The present bail application was filed under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS) read with Section 45 of the Prevention of Money Laundering Act, 2002 (PMLA) by the applicant Rohit Vij, seeking regular bail in connection with a major money laundering investigation arising from an investment app scam named ‘LOXAM’. The prosecution alleged that the applicant operated a vast hawala network and utilized shell/mule companies—specifically M/s Ranjan Moneycorp Pvt. Ltd. and KDS Forex Pvt. Ltd.—utilizing dummy directors to convert hundreds of crores of tainted fraud proceeds into foreign currency and cash, which were then routed abroad. The Delhi High Court, presided over by Justice Purushaindra Kumar Kaurav, evaluated the material, including statements recorded under Section 50 of the PMLA, the applicant’s flight risk status, and his suppression of material facts while securing permission to travel abroad. Finding that the twin conditions under Section 45 of the PMLA were unmet and that a formidable case of money laundering was established, the Court dismissed the bail application.
- Genesis of Investigation: An FIR was registered by PS Cyber Crime, Hyderabad, regarding a fraud committed through an investment app called ‘LOXAM’. The proceeds of crime were traced to entities like Xindai Technologies Pvt. Ltd. and Betench Networks Pvt. Ltd., which funneled massive funds into the applicant’s front companies, Ranjan Moneycorp and KDS Forex.
- Survival of PMLA Proceedings Post-Compromise: The Court held that even if a predicate offence is quashed or compromised, PMLA proceedings do not automatically abate unless there is a judicial finding on merits that the scheduled offence never occurred, preventing fraudsters from frustrating money laundering probes through private settlements.
- Inapplicability of Low-Amount Argument: Rejecting the applicant’s contention that the original fraud involved only Rs. 1.16 lakhs, the Court emphasized that the breadth of the Directorate of Enforcement’s (ED) investigative plane under PMLA regarding “proceeds of crime” extends far beyond the specific grievance of the original complainant.
- Flight Risk and Conduct: The Court noted the applicant’s mala fide conduct, observing that he suppressed the issuance of ED summonses from the Hyderabad Court while obtaining permission to travel to Paris, and was eventually intercepted at the Delhi airport via a Look Out Circular (LoC).
- Rejection of Parity: The Court distinguished the applicant’s case from co-accused Bhupesh Arora, pointing out that the applicant was the principal mastermind and operator of the cash/forex conversion mechanism rather than a secondary participant.
- Evidentiary Value of Section 50 Statements: Reaffirming precedents such as Rohit Tandon v. Directorate of Enforcement, the Court highlighted that statements recorded under Section 50 of the PMLA are admissible and established a formidable prima facie case against the applicant.
- Failure to Satisfy Section 45 Twin Conditions: The Court concluded that the applicant failed to satisfy the twin conditions for bail under Section 45 of the PMLA—namely, that there are reasonable grounds for believing he is not guilty and is unlikely to commit any offence while on bail—resulting in the dismissal of the application.
