The council seeks permission to approach the bench.

Much obliged

A very good afternoon, to your lordships and ladyships. If the bench may be pleased,
the council would like to address the bench collectively as your lordships. Much obliged
your lordships

It is a humble pleasure of the concert appear before this honourable court, on behalf of
the petitioners, in the keys of dimple versus directorate of enforcement. The petitioner is
respectfully reserve two minutes for rebuttals.

Council humbly submits that they have approached honourable High Court of Bombay
under 438 of the CRPC for grant of anticipatory bail

Counsel seeks permission to enquire if your lordships are well versed with the facts of
the present case, or if you will prefer a brief perusal of the same?

Dimple on graduating from a premier law institution chose to practise litigation in the area of
income tax on goods and services tax. She quickly established a reputation in the field of tax
advocacy and was assigned Arya soorma’s case. Arya soorma is a well known industrialist
and founder of Soorma forges and metal Works Private Limited. Income tax proceedings
against the company are ongoing before the income tax authorities.

Surma industries had filed its ITR full to year of 20 14-15 under the income tax act.
However, due to cash no issues in the company occurring due to on the sister entity Surya
metal in the source Private Limited we were unable to pay their advance tax and self-
assessment tax on time. However they later paid the entire tax in instalments along with
interest. We had paid 80% of the tax along with interest when they received a show cause
notice from the income tax department as to why prosecution should not be initiated against
them for a wilful attempt to evade payment of tax.

Direct rate of enforcement decided to investigate on this matter and summons were also sent
to advocate dimple among others. On April 25,, 2020, without any prior intimation, the ED
attached to a bank account in which she had received legal fees for representing Soorma
forges in Aurea Suma as proceeds of crime.
Advocate dimple has approached this honourable court, the section 438 of CRPC for grant of
anticipatory bail, fearing she may be arrested for the offence of money laundering.

If your lordships are well-versed with the facts of the case, the Counsel seeks permission
to directly begin with their issues and arguments.
ISSUE 1
The first issue at hand pertains to whether an offence under PMLA is made against
advocate dimple. My arguments in this regard are three fold
At the outset The counsel for the petitioner humbly submits that no offence under PMLA is
made against advocate dimple.
The first argument your lordships is that no offence under section 276C and 278B of the
income tax act has been meet out against Arya Soorma and Soorma metalWorks Private
Limited.

At the outset, relying on the judgement of the hon’ble high court of Telengana in Sujata
Electrical Infratech v Deputy Commisioner of Income Tax, where similar circumstances
occurred, the counsel submits that where self-assessment tax returns filed by assessee ,had
no element of concealment or any intention to evade tax which was liable to be paid, and
assessee had also paid additional amount towards interest and other charges and explained
that delayed payment of tax was due to financial difficulties beyond his control, continuation
of proceedings against assessee under section 276C(2) read with section 278B would amount
to abuse of process of Court. Certain requisite ingredients must be met to prosecute a person
under 276. Firstly, the person should have dishonest intention. Secondly the person should
have tried to conceal the facts. Thirdly, there should be consequent attempt, activating the tax
which the person is liable to pay, As held by. in the present case, Surma industries was unable
to pay the tax on time due to cash flow. Issues arising out of us, outstanding receivables from
sister and see. Secondly, the company had filed its income tax returns on time. It had
voluntarily declared its self assessment. Tax does indicating that they did not try to conceal
the facts and did not have a dishonest intention. Thirdly, even before the show cause notice
was issued the heartbeat 80% of the returns with interest. Additionally soon after the show
cause notice was issued, they paid the remaining 20% along with the returns. THus all the
three requisite ingredients that are required to prosecute a person under section 276 C are not
fulfilled In the instant case. There is no wilful attempt to evade tax on the part of Arya suit,
Mansoor maa forces in metal Works Private Limited. As a result the penal provisions on the
income tax sections 270 6C to do 70 8B would not be applicable in the light of the above
arguments. The council humbly cleats that the continuation of the proceedings against the
petitioner would be an abuse of the process of the court.

