* % + BAIL APPLN.1165/2017 YOGESH MITTAL Versus ENFORCEMENT DIRECTORATE IN THE HIGH COURT OF DELHI AT NEW DELHI Reserved on:
31. 08.2017 Delivered on:14.09.2017 .....
... Petitioner..... Respondent Mr. Mukul Rohatgi & Mr. Vikram Chaudhri, Sr. Advocates with Mr. Sanjay Agarwal, Mr. Arjun Malik, Mr. Ashish Batra, Mr. Sameer Rohatgi & Mr. Harshit Sethi. Advocates who appeared in this case: For the
... Petitioner: For the Respondent: Mr. Sanjay Jain, ASG with Mr. Ajay CORAM:-
"HON’BLE MR JUSTICE ASHUTOSH KUMAR Digpaul, CGSC, Mr. Amit Mahajan, CGSC, Mr. Vinod Diwakar, CGSC, Mr. Kartik Rai, Ms. Mohita, Ms. Adrija Thakur & Mr. Kunal Dutt, Advocates. JUDGMENT ASHUTOSH KUMAR, J1 The petitioner, without approaching the Special Court under the Prevention of Money Laundering Act, 2002 (hereinafter called PMLA) for grant of bail, has preferred the present petition seeking bail in ECIR No.18/DZO-8/2016 primarily on the ground that his remand Bail Appln.1165/2017 Page 1 of 55 in judicial custody is illegal and without any jurisdiction of the learned Special Court to remand the petitioner any further after the presentation of the prosecution under Section 44 of the PMLA, and no cognizance having been taken thereafter as against the petitioner.
2. At the time, when this bail application was filed (i.e. on 15.06.2017), the petitioner had been remanded to E.D custody by the Special Court, PMLA, but no prosecution/complaint was filed qua the petitioner in the Special Court. As such, it was not possible for the petitioner to approach the Special Court, PMLA for bail. The Special Court, PMLA had no record of the petitioner till that time. The prosecution/complaint was filed only on 02.08.2017 during the pendency of this bail application.
3. Mr.Mukul Rohtagi, learned senior counsel appearing for the petitioner, at the outset, submitted that he is seeking bail on the ground of the remand of the petitioner to custody being illegal. Though, if the order of remand is found to be illegal, an accused may be entitled to be released but such order cannot be passed in a bail application and can only be directed in a criminal writ and that also by a Division Bench.
4. Be that as it may, since there is no prayer for release of the petitioner but only for grant of bail on account of infraction of statutory provisions, this petition is being entertained.
5. Certain interesting aspects have been revealed while hearing the present bail application.
6. The petitioner was arrested by the Assistant Director, PMLA, Delhi zonal office, Zone-2, Enforcement Directorate, MTNL Building, Bail Appln.1165/2017 Page 2 of 55 Jawaharlal Nehru Marg, New Delhi on 05.06.2017, purportedly in exercise of powers conferred under sub Section (1) of Section 19 of the PMLA.
7. The petitioner was made to understand that he was being investigated under the PMLA and during the course of investigation, it had transpired that he was involved in the offences punishable under the PMLA.
8. It has been submitted on behalf of the petitioner that the arrest, in itself, was unwarranted as the petitioner had joined investigation and had been appearing before the investigating agency/E.D regularly. He was arrested without obtaining any warrant under Section 155(3) of the Cr.P.C and without recording and forwarding of any FIR as required under Sections 154 and 157 of the Cr.P.C.
9. The petitioner was thereafter produced before the Special Court PMLA, on 06.06.2017.
10. An application was filed on behalf of the E.D, seeking 14 days custody remand of the petitioner. It was asserted by the E.D that from the investigations, it revealed that accused persons had conspired to convert demonetized currency into monetized currency by depositing demonetized currency in banks and thereafter obtaining demand drafts in fictitious names. With respect to the petitioner, it was stated that he had roped in other accused persons and had personally supervised the collection, transportation and deposit of illegal/demonetized currency in bank accounts. The petitioner was also alleged to have made attempts to frustrate the PMLA investigation by asking the suspected account holders of Bank of Baroda to run away. These facts, it was Bail Appln.1165/2017 Page 3 of 55 stated by the E.D, were collected during the course of investigation of the case.
11. It may be stated here that the investigations in the present case was taken up, pursuant to registration of FIR No.205/2016 dated 25.12.2016 under various sections of the Indian Penal Code against co-accused persons, by the Crime Branch, Delhi Police. The E.D, thereafter, registered ECIR No.18/DZO-8/2016 dated 26.12.2016 for investigation of the offence of money laundering.
12. On such application by the E.D seeking custody remand of the petitioner, the Special Court, PMLA, was of the view that since the matter was at the initial stage of the investigation and the petitioner had not cooperated in the investigation of the case thereby preventing the tracking of the money trail of Rs.10 crores (money trail of around Rs.41.65 crores had already been tracked), the petitioner was required to be remanded to custody. The Special Court thus remanded the petitioner to E.D custody till 09.06.2017.
13. It may be relevant here to state that after the registration of the FIR No.205.2016 (predicate offence) on 25.12.2016 and registration of ECIR in question on 26.12.2016, co accused Ashish Kumar, Rohit Tandon and Rajkumar Goel were arrested and produced before the Special Court, PMLA and were remanded to E.D custody as and when requested by the E.D.
14. On 23.02.2017 prosecution/complaint under Section 44 of the PMLA was filed before the Special Court against Rohit Tandon, Ashish Kumar, Rajkumar Goel, Dinesh Bhola and Kamal Jain. Bail Appln.1165/2017 Page 4 of 55 15. On 25.02.2017, the Special Court took cognizance of the offence under Section 3, punishable under Section 4 of the PMLA. After taking of cognizance, summons were issued to the two of the accused persons named above namely Dinesh Bhola and Kamal Jain who had not been arrested.
16. As stated above, it was only thereafter that the petitioner was arrested on 05.06.2017 and presented before the Special Court on 06.06.2017 when he was remanded to E.D custody till 09.06.2017.
17. In the meantime, the Crime Branch, on 24.06.2017 submitted chargesheet in FIR No.205/2016 before the Court of learned Additional Sessions Judge/Special Court, P.C.Act at Tis Hazari Courts, Delhi against the aforesaid accused persons.
18. The petitioner, in the meantime was being continuously remanded by the Special Court, PMLA to E.D custody for specific duration. The petitioner was lastly, remanded to E.D custody for 14 days till 08.08.2017.
19. It has been stated that since the maximum period of investigation in this case, which would be 60 days, was to be completed on 04.08.2017, the E.D, in order to preclude the petitioner from taking advantage of the statutory bail under Section 167 (2) of the Cr.P.C, 1973, submitted the prosecution/complaint qua the petitioner and one Ramesh Chand Sharma on 02.08.2017 i.e only two days prior to the petitioner completing 60 days in custody. Along with the aforesaid prosecution/complaint under Section 44 of the PMLA, a prayer was made before the Court to take cognizance of the complaint and to proceed against the petitioner and another for the offence of Bail Appln.1165/2017 Page 5 of 55 money laundering under Section 3 punishable under Section 4 of the PMLA and punish them accordingly 20. The order of the Special Court, on submission of the prosecution/complaint as against the petitioner, which has been quoted in the additional affidavit filed on behalf of the petitioner, is as follows:-
"“The IO has filed supplementary chargesheet/ prosecution complaint qua accused Yogesh Mittal and Ramesh Chandra Sharma. The supplementary chargesheet/ prosecution complaint be tagged with the main chargesheet which is stated to be pending before the court on 11.08.2017. S/d Ajay Kumar Kuhar ” 21. The petitioner had earlier been remanded to E.D custody till 08.08.2017. When the matter was listed before the Special Court on 08.08.2017, an application was moved by the Deputy Director, E.D requesting for remanding the petitioner to judicial custody. Since the main prosecution report was slated to be listed for 11.08.2017, the Special Court fixed the case of the petitioner on the same date i.e. 11.08.2017 and remanded the petitioner to judicial custody till 11.08.2017. It has been submitted that in the application seeking remand of the petitioner to judicial custody till 11.08.2017 on 08.08.2017, it was stated by the E.D that the investigation under the Bail Appln.1165/2017 Page 6 of 55 PMLA in this case is in progress and passing through critical stage where it is certain that new facts and evidences would come on record and that would be required to be interrogated from the petitioner. The application further indicated that there were more leads and money trails to be analyzed in the case and, therefore, judicial custody of the petitioner was needed.
