Delhi HC dismisses plea by ex-Bhushan Steel promoter Singal against arrest in money laundering case

The Delhi High Court has dismissed a petition by Bhushan Steel’s former promoter Neeraj Singal challenging his arrest by the Enforcement Directorate last year in a money laundering case arising from an alleged bank fraud of Rs 46,000 crore.

Justice Vikas Mahajan also rejected Singal’s plea seeking regular bail in the matter and said the arrest was not illegal.

“It cannot be said that the arrest of the petitioner is illegal. Under the circumstances, I am of the view that the CRLMC 4376/2023 (plea against arrest) as well as BAIL APPLN 2356/2023, deserve to be dismissed and, are accordingly dismissed,” said the judge in an order passed on Monday.

Singal, also an ex-Managing Director of Bhushan Steel, was arrested on June 9, 2023. He contested the ED action against him, claiming he was not informed about the grounds of his arrest, which he insisted was contrary to law.

The court said the Supreme Court’s decision, which mandated supply of the grounds of arrest in writing at the time of arrest, was passed after Singal was apprehended in the present case. The arrest, therefore, cannot be said to be illegal.

At the time of his arrest, oral communication of the grounds of arrest was proper compliance of the provisions of Section 19(1) of the Prevention of Money Laundering Act, the court opined.

“As laid down by the Supreme Court, the requirement of furnishing grounds of arrest to the accused/arrested person in writing was not mandatory or obligatory till the date of directions passed in Pankaj Bansal (case) on 3rd October, 2023, and therefore, non-furnishing of grounds of arrest to the petitioner in writing, who was arrested on 09.06.2023, could not be held illegal,” the court said.

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The court said merely because each page of the ground of arrest’ was not signed by the petitioner, it cannot be a reason to disbelieve the existence of the said document, or to negate the fact that the grounds of arrest were shown to the petitioner.

The Enforcement Directorate alleged before the high court that Singal was involved in one of the biggest banking frauds coupled with the offence of money laundering which caused a loss of more than Rs 46,000 crore of public money.

It alleged that Singal, with the connivance of other accused, knowingly engaged in “illegitimate acquisition” of loans in the name of Bhushan Steel Ltd & other group companies and indulged in laundering the proceeds of crime through a complex web of more than 150 companies.

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