Delhi HC expunges observation against investigation officer of ED in money laundering case

The ED had challenged two orders passed by the special judge of Rouse Avenue court in the matter. This case is related to Lakshay Vij and the other accused.

Justice Anup Jairam Bhambhani after hearing submissions of the Enforcement Directorate (ED) has expunged the observation by the special judge in the matter.

"As a sequitur to the above, the observations made by the learned Special Judge in orders dated October 05, 2024 and October 19, 2024, to the extent they have been extracted above, shall stand expunged," Justice Bhambhani said in an order passed on October 24.

Justice Bhambhani also said, "Furthermore, it needs no emphasis, that adverse remarks made by a court against government servants have a serious deleterious impact on their official record and on their careers, especially if such remarks are unwarranted or unjustified."

The High Court also clarified that there is no stay of the ongoing proceedings, whether in the investigation or prosecution ofthe matter.

The ED had challenged two orders dated October 05, 2024 and October 19, 2024.

Advocate Zoheb Hossain, special counsel for ED argued that in the said two orders the learned Special Judge appears to have rendered 'findings' to the effect that the Investigation Officer (I.O.) has not taken appropriate steps to apprehend the absconding accused Karan Chugh, which are wholly misconceived on point of fact.

He also submitted that the I.O. not only issued summons to Karan Chugh on multiple occasions, he also undertook physical verification of the various available addresses of the accused.

It was also submitted that while the investigation was ongoing, the I.O. also issued requisite intimation to the Bureau of Immigration to open a Look-Out-Circular against the accused, in accordance with the standard procedures followed by the ED when accused persons are not traceable.

It was argued, that there is nothing on record that would warrant the learned Special Judge making the observations made in order dated October 5, which then culminated in the passing of order dated October 19, which order even contemplates summoning the Director of the ED on a subsequent date.

The trial court had observed in the order dated October 5, "The present prosecution complaint was filed on September 20, 2024 and is pending consideration on the point of cognizance. I have gone through the prosecution complaint. As per the prosecution complaint, one Karan Chugh is stated to be one of the main conspirator, kingpin and is "absconding". It is stated in the prosecution complaint that despite several summons, best efforts he is evading the proceedings initiated by the Directorate of Enforcement. Let that be the case and despite the fact that ECIR was recorded in December 2023 and despite the investigation allegedly revealing an in-depth role of Karan Chugh then atleast since July 2024 if not before, the Directorate of Enforcement has failed to take coercive steps against Karan Chugh so as to join him in the investigation."

The trial court observed that the present prosecution complaint has instead been filed against him with his status as an "absconder".

"I completely fail to understand the rationale behind the same. The Directorate of Enforcement, if indeed its investigation revealed the role of Karan Chugh and as is stated in the prosecution complaint then there was more than enough time to initiate coercive steps against Karan Chugh. Having not done so itself smells of foul play, more so when the law as on date is well settled as regards courts power qua those accused persons against whom prosecution complaint/charge sheet has been filed without arrest," the trial court observed.

The court had said, "It somewhere appears that Directorate of Enforcement, the Assistant Director being well aware of the said legal position, deliberately wants to give the benefit of the same to Karan Chugh or else I absolutely find no reason why the prosecution complaint in the present form has been filed against Karan Chugh with his status as "absconder". Having said that this court is not commenting upon the prosecution complaint filed against the other accused persons without their arrest. No doubt arrest and investigation is the sole prerogative of the investigating agency but the manner in which it is conducted should reflect fairness and not arbitrariness or whimsical attitude. In these circumstances, let a detailed report be called from the Director, Directorate of Enforcement in view of the above observation for the next date of hearing."

The special judge on October 19 passed an order saying, "The last date of hearing in the present matter was October 5 and despite lapse of almost two weeks, no compliance report has been filed in terms of the observations made by this court. The prosecution complaint was filed on September 19 and since then, it is pending at the stage of consideration. The shortcomings/lacunas were pointed out to the ld. Counsel and the IO initially orally and then vide orders dated October 5, as no compliance was done by October 5 and accordingly, the court was constrained to pass details orders on October 5. One month's time has not been sufficient for the ED to comply, satisfy the court as regards the observation made by the court. In fact, the IO did not bother to even appear in court today. All this reflects poorly upon the ED. Such a lackadaisical approach on the part of the ED is absolutely unacceptable. ED is showing complete apathy to the observations of this court and the absence of the IO today is ample proof of the same. Let the Director be summoned for the next date of hearing.Relist the matter on October 28, 2024." (ANI)