Chennai Court Denies Bail To Minister Senthil Balaji In Money Laundering Case, Says Allegations Disclose 'Definite Role'

Principal Sessions Judge S Alli noted that allegations against Balaji are "categorical" and disclose that he has a "definite role" in the commission of offence charged against him.

"As claimed by the Senior Counsels for 20 the petitioner, the allegations against the petitioner are not without substance, since the complainant has examined as many as 20 witnesses, apart from the Investigating Officer and have produced 77 documents, runs to 2853 pages, filed along with the complaint. Through the bank statements of the petitioner / accused, cash deposits totally for Rs.1.34 crores has been identified as proceeds of crime during the period of financial year 2013­-2014 to 2021­-2022 and his wife S.Megala has received cash deposits of Rs.29.55 lakhs during the period of F.Y. 2014­ 2015 to F.Y. 2019 ­2020."

Court added that Balaji has failed to fulfil the twin conditions under Section 45 of the Prevention of Money Laundering Act, for grant of bail.

The twin conditions are that when an accused applies for bail under PMLA, the public prosecutor has to be given an opportunity to oppose the same and if the court is considering grant of bail, there must be reasonable grounds for it to believe that the person is not guilty and is unlikely to commit any offence while on bail. A proviso to the provision states that a person who is sick or infirm may be released on bail.

“Considering the gravity of offence, overwhelming materials against the petitioner, the status of the petitioner and the fact that the petitioner has not satisfied the twin conditions of Sec.45 of the PMLA, 2002, this court does not find reasonable grounds for believing that the petitioner is not guilty of the offence or that he is not likely to commit any offence while on bail and taking overall view of the matter, the court is not inclined to grant bail to the petitioner on merits and also on medical grounds,” the Court said.

Senior Advocate Kapil Sibal, appearing for the Minister had argued that there were no materials against the Minister and rather the prosecution was nothing but malice to target the Minister. He had further submitted that the central agency had not been able to prove a trail for the money alleged to be proceeds of crime. Sibal also argued that the Minister had been regularly filing his Income Tax Returns and had substantially explained his sources of income to the Income Tax Department, which had accepted the same.

With respect to the predicate offence, Sibal argued that the entire offence was malice on the part of the ED to target the Minister. He argued that though Balaji was arrested in connection with the Cash-for-job scam, where it was alleged that people paid money to certain persons in order to get jobs, it was nowhere alleged that the persons had contacted the Minister directly. Sibal also wondered how the Minister was made sole accused in the matter, when there were statements by other persons claiming that they had received money.

It was also argued that since all the evidence was already with the department, there was no possibility that the Minister could tamper with the evidence. Relying on the latest Medical report, Sibal also submitted that the Minister could not stand or sit for more than 30 minutes and thus would come under the proviso for Section 45.

Senior Advocate NR Elango, also appearing for the Minister submitted that there were infirmities in the manner in which the evidence was collected. He submitted that though pen drives were recovered, it was submitted in the court after a delay of 6 days during which time the officer had illegal custody of the same. He also submitted that the investigating officer had even failed to take down the serial numbers of the pen drive which was a basic part of the investigation.

Thus, contending that the probability of finding Balaji guilty using flimsy evidence was very low and considering that there were no other cogent materials, Elango requested the court to grant bail.

Countering these submissions, Additional Solicitor General ARL Sundaresan submitted that under Section 24, the burden was on Balaji to prove that the money was untainted and he could not escape that burden by merely saying that the Income Tax Department had accepted the explanations.

Sundaresan further submitted the plea regarding political malice had already been dealt with by the Supreme Court wherein the Apex Court had said that malice could not be used as a defence when there was a predicate offence.

With respect to tampering, Sundaresan argued that though the documents were in the court, the witnesses who gave depositions were outside and they could be easily tampered by Balaji who was a sitting Minister. He further submitted that medical condition could be considered for grant of bail only if it was averred that the facility to treat the accused is not there in jail which was not the present case.

"The petitioner is a Member of the Legislative Assembly and a sitting Minister of Government of Tamil Nadu and previously he was holding the key portfolios, like Transport Corporation, Electricity Board and Excise Policy etc.," the Court noted in its order.

Court also said that the reliability, genuinity, admissibility and also the authenticity of the Electronic Evidence have to be raised during trial and while considering bail plea, the court is not expected to weigh the evidence meticulously, but to arrive at a finding on the basis of broad probabilities.

Rigour of Guilt under S.45 PMLA

During the arguments, Sibal also submitted that though one of the twin conditions in Section 45 of PMLA required the court to be satisfied that the person was not guilty, opinion regarding guilt could be proved only at the time of trial and after investigation it was the duty of the agency to prove guilt. He thus argued that the rigour of concluding that the person was not guilty under Section 45 was not stringent.

However, Sundaresan argued that such an interpretation would defeat the purpose of bringing in a separate provision for bail in money laundering cases. He also emphasised that even constitutional courts were bound by the restrictions of Section 45 while considering bail and that the initial burden upon the agency had already been established.

Click here to read/download the order