Calcutta High Court releases petitioner accused of duping individuals by posing as Enforcement Directorate officer after over one year in custody, citing mitigating circumstances and pending investigation in predicate offence case
In a significant judgment that balances the stringent provisions of the Prevention of Money Laundering Act (PMLA) with the principles of natural justice, the Calcutta High Court has granted bail to Sk. Jinnar Ali, who was accused of committing serious financial crimes through impersonation and extortion.
The petitioner, who had been in custody for over a year since his arrest on July 2, 2025, challenged his detention under the PMLA, 2002. Justice Jay Sengupta, while acknowledging the gravity of the allegations against the petitioner, held that prolonged incarceration could outweigh the stringent bail restrictions contained in Section 45 of the PMLA, particularly when mitigating circumstances are present.
The Allegations
According to the prosecution, the petitioner allegedly duped individuals, including one Tapan Kumar Poi, of substantial sums of money by impersonating himself as an officer of the Enforcement Directorate. The accused individuals, allegedly including the petitioner and one Nisar Ali, posed as ED officers and summoned victims under the pretense of official inquiries. They allegedly arrived in a vehicle bearing ED insignia and made false accusations against victims to coerce them into paying money. From August 2023 to June 2024, the de facto complainant was allegedly forced to pay Rs. 21.30 crore in cash. Forged documents, fake identity cards, rubber stamps, and letterheads of the ED were allegedly recovered during searches. The accused even allegedly posed his wife as a CBI officer and created fake websites of non-existent government organizations like the National Anti-Trafficking Committee to lend legitimacy to the scheme.
Legal Battle
The Enforcement Directorate argued vigorously against bail, contending that the petitioner had not satisfied the mandatory "twin conditions" under Section 45(1) of PMLA, which require the accused to establish that: (1) the case is not prima facie made out, or (2) the accused is not likely to commit further offences or tamper with evidence. The ED emphasized the serious nature of the charges, the risk of witness intimidation, the possibility of evidence tampering, and the fact that 12 vulnerable witnesses remained in the case.
The ED also pointed out that the investigation into the predicate offence was still ongoing, and the quantum of proceeds of crime could not be definitively established at that stage. They argued that searches had revealed incriminating materials corroborating the allegations of large-scale extortion through impersonation and that unexplained cash deposits and property acquisitions required scrutiny.
The Court's Reasoning
Justice Sengupta's judgment, while recognizing the gravity of the allegations, introduced a nuanced interpretation of bail provisions under PMLA. The Court referenced landmark Supreme Court decisions in Senthil Balaji (2024) and Manish Sisodia (2024), establishing that prolonged incarceration of an accused may, in certain circumstances, outweigh the rigors of Section 45 of PMLA.
The judgment identified several mitigating circumstances justifying bail:
1. Already Released on Bail in Predicate Offence: The petitioner had already been released on bail in the predicate offence case on August 20, 2025, shortly after arrest on July 22, 2025. This indicated that even the Magistrate handling the predicate case had found bail appropriate.
2. Incomplete Investigation: The investigation in the predicate offence case remained pending with no charge-sheet filed, suggesting ongoing investigative work that could not be concluded.
3. Scope Creep in ED Investigation: The Court observed that the ED had dealt with several materials that did not necessarily pertain to the parking of tainted money and some materials had no mention in the predicate offence case. The Court noted these could constitute separate predicate offence cases and would ultimately be for the Trial Court to determine their relevance.
4. Over One Year Incarceration: The petitioner had been in custody for more than a year, which the Court found disproportionate, particularly considering he was already on bail in the related predicate offence.
5. Fair Trial Progress: While acknowledging that the prosecution was proceeding well with witnesses being examined, the Court believed that the petitioner's presence during trial was important even if bail was granted.
Bail Conditions
The Court granted bail on stringent conditions designed to ensure the petitioner's appearance during trial and protect witnesses:
- Bond of Rs. 1,00,000 with two sureties of like amount each (one must be local)
- Surrender of passport to the Trial Court
- Restriction on leaving the territorial jurisdiction without permission
- Intimation of mobile phone numbers and place of residence to both the investigating officer and Trial Court
- Prohibition on intimidating or contacting witnesses
- Regular appearance before the Trial Court
- Provision for bail cancellation by the Trial Court for any violations
Significance
This judgment establishes an important precedent within the stringent framework of PMLA bail provisions. While Section 45 of PMLA significantly restricts bail by creating a presumption against bail for money laundering offences (unlike the presumption in favor of bail under ordinary criminal law), this judgment demonstrates that courts have discretionary power to consider prolonged incarceration as a mitigating factor that can tip the scales in favor of bail.
The judgment also highlights judicial scrutiny of investigative scope, suggesting that material collected by enforcement agencies should remain directly connected to the alleged proceeds of crime and the predicate offence. Materials falling outside this scope or not mentioned in the predicate offence might constitute separate cases and cannot automatically justify continued detention under a single PMLA case.
The Court's approach balances two competing interests: the serious nature of financial crimes and the need for fair trial procedures. While not absolving the petitioner of serious charges, the judgment reinforces that even under stringent statutes like PMLA, the basic principles of justice—including the right against indefinite incarceration—remain applicable.
The case now proceeds to trial in the Special Court with the petitioner appearing on bail, similar to his status in the predicate offence case. The final adjudication will ultimately rest with the Trial Court examining evidence and witness testimony systematically.
Bottom Line:
Bail under Prevention of Money Laundering Act, 2002 can be granted despite restrictions under Section 45 of the Act if prolonged incarceration outweighs rigors of the provision or mitigating circumstances exist.
Statutory Provisions
Prevention of Money Laundering Act, 2002, Sections 3, 4, 17, 24, 45, 50, 66(2) and 70
Indian Penal Code, Sections 384, 419, 420, 506, 34
Bharatiya Nyaya Sanhita, 2023, Sections 308(2), 319(2), 318(4)
Bharatiya Nagarik Suraksha Sanhita, 2023, Section 479
Constitution of India: Articles 21 and 22
Criminal Procedure Code, 1973: Section 437
Sk. Jinnar Ali @ Jinnar Ali v. Enforcement Directorate, (Calcutta) : Law Finder Doc Id # 2974419