22. On 11.08.2017, when the matter was listed before the Special Court, the Presiding Officer was on leave. The petitioner along with others were produced from judicial custody. Two of the accused persons who were on bail also presented themselves. The matter was adjourned to 31.08.2017. The order reads as hereunder:-
"“11.8.2017 Ld. P.O is on leave for today. Sh. Vikas Garg, SPP for ED. Accused Rohit Tandon, Raj Kumar Goel, Yogesh Mittal and Ashish Kumar are present from J/C. Accused Dinesh Bhola and Kamal Jain are present on bail with their Counsel. Put up on 31.08.2017 for purpose already fixed. Reader/ 11.08.2017” 23. The order dated 11.08.2017 was, therefore, not passed by the Presiding Officer but by the Reader of the Court. It has also been pointed out that the order does not specifically indicate that the Bail Appln.1165/2017 Page 7 of 55 petitioner is being remanded. The order only states that the case will be listed on 31.08.2017 for the purpose already fixed.
24. This Court was later informed that now the petitioner has been remanded to custody till 16.10.2017.
25. It has been argued on behalf of the petitioner that, in the first instance, when the petitioner was arrested under the provisions of sub clause (3) of Section 19 of the PMLA, he was first required to be taken to a Judicial Magistrate or a Metropolitan Magistrate having jurisdiction, within a period of 24 hours after excluding the time necessary for journey from the place of arrest to the Magistrate‟s Court. Instead of taking him to the Magistrate, the petitioner was straightaway brought to the Special Court. By that time, no complaint had been lodged under Section 44 of the PMLA as against the petitioner. It has then been submitted that even if it is assumed that the investigation in the concerned ECIR was continuing and the Special Court had the power of remand under Section 167 of the Cr.P.C, the remand of the petitioner could not have been for not more than 15 days and ultimately for not more than 60 days.
26. In the present case, the maximum number of days for which the petitioner could have been detained during investigation is 60 days. It has also been argued that only to prevent and thwart the prospects of the petitioner from being released on statutory bail that hurriedly, without there being complete materials on record to justify the filing of the prosecution/chargesheet and on half baked information, the prosecution/complaint under Section 44 of the PMLA was filed on Bail Appln.1165/2017 Page 8 of 55 02.08.2017 as 60 days of custody would have been completed on 04.08.2017.
27. It has thus been argued that after the filing of the prosecution/complaint under Section 44 of the PMLA as referred to above, the investigation would be deemed to have been completed. In the present case, under this Special Act, prosecution/complaint is in the nature of a report under Section 173 of the Cr.P.C. Thereafter, the petitioner could only have been remanded under Section 309 of the Cr.P.C but only after taking cognizance. It was pointed out that there are no committal proceedings provided for in the Act as the Special Court has been vested with the power of trying the case after prosecution/complaint is lodged under Section 44 of the PMLA. Thus after the filing of the prosecution/complaint on 02.08.2017, there was no way in which the petitioner could have been remanded either to E.D custody or to judicial custody before taking cognizance of the offence.
28. Till date, it has been asserted, no cognizance has been taken against the petitioner in the present case.
29. Apart from this, it has been argued, after the prosecution/complaint having been filed, the petitioner was being remanded for more than 15 days at one go, which is impermissible in law. Curiously, few of the last orders of remand do not even specify that petitioner or the other accused persons were being remanded to custody and such orders have been signed by the Reader of the Special Court. It is thus, it has been urged, a complete violation of the procedural requirements, rendering the remand of the petitioner Bail Appln.1165/2017 Page 9 of 55 without any jurisdiction and, therefore, invalid, entitling the petitioner to be released forthwith or granted bail.
30. As opposed to the aforesaid contentions, Mr.Sanjay Jain, learned Additional Solicitor General has argued that prior to the lodging of the prosecution/complaint against the petitioner and another on 02.08.2017, the remand to the E.D custody was under the provisions of Section 167 of the Cr.P.C and after the lodging of the complaint on 02.08.2017, the remand was necessarily under Section 309 of the Cr.P.C. On the aspect of Section 309 being applicable only at the post cognizance stage, Mr.Jain submitted that cognizance of the offence is taken once and is always taken of the offences and not of the offenders. Once cognizance was taken on 25.02.2017 against other co-accused persons and the prosecution/complaint against the petitioner was tagged with the earlier complaint, the Special Court would be deemed to have taken cognizance as against the petitioner as well.
31. With respect to the contention of the petitioner that the order of remand, on a couple of occasions had been signed by the Reader and not the Presiding Officer of the Court, it has been submitted that such aberration is only an irregularity, which though cannot be defended but would not entitle the prosecution case to be thrown out or the petitioner to be released or granted bail.
32. In order to appreciate the contentions of the parties, it would be relevant to examine the relevant provisions of the PMLA, 2002 and the Code of Criminal Procedure, 1973. Bail Appln.1165/2017 Page 10 of 55 33. Section 3 of the PMLA defines the offence of money laundering. Section 4 provides for punishment for money laundering. The sections read as hereunder:-
"3. Offence of money-laundering.—Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with the 1 [proceeds of crime including its concealment, possession, acquisition or use and projecting or claiming]. it as untainted property shall be guilty of offence of money-laundering.
4. Punishment for money-laundering.—Whoever commits the offence of money-laundering shall be punishable with rigorous imprisonment for a term which shall not be less than three years but which may extend to seven years and shall also be liable to fine: Provided that where the proceeds of crime involved in money-laundering relates to any offence specified under paragraph 2 of Part A of the Schedule, the provisions of this section shall have effect as if for the words “which may extend to seven years”, the words “which may extend to ten years” had been substituted.
34. The power of arrest of an accused has been provided in Section 19 of the PMLA which clearly envisages that the authorized officer, on his satisfaction that a person has been guilty of an offence Bail Appln.1165/2017 Page 11 of 55 punishable under the Act, may arrest such person and as soon as possible inform him the grounds of such arrest. This section specifically states that after the arrest, a copy of the order of the arrest along with the materials in the possession of the Arresting Officer has to be forwarded to the Adjudicating Authority in a sealed envelope in the manner as may be prescribed and the Adjudicating Authority shall keep such order and materials for such period, as may be prescribed.
35. Sub Section (3) of Section 19 further emphasizes that every person arrested under Section 19(1) of the Act, shall within 24 hours, be taken to a Magistrate or a Metropolitan Magistrate, as the case may be, having jurisdiction and the period of 24 hours shall exclude the time necessary for journey from the place of arrest to the Magistrate‟s Court.
