M. SIVASANKAR Vs. STATE

JUDGEMENT

(1.) Dated this the 28th day of October 2020 This is an application filed for anticipatory bail under Section 438 Cr.P.C by the applicant who is apprehending arrest in Crime No. ECIR/KCZO/31/2020 of Enforcement Department.

(2.) The applicant is one of the senior most civil servants in the State of Kerala was, till recently working as Principle Secretary, Information Technology and was also Secretary to the Chief Minister of Kerala. He claims to have an unblemished service record of more than three decades. A Crime was registered by the Customs Commissioner ATC based on an allegation that the persons named Sarith, Swapna and Sundeep along with several other accused smuggled primary gold from abroad through diplomatic channel of UAE consulate. Consequently, other investigating agencies like the NIA, and the Enforcement Directorate also registered Crimes against the aforesaid accused persons and the present Crime is being investigated. The applicant was summoned by the Directorate a number of times for questioning and the applicant has been cooperating with such questioning and investigation. The Customs as well as the NIA also had questioned the applicant several times. It is stated that he has been interrogated for more than 90 hours by all the three agencies together. Yet, none of the aforesaid investigating agencies could collect any incriminating materials against him even after hundred days of investigation. The Enforcement Directorate has filed a complaint before the Special Court in which certain baseless allegations are seen made against the applicant giving an indication that he too may have been involved in the illegal activities of the other accused. The applicant had, during his questioning by the agencies conceded about his acquaintance with Swapna who was working as Secretary to the UAE Consulate General. In his capacity as a person holding a key position in the Government he had occasion to contact the Consulate General in connection with the several activities of the State. Swapna was working in the office of the Consulate and in connection with his official duties, the applicant was required to meet her for the purpose of discussing matters concerning the activities of the State. They had become family friends and used to exchange pleasantries and had attended family functions of each other. The applicant was not aware of the involvement of Swapna in gold smuggling activities with the other accused. The applicant had several Whatsapp communications with Swapna and also his Chartered Accountant. But there is nothing suspicious about the said communications. Swapna had allegedly received some money as tips from the ruler of Sharjah. On her request, the applicant had introduced a Chartered Accountant, known for his integrity with whom he had personal acquaintance for the last 25 years, to Swapna to help her to sort out and resolve her financial dealings. The conversations between the applicant and the Chartered Accountant had taken place about 8 to 12 months prior to the alleged act of smuggling. The applicant is not aware of the details regarding the money transaction between Swapna and the aforesaid Chartered Accountant. The applicant apprehends that his communication with Swapna and the Chartered Accountant is being mis-represented to implicate him in a heinous crime of gold smuggling. Each time the applicant is questioned by these investigating agencies, it is taken up by the media to create sensational news to form a negative opinion about the applicant in the society. The applicant and his family consisting of his aged parents are being traumatised by such adverse and such false propaganda. The applicant has cooperated with the investigation throughout and has produced all those documents which he has been asked to produce. The applicant apprehends that the investigating agencies are under tremendous pressure due to media trial. The false propaganda and the frivolous news items constantly demanding the arrest of the applicant may create a situation wherein the investigating agencies may succumb to the media pressure baying for the blood of the applicant. Despite having questioned the applicant for ceaseless hours, nothing has come out to implicate the applicant as an accused leading to an illegal arrest. The Enforcement Directorate had questioned the applicant for 30 hours out of the total 90 hours he was questioned by all the agencies together. It is also stated that considering the present pandemic situation specific directions were issued by the Hon'ble Supreme Court to arrest a person only if it is highly necessary. The applicant undertakes that he is willing to co-operate with the investigation. Considering the background of the applicant and his long unblemished service record, there is little possibility of his absconding or fleeing from justice. Custodial interrogation may not be required and the applicant is willing to abide by any condition that may be imposed by this Court. Under the circumstances, the applicant seeks a pre-arrest bail in case he is to be arrested in connection with the aforesaid Crime of the Enforcement Department.

