[BREAKING] SC Grants Bail To Ex-TN Minister V. Senthil Balaji In Money Laundering Case

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A Supreme Court bench consisting of Justice Abhay Oka and Justice Augustine George Masih had reserved its judgment on August 12, 2024, while expressing concerns about the delay in the trial process.

[BREAKING] SC Grants Bail to Ex-TN Minister V. Senthil Balaji in Money Laundering Case

NEW DELHI: Today (26th Sept) The Supreme Court today (September 26) allowed the bail plea of former Tamil Nadu Minister Senthil Balaji in the money laundering case arising out of the cash for jobs allegations.

A Supreme Court bench consisting of Justice Abhay Oka and Justice Augustine George Masih had reserved its judgment on August 12, 2024, while expressing concerns about the delay in the trial process.

“The Court stated, ‘We have granted bail with certain stringent conditions imposed.’

During the hearings, the Bench questioned the Enforcement Directorate (ED) on whether the trial against Senthil Balaji would commence soon.

Senior Advocates Mukul Rohatgi and Sidharth Luthra represented Balaji, while Solicitor General Tushar Mehta and special counsel Zoheb Hossain appeared for the ED.

Balaji sought bail from the Supreme Court after the Madras High Court rejected his bail plea on February 28.

The case in question involves Senthil Balaji, a former Tamil Nadu minister and current MLA, who faces accusations of money laundering related to a cash-for-jobs scam that occurred during his tenure as the state’s Transport Minister from 2011 to 2016.

Senthil Balaji’s arrest in June 2023 by the Enforcement Directorate (ED) under the Prevention of Money Laundering Act, 2002 (PMLA), followed allegations that he, along with his personal assistants and brother, orchestrated a scheme to collect money from job seekers in exchange for job promises within the Tamil Nadu Transport Department.

Several candidates, who had paid substantial sums for the jobs, filed complaints after not securing employment. This led to the ED registering an Enforcement Case Information Report (ECIR) and taking action, resulting in Balaji’s arrest.

“Balaji has challenged the denial of bail by the Madras High Court before the Supreme Court.”

Represented by Senior Advocates Mukul Rohatgi and Sidharth Luthra, Balaji argued in the Supreme Court that deposits totaling Rs. 1.34 crore in his bank account between 2013 and 2021 were from his agricultural income and his salary as an MLA.

Rohatgi emphasized that

“the prosecution has overlooked these legitimate sources of income and wrongly attributed them to the alleged scam.”

Further, the defense criticized the manner in which the investigating agencies conducted their search and seizure operations.

Rohatgi highlighted specific discrepancies related to hard disk evidence, pointing out that

“while a Seagate hard disk was mentioned in court proceedings, an HP hard disk was actually recovered.”

This discrepancy, according to the defense, undermined the credibility of the evidence presented by the prosecution. Additionally, he argued that no incriminating files, including one named “CSAC” that allegedly detailed Rs. 67 crores from the scam, were found in the seized pen drive and hard disk.

The defense also brought attention to Balaji’s prolonged detention.

Rohatgi stated that “Balaji has been arrested for over 13 months” and that he underwent coronary bypass surgery while in custody. This, along with the prolonged delay in the trial’s commencement, was cited as grounds for granting bail under Section 45 of the PMLA, which provides for bail in exceptional circumstances, such as illness.

In response, the Enforcement Directorate, represented by Solicitor General Tushar Mehta and Advocate Zoheb Hossain, dismissed Balaji’s defense. The ED maintained that the Rs. 1.34 crore in cash deposits were not linked to his MLA salary or agricultural income.

They argued that MLA salaries are typically deposited directly into bank accounts, and that Balaji’s declared income in his election affidavits did not align with the amounts he now claimed as agricultural income.

The ED refuted the legitimacy of these claims, asserting that the discrepancies were a clear indication of illicit financial activity.

The ED further argued that an incriminating file, “csac.xlsx,” detailing the money collected from the scam, was found on a pen drive recovered from Balaji’s residence.

In addition to the pen drive, the ED presented “documents and emails implicating Balaji, including files found on his computer showing the detailed management of the alleged scam.”

Moreover, the ED raised concerns about Balaji’s continued influence, noting that “the state of Tamil Nadu is helping the accused and ensuring that the trial in the predicate offense is not likely to conclude.” The ED also contended that Balaji was compromising witnesses and victims in the predicate offense, making it difficult to proceed with the case fairly.

Previously, the Madras High Court had rejected Balaji’s bail plea, citing a lack of merits in his arguments. The court observed that the ED’s investigation was based on documents already present in the predicate offense, and there was no basis to suspect tampering with the evidence. The High Court had also directed the Special Court to expedite the trial process, taking into consideration “Balaji’s long incarceration.”

During the hearings, the Supreme Court raised several pertinent questions, particularly regarding the “feasibility of proceeding with the PMLA trial without the completion of the trial in the predicate offense,” which involves over two thousand accused individuals.

Additionally, the court pressed the ED to provide concrete proof of whether the incriminating file “CSAC” was indeed recovered from the pen drive seized at Balaji’s residence, as the defense had repeatedly challenged this claim.

As the bench of Justice Abhay Oka and Justice Augustine George Masih continued to deliberate, the final judgment is keenly awaited, as it will significantly impact the course of Balaji’s case.