36. For the purposes of trying offences under the PMLA, Special Courts have been constituted under Section 43 of the Act. How the offences would be tried has been delineated in Section 44 of the Act which reads as hereunder:-
"“44. Offences triable by Special Courts.—(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974),— (a) an offence punishable under section 4 and any scheduled offence connected to the offence under that section shall be triable by the Special Court constituted for the area in which the offence has been committed: Bail Appln.1165/2017 Page 12 of 55 Provided that the Special Court, trying a scheduled offence before the commencement of this Act, shall continue to try such scheduled offence; or].; (b) a Special Court may, [upon perusal of police report of the facts which constitute an offence under this Act or]. upon a complaint made by an authority authorised in this behalf under this Act take [cognizance of offence under section 3, without the accused being committed to it for trial].; (Emphasis provided) (c) if the court which has taken cognizance of the scheduled offence is other than the Special Court which has taken cognizance of the complaint of the offence of money- laundering under sub-clause (b), it shall, on an application by the authority authorised to file a complaint under this Act, commit the case relating to the scheduled offence to the Special Court and the Special Court shall, on receipt of such case proceed to deal with it from the stage at which it is committed. (d) a Special Court while trying the scheduled offence or the offence of money-laundering shall hold trial in accordance with the Bail Appln.1165/2017 Page 13 of 55 provisions of the Code of Criminal Procedure, 1973 ( 2 of 1974) as it applies to a trial before a Court of Session. (2) Nothing contained in this section shall be deemed to affect the special powers of the High Court regarding bail under section 439 of the Code of Criminal Procedure, 1973 (2 of 1974) and the High Court may exercise such powers including the power under clause (b) of sub-section (1) of that section as if the reference to “Magistrate” in that section includes also a reference to a “Special Court” designated under section 43.” 37. From a perusal of Section 44 of the PMLA, the following procedure emerges:-
"(i) all offences punishable under Section 4 and any scheduled scheduled offence connected to the offence shall be triable by the Special Court; (ii) the Special Court, on a complaint made by an authority authorized in this behalf, take cognizance of offence under Section 3, without the accused being committed to it for trial and that the Special Court shall hold trial in accordance with the provisions of Cr.P.C, 1973 as it applies to a trial before a Court of Sessions. Sub clause (2) of Section 44 further clarifies that nothing shall affect the special powers of the High Court regarding bail under Section 439 of the Code of Criminal Procedure, 1973 and the High Court may exercise such powers including the power under clause (b) of sub-section (1) of that section as if the reference to “Magistrate” in Bail Appln.1165/2017 Page 14 of 55 that section includes also a reference to a “Special Court” designated under section 43 of the Act.
38. Section 45 of the Act makes the offences under the PMLA to be cognizable and non-bailable.
39. Under the PMLA, the provisions of Cr.P.C have been made applicable to the proceedings before the Special Court. A special reference of Section 65 of the Act is necessary. Section 65 of the PMLA reads as hereunder:-
"“65. Code of Criminal Procedure, 1973 to apply.—The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) shall apply, insofar as they are not inconsistent with the provisions of this Act, to arrest, search and seizure, attachment, confiscation, investigation, prosecution and all other proceedings under this Act.” 40. From a conspectus of the aforenoted provisions under the Act, it is clear that the provisions of the Cr.P.C, 1973 would apply to the proceedings before the Special Court dealing with the offences under the PMLA.
41. Thus, during the course of investigation and prior to the filing of the complaint under Section 44 of the PMLA, the provisions of Sections 167 and 173 of the Cr.P.C would be applicable which deal with the procedure when investigation cannot be completed in 24 hours and the procedure on completion of investigation. Needless to state here that the prosecution/complaint referred to in Section 44 of Bail Appln.1165/2017 Page 15 of 55 the PMLA is akin to a report under Section 173 in as much as a report under Section 173 of the Code of Criminal Procedure is submitted after the investigation is completed. So is the prosecution/complaint under Section 44 of the PMLA. After the filing of the predicate offences and registration of the ECIR, investigations are held and the prosecution/complaint under Section 44 is only a culmination of the investigation. It would be necessary in this context to examine the relevant provisions of Sections 167 and 173 of the Cr.P.C, 1973. They read as hereunder:-
"167. Procedure when investigation cannot be completed in twenty-four hours.—(1) Whenever any person is arrested and detained in custody, and it appears that the investigation cannot be completed within the period of twenty-four hours fixed by section 57, and there are grounds for believing that the accusation or information is wellfounded, the officer in charge of the police station or the police officer making the investigation, if he is not below the rank of sub-inspector, shall forthwith transmit to the nearest Judicial Magistrate a copy of the entries in the diary hereinafter prescribed relating to the case, and shall at the same time forward the accused to such Magistrate. (2) The Magistrate to whom an accused person is forwarded under this section may, whether he has or has not jurisdiction to try the case, from time to time, authorize the detention of the accused in such custody as Bail Appln.1165/2017 Page 16 of 55 such Magistrate thinks fit, for a term not exceeding fifteen days in the whole; and if he has no jurisdiction to try the case or commit it for trial, and considers further detention unnecessary, he may order the accused to be forwarded to a Magistrate having such jurisdiction: Provided that— (a) the Magistrate may authorize the detention of the accused person, otherwise than in custody of the police, beyond the period of fifteen days, if he is satisfied that adequate grounds exist for doing so, but no Magistrate shall authorize the detention of the accused person in custody under this paragraph for a total period exceeding— (i) ninety days, where the investigation relates to an offence punishable with death, imprisonment for life or imprisonment for a term of not less than ten years; (ii) sixty days, where the investigation relates to any other offence, and, on the expiry of the said period of ninety days, or sixty days, as the case may be, the accused person shall be released on bail if he is prepared to and does furnish bail, Bail Appln.1165/2017 Page 17 of 55 and every person released on bail under this sub-section shall be deemed to be so released under the provisions of Chapter XXXIII for the purposes of that Chapter; (b) no Magistrate shall authorize detention of the accused in custody of the police under this section unless the accused is produced before him in person for the first time and subsequently every time till the accused remains in the custody of the police, but the Magistrate may extend further detention in judicial custody on production of the accused either in person or through the medium of electronic video linkage; (c) no Magistrate of the second class, not specially empowered in this behalf by the High Court, shall authorise detention in the custody of the police. Explanation I.—For the avoidance of doubts, it is hereby declared that, notwithstanding the expiry of the period specified in paragraph (a), the accused shall be detained in custody so long as he does not furnish bail. Explanation II.—If any question arises whether an accused person was produced before the Magistrate as Bail Appln.1165/2017 Page 18 of 55 required under clause (b), the production of the accused person may be proved by his signature on the order authorising detention or by the order certified by the Magistrate as to production of the accused person through the medium of electronic video linkage, as the case may be. Provided further that in case of a woman under eighteen years of age, the detention shall be authorised to be in the custody of a remand home or recognised social institution. (2A) Notwithstanding anything contained in sub- section (1) or sub-section (2), the officer in charge of the police station or the police officer making the investigation, if he is not below the rank of a sub- inspector, may, where a Judicial Magistrate is not available, transmit to the nearest Executive Magistrate, on whom the powers of a Judicial Magistrate or Metropolitan Magistrate have been conferred, a copy of the entry in the diary hereinafter prescribed relating to the case, and shall, at the same time, forward the accused to such Executive Magistrate, and thereupon such Executive Magistrate, may, for reasons to be recorded in writing, authorise the detention of the accused person in such custody as he may think fit for a term not exceeding Bail Appln.1165/2017 Page 19 of 55 seven days in the aggregate; and, on the expiry of the period of detention so authorised, the accused person shall be released on bail except where an order for further detention of the accused person has been made by a Magistrate competent to make such order; and, where no order for such further detention is made, the period during which the accused person was detained in custody under the orders made by an Executive Magistrate under this sub-section, shall be taken into account in computing the period specified in paragraph (a) of the proviso to sub-section (2): Provided that before the expiry of the period aforesaid, the Executive Magistrate shall transmit to the nearest Judicial Magistrate the records of the case together with a copy of the entries in the diary relating to the case which was transmitted to him by the officer in charge of the police station or the police officer making the investigation, as the case may be. (3) A Magistrate authorising under this section detention in the custody of the police shall record his reasons for so doing. (4) Any Magistrate other than the Chief Judicial Magistrate making such order shall forward a copy of his order, with his reasons for making it, to the Chief Judicial Magistrate. Bail Appln.1165/2017 Page 20 of 55 (5) If in any case triable by a Magistrate as a summons-case, the investigation is not concluded within a period of six months from the date on which the accused was arrested, the Magistrate shall make an order stopping further investigation into the offence unless the officer making the investigation satisfies the Magistrate that for special reasons and in the interests of justice the continuation of the investigation beyond the period of six months is necessary. (6) Where any order stopping further investigation into an offence has been made under sub-section (5), the Sessions Judge may, if he is satisfied, on an application made to him or otherwise, that further investigation into the offence ought to be made, vacate the order made under sub-section (5) and direct further investigation to be made into the offence subject to such directions with regard to bail and other matters as he may specify.
