Confessional Statement Of Co-Accused Under Section 50 Of PMLA Not Substantive Piece Of Evidence, Can Be Used Only For Corroboration: Delhi High Court

The Delhi High Court has said that the confessional statement of a co-accused under Section 50 of Prevention of Money-Laundering Act, 2002, is not a substantive piece of evidence and can be used only for corroboration in support of other evidence to lend assurance to the Court in arriving at a conclusion of guilt.

Justice Vikas Mahajan reiterated that the statements of the witnesses recorded under Section 50 of the PMLA are to be meticulously appreciated only by the Trial Court during the course of the trial and there cannot be a mini-trial at the stage of bail.

However, the court said that when such statements are part of the material collected during investigation, they can certainly be looked into at the stage of considering bail application albeit for the limited purpose of ascertaining whether there are broad probabilities, or reasons to believe, that the applicant is not guilty.

“Meaning thereby, the statements under Section 50 of the PMLA have to be taken at their face value, but in case any such statement is patently self-contradictory or two separate statements of the same witness are inconsistent with each other on material aspects, then such contradictions and inconsistencies will be one of the factors that will enure to the benefit of the bail applicant whilst ascertaining the broad probabilities, though undoubtedly the probative value of the statement(s) of the witnesses and their credibility or reliability, will be analyzed by the trial court only at the stage of trial for arriving at a conclusive finding apropos the guilt of the applicant,” the court said.

The court made the observations while granting bail to Sanjay Jain, an accused in a money laundering case.

The case was registered by Enforcement Directorate (ED) on the basis of CBI FIR against the CEO and MD of Indian Farmers Fertilizer Co-operative (IFFCO) Ltd and various others for alleged corruption and causing loss to the exchequer by importing fertilizer raw material at inflated prices. ED alleged that Jain received the proceeds of crime through two routes.

Granting bail to Jain, the court observed that prima facie the predicate offence appeared to be weak in nature and he was entitled to the benefit of the same.

The court agreed with the contention of Jain's counsel that non-arrest of co-accused is a relevant factor which can be taken into account in addition to other surrounding factors to grant the concession of bail to Jain.

Justice Mahajan said that Jain was also entitled to the benefit of the fact that the main accused, as well as, some other accused persons had already been granted bail.

“Accordingly, in view of the above discussion and on the basis of the material available on record, this Court is satisfied that there are reasonable grounds for believing that the petitioner is not guilty of the offence and that he is not likely to commit any offence while on bail,” the court said.

Counsel for Petitioner: Mr. Dayan Krishnan, Sr. Adv., Mr. Siddharth Aggarwal, Sr. Adv. with Ms. Stuti Gujral, Mr. Madhav Khurana, Ms. Trisha Mittal, Ms. Shaurya Singh and Mr. Harsh Yadav, Mr. Aditya Mukherjee, Mr. Puneeth Ganapathy and Ms. Jayati Sinha, Advs. for applicant

Counsel for Respondent: Mr. Zoheb Hossain, Spl. Counsel for ED with Mr. Vivek Gurnani and Mr. Baibhav, Advs

Title: SANJAY JAIN v. ENFORCEMENT DIRECTORATE

Citation: 2024 LiveLaw (Del) 285

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