Delhi High Court issues notice in ED’s plea seeking cancellation of bail to Rajesh Joshi & Gautam Malhotra

Directorate of Enforcement (ED) moved the Delhi High Court on Wednesday seeking “cancellation of bail” of Rajesh Joshi and Gautam Malhotra, granted by the trial court on May 6 in the Delhi Excise Policy Scam case.

Additional Solicitor General (ASG) SV Raju, on behalf of ED, submitted, “The learned Judge takes cognizance on May 1, 2023…cognizance it not taken when prima facie offence is not made out. He forms an opinion that offence is made out, therefore he issues summons to the accused. Few days later, he says offence is not made out that the requirement of S. 45 PMLA….Therefore there is contradictions in the two orders”.

Raju contended that, “One order says offence made out, therefore issue summons. Bail order says, No! No! It is not made out”. He also submitted that that the trial court judge also decides on default bail, on an erroneous ground that the investigation is pending. “There are several judgments to that effect, that If investigation is pending, there is no ground for default bail. The chargesheet is filed. Three Judgments….directly on that point. Even if further investigation is pending, it is no ground for granting default bail.”

Raju contended that the trial court Judge has conducted a “Mini Trial”, he relies on documents outside the chargesheet, and he relies on some CBI document. “Selectively he relies…double standards are applied in respect of the same…I am only asking for an issue of notice at this stage and this judgment may not be treated precedent for other cases. I am not asking to stay… they are already out”.

“I am only saying impugned judgment should not be relied upon by any co-accused”, the ASG submitted.

Justice Dinesh Kumar Sharma ordered that the observations made by the trial court while granting bail to Rajesh Joshi and Gautam Malhotra in the PMLA case cannot be relied upon by any other co-accused person in any proceedings.

The single-judge bench issued notice to the respondents, Rajesh Joshi and Gautam Malhotra. Accordingly, the court posted the matter for further consideration on July 20.

Notably on May 6, Special Judge MK Nagpal of the Rouse Avenue Court, Delhi allowed the bail applications of Rajesh Joshi and Gautam Malhotra in the Delhi Excise Policy Scam case. Both the accused had been directed to furnish a personal bond of Rs. 2,00,000 each with one surety in the like amount subject to the satisfaction of the court.

While allowing the bail applications, the court reiterated that default bail under Section 167(2) is an indefeasible right of an accused and that the present facts and circumstances did not warrant further custody of the accused.

“In the absence of there being any satisfactory corroborative material and in view of the above material contradictions and deficiencies in the evidence relating to above transactions, the statement dated 01.10.2022 made by the approver Dinesh Arora regarding the above-said transactions of transfer or transmission of a part of the advance kickback amount through this applicant cannot be considered to be incriminating enough and sufficient to justify the attraction of bar and rigours contained u/s 45 of the PMLA and to justify his further detention in the case or denial of bail to him,” the Court had held.

With respect to their involvement in formation of cartel the court stated that the evidence and statements on record might be sufficient to show cartelization on behalf of the applicant on all three levels of the liquor business in Delhi, however, the same could not be taken as sufficient to make the court prima facie believe that it was done in pursuance of a criminal conspiracy with the other co-accused.

Case Title: Directorate of Enforcement v. Gautam Malhotra & Directorate of Enforcement v. Rajesh Joshi