Patna High Court
Bidyanand SinghversusThe Union of India through The Assistant Director, Directorate of Enforcement, Patna Zonal Office,
- Decided
- Disposal
- DISMISSED
- Bench
- ASHOK KUMAR PANDEY
Holding
The Court held that the petitioner was prima facie involved in concealment, possession and use of proceeds of crime and therefore bail could not be granted.
Summary
The Patna High Court considered the bail application of Mr. Bidyanand Singh, a lawyer accused under the Prevention of Money Laundering Act, 2002 (PMLA) for allegedly siphoning off compensation awarded to railway accident claimants and laundering the proceeds. The prosecution alleged that Singh, together with other advocates, opened bank accounts in the names of claimants, diverted large sums to their own and relatives' accounts, and concealed the transactions as professional fees. Singh contended that he merely received legitimate fees, that no complaint had been lodged against him, and that the amounts were disclosed in his income tax returns. The Enforcement Directorate relied on seized documents, bank statements, and statements of claimants and associates to demonstrate a systematic scheme of concealment and use of proceeds of crime. The Court examined the provisions of Section 3 (offence of money laundering) and Section 45 (non‑bailable nature) of the PMLA, as well as relevant Supreme Court and High Court precedents. Concluding that the material prima facie established Singh’s involvement in concealment, possession and use of proceeds of crime, the Court refused bail, directing the trial court to expedite the trial.
Issues considered
- Whether the alleged conduct of the petitioner constitutes money laundering under Section 3 of the Prevention of Money Laundering Act, 2002.
- Whether bail can be granted in a non‑bailable offence under Section 45 of the PMLA in view of the facts and material placed on record.
Legislation cited
- Indian Penal Code — s. 120-B, 420
- Prevention of Corruption Act — s. 7A
- Prevention of Money Laundering Act, 2002 — s. 3, 4, 45, 46
Subjects
- money laundering
- PMLA
- bail
- railway claims fraud
- proceeds of crime
- scheduled offence
- concealment
- possession
- use
- legal profession
Judgment
IN THE HIGH COURT OF JUDICATURE AT PATNA
CRIMINAL MISCELLANEOUS No.54140 of 2025
Arising Out of PS. Case No.-8 Year-2023 Thana- E.C.I.R (GOVERNMENT OFFICIAL)
District- Patna
======================================================
Bidyanand Singh S/o Late Jagdeo Prasad Singh R/o Mohalla, House No.11,
Adarsh Vihar Colony Road No.1, Ram Krishna Nagar, New Jaganpura, P.S.-
Ram Krishna Nagar, Distt.- Patna
... ... Petitioner/s
Versus
The Union of India through The Assistant Director, Directorate of
Enforcement, Patna Zonal Office, Bihar
... ... Opposite Party/s
======================================================
Appearance :
For the Petitioner/s : Mr. N.K. Agrawal, Sr. Advocate
Mr. Kaushal Kishor, Advocate
Ms. Jyoti Kumari, Advocate
Mr. Kumar Rajdeep, Advocate
Mr. Saroj Kumar Choudhary, Advocate
For the E.D. : Mr. Tuhin Shankar, Advocate
======================================================
CORAM: HONOURABLE MR. JUSTICE ASHOK KUMAR PANDEY
CAV ORDER
7 29-01-2026 Heard learned counsel for the petitioner and the
learned counsel for the Directorate of Enforcement.
2. The petitioner has prayed for bail in connection
with Special Trial (PMLA) Case No. 04 of 2025 arising out of
ECIR No- PTZO/08/2023 registered for the offence punishable
under Sections 3 and 4 of the Prevention of Money Laundering
Act, 2002.
3. The prosecution case in brief is that E.D.
Investigation under PMLA has been initiated by recording a
ECIR/PTZO/08/2023 dated 23.01.2023. Two FIRs
(RC0232020A0002 dated 30.01.2020 & RC0232020A0003
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dated 30.01.2020) have been lodged by CBI, ACB, Patna
regarding mass scale irregularity/criminality in the death claim
cases filed, processed and decided at Railway Claims Tribunal,
Patna (RCT) against unknown public servants of Railway, the
petitioner and others under Section 120-B, 420 of the IPC and
Section 7A of PC Act. As per the FIRs, during the period 2015
to 2017, unknown public servants of Railway conspired with
claimant’s advocates Kumari Rinki Sinha, the petitioner and
their team. In pursuance of the said criminal conspiracy, in
accidental death claim cases, only a part of the decreed amount,
actually awarded to the claimants, was received by the claimants
and major chunk was siphoned off by the conspiratos.
