Delhi High Court Refuses To Quash Money Laundering Case Against Raghav Bahl, Calls Plea 'Premature'

The Delhi High Court on Monday refused to quash a money laundering case against The Quint's founder Raghav Bahl at this stage. The court also refused to quash the look out circular (LOC) against him at this stage

Dismissing the plea challenging registration of ECIR and proceedings initiated by ED, Justice Jasmeet Singh said:

“The allegations (under the complaint) are yet to reach the stage of trial. Whether there is generation of proceeds of crime or not is being investigated and for the said reason, the petition as of today is premature and is rejected.”

The Income Tax department had initiated proceedings against Bahl under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act for alleged irregularities in IT returns filed for the assessment year 2018-2019. The complaint was filed under section 51 of the Act.

Regarding the LOC, Justice Singh said that quashing the same will be premature. However, the court granted liberty to Bahl to file an application with supporting documents as and when he wants to travel abroad, which, it said, shall be considered in accordance with law.

“The quashing of LOC at this stage will be premature, however the petitioner has travelled in the past and needs to travel for work. Liberty of the petitioner to travel abroad in genuine case and for business cannot be curtailed,” the court said.

Advocate Abhimanyu Bhandari appearing for Bahl submitted that Bahl had sent money through his bank account to purchase a property in London and that there was no tax evasion done in the matter. Thus, he submitted, there can be no proceeds of crime.

It was submitted that at best, Bahl can be charged with underreporting of money transaction abroad but the same does not generate proceeds of crime which is s sine qua non for proceedings under PMLA.

“It is no one’s case that there is any proceeds of crime because there is no tax evasion here. If it is the case that my client sent money on which tax is not paid, the amount in that case is black money. So the income tax will come heavily. But detailed assessment order has come and the officer said that there is no evasion of tax. It is no one’s case that there is evasion of tax. At best, their case is disclosure. There is no benefit accrued to me by making a lesser disclosure,” Bhandari submitted.

On the other hand, Zoheb Hossain appearing for Enforcement Directorate submitted that the allegation made in the complaint is regarding an attempt to evade tax.

He also submitted that similar issues were also argued before the Allahabad High Court and Bahl’s plea was dismissed after observing that, prima facie, there is a case for initiating proceedings against him under Black Money Act. The court was also apprised that SLP against the order was dismissed by the Supreme Court.

It was further submitted that Bahl was seeking quashing of proceedings at the stage of summons and that at such a stage, he cannot even maintain the plea because he is not a person aggrieved, as per the judgments of the Supreme Court.

“In the present case, I am of the view that the petition is itself premature. The petitioner is seeking quashing of ECIR which the Supreme Court states that mere recording of ECIR does not make person an accused,” Justice Singh said.

In his plea, Bahl claimed that since he had done “no wrong”, the continuation of PMLA proceedings “without having any subsisting basis in fact or law” has a “deleterious effect” on his life, business, and reputation.

Title: Raghav Bahl v. ED

Citation: 2023 LiveLaw (Del) 74