Former
Telecom Minister A Raja was in "connivance" with MP Kanimozhi, DMK
supremo M Karunanidhi's wife Dayalu Ammal and other co-accused in
"parking" of illegal gratification of Rs 200 crore in Kalaignar TV, a
special court today said and put them on trial on money laundering
charges.
If convicted, Raja and others will face a maximum sentence of upto seven years.
This is the second case in the 2G spectrum allocation scam in which Raja, Kanimozhi and others, including Swan Telecom promoters Shahid Usman Balwa and Vinod Goenka, will face trial for their alleged involvement in the scam.
The court today framed charges against 19 accused -- 10 individuals and nine companies -- under the provisions of the Prevention of Money Laundering Act (PMLA) and fixed the case for commencement of trial on November 11.
It said there was enough material on record which makes out a "prima facie" case against all the accused who were chargesheeted by the Enforcement Directorate on April 25, for committing an offence punishable under the PMLA.
"Accordingly, I find that there is enough material on record to make out or to presume a prima facie case against each accused for committing an offence of money-laundering as defined under section 3 and punishable under section 4 of the (PML) Act," Special CBI Judge O P Saini said.
Besides Raja, Kanimozhi and Dayalu Ammal, the individual co-accused in the case are Shahid Balwa, Vinod Goenka, Directors of Kusegaon Fruits and Vegetables Pvt Ltd Asif Balwa and Rajiv Agarwal, Kalaignar TV (KTV) MD Sharad Kumar and its Director P Amirtham and Bollywood producer Karim Morani. All of them are out on bail.
The court, in its 208-page order, said, "A Raja in connivance with M K Dayalu, K Kanimozhi and Sharad Kumar, was actually involved in parking the illegal gratification of Rs 200 crore received from Shahid U Balwa and Vinod K Goenka in KTV."
"He (Raja) was also actually involved in the process of refund of the proceeds of crime of Rs 223.55 crore in order to wriggle out of the charges of crime. Thus, Raja has committed the offence of money-laundering as defined under section 3 of the Act," it said.
The court also framed charges against the nine accused firms -- Swan Telecom Pvt Ltd (STPL), Kusegaon Realty Pvt Ltd (formerly known as Kusegaon Fruits and Vegetables Pvt Ltd), Cineyug Media and Entertainment Pvt Ltd (formerly known as Cineyug Films Pvt Ltd), Kalaignar TV Pvt Ltd, Dynamix Realty, Eversmile Construction Company Pvt Ltd, Conwood Constructions and Developers (P) Ltd, DB Realty Ltd and Nihar Constructions Pvt Ltd.
ED, in its charge sheet, had alleged that all the accused were involved in the Rs 200-crore money transaction which was not "bonafide" and "genuine" and it was a "bribe for grant of telecom licences to DB Group companies" by Raja.
As soon as the judge pronounced the order, he asked the accused as to whether they were pleading guilty to the offence or face trial.
To this, all the accused said that they will go for trial on charges against them.
While framing charges, the court observed that not only the roles of each accused were narrated in ED's complaint but there were "factual and credible allegations" against each of them.
The court also noted that the accused tried to project the "tainted money as untainted" and gave it a "colour" of regular business transactions with the intent to conceal its true nature.
"The projection of tainted money as untainted was done by the accused persons/entities in two parts, firstly, when the money flowed from Dynamix Realty to KTV and again when the money flowed back from KTV to Dynamix Realty.
"For both the transactions, that is, giving the money to KTV and its subsequent return, the accused persons/entities gave it a colour of regular business transactions with the intent to conceal its true nature and to project the said tainted amount as untainted," it said.
It said that entities involved in the money transaction from DB group company to DMK-run Kalaignar TV through Kusegaon Fruits and Vegetables Pvt Ltd and Cineyug Films Pvt Ltd showed "knee jerk" reaction to return it after Raja was contacted by the CBI during the probe in the 2G spectrum allocation scam.
"The process of structuring of these dubious transactions for layering of the illegal gratification is a process to project the illicit money as untainted and is squarely covered under the provisions of section 3 of the Act. The knee jerk reaction shown by the entities involved in the return of this amount was triggered on the date when A Raja was contacted by the CBI for investigation," it observed.
