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Synopsis

The Supreme Court has granted bail to Neeraj Singal, former promoter of Bhushan Steel, in a money laundering case related to an alleged Rs 46,000 crore bank fraud, having noted the prolonged period of his incarceration and the fact that the trial has yet to commence.

A bench of Justices Sanjiv Khanna and Sanjay Kumar directed that Neeraj Singal will be released from jail in connection with ECIR of August 29, 2019 for the offences punishable under the Prevention of Money Laundering Act, 2002, in relation to the scheduled offences under Sections 467, 471 and 120B of the Indian Penal Code and Section 447 of the Companies Act, 2013, on terms and conditions to be fixed by the trial court. 

Court ordered that in addition to the conditions imposed by the trial court, Singal would comply with the conditions mentioned in Section 438(2) of the Code of Criminal Procedure, 1973.

It also directed Singal to provide a mobile number on which he can be contacted by the officers of the Enforcement Directorate to ascertain his whereabouts and presence.

"The appellant, Neeraj Singal, will surrender his passport and not leave India without permission of the trial court. In case there is a violation of any terms and conditions of release, it will be open to the prosecution to seek recall of this order before the trial court," the bench said.

Court set aside the Delhi High Court's judgment of January 8, 2024, refusing him bail in the case.

In its order, the bench said, "Keeping in view the period of incarceration undergone by the appellant, Neeraj Singal, and as the trial has effectively not commenced, we accept the present appeals."

In its judgment, the high court had upheld the Enforcement Directorate's arrest of Singal on June 8, 2023.

The high court had then said that oral communication of grounds for arrest sufficed as proper compliance with Section 19(1) of the Prevention of Money Laundering Act (PMLA), 2002, particularly considering the prospective nature of the Supreme Court's directions in the Pankaj Bansal case.

Challenging his arrest, Singal had argued before the high court that he was only provided with the 'arrest memo' during search proceedings.

On the contrary, the ED had contended that the grounds of arrest were orally communicated and bore Singal’s signature, along with the time when his wife was informed.

During the hearing before the apex court, the bench said though allegations against the petitioner were serious, he was not some small-time offender. "Somewhere, we have to draw a line for economic offences. He shook up the economy," the bench said. 

Senior advocate Kapil Sibal, appearing for Singal said his client had been inside for 16 months and the judgment in Pankaj Bansal related to providing grounds of arrest was squarely applied here. It cannot become a punishment before trial.

"Somewhere the courts have to be strict, and even if he shook up the economy, grounds have to be supplied," the bench said, concurring with the appellant's contentions.

Court rejected a vehement opposition made by Additional Solicitor General S V Raju for the Enforcement Directorate to Singal’s bail plea, saying if the trial is delayed then he is entitled to bail.

Court said it was aware of the impact of such scams but if the trial is never going to get over, the court would have to match that with the aspect of liberty.

Case Title: Neeraj Singal Vs Directorate of Enforcement