Panchayati Justice: SC’s Reasons to Deny Sisodia Bail Make No Sense At All

The court finds one instance of a prima facie case against him, but it is hardly the most convincing charge.

Manish Sisodia.

(Photo: PTI)

There’s a Kannada proverb that goes paayasa maadi naayi baala addodu which translates loosely into “making ‘kheer’/’payasam’ and then dipping a dog’s tail in it”.

It’s supposed to convey that good work was completely ruined by one last mistake. This idiom came to mind when I read the Supreme Court (SC) order denying bail to Manish Sisodia.

The first three quarters of the judgment are carefully reasoned and cogent. Reading the analysis one could conclude (as the court partially does) that there is no ground to deny bail to Sisodia.

However, in the next 10 pages of the order, a completely bizarre conclusion is arrived at to deny Sisodia bail – one which has little relation to the facts or the law in the case.

In this article, I’ll try and explain why the SC’s reasons for denying bail to Sisodia make no sense at all.

Why the SC Thought Bail Should Be Granted

The PMLA mandates that bail in money laundering cases can only be granted if a judge is satisfied that there is a good chance that the accused has not committed an offence. Courts are forced to go deep into facts and law before deciding even basic bail petitions. Though intended to make bail harder in money laundering cases, this sometimes backfires when the weaknesses in the case get exposed at such an early stage.

If you followed the hearings in the Sisodia case in the SC, you would find that the oral observations of the court are reflected in the first part of the order. The charge against Sisodia is somewhat similar to the one made against A Raja and others in the context of the 2G spectrum scam. Here, the crime relates to the changes in the Delhi excise policy which the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) argue were made to favour certain liquor wholesalers in return for payments being made to the Aam Aadmi Party (AAP).

Three specific charges against Sisodia were found to be somewhat unfounded by the court.

First, the court finds no basis for the claim that Sisodia received Rs 2.20 crore as part of the conspiracy to change the excise policy. The ED’s claim that this payment was received was made on the basis of a statement made by an approver, Dinesh Arora, is disregarded by the court. The CBI’s own chargesheet in the case makes no mention of this in the first place.

Second, unless the AAP itself was made an accused in the case by the ED for receiving money, Sisodia as its functionary could not be made an accused unless some specific role is attributed to him in the receipt of the money. This could change with Delhi Chief Minister Arvind Kejriwal being summoned by the ED on 2nd November, but as it stands, the ED still hasn’t made the AAP an accused.

Third, the court dismissed the ED’s somewhat stretched interpretation of the law that even being involved in the “generation” of “proceeds of crime” would be an offence under the PMLA. While possessing or passing off “proceeds of crime” would be an offence under the PMLA, this new theory of the ED was untested and it could hardly be said to have made out a prima facie case against Sisodia.

However, the court does find there is one instance of a prima facie case against Sisodia, but as I explain in the next part, it is hardly the most convincing charge against him.

Why the SC Thought Bail Should Be Denied

Even while finding that there’s no money trail leading to Sisodia, the SC still denies him bail on a somewhat strange and inexplicable basis. The SC holds that the profits made by the wholesale distributors during the ten months of the new excise policy (about Rs 338 crores) would be “proceeds of crime” as a result of corruption and therefore would be enough to keep Sisodia behind bars. This is convoluted logic and one which is not borne out by the facts or the law.

In fact, the court notes that this amount is the profit made by all the wholesale distributors as a result of the change in the policy and not just those who are accused of having bribed the government to make the change in policy.

Here’s where the court’s logic breaks down - if these are the proceeds of crime, ED should have made all wholesale distributors accused and not just a few of them. The fact that they are in possession of proceeds of crime would automatically make them an accused under the PMLA but the ED doesn’t think so. It would also be a huge stretch to say Sisodia is in some way in possession of these “proceeds of crime”.

Legally also, this finding makes no sense. Sections 7, 7A, 8, and 10 of the Prevention of Corruption Act, 1988 all explicitly require the payment of a bribe of some sort to a public servant directly or indirectly to constitute an offence.

The court makes no positive finding on this front - it can’t since it has already found that there is little evidence of a money trail here. Instead, the court assumes that the profits earned are illegal because they caused a loss to the exchequer and therefore Sisodia has committed an offence. Making a decision that caused a loss to the exchequer and undue benefit to someone was an offence under the un-amended Section 13(1)(d)(iii) of the PoCA but is no longer one after the amendment in 2018.

In effect, everything it said in the previous part of the order for the grant of bail – of the weak evidence, lack of a link to Sisodia, and the stretched legal interpretation – the court directly contradicts when it comes to denying bail.

Conclusion: Panchayati Justice

The SC’s eventual order is just as bafflingly contradictory.

On the one hand, it notes that there’s a prima facie case and no bail can be given to Sisodia. On the other, it notes that no one can be kept in jail indefinitely pending trial. On the one hand, the court notes that over 450 witnesses need to be examined, and over 50,000 documents need to be entered as evidence, by the CBI and the ED cumulatively.

On the other hand, it accepts at face value that all of this will be done in six months. On the one hand, the court notes that an under trial cannot be kept in jail for no fault of theirs. And then, the court takes no note of the fact that even charges haven’t been framed in this case because the ED went to the Delhi HC to stop framing charges!

Somehow all of this leads the court to conclude that Sisodia should stay in jail for another three months before taking another shot at getting bail - unless his or his wife’s health requires that he be given bail.

This part of the order sounds less like a judgment of a court on facts and law and more like the verdict of a panchayat trying to do right by all parties.

While such an approach may make sense in a civil dispute to give an end to the matter in everyone’s interests, here it comes off as a shoddy balancing act that is neither informed by rights jurisprudence nor the need to ensure a fair trial. It’s a sorry way to end an order that begins with lofty invocations of the rule of law and civil liberty.

(Alok Prasanna Kumar is a Senior Resident Fellow at the Vidhi Centre for Legal Policy in Bengaluru. He is also a member of the Executive Committee of the Campaign for Judicial Accountability and Reforms. This is an opinion piece, and the views expressed are the author’s own. The Quint neither endorses nor is responsible for them.)