Observing that jail is the norm and bail is an exception under certain enactments such as the Prevention of Money Laundering Act (PMLA) of 2002, the Madras High Court on Monday denied bail to Non Resident Indian (NRI) Ahmed A.R. Buhari accused of having cheated several public sector power companies by supplying inferior quality coal at inflated prices and laundering the over invoiced money through shell companies.
Justice G. Jayachandran said, the allegation levelled by the Directorate of Enforcement (ED) against the petitioner was that he had supplied inferior quality coal of Indonesian origin by routing them through his shell companies at Dubai. The money siphoned off was transferred to offshore entities in UAE, British Virgin Islands and Mauritius and brought back to India as equity investment in his Indian entity Coastal Energen Private Limited.
During the course of investigation, the ED sleuths had asked the petitioner to furnish bank account statements of the offshore companies involved in the transaction, the original invoices raised by the Indonesian coal miners to his Dubai based entities and books of accounts of his foreign entities located in Mauritius and British Virgin Islands. The petitioner was reluctant to part with those crucial documents and had given evasive replies.
The judge agreed with Additional Solicitor General R. Sankaranarayanan, assisted by ED’s Special Public Prosecutor N. Ramesh, that since the petitioner was reluctant to handover the documents which were essential for investigation, his mere presence for inquiry would not tantamount to cooperation. “To collect those documents, the confinement of the petitioner is inevitable, else he may secret away the documents,” the judge wrote.
Further, stating that the petitioner had very fragile roots in the country as against his strong connections abroad, Justice Jayachandran said, his previous appearances before the investigating officer as and when it was convenient for him do not indicate that his presence could be secured if he decides to leave the country forever.
The court took note that it was the Directorate of Revenue Intelligence (DRI) which had, in 2017, first suspected the petitioner was involved in supplying coal to public sector power generation companies at artificially inflated import price. The inflated price was remitted from India to the intermediary firms abroad which in turn remit only the actual price to the suppliers of the Indonesian coal and the balance was allegedly siphoned off.
Subsequently, in 2018, the Central Bureau of Investigation (CBI) too registered a case against him on similar charges but a final report was yet to be filed. It was on the basis of the CBI’s case that the ED had begun its own independent investigations and arrested the petitioner, who also runs a 1200 MW Mutiara thermal power plant in Thoothukudi and sells power to Tangedco, on March 3.
Though the ED had provisionally attached Rs. 6,730.68 crore worth properties belonging to the petitioner in February 2020, the provisional order lapsed after 180 days since it was not confirmed as per procedures contemplated under the PMLA.
