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Read ED submission in SC to keep lawyer Rohit Tandon jailed: Laundered up to Rs 128 cr demonetised notes, won’t explain origin of cash

ED plays hardball to keep Rohit Tandon in jail, alleges demonetisation laundering
ED plays hardball to keep Rohit Tandon in jail, alleges demonetisation laundering

T&T Law founding partner Rohit Tandon, now in jail for nearly a year in one of the most high-profile arrests carried out in the wake of the government's demonetisation drive in 2015, is now awaiting a final order of the Supreme Court over his bail plea in the money laundering case against him.

At Monday's hearing (30 November), Chief Justice of India (CJI) Dipak Misra asked additional solicitor general (ASG) Tushar Mehta, who was appearing for the Enforcement Directorate (ED), why Tandon, who has been in jail for more than 10 months now should be denied bail for such a long period for merely a fiscal offence, according to an authoritative source.

However, justices AM Khanwilkar and DY Chandrachud on the bench asked senior advocate Mukul Rohatgi, who was appearing for Tandon, as to why his client had to date not disclosed the source of the allegedly laundered sum of money, added the source.

Tandon's advocates-on-record (AORs) Jayant Mohan and Anupam Lal Das had briefed Rohatgi, senior advocate Subramonium Prasad and instructed advocates Arunabh Chowdhury, Manu Sharma, Sarvesh Singh Baghel, Vaibhav Tomar, Abhir Datt, Shruti Choudhry, Karma Dorjee and Anirudh Singh.

Tandon had appealed to the SC on 4 September against the Delhi high court's January 2017 rejection of his plea for permanent bail.

The high court had only granted him three weeks of interim bail until 6 September to look after his ailing mother.

Since his arrest in January 2017, Tandon has engaged at least 15 lawyers, including senior advocates Rohatgi, Prasad, Vikas Pahwa and Vivek Sood. He was first jailed in January 2017 after his office and residence were raided in December 2016 and allegedly revealed almost Rs 14 crores in unaccounted cash in his possession.

The case against Tandon

The ED has alleged that Tandon definitely laundered more than Rs 51 crore, and possibly even up to Rs 128 crore, by getting illegitimate demonetised currency deposited in bank accounts of dummy shell firms, in connivance with bank officials who were bribed with huge commissions. The currency so deposited would then have been withdrawn by issuing demand drafts (DD) of huge sums in fictitious names, cancelling the DDs and writing cheques for the sums thus credited back into the respective bank accounts.

Mehta submitted to the Supreme Court on Monday that “though there is a clear, categorical and cogent evidence for money laundering of more than Rs 51 crores [unearthed so far], [Tandon] refused to discharge his obligation”. Mehta stated in his written submission:

Learned Senior Counsel for the petitioner was fair enough to admit that the whole money belonged to the petitioner. When enquired as to from which ‘source’, huge cash was procured, there was no clear response to it. Again, learned Senior Counsel for the petitioner was asked as to how the cash belonging to the petitioner happened to be deposited in various accounts of the ‘Group of Companies’ which were not owned by the petitioner and what was its purpose.

It was further enquired as to why the Demand Drafts were got issued in the names of the persons referred above and what was its specific purpose. Learned Senior Counsel for the petitioner avoided to answer these queries stating that the defence of the petitioner could not be disclosed at this juncture to impact his case during trial.

He added in the submission that in total Rs 128 crores were recovered from Tandon's residence during the income tax raid.

Rs 41.65 crore out of this surfaced after a Prevention of Money Laundering (PMLA) investigation revealed that between 15 November 2016 and 19 November 2016 there was a cash deposit of Rs 31.75 crores by Raj Kumar Goel and his associates and that through the mechanism of issuing demand drafts in fictitious names, Rs 31.75 crore was deposited in eight separate accounts with the Kotak Mahindra Bank.

Mehta's submission states:

from 15.11.2016 to 19.11.2016 there was huge cash deposit of Rs 31.75 crores by Raj Kumar Goel and his associates and incoming RTGS was to the tune of Rs 6.86 crores.

Demand Drafts amounting to Rs 38 crores were issued in fictitious names i.e. Sunil Kumar, Dinesh Kumar, Abhilasha Dubey, Madan Kumar, Madan Saini, Satya Narain Dagdi and Seema Bai. Total cash (demonetized currency of Rs 31.75 crores) was deposited in eight accounts of Kotak Mahindra Bank during 15.11.2016 to 19.11.2016 with RTGS inwards to the tune of Rs 6.86 crores.

During the said period, 75 Demand Drafts to the tune of Rs 39.64 crores were issued from the said accounts; out of which three demand drafts of Rs 1.11 crores were cancelled. Demand Drafts issued from Kotak Mahindra Bank amounting to Rs 34.88 crores were recovered. Demand drafts amounting to Rs 3.12 crores all dated 15.11.2016 issued by ICICI bank and Bank of Baroda have also been recovered.

The funds actually pertaining to the petitioner were carefully distanced away from him through a calibrated planning. The collection of cash (demonetized currency) was used to be done through meetings at different dates with the petitioner and his associates Ashish Kumar, Dinesh Bhola and Raj Kumar during 14.11.2016 to 19.11.2016. The demonetized cash used to be taken over by Ashish Kumar and Raj Kumar Goel and others. Demand Drafts were used to be handed over by Ashish Kumar to Dinesh Bhola. Raj Kumar Goel used to bring such cash and deposit the same with Kotak Mahindra Bank with active assistance of Ashish Kumar, Branch Manager as is evident from CCTV footage of the bank.

It is further urged that on 14.11.2016 Ashish Kumar visited petitioner’s office at R-89 GK-I where he took from Dinesh Bhola about Rs 1.5 crores as token of advance to start the work.

The other transactions were done twice in T and T farmhouse (Petitioner’s farm house); two times in a street adjacent to the farm house and the last transaction in the petitioner’s office at R-89, GK-I.

In all these transactions, Dinesh Bhola acting on petitioner’s instructions handed over the demonetized cash to Ashish Kumar and others. It is further urged that the properties involved in money laundering totaling about Rs 41.65 crores have surfaced during investigation so far

Investigation for bigger amounts is still in process, he submitted.

ED submission

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