Supreme Court Issues Notice To Kerala Govt On ED's Plea To Transfer Gold Smuggling Case Trial; Posts For Disposal On October 20

The Supreme Court on Monday posted to October 20 the petition filed by the Enforcement Directorate (ED) seeking to transfer the trial in the gold smuggling case from Kerala.

A bench comprising Chief Justice of India UU Lalit and Justice S Ravindra Bhat allowed the application filed by the State of Kerala seeking impleadment in the ED's petition and issued notice to the State. State has been allowed to file its reply by this Friday. The bench said that it will dispose of the matter on the next hearing date.

The ED has sought transfer of the money laundering case in relation to the smuggling of gold through diplomatic channels. The agency has alleged that "free and fair trial" of the case is not possible in Kerala due to the close nexus between the accused and top officials and functionaries in the Kerala Government.

During the hearing, Solicitor General of India Tushar Mehta, appearing for the ED, referred to the averments made by the State of Kerala in its impleading application that the statements of accused Swapna Suresh against the Chief Minister created riots in the state. The SG said that these statements are enough to conclude that free and fair trial is impossible in Kerala.

The SG informed the bench that the Kerala Police lodged an FIR against the Enforcement Directorate alleging fabrication of evidence and that the Kerala High Court quashed the said FIR. He also referred to the allegations made by accused Swapna Suresh and Sandeep Nair regarding pressure exerted by the Kerala Police.

The SG further pointed out that the State Government constituted a Judicial Commission to enquire if there was any fabrication of evidence in the ED case. The Kerala High Court later stayed the operation of the Commission, he added.

"The allegations are against the Chief Minister, his family members, former Principal Secretary, former Speaker etc..", SG Tushar Mehta said.

Senior Advocate Kapil Sibal, appearing for the State, intervened at this juncture to say "I strongly object, allegations should not be made against the Chief Minister without evidence".

"You are appearing for the State, not the Chief Minister", the SG retorted. 

When the SG said that Kerala police registered an FIR against ED, Sibal intervened to say that the police investigation was based on a complaint made by the ED.

Expressing displeasure at the interruption made by Sibal, the SG said "either you appear, or you don't appear, you can't have both".

The bench at this juncture said that it can dispose of the matter today if the respondents are ready. On the respondents seeking time, the bench agreed to post the matter next week.

Senior Advocate Jaideep Gupta appeared on caveat for accused M Sivasankar an IAS officer of Kerala cadre who was the Principal Secretary to the Chief Minister of Kerala.

 The case under the Prevention of Money Laundering Act (PMLA) is at present before the Special PMLA Court at Ernakulam and the ED seeks its transfer to Special Court for PMLA cases in Karnataka.

The agency has said in its petition that the four accused persons in the case are highly influential and have close nexus with the top officials in the Kerala Government.

The other accused persons are PS Sarith, Swapna Suresh and Sandeep Nair. The ED alleges that the State Police, at the behest of highly influential persons, is trying to derail the trial in the case and is pressurising the accused persons to retract their statements recorded under Section 50 of the PMLA.

It is said that accused Swapna Suresh, while she was under custody, had filed an application for protection stating that certain officials were threatening her against disclosing names of persons in high positions. Another accused, Sandeep Nair, after getting bail in the case, filed a complaint alleging that ED investigating officer had coerced him to name the Chief Minister and other Ministers in the case. The Kerala Police registered FIR against the ED officials alleging fabrication of evidence and the Kerala High Court stayed the FIR proceedings. The Kerala Government also constituted a judicial commission against the ED investigation and the Kerala High Court stayed the functioning of the Commission.

The application also refers to the recent allegations made by Swapna Suresh against the Chief Minister and his family members regarding involvement in gold smuggling. The ED also undertook to produce the confidential statement of Swapan Suresh recorded by the Judicial Magistrate under Section 164 CrPC in a sealed cover.

"These overwhelming facts demonstrate that Local Police and State Government machinery are trying to manipulate the accused and the witnesses. All these facts necessitate that trial be transferred from the State of Kerala. Due to the proximity of the State of Karnataka to the State of Kerala, the present petition seeks for a transfer to the State of Karnataka", stated the application filed under Section 406 of the CrPC.

The smuggling came to light after the Customs Commissionerate (Preventive), Cochin, seized gold worth ₹14.82 crore at the Trivandrum International Airport in July 2020. The contraband was carried in the diplomatic baggage addressed to the consulate of the United Arab Emirates (UAE) at Thiruvananthapuram. A UAPA case is also charged with respect to the smuggling, which is before the Special NIA Court at Kochi.

Case Title : Directorate of Enforcement versus Sarith PS and others | TP (Crl) 449/2022

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