Delhi HC grants bail to Shakti Bhog CMD in money laundering case

The Delhi High Court on Friday granted bail to Shakti Bhog Foods chairman and managing director Kewal Krishan Kumar in connection with a money laundering probe arising from an alleged multi-crore bank loan fraud.

Justice Jasmeet Singh granted relief to the 70-year-old on account of his health condition while observing that he had been in custody for over 18 months and although the charge sheet was yet to be filed, the investigation against him was complete.

The accused, arrested in July 2021, sought bail on the ground that he fell within the category of “sick” and “infirm person” and was thus entitled to release under the Prevention of Money Laundering Act (PMLA).

In view of the medical reports, the court opined that although Kumar was not “sick” as his aliments were not grave or life-threatening, he was suffering from infirmities in view of seizure disorders and mild behavioural disorder and his condition in January presented a grim picture.

“Infirmity is defined as not something that is only relatable to age but must consist of a disability which incapacitates a person to perform ordinary routine activities on a day-to-day basis,” said the court.

“The infirmities in a senile stage combined with constant attendant’ support as noted in the report dated 13.02.2023 coupled with frequent seizures and abnormal behavioural disorder make the applicant infirm’ under the proviso to section 45(1) PMLA,” opined the court.

In the order, the court also clarified that every sickness would not entitle an accused to bail under the PMLA and relief can be given when the condition is so serious that it cannot be treated in jail.

“In my view, granting bail on every sickness will render the proviso to section 45(1) PMLA otiose. The proviso should only be invoked in cases where the sickness suffered by the applicant is so serious and life-endangering that it cannot be treated in jail, or the specialised treatment as required cannot be provided from jail hospitals,” the court said.

The judge asked Kumar to furnish a personal bond with a surety in the sum of Rs 1 lakh and directed him to not leave the country during the bail period and surrender his passport.

It also asked him to appear before the trial court when the matter is listed for hearing, keep his mobile phone in working condition and not indulge in any criminal activity or tamper with evidence.

The Enforcement Directorate (ED) opposed the bail plea on the ground that the accused was stable and should not be enlarged on medical bail.

The money laundering case against Shakti Bhog Foods Limited by ED was based on a CBI FIR that charged it and several others with criminal conspiracy, cheating, and criminal misconduct.

The Central Bureau of Investigation FIR against the company and its promoters came about after the State Bank of India (SBI) registered a complaint against the company for an alleged fraud of Rs 3,269 crore.

According to the SBI, the directors allegedly falsified accounts and forged documents to siphon off public funds.

The 24-year-old company, which is into manufacturing and selling wheat, flour, rice, biscuits, and cookies, had grown organically as it ventured into food-related diversification over a decade with a turnover growth of Rs 1,411 crore in 2008 to Rs 6,000 crore in 2014, the bank complaint had said.

The ED has said the “allegations against the accused include diversion of funds from loan accounts by round-tripping through related entities and siphoning of funds was being done by way of suspicious sale/purchase from various entities.”

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