COURT FOR GREATER

IN THE HONBLE SESSIONS

BOMBAY

AT MUMBAI

MISC APPLICATION NO. OF 2023

IN

P.M.L.A, SPECIAL CASE NO o8OF 2019

In the matter of:

Mr. Sarang Wadhawan
...Applicant/Accused No. 2
Versus

Directorate of Enforcement
...Respondent

APPLICATIONU/S 436A OF THE

CRPC OF THE APPLICANT.

MAY IT PLEASE YOUR HONOR:

1. The Applicant is filing the present Application before this Hon'ble

Court u/s 436A of the CRPC which has been held to be the statutory
bail as per the guidelines laid down by the Hon'ble Supreme Court
Judgement in matter between Vijay Madanlal Choudhary &
Ors. Vs Union of India & Ors. In Spcl. Leve Petition
(Criminal) No. 4634 of2014,"R/w the Judgement of the Hon'ble
 Supreme Court in the matter between "Satyendra Kumar Antil Vs
Central Bureau of Investigation in Special Leave Petition
No. 5191 of 2021" in the captioned proceedings. It is stated that the
Applicant has undergone half his sentence in prison and consequently
would like to place on record additional facts and circumstances before
this Hon'ble Court.

2. It is most respectfully stated that the present Applicant was arrested

on 17th October 2019 which equals to 1294 days of the imprisonment
served under the present CR for the alleged crime under Section 3 r/w
section 4 of the Prevention of Money Laundering Act, 2002("PMLA
ACT"). It is pertinent tonote that the punishment under the provision
of the PMLA ACT is a maximum of 7 years. It is stated that the 2005
Amendment Act adds a new Section 436A to the Code to establish that
if an under-trial prisoner has been detained for a period lasting up to
one-half of the maximum period of imprisonment provided for the
alleged crime, he should be released on bail by providing personal
bond, with or without sureties.

3. That the Section 436-A of the Code of Criminal Procedure, 1973 deals
with the rights of the umder-trial prisoners to be released on bail whilst
explaining the maximum duration after which under-trial prisoners
are entitled to be released on Bail. That Section 436-A lays down that
the Maximum period for which an under-trial prisoner can be detained
reiterated as under:
a. Where a person has, during the period of investigation,
inquiry or trial under this Code of anoffence under any law (not
being an offence for which the punishment of death has been
specified as one of the punishments under that law) undergone
detention for a period extending up to one half of the maximum
period if imprisonment specified for that offence under that law,
 he shallbe released by the court on his personal bond with or
without sureties:
Provided that the Court may, after hearing the Public Prosecutor
and for reasons to be recorded by it in writing, order the
continued detention of such person fora period longer than one
half of the said period or release him on bail instead of the
personal bond with or without sureties:
Provided further that no such person shall in any case be
detained during the period of investigation, inquiry, or trial for
more than the maximum period of imprisonment provided for
the said offence under that law. Explanation In computing the
period ofdetention under this sectionfor granting bail the period
of detention passed due to delay in proceeding caused by the
accused shall be excluded.

4. It is stated that the provisions of the section 436A clearly state that in
a case where punishment for the offence cannot be death and a person
has undergone detention for a period extending up to one-half of the
maximum period of imprisonment specified for the offence, he should
be released on bail. The Applicant herein has undergone his
imprisonment in the present alleged crime as under:
Date of Arrest Date of Complaint Tenure of completion
of 3and half years of
imprisonment,ie
(1294 days) - 3 years 6
months 18 days.
17th October2019 18th October 2019 4th May 2023

5. It is stated that the Hon'ble Supreme Court in the judgment titled

"Vijay Madanlal Choudhary & Ors. vs Union ofIndia & Ors.
In Spcl. Leave Petition(Criminal) No. 4634 of2014" made the
following observations:

146. Learned Solicitor General was at pains topersuade us that

this view would impact the objectives of the 2002 Act and is in
 the nature of super imposition of Section 436A of the 1973 Code
over Section45 of the 2002 Act. Hehas alsoexpressed concern
that the same logic may be invoked in respect of other serious
offences, inchuding terrorist offences which would be
counterproductive. So be it. We are not impressed by this
submission. For, it is the constitutional obligation of the State
to ensure that trials are conchuded expeditiously and at least
within areasonable time where strict bail provisions apply. If
a person is detained for a period extending up to one-half of the
maximum period of imprisonment specified by law and is still
facing trial, it is nothing short of failure of the State in
upholding the constitutional rights of the citizens, inchuding
person accused ofan offence.

149.In our opinion, therefore, Section 4364 needs to be

construed as a statutory bail provision and akin to
Section 167 of the 1973 Code. Notably, learned Solicitor
General has fairly accepted during the arguments and also
restated in the written notes that the mandate of Section167 of
the 1973 Code would apply with full forceeven tocases falling
under Section 3 of the 2002 Act, regarding money-laundering
offences. On the same logic, we must hold that Section
4364 of the 1973 Code could be invoked by accused
arrested for offence punishable under the 2002 Act,
being a statutory bail.

