The Bombay High Court on Wednesday granted bail to Pune builder Avinash Bhosale in the case registered by the Directorate of Enforcement (ED) in an alleged money laundering case under the Prevention of Money Laundering Act (PMLA), observing that he may not be guilty of offence he is being prosecuted for. Bhosale, chairman and founder of ABIL Group was arrested by the ED on June 28, 2022.
“There are reasonable grounds to believe that the applicant (Bhosale) is not guilty of the offences for which he is being prosecuted. The applicant is already granted bail in the predicate offences…,” Justice Manish Pitale said.
Bhosale was initially arrested by the Central Bureau of Investigation (CBI) on May 26, 2022, in a case registered on March 7, 2020, for cheating under the Indian Penal Code and corruption under the Prevention of Corruption Act. This case is treated as a predicate offence.
Justice Manish Pitale directed Bhosale’s release on bail on furnishing a personal bond of Rs1 lakh.
The HC was hearing a petition filed by Bhosale seeking bail in the ED case.
According to the ED, Bhosale received kickbacks from Yes Bank founder Rana Kapoor, also an accused in the case, in return for diverting funds. Yes Bank, under Rana Kapoor, had disbursed Rs3,983 crore to Deewan Housing Finance Limited (DHFL), which were proceeds of crime. Of this amount, DHFL sanctioned and disbursed loans aggregating to Rs2,420 crore to three group concerns of Radius Group, headed by Sanjay Chhabria, also an accused in the case. Bhosale allegedly received Rs350 crore kickbacks from Radius group for facilitating loans from DHFL in the form of consultancy services payments, CBI claimed.
ED has relied on three major transactions between Bhosale’s companies and DHFL and Radius group.
Bhosale had, however, contended that the allegations are misconceived and that they were all legitimate business transactions and were returns on investments made in 2014-2015.
His counsel Aabad Ponda argued that there is no possibility of the trial being concluded within a reasonable period of time. In the PMLA case there are 70 witnesses to be examined and in the predicate offence there are 187 witnesses to be examined by the prosecution.
ED counsel Hiten Venegaonkar opposed the plea contending that there was sufficient material on record in respect of all the three transactions to make out a strong prima facie case to show that Bhosale was beneficiary of about Rs165 crores which must be treated as proceeds of crime.
The high court, however, noted that the transactions showed that amounts were being returned pursuant to investments made by Bhosale in 2014-15 and as per mutually agreed covenants. This indicates that “it could never have been contemplated in the years 2014 and 2015 that such proceeds of crime would be generated in future, which would be utilised for returning the investments”, the bench said.
The judge also underscored that there is “remote possibility” of trial even commencing and hence there is hardly any possibility of the trial being completed within a reasonable period of time.
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