The Allahabad High Court recently rebuked the defence counsels representing Padam Singhee in a high-profile money laundering case for sending repeated emails to the Enforcement Directorate (ED). The court noted that these emails, which urged compliance on procedural matters, overstepped the professional boundaries of legal counsel.
Background of the Case
The case, Padam Singhee v. Directorate of Enforcement (Criminal Misc. Bail Application No. 32236 of 2024), involves Padam Singhee, a director of SVOGL Oil Gas & Energy Limited, who stands accused of laundering funds tied to a substantial loan fraud involving the Punjab National Bank. The ED alleges that Singhee, along with others, was instrumental in diverting funds procured as loans, ultimately causing a loss of approximately ₹252 crore. Singhee has been in judicial custody since February 2024 following his arrest.
SVOGL Oil Gas & Energy Limited, through a series of transactions and alleged shell entities, is said to have siphoned funds between 2006 and 2017. After the bank declared the loan as a Non-Performing Asset (NPA) retroactively to December 2013, the ED’s involvement escalated, and the case developed into a complex investigation under the Prevention of Money Laundering Act (PMLA), 2002.
Court’s Observation on the Role of Counsel
During the hearing, Justice Samit Gopal remarked on the impropriety of the defense counsel’s conduct in directly reaching out to the ED via emails, describing it as “beyond the acceptable scope of an advocate’s role.” The court underscored that such correspondence, especially when intended to enforce procedural compliance by investigative agencies, fell outside the purview of a counsel’s professional duty. The court emphasized that any procedural requests or compliance issues should be addressed within the judicial process, not through direct communications with the agency.
In its criticism, the court noted, “Counsel for the accused is expected to uphold the decorum of the legal process. Compliance requests or enforcement-related communications directed at the Directorate fall strictly within the framework of judicial proceedings. Such actions, when taken outside the purview of the court, can undermine the sanctity of judicial oversight.”
Legal Issues Involved
The legal debate in this case centers on the application of bail provisions under Section 439 of the Code of Criminal Procedure, 1973, and the restrictive bail conditions under Section 45 of the PMLA. Defense counsel, led by Senior Advocate Kapil Sibal, argued that the extended judicial custody and delays in the prosecution’s filing of a charge sheet warranted bail for Singhee. They contended that the prolonged detention violated his fundamental rights, particularly the right to a speedy trial under Article 21 of the Constitution.
Arguments from Both Sides
Defense counsel cited recent Supreme Court judgments that highlighted the principle “bail is the rule, jail is the exception,” emphasizing that preventive detention should not translate into punitive incarceration, especially when trial proceedings have yet to commence.
The ED, represented by Additional Solicitor General Gyan Prakash and others, argued that the accused’s role in the extensive financial misappropriation justified continued detention, particularly given the scale of alleged fraud and the ongoing investigation into financial misconduct involving multiple shell companies.
While the High Court did not provide an immediate ruling on the bail application, it advised all parties to adhere to proper channels in seeking procedural compliance, reminding counsels to respect the judicial process and refrain from direct communication with investigative bodies. The court is expected to consider the merits of Singhee’s bail request further, taking into account constitutional rights balanced against the statutory rigour under the PMLA.
