Chennai: Pointing out that money laundering poses a serious threat not only to the financial system, but also to country's integrity and sovereignty, the Madras high court has dismissed a bail petition from Farokh Irani, former Managing Director of First Leasing Company of India (FLCI), who was arrested in connection with a money laundering case involving Rs 273.99 crore, in which industrialist A.C. Muthiah is the prime accused.
Dismissing the petition, Justice S.Vaidyanathan said, "Since, charges have been framed under the special enactment, will prevail over the provisions of any other enactment, the undertaking given by the petitioner that he is willing to co-operate with the investigation, he will not flee away from this country as he is a permanent resident of Chennai, he is willing to surrender his passport and will not leave Tamil Nadu, cannot be considered for granting bail at this stage, as this court is of the view that custodial interrogation of the petitioner is very much required in this case".
The petitioner was arrested and remanded to judicial custody on June 14 this year for an alleged offence punishable under section 3 of Prevention of Money Laundering Act.
The case of Enforcement Directorate was that an FIR dated September 21, 2015 was registered for the proceeds of crime involving Rs 273.99 crore against seven accused persons and the petitioner, who was ex-managing director of FLCI was arrayed as accused-2. The assets of the company were inflated for obtaining loans from different banks and out of the loan amount, they paid income tax. The company was brought down for liquidation. The case was under investigation by different agencies like RBI, CBI and Enforcement Directorate.
Petitioner contended this case was only civil in nature and unmindful of his age (75), he has been arrested hurriedly for non-payment of loans.
Special government pleader appearing for ED submitted that the company was flouted by the petitioner and the books of accounts revealed several irregularities in the company. It was public money that has been siphoned off, he added.
Pointing out that investigation was on and the company had gone into liquidation, the judge said a huge sum belonging to the public had been siphoned off on account of redemption of provisions of money.