(3.) The Assistant Director, Directorate of Enforcement has filed a counter affidavit interalia contending as follows:- Consequent to the seizure of 30 KGs of primary gold worth ?14.80 crores camouflaged in the immune diplomatic baggage to the UAE Consulate as diplomatic cargo at the Thiruvananthapuram International Airport, OR No.07/2020 was registered by the Customs Commissionerate (Preventive), Cochin against Sarith, the former PRO at the UAE Consulate, Swapna Suresh, the former Secretary to the Consulate General of UAE, Sundeep Nayar and several others. The National Investigation Agency ('NIA' for short), Kochi registered a case as RC02/2020/NIA/KOC under Sections 16, 17 and 18 of the Unlawful Activities (Preventive) Act, 1967 against the aforesaid persons. Based on the case registered by the NIA, the Enforcement Directorate ('ED', for short) also registered the aforesaid Crime and started investigation of the scheduled offences under the Prevention of Money Laundering Act 2002 ('PMLA', for short) against the aforesaid persons and some others. It is understood that huge sums of money were generated from the proceeds of crime and that they are possessing/concealing/using the said proceeds and the ED has been investigating and collecting evidences to initiate action under the provisions of the PMLA. The investigation so far has revealed that the persons arrayed as accused have committed offences of money laundering under Section 3 punishable under Section 4 of the PMLA. The NIA had conducted searches at the premises of the Swapna Suresh and seized her mobile phones and laptops. These devices have been handed over to the NIA Court and were sent to C-DAC, Thiruvananthapuram for analysis and mirror-image. ED had requested the NIA Court for permission to obtain the mirror-image and consequently it was obtained from C-DAC on 08/10/2020. The ED is in the process of examining those digital devices. The apprehension of the applicant that he may be arrested is totally misplaced until there are reasons to believe that materials in the possession of the Directorate of Enforcement are sufficient to attract the provisions of Section 19 of the PMLA. The applicant is yet to be arrayed as an accused in the complaint filed by the ED. It is stated that there is absolutely no warrant in law to interfere with the statutory powers of arrest by the ED under the provisions of PMLA at this stage. Several materials have been found during the search by the NIA and the digital copies/mirror-images are being analysed by the ED. It would not be appropriate to disclose the entire facts which may hamper investigation in this case and help the applicant tamper with the evidence which has been collected. There is no basis for any reasonable apprehension of arrest made out by the applicant. The ED had questioned the applicant and recorded his statements wherein he has affirmed that he had instructed his Chartered Accountant Sri Venugopal to help Swapna Suresh to manage her finances. Sri Venugopal has also confirmed that the applicant had approached him along with Swapna Suresh and had asked him to advise her financial matters. The applicant had also asked him to open a locker in the State Bank of India to be jointly operated by him with Swapna Suresh. Thereafter, Swapna Suresh approached him with a bag containing Rupees Thirty lakhs in cash. Initially, Sri.Venugopal was hesitant to accept that amount. But then Swapna Suresh explained that the cash had come from genuine sources and asked him to deposit that money in the locker. All this had happened in the presence of the applicant. The applicant was constantly in touch with Sri.Venugopal and he was informed about the withdrawals from the bank locker. It is contended that the applicant was evasive in his answers pertaining to the bank locker and denied that he had given instructions to Sri.Venugopal to open a bank locker in his name jointly with Swapna Suresh. The WhatsApp messages recovered by the investigators would however prove otherwise. The search by NIA resulted in seizure of ? 64 lakhs from the said locker. Thereafter ? 36.50 lakhs was seized from another locker in the name of Swapna Suresh In the Federal Bank, Thiruvananthapuram. The applicant had during his questioning admitted that Swapna Suresh was not financially well off and that he had tried his best to help her to find a good job. The WhatsApp chats that he had with Swapna Suresh during the day indicates that they were very close and that she used to discuss everything with him. Under the circumstances, it would be hard to believe that he was not aware of Swapna Suresh receiving commission/kickbacks on smuggling of gold through diplomatic channel. The entire money that Swapna Suresh had amassed were "proceeds of crime" as defined under Section 2(1)(u) of PMLA. The materials in possession of the ED unearthed so far are being produced in a sealed cover before the Court which would demonstrate that the present application needs no indulgence for grant of anticipatory bail.