Altogether 2436 decree cases out of 2636 cases, were disposed
during the tenure of single member bench of Shri. R.K.Mittal,
Hon’ble member judicial, RCT, Patna In 18 months with
average of 135 decree approx per month, whereas prior to that
this average was around 56 between April, 2014 to September
2015. In these orders issued by Shri R.K. Mittal it was directed
that the applicant would sumbit details of bank account duly
verified by the conducting lawyer. Accordingly, in pursuance of
the said criminal conspiracy said advocates and their team
advocates opened new bank accounts for payment of
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compensation. Bank accounts of these claimants were either
opened in PNB, Hilsa Branch; PNB, Mali Branch; PNB,
Phulwarisharif Branch; Allahabad Bank, Patrakar Nagar Branch
and Madhya Bihar Gramin Bank, Lalganj Nalanda Branch
where the branch Managers were known to the petitioner and
their team advocates. The account opening forms withdrawal
slips, KYC documents etc. were got signed by the applicants as
per the instructions from conducting advocates. These
documents were opened in absence of the account holders.
4. As per the mandate, the decretal amount was
credited in respective bank accounts of the claimants. In most of
the cases, the claimants were aware of the new bank accounts in
which the decretal amount was credited. After credit of the
decreed amount, a major part of the compensation was
transferred to the bank account of advocates or their close
relatives. On later date, a part of the compensation was given by
the advocates to the claimants as per their sweet will and
convenience.
5. During the course of investigation under PMLA,
2002, information regarding the decrees and execution orders
issued by Shri R.K. Mittal, the then Member (Judicial), RCT,
Patna was called from General Manager (Vigilance.), East
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Central Railway. The information of total 2030 claims of
decrees/execution orders were issued by Shri R.K. Mittal from
2015 to 2017, was received from General Manager (vig.) vide
letter no. ECR/Vig./V-1/RCT/Claim/Misc/214 dated 18.09.2024.
From the analysis of this information, it is revealed that out of
these 2030 claims of decrees/execution orders were issued by
Shri R.K. Mittal, approximately 960 claims have been dealt by
the above mentioned advocates Bidyanand Singh, Kumari Rinki
Sinha, Rajeev Kumar, Bharat Kumar Gupta, and Parmanand
Sinha wherein approximately Rs. 50 crore compensation was
awarded to the claimants and later substantial part of the same
has been fraudulently siphoned off by above- mentioned
advocates transferring the same to their family member’s bank
account or withdrawing in cash without the knowledge of the
claimants.
6. Learned counsel for the petitioner has submitted
that the petitioner is a bona fide lawyer and doing various types
of cases at R.C.T. Patna and other Courts including the Patna
High Court. The petitioner has committed no offence as alleged
in the complaint and has been falsely implicated in this case
without any basis. The petitioner never used to talk directly with
the client rather it was petitioner’s junior and clerk who used to
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conduct client dealing in which petitioner has no role, despite
that, the petitioner has been made accused in the case. Initially,
the CBI conducted investigation from the angle of corruption
and an inquiry was also held against Shri R.K. Mittal, Member
(Judicial), RCT, Patna in which the petitioner was called as
witness to depose in the said inquiry. The petitioner has only
charged a fee to any claimant for handling his case. No other
amount has been received by the petitioner from them. The bank
account was opened as per the convenience and consent of the
claimant. There was no response of any kind from the petitioner.
No fake document of any kind was used by the petitioner in
opening the bank account. All the documents were of the client
and the client himself was present.
7. It has further been submitted that no written
complaint or objection of any kind has been made anywhere
against the petitioner. All the money that has been received by
the petitioner is private money and part of the fee, as agreed by
the claimants prior to filling of the claims. In fact, the petitioner
has filed audited income tax returns and fully disclosed his
income to the tax authorities. No illegal transaction has taken
place at all and no case of cheating is made out against the
petitioner. The CBI has itself admitted that the amounts received
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by the petitioner is professional fee but they have on their own
accord chosen to consider only a part of it as a genuine receipt
and the remaining amount has been considered to be arising out
of cheating. Thus, the money cannot be considered to be
proceeds of crime. On these grounds, prays to grant bail.
8. As against this, the learned counsel for the Directorate
of Enforcement, Mr. Tuhin Shankar has vehemently opposed the
prayer for bail of the petitioner and submitted that based on the
material and information available with Directorate searches
were carried out under Section 17 of PMLA, 2002 on
22.01.2025 at the premises of Bidyanand Singh (the petitioner)
at Patna, Bihar. During the course of search, blank signed pages,
passport photographs, passbooks of various persons were
recovered from his premises. This proves the modus operandi
used by these advocates to siphon off the compensation amount
by using signatures and banking documents/instruments of the
claimants. During search, his statement was recorded under
Section 17 of the PMLA wherein he could not explain the
reason why the claimant bank account was opened and operated
by him or his team members. He gave evasive answers to the
questions asked regarding these claim cases.
9. During the course of investigation, out of these
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approximately 960 claims, Bank account statements of 924 bank
accounts of claimants were obtained from the concerned banks.
