New Delhi: The Supreme Court on October 5 (Thursday) asked the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) “how will they establish money laundering by [Aam Aadmi Party leader] Manish Sisodia, factually and legally”.
Sisodia is in judicial custody over his alleged involvement in the excise policy scam case. He was arrested on February 26.
The apex court asked the central probe agencies whether there was any evidence to connect the proceeds of the alleged money laundering activity with the AAP leader.
“How will you establish money laundering by Sisodia factually and legally?… He may be aware it may be used, as per your case, but he never came in actual physical possession,” a bench of Justices Sanjiv Khanna and SVN Bhatti said, according to Bar and Bench.
The top court made these remarks while hearing bail pleas filed by AAP leader and former Delhi deputy chief minister Sisodia.
The policy decision
According to LiveLaw, the top court sought clarification regarding the nature of submissions of the investigative agencies. Justice Khanna asked if the Delhi government’s Excise Policy for 2021-22 was under challenge.
Additional Solicitor General (ASG) S.V. Raju, who appeared for the two agencies, responded by saying that the agencies were not challenging the policy decision.
Justice Khanna then asked, “But you say that policy decision was motivated for personal benefits. So will it not mean that you’re challenging the policy decision?”
The ASG said that the submission forwarded by the agencies was that the policy in question was framed in a manner which benefitted certain wholesalers and Sisodia had a role to play in the same. He added that the policy was framed as a “facade” to replace the old excise policy which was not favoured by the Delhi government.
“The old policy was not what they wanted. To change the policy they got Dhawan committee report but it wasn’t what they wanted. So then they invited objections and suggestions. In those objections we see the role of the petitioner,” said the ASG, per LiveLaw.
“We understand that there is a policy change. Everyone will support policies good for their business. Pressure groups are always there. Policy changes even if wrong, without money consideration will not matter. It’s the money part which makes it an offence. If we go to an extent to say that there cannot be any pressure groups, no government can continue…Lobbying will always be there. Of course we’re not saying that bribes can be accepted,” the court said.
Vijay Nair‘s role
The ASG submitted that as per an approver’s statement, Vijay Nair was working on behalf of Sisodia.
To this, Justice Khanna said: “Whose statement is that? That’s his opinion. Two questions in the cross examination and this will fall flat. It’s an opinion, he’s not an expert. Expert opinion is different. It’s an inference drawn. His opinion does not matter. The court’s opinion matters.”
ASG Raju argued that Nair was given a bungalow next to the chief minister’s bungalow and he operated from the chief minister’s office.
“He is somebody who is connected to the Aam Aadmi Party. So if somebody says he is connected to Deputy CM…see how he is operating. They are having the GoM policy even before the policy was released. This shows that they had a role to play in the policy,” ASG Raju added.
How will you bring Sisodia under PMLA?
As per LiveLaw, Justice Khanna said: “Manish Sisodia is not involved in all this. Vijay Nair is there but Manish Sisodia is not in this part. How will you bring him under money laundering Act? The money is not going to him. In case it is a company with whom he is involved, then we have vicarious liability. Otherwise the prosecution falters. Money laundering is entirely a different offence…We have to show that he is in possession of that property. You will have to go to the exact wording of the section and show how will you bring him in.”
The bench added that PMLA dealt with process or activity connected with proceeds of crime and not “generation”.
“He has not got the possession, somebody else has. It’s not acquisition by him, it is acquisition by someone else. Use is by someone else. Projecting is by someone else…Generation is not a part of it. Concealment is a part of it. Possibly you can bring it under concealement, I don’t know. That’s why I said- Abetment is separate, vicarious liability is separate, principal offender may be someone separate.”
The ASG said that “he is involved in a process or activity which is connected to the proceeds of crime.”
“Generation of money is not an offence under Section 3 (of the Prevention of Money Laundering Act/ PMLA),” the apex court pointed out.
“When you give bribe, you’re involved in the activity connected to the proceeds of crime. Suppose, let’s assume, ultimately no money is passed on. Will PMLA trigger? What triggers in PMLA is proceeds of crime PMLA will be triggered after proceeds of crime are given or paid. You have to connect the person concerned with the proceeds of crimes, directly or indirectly. Abetment, it may be. But as a principal offender it will be a different situation.”
The case will be next heard on October 12.