BREAKING| Delhi High Court Stays Arvind Kejriwal's Bail Till Final Pronouncement On ED's Stay Application

The Delhi High Court on Friday (June 21) stayed the order granting bail to Delhi Chief Minister Arvind Kejriwal in the money laundering case connected to the liquor policy case.

The Court stayed the operation of the bail order till final order is passed on the stay application filed by the Directorate of Enforcement(ED).

"Arguments are heard. I am reserving this order for two three days. Order reserved. Till pronouncement, the operation of the impugned order shall remain stayed," the Court ordered.

A vacation bench of Justice Sudhir Kumar Jain passed the order while issuing notice on the petition filed by the Directorate of Enforcement (ED) challenging yesterday's order passed by the trial court granting Kejriwal bail.

The matter was heard today itself after the ED's counsel made an urgent mentioning this morning before the Court. 

ED's arguments

At the outset, Senior Advocate Vikram Chaudhari, for Kejriwal, raised a preliminary objection to the listing of the matter during the vacations because the trial judge had granted bail through a detailed order.

Additional Solicitor General SV Raju contended that the bail order was "perverse" as it was contrary to the mandate of Section 45 of the Prevention of Money Laundering Act. The ASG further submitted that the trial judge did not give "full opportunity" to the ED to present the case and insisted that they should be brief in their arguments. He complained that though new points were argued by Kejriwal's lawyers in rejoinder, ED was denied the opportunity to rebut them.

The law officer of the ED contended that the trial court did not examine their reply by terming it as "bulky."

"You don't hear me. You don't look at the reply saying it's bulky. There can't be a more perverse order than this...Without going through documents filed by both sides, without giving us opportunity the matter is decided. It is the duty of court to pass order in accordance with law. Without going to documents how can you say it's relevant or not relevant?" he submitted.

The ASG further stated that even while giving liberty to Kejriwal to file bail application before the trial court, the Supreme Court did not state that the trial court should consider it ignoring the findings of the High Court. 

Taking exception to the observations in the bail order that ED has failed to provide direct evidence, he said, "This is a wrong statement. We read Magunta Reddy statement. You can decide against me but don't say wrong things about me in the order. This reply was on record. Judge says bulky, I'll not go through it. Then says ED failed to point out. What kind of order is this? I am shocked." The ED had pointed out that Magunta Reddy had met Kejriwal and the latter demanded Rs 100 crores as bribe. "We have shown all this to show that he had a role in the demand of 100 crores. Yet the judge says no direct evidence. Direct evidence is in the form of statement. There is corroboration also."

Asserting that ED has shown evidence for use of proceeds of crime by the AAP in Goa assembly elections and has traced out Rs 45 crores, Raju questioned the trial court's findings.

Stating that the bail order was passed on "irrelevant considerations" and no prima facie find regarding the lack of guilty has been made, he pressed for its cancellation.

Kejriwal's arguments

Senior Advocate Dr Abhishek Manu Singvhi, terming ED's approach to be "deplorable", stating that the accused cannot be kept indefinitely in jail merely for the investigating agency to find evidence. It is very unfortunate that the ASG was maligning the judge merely because an adverse order was passed.

The hearing lasted for five hours out of which ED took 3.45 hours and the rest by Kejriwal's lawyer. Therefore, where is the question of ED being denied the opportunity to present its case, Singhvi asked.

He clarified that the earlier judgment passed by the Delhi High Court was concerning the legality of the arrest and the issue of bail was not considered. Referring to the fact that the Supreme Court has reserved judgment on the appeal against the High Court's verdict, he submitted :

"Leave is granted against Justice Swarana Kanta Sharma's order. My friend(ASG) has argued it as if Justice Sharma's order is the final word. It is being considered by SC. If the arrest is bad, all other steps are irrelevant. It is the last word of SC which will come in July and not Justice Sharma's." He emphasised that the Supreme Court has granted liberty to Kejriwal to approach the trial court for bail.

"Like Alice in Wonderland, ED has its own meaning of perversity. For them it means error is perversity and unless every argument of ED is repeated verbatim, it is perversity."

Stressing that stay of the bail order would amount to a cancellation of the bail, Singhvi urged that such a prayer cannot be granted at the mere asking. The threshold for cancellation of bail which has been granted by a competent court is higher. Attention was drawn to the fact that Kejriwal was given interim bail for about three weeks by the Supreme Court and that he surrendered after the bail term.

Where is the imminent "flight risk" of the accused to stay the bail order, Singhvi asked, underscoring that Kejriwal surrendered on June 2 in terms of the interim bail order.

Getting into the merits of the matter, Singhvi submitted that the statements given in 2022 by four witnesses - Raghav Magunta, Buchi Babu, Abhishek Boinpally and Sarath Reddy- did not implicate Kejriwal. Magunta Sreenivasa Reddy later gave a statement against Kejriwal and the next day, his son Raghav Magunta got bail. Buchi Babu also immediately got bail after he implicated Kejriwal.

Singhvi stressed that the trial court has passed a discretionary order, after taking a view on the aspects of the case and the High Court cannot interfere with the discretion exercised by the judge at the admission stage.

"It's a discretionary order considering all the arguments. Your lordships may reverse it in final order. But no stay can be granted."

"The law is totally barring of an interim, first day, without final hearing, granting stay on bail. Unless it is a terrorist or when it's impossible to conduct trial. Maybe possibly genocide or child rape cases. I don't understand how without a final hearing stage, my learned friend can ask your lordships to stay the order," he urged.

Raising the point of the balance of convenience, Singhvi said : "Assume your lordships may not stay today. I come out. How is it irreversible? Where will he go? What will he do? Take the reverse. Your lordships stays the order and later dismiss the petition."

Supplementing Singhvi's arguments, Vikram Chaudhari submitted that the trial court's order has considered all aspects raised by the ED.

Detailed live updates from the hearing can be read here.

Yesterday, Vacation Judge Niyay Bindu of Rouse Avenue Court granted bail to Kejriwal. The bail order contained scathing observations against the ED. The judge went to the extent of drawing an inference that the ED was acting with bias against Kejriwal. The order further held that the ED has not shown any direct evidence regarding the proceeds of crime.

Title: ED v. Arvind Kejriwal

Citation: 2024 LiveLaw (Del) 728