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The firm went into insolvency in 2019 after the auditor revealed financial misconduct, leading to the filing of an FIR against the CFO and senior officials of CKL, who were subsequently arrested
The Bombay High Court has recently denied bail to Ajay Ajit Peter Kerkar, the promoter of King & Cox, in the money laundering case filed by the Enforcement Directorate against him.
The high court observed that the right to be released is not absolute even after serving half of the minimum imprisonment.
“It is to be noted that even the right to be enlarged on bail after undergoing detention for a period exceeding one half of the minimum period of imprisonment is not an absolute right,” the bench noted.
A single-judge bench of Justice PK Chavan was hearing the application filed by Kerkar seeking bail in the money laundering case on grounds of prolonged incarceration.
Kerkar was arrested after an FIR was filed against Cox & Kings Group of Companies (CKL) and others alleging bank fraud.
The firm went into insolvency in 2019 after the auditor revealed financial misconduct, leading to the filing of an FIR against the CFO and senior officials of CKL, who were subsequently arrested.
Based on the Mumbai Police FIR, the Enforcement Directorate filed a money laundering case, and Kerkar was arrested.
His bail application was rejected by the Special PMLA Court on 29th April 2021.
In March 2023, the high court granted temporary bail to enable the applicant to undergo medical treatment at his own cost, but the same was discontinued by the high court in November 2023.
Advocate DU Mirajkar, representing Kerkar, contended that he has undergone 2 years and 340 days in custody as an under-trial prisoner, and the maximum sentence under Section 4 of the PMLA 2002 is 3 years.
He sought bail on the ground that charges were not framed, and the prospects of the trial commencing in the near future were bleak.
Punishment Under Section 4 PMLA 2002
Whoever commits the offence of money-laundering shall be punishable with rigorous 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
Special Public Prosecutor Hiten Vinegavkar submitted that the right to be released on bail would accrue to the applicant on the day when half of the maximum period of imprisonment specified under Section 4 of the PML Act would be over.
Venegavkar emphasized that one-half of the minimum period of imprisonment provided under Section 4 of the PML Act is yet to be completed, and therefore, as and when the said period is over, the applicant would be at liberty to pray for his release under Section 436A of the Cr.P.C.
Accordingly, the high court denied bail to the Cox & King promoter.
Case title: Ajay Ajit Peter Kerkar vs Directorate of Enforcement & Anr
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