Jharkhand High Court Denies Bail To Suspended IAS Officer Pooja Singhal In Money Laundering Case

The Jharkhand High Court recently denied bail to Indian Administrative Services (IAS) officer Pooja Singhal in connection with a money laundering case registered against her pertaining to the alleged embezzlement of MGNREGA funds in Khunti district during 2009-2010 and some other suspicious financial transactions.

While denying her bail, the bench of Justice Sanjay Kumar Dwivedi noted that the apprehension of the Enforcement Directorate with regard to tempering with the evidence cannot be ruled out.

The Court also took into account the fact that during the probe into the matter, the allegations had surfaced that she was indeed involved in the laundering of a huge amount of money.

The case in brief

Singhal was posted as Deputy Commissioner (DC) of Khunti between February 16, 2009, and July 19, 2010, wherein she was the principal authority for sanctioning funds for different development projects. Allegedly, in connivance with the co-accused, she managed to do defalcation of funds in different development projects.

In lieu of the same, she used to obtain the illegal commission from one Ram Binod Prasad Sinha/coaccused (Junior Engineer) in cash and ignored all the irregularities and misdeeds by him.

It came out in the inquiry conducted in this matter subsequently, that there were huge differences in the quantum of funds released to the Junior Engineer and the quantity of the completed work in respective projects. In many cases, it was seen that the construction work of nominal value was done against the withdrawal of a substantial amount allocated for the given project.

Pursuant to this, on May 6 this year, the ED conducted searches at several properties linked to Singhal and two others (her husband and her CA) and it recovered Rs 19.76 crore cash. She along with her CA was arrested and sent to judicial custody by the court of Prevention of Money Laundering Act (PMLA).

The case of the ED is that Singhal used to receive a 5% "illegal commission" in development projects in Khunti from funds she disbursed for the works under MGNREGA. She maintained two PAN and an amount of Rs 73.81 lakh was found deposited in her ICICI bank accounts. Of the Rs 73.81 lakh, Rs 61.5 lakh was found to have been deposited between 2009-11, which the ED alleges, constituted "proceeds of crime".

On the other hand, moving the High Court seeking bail in the matter, her counsel denied all the charges and allegations leveled against her and argued that she is a responsible IAS officer who constituted a committee to look into the alleged embezzlement of the funds.

Court's observations

At the outset, the Court noted that a sum of Rs.01.33 crore had been deposited in the form of cash in the name of the brother of her Chartered Accountant and her mother and therefore, it cannot be said that she was not using the proceeds of crime in light of section 2(1)(u) of the PML Act.

"The allegation prima facie suggests that it has a direct link with the "proceeds of crime". In that, the property derived or obtained as a result of criminal activity relating to notified offences, termed as a scheduled offence, is regarded as tainted property, and dealing with such property in any manner is an offence of money laundering," the Court remarked.

Further, the Court also took into account the alleged modus operandi as adopted by Singhal wherein she first opened bank accounts for a short duration, then deposited huge cash into it, then converted those cash into demand drafts to purchase insurance policies of longer durations and prematurely closed those policies to bring back liquidity in her accounts for further investment.

The Court also noted that she used to invest the same either in the form of capital infusion by her brother Siddharth Singhal and her husband Abhishek Jha who is also an accused in their company M/s Pulse Sanjeevani Healthcare Private Ltd. A huge amount of cash amounting to Rs.73.81 lakhs was deposited in her various ICICI bank accounts.

The Court further took into account the submission that a false certificate was tried to be obtained on the medical ground to obtain the benefit of a medical certificate by her and that she had not been able to succeed due to the presence of the authority of the Enforcement Directorate). The Court also noted that the medical report suggested that she was well oriented stable and fit medically and psychologically.

Consequently, noting that the apprehension with regard to tempering with the evidence cannot be ruled out, the Court refused to grant her the benefit of regular bail to her.

Appearances:

For the Petitioner:- Mr. Indrajit Sinha, Advocate Mr. Bibhash Sinha, Advocate Mr. Ashok Gahlot, Advocate Mr. Sudhansu Singh, Advocate

For the E.D. :- Mr. Amit Kumar Das, Advocate Mr. Saurav Kumar, Advocate Mr. Shivam Utkarsh Sahay, Advocate Mrs. Swati Shalini, Advocate Mr. Sahay Gaurav Piyush, Advocate

Case title - Pooja Singhal v. Directorate of Enforcement

Case Citation: 2022 LiveLaw (Jha) 91

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