ED Has No Right To Restrict Movement, Confine People During Search At Their Premises: P&H HC

It is most heartening and most refreshing to note that the Punjab and Haryana High Court at Chandigarh while championing and espousing the right to life and personal liberty as enshrined in Article 21 of the Constitution has in a learned, laudable, landmark and latest oral judgment titled Dilbagh Singh @ Dilbagh Sandhu vs Union of India and another in CRM-M-2191-2024 (O&M) and CRM-M-3385-2024 (O&M) and cited in Neutral Citation No:=2024:PHHC:017817 that was first reserved on 02.02.2024 and then finally pronounced on 08.02.2024 has minced just no words to make it absolutely clear that the Enforcement Directorate (ED) cannot confine a person within a premises during its search and seizure operation in a money laundering case. The petitioners along with their family members were illegally detained by the ED from January 4 to January 8 when the search and seizure of their houses took place. It must be mentioned here that the Single Judge Bench comprising of Hon’ble Mr Justice Vikas Bahl who authored this notable judgment had made the key observation while setting aside the arrest of former Indian National Lok Dal legislator Dilbagh Singh and another accused Kulwinder Singh in a money laundering case that pertained to allegations of illegal mining.

In very clear cut terms, it is pointed out by the Court as an incontrovertible fact that, “There is nothing which stops the persons whose premises are being searched from carrying out their daily routine including going to their offices/places of work.” It is the bounden duty of all the courts dealing with such cases to ensure that what has been held so sagaciously in this leading case is observed more in practice than in breach! No denying it!

At the very outset, this brief, brilliant, bold and balanced oral judgment sets the ball in motion by first and foremost putting forth in para 1 that, “Present order shall dispose of two petitions filed under Section 482 of the Code of Criminal Procedure, 1973 (for short ‘CrPC’) i.e. CRMM-2191-2024 filed by Dilbag Singh @ Dilbag Sandhu and CRM-M-3385- 2024 filed by Kulwinder Singh, since common questions of law and facts arise in both the cases and also since both the petitions arise from the same ECIR.”

To put things in perspective, the Bench envisages in para 6 that, “It is not in dispute that both the petitioners have till date, muchless till the date of arrest i.e. 08.01.2024, not been made an accused in the above-said FIRs. In Para A(1) of the reply dated 22.01.2024, filed in the case of petitioner Dilbag Singh @ Dilbag Sandhu, averments have been made to indicate that even the petitioners were accused in the eight FIRs, but on a specific query raised, both learned senior counsel for the petitioners as well as learned counsel for the respondents have fairly stated that the petitioners till date have not been made an accused in any of the said eight FIRs. In the reply dated 30.01.2024 filed in the case of petitioner Kulwinder Singh, the facts have been correctly stated and the word “petitioner” has not been mentioned in the said paragraph i.e. A(1). Since the above-said FIRs were registered under Sections 120-B, 411, 419, 420, 467 and 471 IPC, which are scheduled offences under Part A Paragraph I of the Schedule appended to The Prevention of Money Laundering Act, 2002 (hereinafter referred to as “the 2002 Act), the Directorate of Enforcement recorded an ECIR bearing No.GNZO/19/2023 dated 23.09.2023 against various accused persons, Screen Plants and Stone Crushers in order to investigate the commission of the offence of money laundering as defined under Section 3 and punishable under Section 4 of the 2002 Act. A search was carried out from 04.01.2024 (0825 hours) to 08.01.2024 (1300 hours), at the residential premises of the petitioner Dilbag Singh @ Dilbag Sandhu and Rajinder Singh, located at 410, Friends Colony, Yamuna Nagar and another search was also carried out from 04.01.2024 to 08.01.2024 at the premises of petitioner Kulwinder Singh, House No.62, Sector 14, HUDA, Yamuna Nagar. It is the case of the petitioners that they were illegally detained/arrested on 04.01.2024. It is the case of the prosecution that petitioner Dilbag Singh @ Dilbag Sandhu was arrested on 08.01.2024 at 12.15 PM from the above-said house and the petitioner Kulwinder Singh was arrested on 08.01.2024 at 02.20 PM from House No.62, Sector 14, HUDA, Yamuna Nagar. It is the case of the prosecution that searches were carried out at other places also. As per the case of the prosecution, the written grounds of arrest were given to both the petitioners on 08.01.2024. In the grounds of arrest with respect to petitioner Dilbag Singh @ Dilbag Sandhu, reference was made to the above-said 8 FIRs, more so, FIR No.226 dated 14.10.2022, in which, it was alleged that the Plant & Machinery of one Om Guru Unit was dismantled a year ago, but on the examination of sale-purchase record, it was found that purchases had been made from 10.05.2022 to 17.06.2022 and the sellers with respect to the same were M/s Mubarikpur Royalty Company, PS Buildtech and the quantity involved in the same was 168830 MT (value of approx. Rs.8.4 crore) and the purchase records were not found on e-Rawana portal, which indicated that the above purchases were done through fake e-Rawana. In the said grounds of arrest, it was further stated that it had been found that an order was passed by the NGT on 31.05.2022 directing both JSM Foods Pvt. Ltd. and PS Buildtech not to mine boulder and gravel on the mining sites in question and vide order dated 18.11.2022, huge penalties were imposed against M/s Development Strategies India Private Limited, Delhi Royalty Company and Mubarikpur Royalty Company and that during investigation, it was revealed that petitioner Dilbag Singh @ Dilbag Sandhu was the authorized signatory in two of the bank accounts of Development Strategies India Private Limited and his wife & son had invested huge amounts in Delhi Royalty Company. It was further stated that petitioner Dilbag Singh @ Dilbag Sandhu had willfully adopted an attitude of non-cooperation by either evading the queries or giving misleading/part evasive replies. Similarly, as per the case of the prosecution, the grounds of arrest in writing were given to the petitioner Kulwinder Singh on 08.01.2024, in which also, the above said background was given and thereafter, it was stated that the said Kulwinder Singh through his relatives and close persons was also involved in the said mining activities.”