Your lordships, When return has been properly accepted and he assessment is also confirmed,
a mere default in the payment of taxes would not be considered as a wilful attempt to evade
taxes. Wilful attempt cannot be imported to be failure to pay the tax. there should be a wilful
attempt on the part of assessee to evade payment of any tax penalty or interest in order to
attract the liability. This was held by the honourable High Court of Madras in the case of SP
Velayutham versus assistant Commissioner of income tax.

Your lordships the second argument is that there is no scheduled offence and that
dimple did not receive any proceeds of crime.
Your Lordships, the counsel seeks permission to read section 3 of PMLA for your
convenience. Much obliged.
“Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a
party or is actually involved in any process or activity connected with the 1 [proceeds of
crime including its concealment, possession, acquisition or use and projecting or claiming] it
as untainted property shall be guilty of offence of money-laundering.”
This section mentions the offence of money laundering and explains it as an act when
someone is involved with activity associated with proceeds of crime and is involved in
portraying it as an untainted property.
At this point your lordships, it is imperative to look at the definition of scheduled offences
and proceeds of crime as mentioned under PMLA.
Your lordships, proceeds of crime are described under section 2(1)U of PMLA as any
property that is derived as a result of a criminal activities relating to a scheduled offence.
Further, your lordships, scheduled offences are defiuned under section 2(1)(y) of PMLA. as
offences specified under part A of the schedule.
Further lordships, the council would like to rely on the landmark judgement of the
honourable Supreme Court in Vijay Madan Lal Chaudhary versus union of India , if your
lordships may please refer to page 19 para 13 of the memorial, in this judgement it was
stated that offence under section 3 of PMLA and being considered as proceeds of crime is
dependent on illegal gain of property as a result of criminal activity relating to a scheduled
offence. authorities under 2002 act cannot prosecute any person on notional basis or on the
assumption that a scheduled offence has been committed.

In the light of the above sections, the counsel humbly submits that ax evasion is not a
scheduled offence under PMLA. Further for the application of PMLA, it is essential for
scheduled offence to take place. Thus since a scheduled offence has not taken place , the
counsel humbly submits that the provisions of section 3 of PMLA, 2002 cannot be invoked.
Additionally, since the legal fees obtained by Miss dimple were not related to a criminal
activity related to a scheduled offence, they cannot be said to be proceeds of crime.
Put there to be money laundering. It is essential for there to be proceeds of crime that arise
from a scheduled offence. However, due to the lack of these elements, miss dimple is not
involved in money laundering and her legal fees cannot be said to be proceeds of crime.
Ships.

The third argument is that no offence against Surma fortunes in metal works in Arya soon
maa is made out against 120 B of the Indian penal code.
Launch at the outset, the council reliance on the judgement of such a Narayana versus income
tax department

in the instant case, as there is no material on record to suggest that any proceeds of crime has
been accumulated in the form of property by way of committing the predicate offence
punishable under section 276 C and 278B of the income tax act, read with 120 B of Indian
penal code, 1860.

In the light of above submissions, it is submitted that the applicant has proceeds of crime nor
any other property in this area got no scheduled offence under PMLA has been committed.
Does there is no reason to curtail horse, dimple civil reporter, liberty, sort, it course of action
against her for the same. The applicant undertakes to buy by all conditions imposed upon him
by the court in light of the conditions of 438 of CRPC.
If your lordships are satisfied, the counsel solicits permission to move on to the second issue

ISSUE (2): THAT TITANIA’S PROSECUTION OF T-CITY VIOLATES THE RELEVANT LEGAL

PROVISIONS
Outside the council would like to state that bail is the rule and jail is the offence. The same
has been reiterated by the honourable court of a country in several cases. In this particular
instance, the counsel relies on the keys of Raj Singh Gehlot versus directorate of
enforcement. No chips. The guilt of the accused is not to be determined at the stage of the bill
at the stage of the bail. The court has accessed the matter on Broad probabilities, by the
honourable Delhi High Court, in previous judgements, PRAKASH Khandelwal versus the
directorate of enforcement.
It is most humbly submitted before this honourable court that advocate dimple is entitled to
bail under section 438 of the code of criminal procedure. Read with section 45 of PMLa.
The arguments in this regard are two fold.