173. Report of police officer on completion of investigation.—(1) Every investigation under this Chapter shall be completed without unnecessary delay. (1A) The investigation in relation to rape of a child may be completed within three months from the date on which the information was recorded by the officer in charge of the police station. Bail Appln.1165/2017 Page 21 of 55 (2) (i) As soon as it is completed, the officer in charge of the police station shall forward to a Magistrate empowered to take cognizance of the offence on a police report, a report in the form prescribed by the State Government, stating— (a) the names of the parties; (b) the nature of the information; (c) the names of the persons who appear to be acquainted with the circumstances of the case; (d) whether any offence appears to have been committed and, if so, by whom; (e) whether the accused has been arrested; (f) whether he has been released on his bond and, if so, whether with or without sureties; (g) whether he has been forwarded in custody under section 170. (h) whether the report of medical examination of the woman has been attached where investigation relates to an offence under section 376, 376A, 376B, 376C2[376D or section 376E of the Indian Penal Code (45 of 1860)]..]. (ii) The officer shall also communicate, in such manner as may be prescribed by the State Government, Bail Appln.1165/2017 Page 22 of 55 the action taken by him, to the person, if any, by whom the information relating to the commission of the offence was first given. (3) Where a superior officer of police has been appointed under section 158, the report shall, in any case in which the State Government by general or special order so directs, be submitted through that officer, and he may, pending the orders of the Magistrate, direct the officer in charge of the police station to make further investigation. (4) Whenever it appears from a report forwarded under this section that the accused has been released on his bond, the Magistrate shall make such order for the discharge of such bond or otherwise as he thinks fit. (5) When such report is in respect of a case to which section 170 applies, the police officer shall forward to the Magistrate along with the report— (a) all documents or relevant extracts thereof on which the prosecution proposes to rely other than those already sent to the Magistrate during investigation; (b) the statements recorded under section 161 of all the persons whom the prosecution proposes to examine as its witnesses. Bail Appln.1165/2017 Page 23 of 55 (6) If the police officer is of opinion that any part of any such statement is not relevant to the subject-matter of the proceedings or that its disclosure to the accused is not essential in the interests of justice and is inexpedient in the public interest, he shall indicate that part of the statement and append a note requesting the Magistrate to exclude that part from the copies to be granted to the accused and stating his reasons for making such request. (7) Where the police officer investigating the case finds it convenient so to do, he may furnish to the accused copies of all or any of the documents referred to in sub-section (5). (8) Nothing in this section shall be deemed to preclude further investigation in respect of an offence after a report under sub-section (2) has been forwarded to the Magistrate and, where upon such investigation, the officer in charge of the police station obtains further evidence, oral or documentary, he shall forward to the Magistrate a further report or reports regarding such evidence in the form prescribed; and the provisions of sub-sections (2) to (6) shall, as far as may be, apply in relation to such report or reports as they apply in relation to a report forwarded under sub-section (2).” Bail Appln.1165/2017 Page 24 of 55 42. Under the Cr.P.C, 1973, after a person is arrested in connection with investigation of a case and the investigation with respect to the offence cannot be completed within a period of 24 hours as mandated by Section 57 of the Code of Criminal Procedure, the accused shall be forwarded to a Magistrate who may or may not have the jurisdiction to try the case and who shall authorize the detention of the accused in custody for a term not exceeding 15 days in the whole in one go and not more than 90 days if the investigation relates to an offence punishable with death, imprisonment for life or imprisonment for a term of less than 10 years and 60 days where the investigation relates to any other offence, if the Magistrate thinks fit. In case the chargesheet is not submitted within the aforesaid period of either 60 days or 90 days depending upon the nature of accusation, it is mandatory that the accused shall be released on bail and such release shall be deemed to be under Chapter XXXIII of the Code which deals with the provisions as to bail and bonds.
43. For an accused to be remanded, the Magistrate has to ensure that the accused is produced before him in person for the first time and subsequently every time till he remains in custody of police but the Magistrate may order remand in judicial custody on production of the accused either in person or through the medium of electronic video linkage.
44. Thus what is indubitably clear is that the Special Court, before the filing of the prosecution/complaint under Section 44 of the PMLA, can authorize the detention of an accused and keep him remanding in custody, authorizing his detention for 15 days at one go, to a Bail Appln.1165/2017 Page 25 of 55 maximum of 60 or 90 days as the case may be. Thereafter, since the prosecution/complaint is in the nature of a report under Section 173, the power of authorizing the detention would only be under Section 309 of the Cr.P.C as there is no commitment proceedings under the PMLA. In cases concerning IPC, there is an intermediate stage which is the stage of Section 209 of the Cr.P.C when the case is committed to the Court of Sessions when the offence is punishable exclusively by it. Though there is no application of Section 209 Cr.P.C under PMLA, but the provisions of Section 209 are being extracted below so as to have a clear understanding of the power of remand. Section 209 reads as follows:-
"209. Commitment of case to Court of Session when offence is triable exclusively by it.—When in a case instituted on a police report or otherwise, the accused appears or is brought before the Magistrate and it appears to the Magistrate that the offence is triable exclusively by the Court of Session, he shall— (a) commit, after complying with the provisions of section 207 or section 208, as the case may be, the case to the Court of Session, and subject to the provisions of this Code relating to bail, remand the accused to custody until such commitment has been made; (b) subject to the provisions of this Code relating to bail, remand the accused to Bail Appln.1165/2017 Page 26 of 55 custody during, and until the conclusion of, the trial; (c) send to that Court the record of the case and the documents and articles, if any, which are to be produced in evidence; (d) notify the Public Prosecutor of the commitment of the case to the Court of Session.” 45. Section 173 of the Cr.P.C provides that as soon as the investigation is completed, a report in the prescribed form shall be filed. However, there is a provision for further investigation under Section 173(8) which permits the investigating agency to conduct further investigation even after a report has been submitted to the Magistrate under sub Section (2) of Section 173. After the further investigation, the report has also to be submitted to the Magistrate.
46. On submission of report under Section 173 of the Code of Criminal Procedure, a Magistrate takes cognizance of the offence under Section 190 of the Cr.P.C. Under certain circumstances a Sessions Court also takes cognizance of the offence under Section 193 of the Cr.P.C as a Court of original jurisdiction but only when the case has been committed to it by a Magistrate under the Code.
47. After cognizance is taken, the case has to be tried on day to day basis unless the Court finds the adjournment of the same beyond the following day to be necessary for reasons to be recorded. If the Court, after taking cognizance of an offence, or commencement of trial, finds it necessary or advisable to postpone the commencement of, or Bail Appln.1165/2017 Page 27 of 55 adjourn, any inquiry or trial, it may, from time to time, for reasons to be recorded, postpone or adjourn the same on such terms as it thinks fit, for such time as it considers reasonable, and may by a warrant remand the accused if in custody. However, the remand shall not be for a term exceeding 15 days at a time. The aforesaid provisions are to be found in Section 309 of the Cr.P.C which is as hereunder:-
"309. Power to postpone or adjourn proceedings.—(1) In every inquiry or trial the proceedings shall be continued from day-to-day until all the witnesses in attendance have been examined, unless the Court finds the adjournment of the same beyond the following day to be necessary for reasons to be recorded: Provided that when the inquiry or trial relates to an offence under section 376, section 376A, section 376B, section 376C or section 376D of the Indian Penal Code (45 of 1860), the inquiry or trial shall, as far as possible be completed within a period of two months from the date of filing of the charge sheet.]. (2) If the Court, after taking cognizance of an offence, or commencement of trial, finds it necessary or advisable to postpone the commencement of, or adjourn, any inquiry or trial, it may, from time to time, for reasons to be recorded, postpone or adjourn the same on such terms as it thinks fit, for such time as it considers reasonable, and may by a warrant remand the accused if in custody: Bail Appln.1165/2017 Page 28 of 55 Provided that no Magistrate shall remand an accused person to custody under this section for a term exceeding fifteen days at a time: Provided further that when witnesses are in attendance, no adjournment or postponement shall be granted, without examining them, except for special reasons to be recorded in writing: Provided also that no adjournment shall be granted for the purpose only of enabling the accused person to show cause against the sentence proposed to be imposed on him. Provided also that— (a) no adjournment shall be granted at the request of a party, except where the circumstances are beyond the control of that party; (b) the fact that the pleader of a party is engaged in another Court, shall not be a ground for adjournment; (c) where a witness is present in Court but a party or his pleader is not present or the party or his pleader though present in Court, is not ready to examine or cross-examine the witness, the Court may, if thinks fit, record the statement of the witness Bail Appln.1165/2017 Page 29 of 55 and pass such orders as it thinks fit dispensing with the examination-in- chief or cross-examination of the witness, as the case may be. Explanation 1.—If sufficient evidence has been obtained to raise a suspicion that the accused may have committed an offence, and it appears likely that further evidence may be obtained by a remand, this is a reasonable cause for a remand. Explanation 2.—The terms on which an adjournment or postponement may be granted include, in appropriate cases, the payment of costs by the prosecution or the accused.” 48. Thus, for all practical purposes, on the filing of the prosecution/complaint under Section 44 of the PMLA and after cognizance of the offence and framing of the charges, the trial commences. In that case, if the trial cannot be held on a day to day basis, the proceedings can be adjourned and for such time, the accused would be remanded to judicial custody. For the application of Section 309 of the Cr.P.C to the proceedings, it is albeit necessary that cognizance must have been taken of the offence.
