Court finds lack of prima facie evidence against the SDPI leader, citing prolonged incarceration and constitutional rights
The Delhi High Court has granted bail to Moideen Kutty K, also known as M.K. Faizy, in a high-profile money laundering case linked to the Popular Front of India (PFI). The judgment, delivered by Justice Neena Bansal Krishna, emphasized the absence of concrete evidence to establish Faizy's involvement in money laundering activities under the Prevention of Money Laundering Act (PMLA), 2002.
Faizy, the National President of the Social Democratic Party of India (SDPI), was arrested on March 3, 2025, by the Enforcement Directorate (ED) based on allegations that he facilitated the acquisition and projection of funds as legitimate for unlawful activities. The ED's complaint hinged on Faizy's past association with the PFI, which was banned by the Indian government in 2022.
In the judgment, the Court noted that mere association with an organization or holding a leadership position, without specific evidence of personal involvement in money laundering, is insufficient to establish a prima facie case under Section 3 of the PMLA. The Court observed that Faizy's name surfaced for the first time in the 7th Supplementary Prosecution Complaint, despite multiple complaints filed since 2018, indicating a lack of substantive evidence against him.
The Court also highlighted the prolonged incarceration of Faizy, who has been in custody for over 11 months, as a significant factor in its decision. It underscored the constitutional mandate that personal liberty cannot be curtailed indefinitely without trial, aligning with the principle that "bail is the rule and jail is the exception."
Furthermore, the Court addressed the ED's arguments regarding Faizy's alleged fundraising activities and association with PFI. It concluded that there was no prima facie evidence linking the funds to any scheduled offence, thereby questioning the classification of those funds as "proceeds of crime."
The Court imposed specific bail conditions, including the submission of a personal bond, restriction on leaving the country, and prohibitions against tampering with evidence or contacting prosecution witnesses.
This decision, while granting bail, does not preclude further legal proceedings, as the Court clarified that its observations are solely for the purpose of the bail application and should not influence the trial's outcome.
Bottom Line:
Grant of Bail - Prevention of Money Laundering Act, 2002 - Applicant alleged to be involved in money laundering under Section 3 of PMLA - Mere association with an organization or holding a position without specific evidence of personal involvement in money laundering activities does not constitute an offence under Section 3 of PMLA.
Statutory provision(s): Section 3 of the PMLA, Section 45 of the PMLA, Section 439 of the Code of Criminal Procedure, 1973, Article 21 of the Constitution of India
Moideen Kutty K @ M. K. Faizy v. Directorate Of Enforcement, (Delhi) : Law Finder Doc id # 2853782
