Disturbing That ED Hasn't Completed Investigation Even After 5 Years : Supreme Court On Chhattisgarh NAN Scam Case

A bench of Justice Abhay S Oka and Justice Augustine George Masih granted two weeks' time to the ED to file an affidavit to show that accused Alok Shukla and Anil Tuteja, then Chairman and Managing Director of NAN, are misusing their anticipatory bail. The ED has challenged their anticipatory bail granted by the Chhattisgarh High Court in 2020.

“Is it not disturbing that in a 2019 ECIR, today we are in 2024, and the investigation is not complete, complaint under PMLA is not filed?”, Justice Oka said, after Additional Solicitor General SV Raju submitted that he does not want to file an affidavit as it will “paint a very bad picture of the judiciary”.

In 2022, ED, claiming collusion between accused and authorities, submitted before the apex court that a high court judge was in touch with people who were helping accused.

The court pointed out the previous order in which Raju's statement was recorded that ED will file an affidavit to support the contention that Tuteja and Shukla are misusing the anticipatory bail. The court further questioned what the judiciary has to do with the allegation that the accused are misusing the anticipatory bail.

ASG Raju said that he will file the material in sealed cover. However, counsel for the accused objected to sealed cover, citing the court's judgment against the practice of filing sealed cover.

The ED has moved the present SLP against Chhattisgarh HC's order granting anticipatory bail to Tuteja.

Tuteja and Shukla had sought anticipatory bail due to apprehension of arrest in connection with an ECIR initially registered in Raipur and later transferred to New Delhi. They are accused under Sections 3 and 4 of the Prevention of Money-Laundering Act, 2002 (PMLA).

Background –

In 2015, the Anti-Corruption Bureau/Economic Offences Wing registered the FIR against Shiv Shankar Bhatt and 26 others, including Tuteja for alleged offences under Sections 13(1)(e) and 13(2) of the Prevention of Corruption Act, 1988, and Sections 109 and 120B of the IPC.

The ACB/EOW's supplementary charge-sheet claimed that they engaged in corruption and conspiracy, with ACB/EOW seizing a pen drive from Girish Sharma, Tuteja's PA, detailing transactions indicating illegal monetary gains for the applicants.

It is alleged that Shukla and Tuteja received Rs. 2,21,94,000 and Rs. 1,51,43,000, respectively, from May 2014 to February 2015. The corruption allegedly involved illegal collection of money by NAN officials for procuring substandard rice, resulting in substantial illegal earnings and systematic district-wise collections. Following ED's summons on March 13, 2020, the applicants filed for anticipatory bail.

The applicants contended that they had already received anticipatory bail in connection with the predicate offence, the trial of the predicate offence is at a dormant stage, and no departmental inquiry or show cause notice has been initiated against them.

They highlighted that sanction to prosecute was granted by the Central and State Governments in July 2016, but the supplementary charge-sheet was delayed until December 2019. The ECIR case was registered on January 9, 2019, with summons issued in March 2020.

Further, they submitted that witnesses, including rice millers and NAN employees, denied any bribe demands or involvement in illegal activities, and custodial interrogation is unnecessary as they have cooperated fully with the investigation, including during the Covid-19 pandemic.

Opposing the applications, ED cited judgments asserting that the applications under Section 438 CrPC should have been first filed before the Sessions Court, and the applications before the High Court were not maintainable.

The CG High Court affirmed its jurisdiction to entertain the applications, noting that both High Court and Sessions Court have concurrent jurisdiction for Section 438 CrPC applications.

The HC also observed that Section 45 of PMLA, as per Supreme Court's ruling in Nikesh Tarachand Shah case, is inapplicable to anticipatory bail proceedings. Thus, the court granted anticipatory bail to the applicants, noting their full cooperation with the investigation, absence of direct evidence, and lack of necessity for custodial interrogation.

Case no. – Directorate of Enforcement v. Anil Tuteja and Ors.

Case Title – SLP(Crl.) No. 6323-6324/2020

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