"The investigation has brought out that the reverse flow of the funds occurred from the time A Raja was asked to join investigation and the completion of the flow coincided with the day of his arrest. Investigations under the (PML) Act has revealed how the illegal gratification of Rs 200 crore was mobilized by KTV in a short span of time since the amount received earlier had already been utilized," it said.
In the first case probed by the CBI, Raja, Kanimozhi, Shahid Balwa, Goenka, Asif Balwa, Rajiv Agarwal, Morani and Sharad Kumar, along with others, are facing trial for criminal breach of trust, conspiracy, forgery, cheating and other offences punishable under the provisions of the IPC and under the Prevention of Corruption Act.
The court, in its order, said that entire amount to the tune of Rs 223.55 crore was in fact the "proceeds of crime".
"The offence of money-laundering has been established by the investigation carried out under the (PML) Act against the accused persons named in the complaint and the proceeds of crime amounting to Rs 223.55 crore has been attached," it said.
Regarding Kanimozhi, the court noted that she "knowingly facilitated and was actually involved in the process of generation and layering of proceeds of crime and in projection of it as untainted property".
It noted that probe conducted by the agency has revealed that Raja was in contact with Kanimozhi and "pre-determined destination" of the illegal gratification of Rs 200 crore was KTV, in which Kanimozhi and Sharad Kumar were holding 20 per cent equity each respectively while Dayalu was having the rest 60 per cent.
"Kanimozhi allowed the pledging of her 20 per cent equity to Cineyug Films (P) Ltd, along with other two promoter shareholders of KTV in order to conceal the actual nature/ purpose of receipt of Rs 200 crore in KTV from Dynamix Realty through Cineyug Films (P) Ltd. The amount of Rs 200 crore was consumed by KTV in its business operations,in which P Amirtham had an important say," it said.
The court also noted that for passing on the illegal gratification of Rs 200 crore, Dynamix Realty transferred a sum of Rs 209.25 crore between 2008 to 2009 to Kusegaon Fruits and Vegetables (P) Ltd in tranches which transferred Rs 206.24 crore to Cineyug Films (P) Ltd which finally transferred Rs 200 crore to Kalaignar TV (P) Ltd.
"The dates on which the amounts were transferred from the starting point, that is, Dynamix Realty to the destination, that is, Kalaignar TV (P) Limited, are not only very proximate to each other but also demonstrate that financial transactions of varying amounts were carried out with the intention of transferring the illegal gratification to Kalaignar TV (P) Ltd, through intermediaries so as to make the transactions appear bonafide, which, in fact, were not," it observed.
It said that the refund of money by KTV was to project the earlier receipt of funds as bonafide business transactions so as to conceal the true nature of bribe money.
"Modus-operandi adopted by the accused entities was again the mode of inter-corporate deposits. Sequence flow of funds from one to other entity at the time of reverse flow of funds from KTV to Dynamix Realty corroborate that entire exercise done by the accused persons/entities is nothing but projection of proceeds of crime as untainted," it said.
The court also observed that for the transactions of more than Rs 200 crore between the entities, there was no "valid agreement" signed between any of the parties.
The court said that the money was returned with additional amount so as to project as if the loan was being returned along with interest.
It also said that at the stage of framing of charges, only a prima facie view was required to be taken and money laundering was a separate and independent offence.
It observed that ED has not filed the complaint in the case only on the basis of the material collected by the CBI during the probe.
"It is, thus, clear that the complaint has not been filed on the same material as fresh material was collected by ED also. Even if the complaint is filed on the same material, there is nothing wrong in that if an offence under the Act is disclosed by it," it said.
"In the complaint, role of each company has been explained in detail and the proceeds of crime have been traced to each one of them. The role of each company and accused individually associated with a company has been comprehensively explained and extracted above, both individually as well as in official capacity, and needs no repetition at this stage," it said.
Regarding the contentions of accused that there were no material against the firms which were chargesheeted by ED, the judge said that the facts revealed that all the accused were involved, in one way or the other, in the money transaction or was actually a party to it, directly or indirectly.