The first argument your lordships is that the twin conditions under PMLA or not applicable to
anticipatory bail.
At the outset, the council contends that section 3 of PMLA cannot be made out under the
against the applicants, as none of it essentials have ben. The counsel has argued regarding the
same in the previous issue. PMLE mandates the existence of proceeds of crime. However in
the present case there are no proceeds of crime or an offence listed in the scheduled offences
and does PMLA would not be applicable to advocate dimple.

Your lordships the council would like to draw your attention to section 45 If I made it the
relevant line for your convenience. No person, accused of an offence under PMLA shall be
released on bail unless the twin conditions laid down there in all satisfied. However, your
lordships miss dimple was not accused of an offence under PMLE. The directorate of
enforcement had merely issued summons against her that she was not an accused under
PMLA and the twin conditions under section 45 would not apply to her.
Additionally or not ship the council relying on the judgement in Sanjay PRAKASH
Khandelwal versus directorate of enforcement submits that the twin conditions of section 45
does not put an absolute restraint on the ground to pay or require a positive finding qua guilt.
In the case of sprang Pankaj Grover versus government of India, the honourable Supreme
Court Samarth did that to bail conditions placing unchallengeable burden on the accused to
conditions contradicts the fundamental principle of Krish criminal justice where there should
be the norm in jail. The exceptions it’s if you only districts, the fundamental right to life is
outlined in section 21 and mix
 It as compared to provisions of CRPC. Additionally, it also violates article 14 of the
Constitution as it establishes different rules by sensually the same action or omission.

Does your lordships In the light of the above arguments, the council bin conditions of pale as
lead in section 4550 Emily would not apply to a cookie dimple. In instant the principles of
bail under section 438 could apply.

Moving on to the second argument or not ships without prejudice the twin conditions
for anticipatory bail under section 45 of PMLA are satisfied.

You are chips under section 45 two conditions must be satisfied for be if I need it for your
convenience. The first one is that an accused must show that he or she is professionally
not guilty of the offence and secondly that there is no threat of commission of offence
when enlarged on bail.

Lawsuits. In the instant case advocate dimple was only exercising, a legal right to
profession and Boli representing her client. Legal fees paid to her cannot be constituted as
one from criminal activity. Firstly, because she was not associated with Arya Soorma or
Soorma industries before she started representing them. Additionally in the above
arguments, it has been argued and established that no offence was committed bye are you
soon monsoon maa metal works under PMLAU Lord Shiva advocate dimple has not been
a part of any conspiracy. She has never direct your indirectly had any relation to any kind
of criminal act.

Call Harshit. The council submits that there is no threat of commission of offence by in
last one be. Advocate dimple does not have any previous criminal history and is a very
respectable citizen. There is no chance of her free away from justice or committing any
offence .

No no CHITRA. It is further submitted that even if the respondent Elizabeth siphoning of

funds has taken place, the applicant is Justin of attorney to Arya Soorma and Surya
metalwork. She had no prior association with them in any manner. It is you lying on the
judgement of Vijay Madanlal Chaudhary’s case where was held that the quarter the stage
of considering the application of feel is required to consider the question from the angle is
the weather. The accused is possessed of direct visit men's Rhea. Lots of snow will fall
tax version has taken place on the part of Soorma industries or Arya Surma additionally,
advocate dimple had no means Shreya to commit money laundering or a scheduled
offence under PMLA. Does the question of scheduled offence as well as proceeds of
crime does not arise and there is no presence of guilty, mind or bad motive which could
be established.