49. Under the Code of Criminal Procedure, there are three stages where an accused could be remanded to custody. Firstly, during the course of investigation of the case under the provisions of Section 167 of the Cr.P.C, an accused could be remanded to the police Bail Appln.1165/2017 Page 30 of 55 custody/judicial custody. Then comes the stage of Section 209 Cr.P.C, when chargesheet is submitted and the Magistrate takes a decision to prosecute/commit the case to Court of Sessions in cases of offences exclusively triable by Courts of Sessions. During that period also there is a provision of remand of an accused to custody which has been provided under Section 209 of the Cr.P.C. The third provision is the post cognizance stage and which is to be found in Section 309 of the Cr.P.C as stated above. The remand of the petitioner to E.D custody prior to 02.08.2017 when the prosecution/complaint under Section 44 of the Act was filed against the petitioner and another was therefore, permissible under Section 167 of the Cr.P.C. Thereafter, in the absence of any committal proceedings available under the PMLA, the power of remand of an accused is only to be found in Section 309 of the Cr.P.C, which has been referred to above. For the application of Section 309 of the Cr.P.C it is required that cognizance of the offence ought to have been taken.
50. In the present case, the major contention of the petitioner is that till date cognizance has not been taken.
51. Now, it would be relevant here to understand as to what would amount to taking of cognizance in the present case.
52. In Ajit Kumar Palit vs. State of West Bengal and Anr, AIR1963SC765 the Supreme Court had the occasion to deal with Sections 4 & 5 of the West Bengal Criminal Law Amendment (Special Courts) Act, 1949. It was held by the Supreme Court in the aforesaid case as follows:-
"Bail Appln.1165/2017 Page 31 of 55 “19. The provisions of Section 190(1) being obviously, and on its own terms, inapplicable, the next question to be considered is whether it is the requirement of any principle of general jurisprudence that there should be some additional material to entitle the court to take cognizance of the office. The word “cognizance” has no esoteric or mystic significance in criminal law or procedure. It merely means-become aware of and when used with reference to a court or Judge, to take notice of judicially. It was stated in Gopal Marwari v. Emperor [AIR1043Patna 245]. by the learned Judges of the Patna High Court in a passage quoted with approval by this Court in R.R. Chari v. State of Uttar Pradesh [(1951) SCR312at p 320]. that the word “cognizance” was used in the Code to indicate the point when the Magistrate or Judge takes judicial notice of an offence and that it was a word of indefinite import, and is not perhaps always used in exactly the same sense. As observed in Emperor v.Sourindra Mohan Chuekorbutty, [ILR37Cal 412 at p 416]. “taking cognizance does not involve any formal action; or indeed action of any kind, but occurs as soon as a Magistrate, as such, applies his mind to the suspected commission of an offence”. Where the statute proscribes the materials on which alone the judicial mind shall operate before any step is taken, obviously the statutory requirement must be Bail Appln.1165/2017 Page 32 of 55 fulfilled. Thus, a Sessions Judge cannot exercise that original jurisdiction which Magistrates specified in Section 190(1) can, but the material on which alone he can apply his judicial mind and proceed under the Code is an order of commitment. But statutory provision apart, there is no set material which must exist before the judicial mind can operate. It appears to us therefore that as soon as a Special Judge receives the orders of allotment of the case passed by the State Government it becomes vested with jurisdiction to try the case and when it receives the record from the Government it can apply its mind and issue notice to the accused and thus start the trial of the proceedings assigned to it by the State Government.” Similarly, in Tula Ram and Others vs. Kishore Singh, (1977) 53. 4 SCC459 the Supreme Court was examining as to whether a Magistrate, on receiving a report under Section 173 of the Cr.P.C can issue notice to the complainant, record his statement and the statement of other witnesses and then issue process under Section 204 of the Code and in the aforesaid judgment, the Supreme Court was of the view that the question as to what is meant by taking cognizance is no longer res integra as it has been decided by several decisions of the Supreme Court. In R.R.Chari vs. State of U.P, 1951 SC207 the Supreme Court had ruled that taking cognizance does not involve any formal action or indeed action of any kind but occurs as soon as a Bail Appln.1165/2017 Page 33 of 55 Magistrate as such applies his mind to the suspected commission of an offence. The Supreme Court in Tula Ram and Others (Supra) has held as follows:-
"“It seems to us that there is no special charm or any magical formula in the expression “taking cognizance” which merely means judicial application of the mind of the Magistrate to the facts mentioned in the complaint with a view to taking further action. Thus what Section 190 contemplates is that the Magistrate takes cognizance once he makes himself fully conscious and aware of the allegations made in the complaint and decides to examine or test the validity of the said allegations. The Court prescribes several modes in which a complaint can be disposed of after taking cognizance. In the first place, cognizance can be taken, on the basis of three circumstances: (1) upon receiving a complaint of facts which constitute such offence; (2) upon a police report of such facts; and (c) upon information received from any person other than the police officer or unon his own knowledge, that an offence has been committed. These are the three grounds on the basis of which a Magistrate can take cognizance and decide to act accordingly. It would further appear that this Court in the case of Narayandas Bhagwandas Madhavdas v. State of West Bengal [AIR1959SC1118: (1960) 1 SCR93 1
1959 Cri LJ1368 observed the mode in which a Bail Appln.1165/2017 Page 34 of 55 Magistrate could take cognizance of an offence and observed as follows: It seems to me clear however that before it can be said that any Magistrate has taken cognizance of any offence under Section 190(1)(a), Criminal Procedure Code. he must not only have applied his mind to the contents of the petition but must have done so for the purpose of proceeding in a particular way as indicated in the subsequent provisions of this Chapter — proceeding under Section 200 and thereafter sending it for inquiry and report under Section 202.” 54. Similarly, in Anil Saran vs. State of Bihar and Another, (1995) 6 SCC142 the Supreme Court has held as follows:-
"5. We find no force in the contention. Though the Code defines “cognizable offence” and “non-cognizable offence”, the word „cognizance‟ has not been defined in the Code. But it is now settled law that the court takes cognizance of the offence and not the offender. As soon as the Magistrate applies his judicial mind to the offence stated in the complaint or the police report etc. cognizance is said to be taken. Cognizance of the offence takes place when the Magistrate takes judicial notice of the offence. Whether the Magistrate has taken cognizance of offence on a complaint or on a police report or upon information of a person other than the Bail Appln.1165/2017 Page 35 of 55 police officer, depends upon further steps taken pursuant thereto and the attending circumstances of the particular case including the mode in which case is sought to be dealt with or the nature of the action taken by the Magistrate. Under sub-section (1) of Section 190 of the Code, any Magistrate may take cognizance of an offence (a) upon receiving a complaint of facts which constitute such offence, (b) upon a police report of such facts, and (c) upon information received from any person other than a police officer, or upon his own knowledge, that such offence has been committed.