"The truth or falsehood of these allegations cannot be gone into and the same have to be taken at the face value at this stage. As such, it cannot be said that there is no material at all against these companies and the same have been implicated in this case without any reason," it noted.
If convicted, Raja and others will face a maximum sentence of upto seven years.
This is the second case in the 2G spectrum allocation scam in which Raja, Kanimozhi and others, including Swan Telecom promoters Shahid Usman Balwa and Vinod Goenka, will face trial for their alleged involvement in the scam.
The court today framed charges against 19 accused -- 10 individuals and nine companies -- under the provisions of the Prevention of Money Laundering Act (PMLA) and fixed the case for commencement of trial on November 11.
It said there was enough material on record which makes out a "prima facie" case against all the accused who were chargesheeted by the Enforcement Directorate on April 25, for committing an offence punishable under the PMLA.
"Accordingly, I find that there is enough material on record to make out or to presume a prima facie case against each accused for committing an offence of money-laundering as defined under section 3 and punishable under section 4 of the (PML) Act," Special CBI Judge O P Saini said.
Besides Raja, Kanimozhi and Dayalu Ammal, the individual co-accused in the case are Shahid Balwa, Vinod Goenka, Directors of Kusegaon Fruits and Vegetables Pvt Ltd Asif Balwa and Rajiv Agarwal, Kalaignar TV (KTV) MD Sharad Kumar and its Director P Amirtham and Bollywood producer Karim Morani. All of them are out on bail.
The court, in its 208-page order, said, "A Raja in connivance with M K Dayalu, K Kanimozhi and Sharad Kumar, was actually involved in parking the illegal gratification of Rs 200 crore received from Shahid U Balwa and Vinod K Goenka in KTV."
"He (Raja) was also actually involved in the process of refund of the proceeds of crime of Rs 223.55 crore in order to wriggle out of the charges of crime. Thus, Raja has committed the offence of money-laundering as defined under section 3 of the Act," it said.
The court also framed charges against the nine accused firms -- Swan Telecom Pvt Ltd (STPL), Kusegaon Realty Pvt Ltd (formerly known as Kusegaon Fruits and Vegetables Pvt Ltd), Cineyug Media and Entertainment Pvt Ltd (formerly known as Cineyug Films Pvt Ltd), Kalaignar TV Pvt Ltd, Dynamix Realty, Eversmile Construction Company Pvt Ltd, Conwood Constructions and Developers (P) Ltd, DB Realty Ltd and Nihar Constructions Pvt Ltd.
ED, in its charge sheet, had alleged that all the accused were involved in the Rs 200-crore money transaction which was not "bonafide" and "genuine" and it was a "bribe for grant of telecom licences to DB Group companies" by Raja.
As soon as the judge pronounced the order, he asked the accused as to whether they were pleading guilty to the offence or face trial.
To this, all the accused said that they will go for trial on charges against them.
While framing charges, the court observed that not only the roles of each accused were narrated in ED's complaint but there were "factual and credible allegations" against each of them.
The court also noted that the accused tried to project the "tainted money as untainted" and gave it a "colour" of regular business transactions with the intent to conceal its true nature.
"The projection of tainted money as untainted was done by the accused persons/entities in two parts, firstly, when the money flowed from Dynamix Realty to KTV and again when the money flowed back from KTV to Dynamix Realty.
"For both the transactions, that is, giving the money to KTV and its subsequent return, the accused persons/entities gave it a colour of regular business transactions with the intent to conceal its true nature and to project the said tainted amount as untainted," it said.
It said that entities involved in the money transaction from DB group company to DMK-run Kalaignar TV through Kusegaon Fruits and Vegetables Pvt Ltd and Cineyug Films Pvt Ltd showed "knee jerk" reaction to return it after Raja was contacted by the CBI during the probe in the 2G spectrum allocation scam.
"The process of structuring of these dubious transactions for layering of the illegal gratification is a process to project the illicit money as untainted and is squarely covered under the provisions of section 3 of the Act. The knee jerk reaction shown by the entities involved in the return of this amount was triggered on the date when A Raja was contacted by the CBI for investigation," it observed.
