Kanhaiya Prasad, the son of Radha Charan Sah, the Member of Bihar Legislative Council (MLC) who was released on bail was directed by the Supreme Court to "surrender before the Special Court within one week" from February 13, 2025 although it has not "expressed any opinion on the merits of the case."
Setting aside a judgement of Dr. Anshuman of Patna High Court, Supreme Court's division bench of Justices Bela M. Trivedi and Prasanna B. Varale observed: "The High Court has utterly failed to consider the mandatory requirements of Section 45 and to record its satisfaction whether any reasonable ground existed for believing that the respondent was not guilty of the alleged offence, and that he was not likely to commit any offence while on bail. Merely because the prosecution complaint had been filed and the cognizance was taken by the court that itself would not be the ground or consideration to release the respondent on bail, when the mandatory requirements as contemplated in Section 45 have not been complied with." The 16-page long judgement was authored by Justice Trivedi.
Supreme Court's judgement reads: "As well settled, the offence of money laundering is not an ordinary offence. The PMLA has been enacted to deal with the subject of money laundering activities having transnational impact on financial systems including sovereignty and integrity of the countries. The offence of money laundering has been regarded as an aggravated form of crime world over and the offenders involved in the activity connected with the Proceeds of Crime are treated as a separate class from ordinary criminals. Any casual or cursory approach by the Courts while considering the bail application of the offender involved in the offence of money laundering and granting him bail by passing cryptic orders without considering the seriousness of the crime and without considering the rigours of Section 45, cannot be vindicated."
Some 20 FIRs were registered at the police stations at Patna, Saran and Bhojpur districts under Sections 38, 120B, 378, 379, 406, 409, 411, 420, 467, 468 and 471 of IPC, and under Section 39(3) of the Bihar Mineral, (Concession, Prevention of Illegal Mining, Transportation & Storage) Rule, 2019. It is alleged inter alia that M/s Broad Son Commodities Private Ltd and its Directors were engaged in illegal mining and selling of sand without using the departmental pre-paid transportation E-challan, issued by the Mining Authority Bihar, and thus had caused revenue loss of Rs.161,15,61,164/- to the Government Exchequer. Since the said FIRs contained Scheduled offences as defined under Section 2(1)(y) of the Prevention of Money Laundering Act, 2002 (PMLA), ECIRs dated March 15, 2023, addendum ECIR dated November 8, 2023 and dated May 4, 2024 came to be registered, and the investigation for the offences of Money Laundering was initiated.
During the course of investigation, search operations were carried out under Section 17 of PMLA at the various locations and premises related with the said Company and its Directors, including four premises of Radha Charan Sah, (father of the respondent). During the course of inquiry, the statements of the respondent-Kanhaiya Prasad, being son of the said Radha Charan Sah was recorded on September 1, 2023 and September 4, 2023 under Section 50 of the PMLA. It has been alleged by the appellant-ED that thereafter the respondent was issued summons to appear before the Directorate on September 11, 2023, September 12, 2023 and September 13, 2023, however, he failed to appear on the said dates. The respondent thereafter was arrested at the ED, Patna Zonal Office, Bihar on September 18, 2023. On production of the respondent before the concerned court, his custody was handed over to ED, on September 22, 2023.
From the documents seized from the premises of the Radha Charan Sah and from the statements recorded under Section 50 of the Witnesses, of the respondent and of his father, it was found that the Kanhaiya Prasad, the respondent-accused was actually involved in the process of concealing and the possession of the proceeds of crime amounting to Rs.17,26,85,809/- which were used for carrying out the renovation work in the resort at Manali and for the construction work of the school owned by his trust. It was also found that the respondent-accused had handled the proceeds of crime and transferred it by using hawala network for acquisition of the resort at Manali. It was also alleged that the entire work of family-owned LLP’s and of Maa Sharda Devi Buildings and Construction, was handled by Kanhaiya Prasad, the respondent to route the proceeds of crime generated by his father to portray it as untainted money. Kanhaiya Prasad had allegedly layered and laundered the proceeds of crime generated by his father, being a syndicate member involved in illegal sale of sand using hawala network. The respondent also had allegedly concealed the proceeds of crime by way of purchasing properties, carrying out renovation work and constructions in the family owned trust property using the said proceeds of crime.
Enforcement Directorate (ED) had challenged the legality of the impugned judgment and order of Patna High Court whereby the High Court had allowed released the respondent Kanhaiya Prasad on bail in connection with the Special Trial (PMLA) Case.
Earlier, ED has provisionally attached 2 immovable properties to the extent of Rs. 26.19 crore acquired by Radha Charan Sah.
"a) The petitioner shall furnish a personal bond with a surety in the sum of Rs. 1,00,000 to the satisfaction of the Trial Court;
b) The petitioner shall give up his citizenship of Dominican Republic within a period of 1 week from the date of release and documentary proof of the same be placed before the learned Trial Court;
c) The petitioner shall not leave the country during the bail period and surrender his Dominican Republic passport at the time of release before the Trial Court;
d) The petitioner shall join the investigation as and when called by the ED authority concerned;
e) The petitioner shall appear before the Court as and when the matter is taken up for hearing;
f) The petitioner shall provide his mobile number to the ED authority concerned at the time of release, which shall be kept in working condition at all times. The applicant shall not switch off, or change the same without prior intimation to the ED authority concerned, during the period of bail;
g) In case he changes his address, he will inform the ED authority concerned and this Court concerned also;
h) The petitioner shall not indulge in any criminal activity during the bail period;
a) The petitioner shall not leave the country during the bail period and surrender his passport at the time of release before the Trial Court;
b) The petitioner shall appear before the Court as and when the matter shall be taken up i.e. to say on each and every date.
c) The petitioner shall provide his mobile number to the ED authority concerned at the time of release, which shall be kept in working condition at all times and he shall not switch off or change the same without prior intimation to the ED authority concerned, during the period of bail.
d) In case, he changes his address, he will inform the ED as well as to the concerned Court.
e) The petitioner shall not indulge in any criminal activity during the bail period.
f) The petitioner shall not influence the prosecution witness directly or remotely. The prosecuting agency will be at liberty to file an appropriate application for modification/for calling the order passed by this Court for any reason or the petitioner violates any of the conditions imposed by this Court.
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