6. Sub-section (1) of Section 192 has conferred a special power on the Chief Judicial Magistrate, as, normally, the Magistrate taking cognizance of an offence, has himself to proceed further as enjoined by the Code. But, an exception has been made in the case of Chief Judicial Magistrate, may be because he has some administrative functions also to perform. A Magistrate who receives the case on transfer and takes cognizance would not become incompetent to do so merely because the sanction of transfer of the case to his file is not in accordance with law. The power to take cognizance has been conferred on a Magistrate by Section 190(1) of the Code and he would not be denuded of this power because the case has come to his file pursuant to some illegal order of the Chief Bail Appln.1165/2017 Page 36 of 55 Judicial Magistrate. The former would be exercising his power of taking cognizance even in such a case, because of his having received a complaint constituting the offence. It would not be material, for this purpose, as to how he came to receive the complaint — directly or on transfer from the Chief Judicial Magistrate.” 55. The Supreme Court in State of Karnataka and Anr Vs. Pastor P.Raju, AIR2006SC2825 the Supreme Court has held as follows:-
"“7. Several provisions in Chapter XIV of the Code of Criminal Procedure use the word "cognizance". The very first Section in the said Chapter, viz., Section 190 lays down how cognizance of offences will be taken by a Magistrate. However, the word "cognizance" has not been defined in the Code of Criminal Procedure. The dictionary meaning of the word "cognizance" is - 'judicial hearing of a matter'. The meaning of the word has been explained by judicial pronouncements and it has acquired a definite connotation. The earliest decision of this Court on the point is R.R. Chari v. State of U.P. MANU/SC/0025/19
1951CriLJ775 , wherein it was held: Taking cognizance does not involve any formal action or indeed action of any kind but occurs as soon as a Magistrate as such applies his mind to the suspected commission of an offence. Bail Appln.1165/2017 Page 37 of 55 In Darshan Singh Ram Kishan v. State of Maharashtra MANU/SC/0089/19
1971CriLJ1697 , while considering Section 190 of the Code of 1908, it was observed that "taking cognizance does not involve any formal action or indeed action of any kind but occurs as soon as a Magistrate as such applies his mind to the suspected commission of an offence. Cognizance, therefore, takes place at a point when a magistrate first takes judicial notice of an offence. This is the position whether the magistrate takes cognizance of an offence on a complaint, or on a police report, or upon information of a person other than a police officer."
In Narayandas Bhagwandas Madhavdas v. The State of West Bengal MANU/SC/0054/19
1959CriLJ1368 it was held that before it can be said that any Magistrate has taken cognizance of any offence under Section 190(1)(a) Criminal Procedure Code, he must not only have applied his mind to the contents of the petition but must have done so for the purpose of proceeding in a particular way as indicated in the subsequent provisions of the Chapter - proceeding under Section 200 and thereafter sending it for inquiry and report under Section 202. It was observed that there is no special charm or any magical formula in the expression "taking cognizance" which merely means judicial application of the mind of the Magistrate to the facts mentioned in the complaint with a view to taking further action. It was also observed that what Section 190 Bail Appln.1165/2017 Page 38 of 55 contemplates is that the Magistrate takes cognizance once he makes himself fully conscious and aware of the allegations made in the complaint and decides to examine or test the validity of the said allegations. The Court then referred to the three situations enumerated in Sub-section (1) of Section 190 upon which a Magistrate could take cognizance. Similar view was expressed in Kishun Singh and Ors. v. State of Bihar MANU/SC/0460/19
1993CriLJ1700 that when the Magistrate takes notice of the accusations and applies his mind to the allegations made in the complaint or police report or information and on being satisfied that the allegations, if proved, would constitute an offence, decides to initiate judicial proceedings against the alleged offender, he is said to have taken cognizance of the offence. In State of West Bengal v. Mohd. Khalid and Ors. MANU/SC/0154/19
AIR1995SC785 the Court after taking note of the fact that the expression had not been defined in the Code held: ...In its broad and literal sense, it means taking notice of an offence. This would include the intention of initiating judicial proceedings against the offender in respect of that offence and taking steps to see whether there is any basis for initiating judicial proceedings or for other purposes. The word 'cognizance' indicates the point when a Magistrate or a Judge first takes judicial notice of an Bail Appln.1165/2017 Page 39 of 55 offence. It is entirely a different thing from initiation of proceedings; rather it is the condition precedent to the initiation of proceedings by the Magistrate or the Judge. Cognizance is taken of cases and not of persons. It is necessary to mention here that taking cognizance of an offence is not the same thing as issuance of process. Cognizance is taken at the initial stage when the Magistrate applies his judicial mind to the facts mentioned in a complaint or to police report or upon information received from any other person that an offence has been committed. The issuance of process is at a subsequent stage when after considering the material placed before it the Court decides to proceed against the offenders against whom a prima facie case is made out.” 56. Thus what can be gleaned from the aforementioned decisions is that the term „cognizance‟ may not have been defined in the Cr.P.C but it has a clear and definite meaning and connotation as derived from various judicial precedents. Simply speaking, cognizance is taking judicial notice by a Court of law, possessing jurisdiction, on a cause or matter presented before it so as to decide whether there is any basis for initiating proceedings and determination of the cause or matter judicially.
57. Thus applying the aforesaid concept to the facts of the present case, it would appear that when the learned Special Judge, PMLA took cognizance against some of the accused persons on 25.02.2017 on the Bail Appln.1165/2017 Page 40 of 55 lodging of the complaint under Section 44 of the PMLA on 23.02.2017, it amounted to taking cognizance in the present complaint also which was lodged on 02.08.2017 as the complaint against the petitioner was tagged along with the main complaint. The orders of the Special Court, as has been seen earlier, reflect that after application of mind, the petitioner was remanded to E.D custody before the lodging of the complaint on 02.08.2017 and to judicial custody after the lodging of the complaint referred to above.
58. Thus the present remand of the petitioner would be under Section 309 of the Cr.P.C.
59. It has been argued on behalf of the petitioner that the prosecution/complaint filed on 02.08.2017 was only for the purposes of preventing the petitioner from taking advantage of the provisions of Section 167(2) of the Cr.P.C in obtaining a statutory bail. It was, additionally, argued that the prosecution complaint is in the nature of a report under Section 173 of the Cr.P.C, 1973 and it must conform to the requirements as provided under Section 173 of the Cr.P.C. The report under Section 173 has to contain all the information and materials and it should not be an inchoate report, without conclusive finding that an accused/petitioner is required to be tried for such offence. If the investigation was required to be continued, it was absolutely unnecessary for the prosecution to have filed the prosecution/complaint under Section 44 of the PMLA on 02.08.2017. It has been argued that permitting this would amount to giving imprimatur to something which has been done indirectly and which could have been done directly. Bail Appln.1165/2017 Page 41 of 55 60. On the first blush, this argument appears to be convincing. However, when the facts are analyzed and the provisions of the Cr.P.C and PMLA are scrutinized, the aforesaid argument would not be sustainable. Under the Cr.P.C, there is a provision for further investigation [Section 173(8)]. which is not dependent or contingent upon filing of the charge sheet. It matters not if cognizance has been taken in a case, for the investigating agency to continue with the further investigation.
61. Looking at the successive orders of remand by the Special Court, it becomes very clear that the Special Court has applied its mind. The prosecution/complaint lodged on 02.08.2017 against the petitioner was tagged with the main prosecution/complaint against the other accused persons in which cognizance has been taken. The orders further reveal that the pros and cons of the request for remand by the E.D was analyzed and then only the order was passed. Thus when the petitioner was remanded to custody by a Special Court after the lodging of the prosecution/complaint on 02.08.2017, it was only a remand for the purposes of further investigation. Precisely for this reason, post lodging of the complaint (i.e. 02.08.2017) the remand is to judicial custody and not to the E.D custody.