"The investigation has brought out that the reverse flow of the funds occurred from the time A Raja was asked to join investigation and the completion of the flow coincided with the day of his arrest. Investigations under the (PML) Act has revealed how the illegal gratification of Rs 200 crore was mobilized by KTV in a short span of time since the amount received earlier had already been utilized," it said.
In the first case probed by the CBI, Raja, Kanimozhi, Shahid Balwa, Goenka, Asif Balwa, Rajiv Agarwal, Morani and Sharad Kumar, along with others, are facing trial for criminal breach of trust, conspiracy, forgery, cheating and other offences punishable under the provisions of the IPC and under the Prevention of Corruption Act.
The court, in its order, said that entire amount to the tune of Rs 223.55 crore was in fact the "proceeds of crime".
"The offence of money-laundering has been established by the investigation carried out under the (PML) Act against the accused persons named in the complaint and the proceeds of crime amounting to Rs 223.55 crore has been attached," it said.
Regarding Kanimozhi, the court noted that she "knowingly facilitated and was actually involved in the process of generation and layering of proceeds of crime and in projection of it as untainted property".
It noted that probe conducted by the agency has revealed that Raja was in contact with Kanimozhi and "pre-determined destination" of the illegal gratification of Rs 200 crore was KTV, in which Kanimozhi and Sharad Kumar were holding 20 per cent equity each respectively while Dayalu was having the rest 60 per cent.
"Kanimozhi allowed the pledging of her 20 per cent equity to Cineyug Films (P) Ltd, along with other two promoter shareholders of KTV in order to conceal the actual nature/ purpose of receipt of Rs 200 crore in KTV from Dynamix Realty through Cineyug Films (P) Ltd. The amount of Rs 200 crore was consumed by KTV in its business operations,in which P Amirtham had an important say," it said.
The court also noted that for passing on the illegal gratification of Rs 200 crore, Dynamix Realty transferred a sum of Rs 209.25 crore between 2008 to 2009 to Kusegaon Fruits and Vegetables (P) Ltd in tranches which transferred Rs 206.24 crore to Cineyug Films (P) Ltd which finally transferred Rs 200 crore to Kalaignar TV (P) Ltd.
"The dates on which the amounts were transferred from the starting point, that is, Dynamix Realty to the destination, that is, Kalaignar TV (P) Limited, are not only very proximate to each other but also demonstrate that financial transactions of varying amounts were carried out with the intention of transferring the illegal gratification to Kalaignar TV (P) Ltd, through intermediaries so as to make the transactions appear bonafide, which, in fact, were not," it observed.
It said that the refund of money by KTV was to project the earlier receipt of funds as bonafide business transactions so as to conceal the true nature of bribe money.
"Modus-operandi adopted by the accused entities was again the mode of inter-corporate deposits. Sequence flow of funds from one to other entity at the time of reverse flow of funds from KTV to Dynamix Realty corroborate that entire exercise done by the accused persons/entities is nothing but projection of proceeds of crime as untainted," it said.
The court also observed that for the transactions of more than Rs 200 crore between the entities, there was no "valid agreement" signed between any of the parties.
The court said that the money was returned with additional amount so as to project as if the loan was being returned along with interest.
It also said that at the stage of framing of charges, only a prima facie view was required to be taken and money laundering was a separate and independent offence.
It observed that ED has not filed the complaint in the case only on the basis of the material collected by the CBI during the probe.
"It is, thus, clear that the complaint has not been filed on the same material as fresh material was collected by ED also. Even if the complaint is filed on the same material, there is nothing wrong in that if an offence under the Act is disclosed by it," it said.
"In the complaint, role of each company has been explained in detail and the proceeds of crime have been traced to each one of them. The role of each company and accused individually associated with a company has been comprehensively explained and extracted above, both individually as well as in official capacity, and needs no repetition at this stage," it said.
Regarding the contentions of accused that there were no material against the firms which were chargesheeted by ED, the judge said that the facts revealed that all the accused were involved, in one way or the other, in the money transaction or was actually a party to it, directly or indirectly.
"The truth or falsehood of these allegations cannot be gone into and the same have to be taken at the face value at this stage. As such, it cannot be said that there is no material at all against these companies and the same have been implicated in this case without any reason," it noted.
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