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Synopsis

Senior Advocate N. Hariharan appearing for Satyendar Jain before the Delhi High Court on Tuesday argued that directly or indirectly there is no connection between Jain and the 'proceeds of crime' in the present money laundering case.

"Others have a majority shareholding, they are sharing the majority," he said. 

Relying on Vijay Madanlal's Judgment of the Apex Court, Hariharan contended that "No Notional Attribution" cannot be made in a Prevention of Money Laundering Act (PMLA) case. He mentioned the findings of the agency, which states that the assets of the company were the same at the end of the cheque period and argued that this is "Notional".

He argued there is no laundering in this case. "A shareholder can have nothing to do with the company and it cannot be attributed to him (Satyendar Jain). The money about which the Directorate of Enforcement (ED) is talking came to the company, it cannot be attributed as 'Proceeds of Crime'," he said. 

Hariharan also argued that the balance sheets were not signed by Jain. "Post 2013, I (Satyendar Jain) have not signed a single deed", he submitted.

Taking note of the submissions, Justice Dinesh Kumar Sharma adjourned the matter while stating, “I am part of a Tribunal bench, which will start now, We will continue hearing tomorrow at 12:30 pm”.

Earlier, In January, Hariharan had argued that only the cheque period should be taken into consideration & proceeds of crime will be generated only after an offence has been committed. "I'll expand on this aspect, in due course", he had submitted.

"Scheduled offence is not made out", the Senior Counsel had argued. Hariharan had argued that all the shares were acquired in 2008-10 when Satyendar Jain was not a public servant. 

On December 1, the single-judge bench had issued notice and sought a response from the ED within two weeks on the plea filed by Jain in connection with the present matter.

Senior Advocate N. Hariharan appearing for Jain had submitted, “We are seeking a regular bail in the present case, post dismissal of an application by the trial court”. He had contended that for a ‘predicate offence to take place in a disproportionate assets case, there is a cheque period (February 14, 2015, to May 31, 2017) within which the offence is supposed to have been committed.

Hariharan had submitted that on August 30, 2017, the Enforcement Case Information Report (ECIR) was registered under Prevention of Money Laundering (PMLA) in pursuance of this predicate offense, and on December 3, 2018, the charge sheet was filed, and on July 6, 2019, he was granted regular bail (on summons) by the Special Judge (CBI).

The Senior Counsel had further stated that "after five years down the line, I (Jain) am arrested on May 31, 2022, in the ECIR and remanded to police custody. Since June 13, 2022, I have been in judicial custody in the present case." Furthermore, he had submitted that Jain moved his first bail application to the ECIR on June 18 which was rejected on the ground that investigations were not complete, otherwise, he had stated, that the bail order mentioned that “I (Jain) am not at Flight Risk”.

Background:

Special Judge Vikas Dhull of the Rouse Avenue Court on November 17, denied bail to Jain in the money laundering case.

The bail application filed by Satyendra Jain pertained to his arrest in a Money Laundering case in which he was arrested by the Enforcement Directorate on May 31, 2022.

In April, ED attached assets worth Rs. 4.81 crores linked to Jain and his family. ED initiated an investigation based on an FIR registered by the Central Bureau of Investigation (CBI) against Jain and others under relevant sections of the Indian Penal Code and the Prevention of Corruption Act.

It is alleged that when Jain was a public servant, companies owned and controlled by him received up to Rs. 4.81 crores from shell companies through the Hawala network.

Case Title: Satyendra Kumar Jain v. Directorate of Enforcement