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Synopsis

The Allahabad High Court on Thursday rejected bail plea of Uttar Pradesh MLA Abbas Ansari, son of politician-turned-gangster late Mukhtar Ansari, in a money laundering case. 

Abbas was arraigned as an accused in a case registered by the Enforcement Directorate (ED) against M/s. Vikas Construction & others in 2021. Ansari is accused of committing offence punishable under Section 3 read with Section 4 of the Prevention of Money Laundering Act, 2002.

The allegations were that the partners of M/s Vikas Construction had encroached on public property in district Mau and Ghazipur by falsification of records. 

ED arrested Ansari on November 4, 2022.

Senior Counsel Kapil Sibal, assisted by Advocates Purnendu Chakravarty and Pranjal Krishna representing Abbas Ansari argued that he was in no way connected to the firm M/s. Vikas Construction or its operations. They asserted that there was no material to indicate that Abbas had any connection with the properties acquired by the firm. 

Clarifying that it was Abbas's mother Afshar Ansari and his maternal uncle Atif Raza who held major shares in the firm, the counsel contended that merely because some partners in the firm M/s. Vikas Construction were related to Abbas, it did not mean that he too was a partner in crime.

They submitted that there may have been some amount that was transacted through Abbas's account, which had come from his mother and/or uncle, but that in itself was not sufficient to allege that he was involved in money laundering.

'Unaccounted money' cannot be taken as a synonym for 'proceeds of crime' as both are distinct and separate concepts, Senior Counsel Sibal argued.

He alleged that Abbas was falsely implicated in the matter and even though the trail of money had not been satisfactorily connected to him, he had been apprehended and was languishing in jail since 2022. 

On the other hand, counsel appearing for the investigating agency Advocate Rohit Tripathi argued that there was ample evidence to establish Abbas's complicity in money laundering. He submitted that M/s. Vikas Construction was used as a vehicle for generating the proceeds of crime and the funds so generated were transferred to and from M/s. Aaghaaz Project and Engineering Ltd., again an Ansari-family owned company. Routing of funds through the two firms and thereafter the end proceeds were debited and credited through Abbas's account, he pointed out. 

Moreover, he averred that Abbas did not cooperate during investigation and he was apprehended under Section 19 of the Act of 2002. A lookout notice had to be issued against him. 

The bench of Justice Jaspreet Singh noted that prima facie the record indicates that during investigation it was clearly traced that the firm M/s. Vikas Construction and M/s. Aaghaaz were in total control of the members of Abbas' family. 

It was also on record that statements recorded during the investigation given by Atif Raza, who stated that he was only executing the directions of Mukhtar Ansari and had done the web of the transactions, Abbas and the charted accountant all indicated that Abbas' mother, a home maker, had 60% shares in the partnership M/s Vikas Construction and firm was used prima facie for generating the proceeds of crime and then funds were transferred to various persons including Abbas. 

Court also pointed out that Abbas had not been able to indicate or explain the amount received into his account from Mashaza Enterprizes.

"Merely to state that whenever he needed funds, he would inform his mother and his maternal uncle and maternal grand father and they would arrange for the funds which were received and the applicant did not know anything beyond that. This explanation does not reflect credibility especially from the applicant who is a sitting MLA and an elected representative of the people," the single judge bench opined. 

Court underscored that Section 2(1)(u) defines the phrase 'proceeds of crime' which clearly indicates that any person who derives any property or obtains, directly or indirectly as a result of a criminal activity would be treated as proceeds of crime. 

The offence of money laundering as per Section 3 not only relates to generation of such proceeds of crime but also includes any activity directly or indirectly relating to concealment or possession or acquisition or use amongst others, court clarified. 

It held that the said definition is very wide and inclusive, thus, the fact that directly or indirectly if any person is in possession or use of such proceeds of crime whether directly or indirectly, knowingly assists or knowingly is a party or actually involved or in any activity connected with proceeds of crime relating to concealment possession acquisition or use or projecting the property as untainted property or claiming as untainted property in any manner whatsoever would be liable for commissioning of any offence under the PMLA.

Court opined that in the instant case, the complaint and the supplementary complaint prima facie reflected Abbas' involvement. It also highlighted that there was material available on record including the flow charts which clearly demonstrated the origin of funds and also explained how they found their way into the account of Abbas who used them as well.

Therefore, considering Abbas' family antecedents, his initial non-cooperation with ED and overall view including the gravity of offence including the fact that the witnesses of fact are yet to be examined, court rejected Abbas' bail plea. 

However, court clarified that the observations made in this order may not be taken as an expression of opinion on merits.

Court also directed the trial court to expedite the trial to complete it as swiftly as possible.

Case Title: Abbas Ansari v. Directorate Of Enforcement, Allahabad