Lordships, the triple stab list in several judgements has been satisfied by the facts at hand.
Firstly, flightless advocate dimple practises in the High Court as well as the income tax
appellate Tribunal. This indicates that she has deep roots in society in terms of practice
and name in the income tax advocacy stock.

And secondly, advocate dimple cannot tamper with evidence in income tax proceedings
are already on going against Arya Sur Mansoor, maa forces and metal Works Private
Limited. Additionally the process has been issued before the special court. Documentary
evidence has already been seized or brought on record along with other documents so
there is no possibility of tampering with the evidence. Additionally, the applicant also
undertakes to not indulge in the same in the future.

What is your lordships since the investigating agency has already launched its
investigation and their ongoing before different authorities. The suit and this would
before the High Court has reached the final stage of proceedings. There is no possibility
of the applicant influencing any witnesses.

Further, your lordships, my respected friend on the other side may argue that since my
client if used to go before the enforcement directorate, releasing four on bail, believe the
non-cooperation from her side.

Learn cancel humbly submits that the applicant is entitled to protection under section 126
and 129 of the Indian evidence act

Not producing the documents before the enforcement directorate your lordships the
applicant being an advocate has the duty to uphold the sanctity of food infection and her
duty towards the client. This is necessary to protect the accuse article 20 211 and the poor
freedom of profession under article 19 1G

Hello CHITRA, in part six chapter 2, section to rule 17 of BCI or it is stated that an
advocate shall not directly or indirectly commit a breach of the application imposed by
section 126 of the Indian evidence act does reiterating the spirit of attorney-client
privilege, breach of which will also lead to violation of the park and service does your
lordships advocate dimple was cooperating with the proceedings of enforcement
directorate five or she did so while respecting certain provisions of CRPC, Indian
evidence act and advocates act that was applicable to her.

Additionally, you are not ship to counsel, submitted, dimple would be protected under
section 45 one and would be entitled to anticipatory bail. You know chitra section 45 fun
incorporates relaxation under PMLA4 persons will follow 16 years of age of woman or
one who is sick or infirm.The same was upheld in preeti Chandra v directorate of
enforcement

Further lordships the conditions for bail under section 438 of CRPC or satisfied. Bill is
granted under section 438 for apprehension of arrest app. Apprehension of this arrest is
reasonable and sufficient for grant of anticipatory bail. Since Soorma industries and
advocate dimple both court summons for prosecution and her bank account was also
attached by PMLA without prior intimation that she would be entitled to the relief of
anticipatory bail

Your lordships the council. Relying on the judgement of Basant Bansal versus state
submits that 438 provides for the procedure of granting an anticipatory bail. It is
concerned with the right to life and personal liberty of an individual who is yet to be
found guilty in the commission of a non-bailable offence. If the applicant is arrested, it
would be in direct violation of its fundamental right under article 21.

If you’re satisfied the council six permission to move ahead with the Prayer

In the light of all the submissions made the petitioner show by respectfully request the
tribunal to a judge and declared that
 1. Open under PMLA is not made out against advocate dimple
2. Nonappearance of advocate dimple before enforcement directorate under section
PMLA, 50 of PML of a sound in law
3. Advocate dimple is eligible to obtain anticipatory bail under section 438 of CRPC
read with section 45 of PMLA
4. In large, the applicant on deal with any reasonable condition which will be abided
by the applicant.

And or pass any other orders that it deems fit in the interest of justice, equity and
good conscience and for this the petitioner as an duty-bound shall humbly pray

Directorate of Enforcement v. V.C. Mohan...

Even though the application is under Section 438 CrPC, however, the interplay
and consideration of Section 45, PMLA must not only be reflected but duly
considered whilst adjudicating the said anticipatory bail application. ...