HC refuses businessman’s plea seeking direction to ED to return his mobile and seized documents

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The Madras High Court has held that it lacked territorial jurisdiction, since the investigation under the Prevention of Money Laundering Act, was being done by the ED and CBI units in New Delhi

The Madras High Court has held that it lacked territorial jurisdiction, since the investigation under the Prevention of Money Laundering Act, was being done by the ED and CBI units in New Delhi

The Madras High Court has dismissed a writ petition filed by businessman, Ramesh Dugar, seeking a direction to the Directorate of Enforcement (ED) to return the documents and an iPhone that were seized from his residence in Chennai on August 5.

The court held that it had no territorial jurisdiction to entertain the petition since the matter was being investigated by the ED as well as the Central Bureau of Investigation (CBI) units in New Delhi.

Justices P.N. Prakash and RMT Teekaa Raman pointed out that the search and seizure operations had taken place in the process of finding the trail of a bribe amount of ₹50 lakh that was allegedly paid to Karti P. Chidambaram, now Sivaganga Member of Parliament, in 2011. The entire investigation, in the individual cases registered by the CBI as well as the ED this year, was being conducted by the New Delhi units of both the agencies.

“We are afraid that in the facts and circumstances of this case, seizure and recovery of the articles from the premises of the petitioner in Chennai cannot confer jurisdiction on this court because the investigation by the CBI as well by the ED is being held at New Delhi and the search and seizure is the effect of the investigation and not the cause of the investigation,” they wrote after concurring with objections raised by ED special public prosecutor N. Ramesh.

The judges, however, granted liberty to the petitioner to work out his remedy before the appropriate forum in a manner known to law. Recalling the history of the case, the judges pointed out that the CBI had registered a First Information Report (FIR) on May 14 this year against Mr. Chidambaram and a few others under the provisions of the Prevention of Corruption Act of 1988 and under Section 120B (criminal conspiracy) of the Indian Penal Code.

According to the CBI, Talwandi Sabo Power Limited (TSPL) was in the process of establishing a 1,980 MW thermal power plant at Mansa district of Punjab in 2011. The plant was being established by a Chinese company, Shangdong Electric Power Construction Corporation, but the project had run behind schedule translating into huge financial repercussions in terms of penalties, interest on bank loans and so on. Therefore, TSPL was in need of more project visas for the Chinese experts.

Therefore, Vikas Makharia, associate vice-president of TSPL, got in touch with Mr. Chidambaram through an associate and paid ₹50 lakh to obtain permission from the Union Home Ministry on August 30, 2011, for reusing the visas issued for the project. The money was paid to Bell Tools Limited by raising a false invoice for out-of-pocket expenses incurred with respect to the reuse of project visas though the company had never been in such business/services, the CBI alleged.

Further, it was revealed that during the same period, Advantage Strategic Consulting Private Limited, “a company controlled by Mr. Chidambaram,” had entered into cash transactions with the Dugar group of companies during the close proximity of the illegal gratification paid by TSPL. Therefore, the ED had registered a separate Enforcement Case Information Report (ECIR) on May 25 this year under the Prevention of Money Laundering Act of 2002.

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