62. Section 173(8) of the Cr.P.C permits further investigation in respect of an offence even after a report under Section 173(2) has been forwarded to a Magistrate.
63. In H.N.Rishbud vs. State of Delhi, AIR1955SC196 the Supreme Court dealt with the definition of “investigation” under the Bail Appln.1165/2017 Page 42 of 55 Cr.P.C, 1898 which is almost the same as in 1973 Code. In the aforesaid case, it was held as hereunder:-
"“Thus, under the Code investigation consists generally of the following steps: (1) Proceeding to the spot, (2) Ascertainment of the facts and circumstances of the case, (3) Discovery and arrest of the suspected offender, (4) Collection of evidence relating to the commission of the offence which may consist of (a) the examination of various persons (including the accused) and the reduction of their statements into writing, if the officer thinks fit, (b) the search of places or seizure of things considered necessary for the investigation and to be produced at the trial, and (5) Formation of the opinion as to whether on the material collected there is a case to place the accused before a Magistrate for trial and if so taking the necessary steps for the same by the filing of a charge-sheet under Section 173.” In the old Code of 1898 there was no such express provision 64. like what is available by way of Section 173(8) of Cr.P.C., 1973 but such powers were recognized in Ram Lal Narang vs.State (Delhi Admn.), (1979) 2 SCC322 wherein the Supreme Court observed as follows:-
"“… It is easy to visualise a case where fresh material may come to light which would implicate persons not previously accused or absolve persons already accused. Bail Appln.1165/2017 Page 43 of 55 When it comes to the notice of the investigating agency that a person already accused of an offence has a good alibi, is it not the duty of that agency to investigate the genuineness of the plea of alibi and submit a report to the Magistrate?. After all the investigating agency has greater resources at its command than a private individual. Similarly, where the involvement of persons who are not already accused comes to the notice of the investigating agency, the investigating agency cannot keep quiet and refuse to investigate the fresh information. It is their duty to investigate and submit a report to the Magistrate upon the involvement of the other persons. In either case, it is for the Magistrate to decide upon his future course of action depending upon the stage at which the case is before him. If he has already taken cognizance of the offence, but has not proceeded with the enquiry or trial, he may direct the issue of process to persons freshly discovered to be involved and deal with all the accused in a single enquiry or trial. If the case of which he has previously taken cognizance has already proceeded to some extent, he may take fresh cognizance of the offence disclosed against the newly involved accused and proceed with the case as a separate case. What action a Magistrate is to take in accordance with the provisions of the Code of Criminal Procedure in such Bail Appln.1165/2017 Page 44 of 55 situations is a matter best left to the discretion of the Magistrate.” (Emphasis provided by this Court) 65. Thus, on a perusal of the provisions contained in Section 173(8) and 309(2), there is nothing to suggest that after cognizance of an offence is taken, an accused cannot be detained/remanded.
66. Section 309 relates to the power of Court to postpone the commencement or adjournment of an enquiry or trial.
67. In State through CBI vs. Dawood Ibrahim Kaskar & Ors, (2000) 10 SCC438 the Supreme Court has stated as hereunder:-
"“11. There cannot be any manner of doubt that the remand and the custody referred to in the first proviso to the above sub-section are different from detention in custody under Section 167. While remand under the former relates to a stage after cognizance and can only be to judicial custody, detention under the latter relates to the stage of investigation and can initially be either in police custody or judicial custody. Since, however, even after cognizance is taken of an offence the police has a power to investigate into it further, which can be exercised only in accordance with Chapter XII, we see no reason whatsoever why the provisions of Section 167 thereof would not apply to a person who comes to be later arrested by the police in course of such investigation. If Section 309(2) is to be interpreted — as Bail Appln.1165/2017 Page 45 of 55 has been interpreted by the Bombay High Court in Mansuri [From the Judgment and Order dated 1-8- 1996 of the Designated Court for Bomb Blast Cases, Brihat Mumbai in Misc. Applications Nos. 201, 210 and 211 of 1996]. — to mean that after the Court takes cognizance of an offence it cannot exercise its power of detention in police custody under Section 167 of the Code, the Investigating Agency would be deprived of an opportunity to interrogate a person arrested during further investigation, even if it can on production of sufficient materials, convince the Court that his detention in its (police) custody was essential for that purpose. We are, therefore, of the opinion that the words “accused if in custody” appearing in Section 309(2) refer and relate to an accused who was before the Court when cognizance was taken or when enquiry or trial was being held in respect of him and not to an accused who is subsequently arrested in course of further investigation. So far as the accused in the first category is concerned he can be remanded to judicial custody only in view of Section 309(2), but he who comes under the second category will be governed by Section 167 so long as further investigation continues. That necessarily means that in respect of the latter the Court which had taken cognizance of the offence may exercise its power to Bail Appln.1165/2017 Page 46 of 55 detain him in police custody, subject to the fulfillment of the requirements and the limitation of Section 167.” (Emphasis provided by this Court) 68. In Union of India vs. Thamisharasi & Ors, (1995) 4 SCC190 the Supreme Court has stated as hereunder:-
"“16. It is settled that “the court will have no power of remand of an accused to any custody unless the power is conferred by law”. (See Matabar Parida Bisnu Charan Parida Batakrushna Parida Babaji Parida v. State of Orissa [(1975) 2 SCC220:
1975. SCC (Cri) 4
1975 Supp SCR137 .) The power must, therefore, be traced to some provision of the statute……….” 69. In Suresh Kumar Bhikamchand Jain vs. State of Maharashtra, (2013) 3 SCC77 the Supreme Court has held as under:-
"“18. None of the said cases detract from the position that once a charge-sheet is filed within the stipulated time, the question of grant of default bail or statutory bail does not arise. As indicated hereinabove, in our view, the filing of charge-sheet is sufficient compliance with the provisions of Section 167(2)(a)(ii) in this case. Whether cognizance is taken or not is not material as far as Section 167 Cr.P.C is concerned. The right which may have accrued to the petitioner, had charge-sheet not been filed, is not attracted to the facts of this case. Merely because Bail Appln.1165/2017 Page 47 of 55 sanction had not been obtained to prosecute the accused and to proceed to the stage of Section 309 Cr.P.C, it cannot be said that the accused is entitled to grant of statutory bail, as envisaged in Section 167 Cr.P.C. The scheme of Cr.P.C is such that once the investigation stage is completed, the court proceeds to the next stage, which is the taking of cognizance and trial. An accused has to remain in custody of some court. During the period of investigation, the accused is under the custody of the Magistrate before whom he or she is first produced. During that stage, under Section 167(2) Cr.P.C, the Magistrate is vested with authority to remand the accused to custody, both police custody and/or judicial custody, for 15 days at a time, up to a maximum period of 60 days in cases of offences punishable for less than 10 years and 90 days where the offences are punishable for over 10 years or even death sentence. In the event, an investigating authority fails to file the charge-sheet within the stipulated period, the accused is entitled to be released on statutory bail. In such a situation, the accused continues to remain in the custody of the Magistrate till such time as cognizance is taken by the court trying the offence, when the said court assumes custody of the accused for purposes of remand during the trial in terms of Section 309 Cr.P.C. The two stages are Bail Appln.1165/2017 Page 48 of 55 70. different, but one follows the other so as to maintain a continuity of the custody of the accused with a court.” In Dinesh Dalmia vs. CBI, (2007) 8 SCC770 the CBI had (Emphasis provided by this Court) lodged FIR against Mr.Dinesh Dalmia and three companies registered and incorporated under the Companies Act, 1956 on a complaint made by SEBI. Dinesh Dalmia was evading arrest. The Magistrate, on a prayer by the CBI had issued non-bailable warrant of arrest against him. Upon completion of investigation, chargesheet was submitted under Section 173 of the Cr.P.C. In the said chargesheet, the name of the appellant was arraigned in column 1. It was prayed by the CBI that cognizance be taken and process be issued for securing the presence of accused/Dinesh Dalmia so that he may be tried in accordance with law. On such report, cognizance was taken on the basis of the chargesheet. It was noted by the Court that non-bailable warrant of arrest against the appellant was pending.