6. It would not be out of place to say that much prior to the provision
coming in existence, the Supreme Court had expressed concerns with
regard to persons languishing in jail for long periods of time.
7. That the Hon'ble Supreme Court in "Satyendra Kumar Antil Vs
Central Bureau of Inuestigation in Special Leave
Petition(CRL.)NO. 5191 OF 2021" has observed that

47.Under this provision, when aperson has undergone detention for

a period extending to one-half of the maximum period of
imprisonment specified for that offense, he shall be released by the
court on his personal bond with or without sureties. The word shall
clearly denotes the mandatory compliance of this provision. We do
feel that there is not even a need for a bail application in a case of this
nature particularly when the reasons for delay are not attributable
against the accused. We are also conscious of the fact that while
taking a decision the public prosecutor is to be heard, and the court,
if it is of the view that there is a need for continued detention longer
than one-half of the said period, has to do so. However, such an
exercise of power is expected to be undertaken sparingly being an
exception to the general rule.
Once again, we have to reiterate that bail is the rule and jail is an
exception coupled with the principle governing the presumption of
innocence. We have no doubt in our mind that this provision is a
substantive one, facilitating liberty, being the core intendment of
Article 21".

8. The Applicant is aged about 46 years old. That the availability of the
Applicant for further investigation, interrogation and facing trial is not
jeopardized and he is not tampering with the evidence or influencing
or intimidating the witnesses. Taking these and all other facts and
circumstances including the duration of custody into consideration the
appellant in our considered view isentitled to be granted bail.

9. In view of the foregoing paras and the judgement of the Hon'ble

Supreme Court Vijay Madanlal Choudhary & Ors. Vs Union
of India& Ors. In Spcl. Leave Petition (Criminal) No. 4634
f 2014," r/w Satyendra Kumar Antil Vs Central Bureau of
 Petition(CRL.)NO. 5191 OF
Investigation in Special Leave
the Applicant most respectfully prays that this Hon'ble Court
2021",
Applicant and consider the facts
allows the present Application of the
three and half years of
brought on record pertaining to the
pass any such
imprisonment already been served by the Applicant and
deem fit and proper in the
terms and conditions as this Hon'ble Court
the Applicant shall
interest of justice and equity for which
always be duty bound.
Enforcement,
10.Attached herewithcopy of the say filed by Directorate of
the Accused No. 1 (Mr.
the Respondent in Exhibit No. 147 B filed by
hereto
Rakesh Kumar Wadhawan) in the above captioned matter
marked and annexed as Annexure A.

Date: 05.05.2023

Place: Mumbai Ady. 'Sagar Shetty

Adv. for the Applicant
 1

IN THE HON'BLE CcoURT OF LD. SPECIAL COURT,

PMLA, CITY CIVIL & SESSIONS COURT, MUMBAI

EXHIBIT NO. 147/2022

IN

SPL. PMLA CASE NO. 08/2019

In the matter of:

Sh. Rakesh Kumar Wadhawan

(In JC at Arthur Road Jail) ..Applicant/Accused

Vs.

Directorate of Enforcement

.Respondent/Complainant

REPLY FOR AND ON BEHALF OF THE RESPONDENT

TOTHE BAIL APPLICATION OF THE APPLICANT

ABOVE NAMED Qt erh 44(8)

MOST RESPECTFULLY SHOWETH:

I, Suryakant Swarnkar, presently working as Assistant

Director, Directorate of Enforcement, Ministry of Finance,
Department of Revenue, Government of India, Zonal Office - I, 4th
Floor, Kaiser-I-Hind Building, Ballard Estate, Fort, Mumbai - 400
001, do hereby respectfully submit as under:

A. That the reply is being filed by the respondent who is fully

conversant with the facts and circumstances of the case as

 2

competent to file
borne out from official records and therefore,
this reply in his official capacity.

understood the contents

B. That the respondent has read and
of the application filed by applicant.

grounds on which
C. At the outset, it is submitted that the
present applicant viz.
the application has been filed by
except those
Rakesh Kumar Wadhawan are wrong and denied
Complainant.
which have been specifically admitted by the

D. It is submitted that the contents of the complaint

filed by
the instant
the respondent may be read as part and parcel of
the sake
reply and the same are not being repeated herein for

of brevity.
PRELIMINARY SUBMISSIONS:

It is most respectfully submitted that the present application

is liable to dismissed to limine as the same has been premised
on an erroneous belief that the applicant herein it liable to
enlarged on bail u/s 436A Cr. P.C. It is significant to state
that it has been clearly interpretate by the Honble Supreme
Court in its landmark judgement of "Vijay Madanla!
Choudhary & Ors. Vs Union of India && ors," That bail u/s
436A cannot be claim as an absolute right. The relevant
portion of the said judgement is as follows