As it turned out, the Bench then enunciates in para 7 that, “On 09.01.2024, both the petitioners were produced before the Special Court (PMLA) Gurugram, Haryana and two separate applications were filed by respondent No.2, under Section 65 of the 2002 Act read with Section 167 of the CrPC seeking remand of the petitioners, in which, vide two separate orders dated 09.01.2024, seven days custody of both the petitioners was granted to the Enforcement Directorate by the Special Judge, Gurugram. On 16.01.2024, both the petitioners were produced before the Special Court (PMLA) Gurugram, Haryana for extension of custody of both the petitioners and two separate applications were filed on 16.01.2024 under Section 65 of 2002 Act read with Section 167 of the CrPC for the said purpose. The Special Judge (PMLA), Gurugram, vide a common order dated 16.01.2024 was pleased to extend the remand custody of both the petitioners for a further period of 7 days. On 23.01.2024, both the petitioners were produced before the Additional Sessions Judge, Gurugram and vide a common order dated 23.01.2024, both the petitioners were remanded to judicial custody till 06.02.2024 and since then, both the petitioners are in judicial custody, being lodged in Bhondsi Jail. It is in the said background that the present two petitions have been filed.”

While concluding, the Bench directs in para 76 that, “As per the discussion herein above, both the petitions deserve to be allowed and the impugned orders deserve to be set aside on the following grounds: –

“a) Non-application of mind and non-recording of compliance of the conditions/stipulations contained in Section 19 by the Special Court while passing the impugned orders.

b) Illegal detention/wrongful restraint of the petitioners from 04.01.2024 to 08.01.2024 amounting to arrest on 04.01.2024 itself and consequential violations of Section 19 of PMLA read with Section 167 CrPC on account of non-production of petitioners within 24 hours.

c) Violation of provisions of Section 19(2) of the 2002 Act.

d) Non-compliance of Section 19(1) of the 2002 Act.””

For the sake of clarity, the Bench clarifies in para 77 that, “The custody of the Enforcement Directorate is over and presently the petitioners are in judicial custody.”

In addition, the Bench then directs in para 78 that, “Keeping in view the above-said facts and circumstances, both the petitions are allowed and the impugned arrest orders, arrest memos along with the orders of remand passed by the Special Judge, Gurugram and the Additional Sessions Judge, Gurugram and all orders consequential thereto in both the cases are set aside and both the petitioners are ordered to be released forthwith, unless their incarceration is required in connection with any other case.”

Finally, the Bench then aptly concludes by holding in para 79 that, “All the pending miscellaneous application(s), if any, shall stand disposed of, in view of the abovesaid judgment.”

All told, it is high time and all those who are in ED must definitely pay heed to what the Punjab and Haryana High Court has held so very elegantly, eloquently and effectively in this leading case. It is made indubitably clear by the Chandigarh High Court that ED has no right to restrict movement and confine people during search at their premises. It is definitely the bounden duty of the ED to most strictly adhere to what has been held and refrain from restricting the movement and confining the people whose premises are being searched. No denying it!

Sanjeev Sirohi, Advocate,

s/o Col (Retd) BPS Sirohi,

A 82, Defence Enclave,

Sardhana Road, Kankerkhera,

Meerut – 250001, Uttar Pradesh.