71. Ultimately, Mr.Dinesh Dalmia was arrested and produced before the Magistrate in Delhi for transit remand to Chennai. When he was produced before the Magistrate at Chennai, an order for police custody was prayed for and was granted for the purposes of brain mapping, polygraph test etc. Dinesh Dalmia was remanded to judicial custody, later, on the plea that further investigation was pending.
72. In the meantime, on completion of 60 days of his arrest, a prayer for statutory bail under Section 167(2) was made by him on the ground that no chargesheet in terms of Section 173(8) had been filed. Bail Appln.1165/2017 Page 49 of 55 When this application was pending consideration, the CBI sought his remand under Section 309(2). The prayer of the statutory bail was rejected. In revision, the Sessions Court allowed the statutory bail on the ground that since the remand was being sought under Section 167 then, no further remand could be made under Section 309(2). As against the aforesaid order, the CBI had moved the High Court. The High Court overturned the decision of the Sessions Court. The matter ultimately travelled to the Supreme Court.
73. The Supreme Court in Dinesh Dalmia (Supra) held as hereunder:-
"19. A charge-sheet is a final report within the meaning of sub-section (2) of Section 173 of the Code. It is filed so as to enable the court concerned to apply its mind as to whether cognizance of the offence thereupon should be taken or not. The report is ordinarily filed in the form prescribed therefor. One of the requirements for submission of a police report is whether any offence appears to have been committed and, if so, by whom. In some cases, the accused having not been arrested, the investigation against him may not be complete. There may not be sufficient material for arriving at a decision that the absconding accused is also a person by whom the offence appears to have been committed. If the investigating officer finds sufficient evidence even against such an accused who had been absconding, in Bail Appln.1165/2017 Page 50 of 55 our opinion, law does not require that filing of the charge-sheet must await the arrest of the accused.
20. Indisputably, the power of the investigating officer to make a prayer for making further investigation in terms of sub-section (8) of Section 173 is not taken away only because a charge-sheet under sub-section (2) thereof has been filed. A further investigation is permissible even if order of cognizance of offence has been taken by the Magistrate.
23. Application of sub-section (2) of Section 173 of the Code vis-à-vis sub-section (2) of Section 309 must be considered having regard to the aforementioned factual and legal backdrop in mind.
28. It is now well settled that the court takes cognizance of an offence and not the offender. (See Anil Saran v. State of Bihar [(1995) 6 SCC142:
1995. SCC (Cri) 1051]. and Popular Muthiah v. State [(2006) 7 SCC296: (2006) 3 SCC (Cri) 245].
29. The power of a court to direct remand of an accused either in terms of sub-section (2) of Section 167 of the Code or sub-section (2) of Section 309 thereof will depend on the stages of the trial. Whereas sub-section (2) of Section 167 of the Code would be attracted in a case where cognizance has not been taken, sub-section (2) of Bail Appln.1165/2017 Page 51 of 55 Section 309 of the Code would be attracted only after cognizance has been taken. (Emphasis supplied by this Court) 74. Thus, in the opinion of this Court, the petitioner was being investigated pursuant to the registration of the FIR2052016 dated 25.12.2016 by the Special Branch, Delhi Police and the ECIR No.18/DZO-8/2016 dated 26.12.2016 by the Enforcement Directorate. During the period when the petitioner was being investigated, after his arrest, the Special Court remanded the petitioner under the provisions of Section 167 of the Code of Criminal Procedure. On the presentation of prosecution/complaint against other accused persons under Section 44 of the PMLA, cognizance was taken against them. On the presentation of the prosecution/complaint on 02.08.2017 qua the petitioner and another, the complaint was tagged along with the main complaint. This would obviously mean that the cognizance of the offence has been taken against the petitioner as well. Though there is no specific order stating that cognizance has been taken against the petitioner for the aforesaid offence but the manner in which the petitioner was remanded to either E.D custody or judicial custody reflects an application of mind of the learned Special Judge. After the lodging of the prosecution/complaint on 02.08.2017, the petitioner has been remanded, therefore, under the provisions of Section 309 of the Cr.P.C. Such a remand is for the purposes of further investigation under Section 173(8) of the Cr.P.C. Thus, there does not appear to be Bail Appln.1165/2017 Page 52 of 55 any infraction of the provisions of either the PMLA or the Cr.P.C so far as the remand is concerned.
75. However, this Court is pained to record that either under the provisions of Section 167 or under Section 309 of the Cr.P.C, the petitioner could not have been remanded for more than 15 days in one go. If this has been done by the Special Court, it is severely deprecated. The learned Special Court ought to have realized that it can only act according to the provisions of the Cr.P.C and the PMLA, under which the Court was functioning. That apart, what is really shocking is that the order remanding other accused persons or the petitioner to either E.D custody or judicial custody, has been passed, on a couple of occasions, by the Reader of the Court which is simply impermissible. The provisions of the Cr.P.C clearly mandate that such remand orders have to be passed specifically by the Court concerned. In case the Court is on leave, there is a provision in the Code (Refer to Section 2A of Section 167 Cr.P.C) where the matter could be placed before the nearest Court exercising the same powers who could after recording reasons in writing authorize the detention of an accused/petitioner in custody but for a term not exceeding seven days in the aggregate.
76. This Court is at a loss to understand as to how the petitioner was remanded for more than 15 days in one go and the order of remand was permitted to be recorded by the Reader of the Court.
77. Learned advocates appearing for the petitioner has drawn the attention of this Court to a judgment of the Supreme Court in Ram Narayan Singh vs. State of Delhi and Ors, AIR1953SC277wherein Bail Appln.1165/2017 Page 53 of 55 the Supreme Court of India was dealing with a petition of Writ of Habeas Corpus filed by one Ram Narayan Singh on behalf of four others who were the petitioners of the case. Those persons were arrested and were being prosecuted for having defied the order prohibiting meetings and processions in the area in question, which was punishable under Section 188 of the IPC. In the aforesaid case, there were two remand orders; one passed by the Additional District Magistrate, Delhi and the other passed by the trying Magistrate. The Supreme Court, in the aforesaid case, found that the order of remand by the Magistrate did not have a clear endorsement of those persons having been remanded to judicial custody; rather the order of remand merely intimated that the case was being adjourned for a specific date. The Supreme Court, in that case, was of the view that such a clear/specific endorsement was necessary and without that having been recorded, the remand was illegal. The Supreme Court, therefore, released those persons and set them at liberty forthwith.
78. The facts of the present case are different. The petitioner had earlier been remanded to custody with specific endorsement. However, for the fault of the Court, the prosecution cannot be made to suffer. Otherwise also, such departures from the procedure would come within the category of irregularity and not an illegality.
79. This Court has perused the order of remand, though recorded by the Reader which says that the case is adjourned for a particular date for the purpose already fixed. This can, for the purposes of this case, be read as "remand till that date". Bail Appln.1165/2017 Page 54 of 55 80. This Court in the aforesaid circumstances feels it necessary to caution the learned Special Court to be careful while dealing with such matters which concern the liberty of an individual. Such remands, in the name/garb of further investigation, cannot be continued for perpetuity as it would militate against the spirit of the procedural laws enacted for the purposes of giving specific time lines for the investigation of a case and commencement of the trial. Any mechanical order of remand, then, cannot be countenanced.
81. It is, however, again made clear that this Court has not gone into the merits of the case so far as the petitioner is concerned and, therefore, the petitioner would be at liberty to approach the Special Court, PMLA for grant of bail on individual merits of his case. This bail application has only been considered with regard to the legality of the remand of the accused in either E.D custody or judicial custody.
82. The bail application is, therefore, dismissed with the observation recorded above. SEPTEMBER14 2017 k ASHUTOSH KUMAR, J Bail Appln.1165/2017 Page 55 of 55