NEW DELHI, Dec 25: A Delhi court has refused to hear a chargesheet against Adhunik Corporation Limited and its two directors in a coal scam case filed by the ED, saying an attempt to obtain proceeds of crime or anticipation of unlawful benefits cannot be called money laundering.
In his order dated December 23, Special Judge Arun Bhardwaj granted relief to Adhunik Corporation Ltd (ACL) and its then directors Mahesh Kumar Agarwal and Nirmal Kumar Agarwal in the case related to the New Patra Para coal block in Odisha.
According to the Enforcement Directorate (ED), the family members and group companies of the accused have deposited funds amounting to Rs 50.37 crore in the form of share capital in ACL in anticipation of “undue advantage to be derived or acquired by ACL as a result”. of, or as a result of, criminal activity related to a scheduled offense (filed by the CBI), resulting in the allocation of a coal block.
The judge noted that according to the ED, the infusion of capital/investment through the holding company into ACL was made in “anticipation” of undue benefits that ACL might obtain or obtain as a result of criminal activities in connection with the planned crime.
“According to the complainant (ED) himself, the unlawful benefits had therefore yet to be obtained or obtained and were only to be expected,” the judge ruled.
He noted that ED itself has stated that the suspects attempted to acquire the proceeds of crime and anticipated illicit benefits, “meaning that the proceeds of crime had yet to accrue.”
“Therefore, it cannot be said that an attempt to obtain proceeds of crime or anticipation of unlawful benefits falls within the definition of money laundering because up to the stage of the attempt or the stage of anticipation of unlawful benefits there is no is from proceeds from crime. There was no money available for money laundering,” the judge said.
The judge noted that the cash injection had already begun before the hatching of the conspiracy alleged in the predicate offence.
The investors were relatives and group companies of the suspect and there was no investor who invested in the ACL because of the allocation of coal blocks in his favor, the judge noted.
“The infusion of capital/investments through family members and group companies will therefore not fall within the definition of ‘proceeds of crime’ under Section 2 (1) (u) of PMLA (Prevention of Money Laundering Act),” the judge said. .
When the family members and group companies invest in the shares of a company that has obtained the allocation of a coal block through fraud, their investment does not fall within the definition of ‘proceeds from crime’, the judge ruled.
He further notes that the family members and group companies had already made partial investments in ACL before the allocation of the coal block to ACL.
Investments continued to be made by the family members and group companies even after the allocation was imminent based on the recommendations of the Inter-Ministerial Group as there was no substantial progress in the development of the coal block even after a warning on November 3 . 2010, according to the judge.
“Therefore, the investments of family members and group companies in ACL will not constitute the proceeds of crime,” he noted.
The judge further noted that the Delhi High Court has categorically held that the allocation of coal cannot possibly be viewed as proceeds of crime in itself.
“This court is of the opinion that from the material placed before this court, no offense of money laundering under Section 3 of the PMLA can be established and there is no material to take cognizance of the offense of money laundering and to continue doing so. complaint,” the judge said.
The suspects were earlier convicted in a related corruption case filed by the CBI for conspiracy and cheating the government in the allocation of a coal block by misrepresenting facts and using forged documents as genuine.
Their four-year jail term, awarded by the special court, was later stayed by the Delhi High Court after they appealed against their conviction. (PTI)