph, representing James, argued that the supplementary prosecution complaint did not attribute any specific role to James in lowering the VVIP helicopters' height and lacked material evidence connecting him to the offence. 

It was further contended that James had already undergone over six years of incarceration, nearing the maximum seven-year sentence under the PMLA, without conviction. Advocate Joseph argued that the prolonged detention without trial violated his right to a fair trial under Article 21.

Special Counsel Zoheb Hossain, for the ED, argued that James posed a flight risk, as he repeatedly evaded investigation and failed to cooperate with authorities. It was argued that James fled India after the AgustaWestland investigation surfaced and obstructed inquiries even after arrest. The state asserted that as a British national with no Indian ties, he risked absconding if granted bail. 

While addressing the bail application, the court acknowledged that James had already served a duration equivalent to the maximum punishment prescribed under Section 4 of the Prevention of Money Laundering Act (PMLA). Given these circumstances, the merits of the allegations were not assessed at this stage. The court also observed that although Section 45 of PMLA imposed stringent bail conditions, the Supreme Court had emphasized the need to interpret such provisions in harmony with Article 21 of the Constitution, ensuring that statutory restrictions did not lead to indefinite incarceration.

Relying on Prem Prakash v. Union of India [2024 SCC OnLine SC 2270], the court emphasized the fundamental right to a speedy trial, stating that prolonged pre-trial detention should not become punitive. 

“As noted above, the Hon’ble Supreme Court, in multiple decisions, has held that the right to bail must be read into such provisions where there is an inordinate delay in the completion of trial which effectively converts pre-trial custody into a punitive sentence”, the court highlighted. 

In the present case, despite James’s custody exceeding six years, the trial had not commenced, and the investigation remained incomplete. The court also examined Section 436A of the Code of Criminal Procedure (Cr.P.C.), which limits pre-trial detention to half the maximum sentence unless the Court records specific reasons for extending it. James had already exceeded this threshold, and further incarceration without trial would render the process meaningless.

Additionally, the court noted that the trial under PMLA could not conclude unless the scheduled offence trial was completed. The Supreme Court had already granted the applicant bail in the scheduled offence case, considering his prolonged detention and the incomplete investigation. More than 100 witnesses were yet to be examined, and over 1,000 documents were relied upon by the prosecution, making the trial’s completion within the remaining sentence period unlikely.

The court addressed the DoE’s argument that James posed a flight risk. It noted that while previous bail applications had been denied on this ground, the Supreme Court had now granted him regular bail, directing the CBI to request necessary conditions from the Trial Court. 

The court granted bail to James considering his extended detention, the absence of progress in the trial, and the Supreme Court’s decision granting bail in the predicate offence.

For Petitioner: Advocates Aljo K. Joseph, Vishnu Shankar and Sriram P
For Respondent: Special Counsel Zoheb Hossain, Standing Counsel Vivek Gurnani and Advocate Kartik Sabharwal
Case Title: Christian James Michel v Directorate Of Enforcement (2025:DHC:1412)