On 18th March, the Supreme Court of India dismissed the bail plea of Aam Aadmi Party (AAP) leader Satyendar Jain and observed that prima facie Jain was guilty of money laundering. The court said, “Having regard to the facts and circumstances of the case, we are of the opinion that the appellants have miserably failed to satisfy us that there are reasonable grounds for believing that they are not guilty of the alleged offences. On the contrary, there is sufficient material collected by the respondent-ED to show that they are prima facie guilty of the alleged offences.”
The court rejected the plea to grant bail to the AAP leader and highlighted that the accused failed to fulfil the twin conditions under Section 45 of the Prevention of Money Laundering Act for bail. Notably, Jain was arrested by the Enforcement Directorate (ED) in 2022 for his alleged involvement in money laundering via four companies during 2010-12 and 2-15-16.
Additional Solicitor-General SV Raju appeared for ED and argued that Jain effectively controlled the companies involved in the alleged money laundering racket. His control remained on the companies even though he had left his position as director. Senior Advocate Abhishek Manu Singhvi, appearing for Jain, refuted the allegations, claiming that there was a lack of credible links to tie Jain to the money laundering activities.
After hearing arguments from both sides, the court concluded that Satyendar Jain was responsible for conceptualising the accommodation of entries against cash. The accommodation entries done by the companies under Jain totalled approximately Rs 4.81 crores. The two-judge bench comprising Justice Bela M Trivedi and Justice Pankaj Mithal observed, “There remains no shadow of a doubt” about Jain’s role in the racket.
The court further highlighted the assistance provided by Vaibhav Jain and Ankush Jain in making false declarations under the Income Declaration Scheme, 2016. The total amount under false declarations amounted to Rs 8.26 crores. These declarations were made allegedly to protect Jain. Later, the Income Tax Department deemed those declarations void. However, the court stated that the appellants could not be allowed to take advantage of it as they misled the authorities.
The court said, “The declarations made by Ankush Jain and Vaibhav Jain under IDS have not been accepted by the income tax authorities on the ground that they had misrepresented the fact that the investments in the said companies belonged to them, which belonged to Satyendar Jain. The appellants cannot be permitted to take advantage of their wrongdoing of filing false declarations to mislead the income tax authorities and now submit in the present proceedings under PMLA that the said declarations under the IDS were void. The declarations made by them under the IDS, though, were held to be void; the observations and proceedings recorded in the said orders passed by the authorities and by the high court cannot be brushed aside merely because the said declarations were deemed to be void under Section 193 of the Finance Act, 2016.”
The court concluded that Jain and his two aides failed to comply with the twin mandatory conditions in Section 45 of the PMLA, which led to the denial of bail to Jain. The court further directed Jain to surrender before the special court. He was out on bail on medical grounds.
The court observed, “It is needless to say that the right to speedy trial and access to justice is a valuable right enshrined in the Constitution of India, and provisions of Section 436A of the Code of Criminal Procedure would apply with full force to the cases of money laundering falling under Section 3 of the Prevention of Money Laundering Act, subject to the provisos and the explanation contained therein.”
ED arrested Satyendra Jain in May 2022 under the provisions of PMLA. In April 2023, the Delhi High Court denied him bail, and he was moved to the Supreme Court. The court heard the matter for four days and reserved the judgment in January this year.