"144. The Union of India also recognized the right to speedy

trial and access to justice as fundamental right in their written
subnissions and, thus, subnitted that in a limited situation
 3

right of bail can be granted in case of violation of Article 21 of

the Constitution. Further, it is to be noted that the Section 436A
of the 1973 Code was inserted after the enactment of the 2002
Act. Thus, it would not be appropriate to deny the relief of
Section 436A of the 1973 Code which is a wholesome prouision
beneficial to a person accused under the 2002 Act. However,

Section 436A of the 1973 Code, does not provide for an

absolute right of bail as in the case of default bail under

Section 167 of the 1973 Code. For, in the fact situation of a

case, the Court may stilldeny the relief owing to ground, such
as where the trial was delayed at the instance of accused
himself."

PARA-WISE REPLY TO GROUNDS cITED BY THE PPELLANT:

1. It is submitted that the averments made by the appellant in

Para 1 to 4 being matter of facts in the instant matter, do
not requireany comments from the Respondent.

2. It is submittedthat the assertions so raised by the applicant

are wrong and denied. At the cost of repetition, it is
submitted that the promotors of the HDIL i.e. Rakesh Kumar
Wadhawan & Sarang Wadhawan fraudulently took the loan
from PMC bank against the banking norm and without

adequate security. The applicant herein thereby caused

wrongful loss to the concerned bank and wrongful gain to
HDIL. All the persons have conspired with each other and
caused wrongful loss to the PMC Bank and wrongful gain to
the HDIL group of companies. The accused no. 1is the major
 4

(le
beneficiary in the whole fraud perpetrated by them. The loan
sanctioned fraudulently has been availed by the HDIL and its
group companies and it has been utilized and siphoned off by
them for their benefits. Thus, the accused
derived/gathered
monies from the PMC Bank and laundered the same by
purchasing other properties or utilizing them in business
activities of their companies. With regard to the contention of

the applicant herein regarding the age, it is submitted that

applicant has used logical fallacy of argument known as

argumentum ad passions/ appeal to emotions to direct the
Hon'ble Court from the severity and gravity the said offence
has, in which the applicant herein is the prime accused.
Further, it is important to mention that two new ECIR
has been received against the applicant Rakesh Kumar

Wadhawan (One by Central Bank of India in ECIR No.

ECIR/MBZO-I/22/2023 and one in the case of Mack Star
Marketing Pvt Ltd in ECIR No. 39 of 2020 where in Rakesh
Kumar Wadhawan is main accused). Furthermore, it is
submitted that Application for the committal of the above
case has already been filed before The Honble Addl. Chief

Metropolitan Magistrate, ACMM 47th Court, Esplanade

Court, Mumbai and the same is reserve for order on

12.05.2023.

3. It is submitted that the averments made by the appellant

in Para 6 is denied. In this connection, it is
submitted that
the Hon'ble Supreme Court in the para 144 of judgement of
 5

"Vijay Madanlal Choudhary & Ors. Vs Union of India & ors.

held that

"The Union of India also recognized the right to speedy

trial and access to justice as fundamentalright in their
in a
writtern submissions and, thus, submitted that

limited situation right of bail can be granted in case of

vtolation of Article 21 of the Constitution. urther, it is
1973 Code was
to be noted that the Section 436A of the
Thus, it
inserted after the enactment of the 2002 Act.

would not be appropriate to deny the relief of Section

436A of the 1973 Code which is a wholesome provision
beneficial to a person accused under the 2002 Act.

However, Section 436A of the 1973 Code, does not

provide for an absolute right of bail as in the case of

default bail under Section 167 of the 1973 Code. For, in

the fact situation of a case, the Court may still deny the
relief owing to ground, such as where the trial was

delayed atthe instance of accused himself."

4. It is submitted that the averments made by the appellant

in Para8 is denied. In this connection, it is submitted that in

Hon'ble Supreme Court held in case of Ramchand

Karunakaran vs Directorate of Enforcement stated that

"34 Economic offences constitute a class apart and need

to be visited with a dfferent approach in the matter of
bail. The economic ffence having deep rooted
 6

12
conspiracies and tnvolving huge loss of public funds
needs to be viewed seriously and considered as grave
offences affecting the economy of the country as a
whole and thereby posing serious threat to the financial
health of the country."

5. No comments regarding the contention raised para 8 and 9

are required to be offered as the denial of averments made

therein are already mentioned supra.

PRAYER

Under the circumstances mentioned herein above, the

respondent herein humbly prays that the application of
Rakesh Kumar Wadhawan nay kindly be rejected and further
orders as deemed fit and proper in the light of the above facts
and circumstances may kindly be passed.

Signed this Day of April, 2023 at Mumbai.

(SURYAKANT SWARNKAR)
ASSITANT DIRECTOR
ENFORCEMENT DIRECTORATE
MUMBAI ZONAL OFFICE-I