From the analysis of these bank accounts, it is revealed that in
most of the cases, the amount credited as a compensation from
the Railway was transferred to Bank Accounts of the petitioner
and Associates, Parmanand Sinha, Archana Sinha, Vijay Kumar
and other related persons. In some other cases, the
compensation amount has been withdrawn in cash. During the
course of investigation, statement of 45 Claimants have been
recorded under Section 50 of PMLA, 2002. Claimants have
stated in their statement that after the death of their family
members in railway accident, Bidyanand Singh, Vijay Kumar or
Parmand Sinha approached them for filing their claim in the
Railway Claims Tribunal. These advocates and their staffs asked
them to visit the office, were made to put their signatures on the
number of papers including banking instruments and blank
papers. Claimants were never informed about the exact amount
of claim that they would be getting. These advocates and their
staff opened bank accounts in the name of these Claimants
without their knowledge. Claimants were unaware of these
Bank Accounts. Claimants stated that the documents on which
Bidyanand Singh and his staff had initially taken their signature
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at his office must have been used to open these bank accounts
without their knowledge. They also stated that they were
unaware of the claim amount credited in their bank accounts.
Some of them received meagre money from these advocates as
compensation amount. Some of them received this meagre
amount only after the initiation of investigation by CBI
regarding this fraud.
10. Further, during the course of investigation, bank
accounts of Bidyanad Singh (the petitioner) were analysed and
the relevant transactions were confronted by him during his
statement dated 03.02.2025 and 04.02.2025 recorded under
Section 50 of the PMLA. He stated that the amount directly
transferred to his account from claimant’s account, is his fees.
He also stated that the amount deposited in cash in his bank
account is fees amount deposited in his account as fees from the
claimants. During the course of investigation, bank accounts of
Bidyanand Singh and Associates were analysed and the relevant
transactions were confronted by Bidyanand Singh during his
statement dated 04.02.2025 recorded under Section 50 of the
PMLA. He stated that the amount directly transferred to his
account from claimant’s accounts, is his fees. From the analysis
of these bank accounts, it is clear that huge amount of
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compensation is transferred fraudulently in the bank accounts of
advocates and their relatives from the bank accounts of
claimants without their knowledge in the name of fees. It is also
clear that the amount which has been withdrawal fraudulently in
cash from the bank account of the claimants was later deposited
in the bank accounts of advocates and their relatives in the name
of fees. It is clear that the amount which has been withdrawn
fraudulently in cash from the bank account of claimants was
later deposited in the bank accounts of advocates and their
relatives in the name of fees.
11. From the bank analysis of the said accounts, it is
also revealed that the petitioner transferred huge amounts to his
team members Parmanand Singh, Archana Singh, Vijay Kumar
and Nirmala Kumari and huge amount was credited back to the
account of the petitioner. These amounts are nothing but the
settlements between them carried out to adjust their share of
siphoned off amounts from claimants account. Statements of
Parmanand Sinha were recorded under Section 50 of the PMLA
Act, 2002, wherein he stated that all financial decisions,
including transfers, were made under the direction of Bidyanand
Singh. He confirmed multiple bank transactions between his
accounts and those of claimants. He refuted Bidyanand Singh’s
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statement, which claimed that Parmanand Sinha and Vijay
Kumar handled all financial transactions. He stated that he was
merely an employee and did not make independent financial
decisions. He confirmed that claimant accounts were used
without their knowledge in spite of that instruction came from
Bidyanand Singh.
12. Likewise, the statement of Vijay Kumar was
recorded under Section 50 of the PMLA Act who has also stated
that claimants were unaware of the exact compensation amount
or the fees retained by Bidyanand Singh. He confirmed that
some amounts were withdrawn in cash and handed over to
Bidyanand Singh’s office for disbursement to claimants.
13. Sudhir Kumar, former Branch Manager of Canara
Bank, Mithapur, has also given his statement recorded under
Section 50 of PMLA and has stated that the petitioner, a lawyer
handling railway claims, opened around 30-40 bank accounts
for claims with himself or Vijay Kumar as the introducer. Most
claimants never visited the bank, and withdrawals were made
without their knowledge using pre-signed cheques or
withdrawal forms. Bidyanand Singh and his associates
frequently visited the bank and facilitated transactions.
14. During the course of search, action conducted by
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Directorate on 22.01.2025 at the premises of Vijay Kumar, files
containing documents related to Railway Claims Tribunal
claims were seized under the provisions of PMLA, 2002. In the
said file, handwritten account of money received by one
claimant Sundari Devi is written wherein it is mentioned that
Sundari Devi and her sons received Rs. 4,70,300/- as
compensation amount from railways. Out of this, Rs. 2,30,000/-
was given to client (Sundari Devi) and remaining Rs. 2,35,300/-
(excluding Rs. 5,000/-) was distributed between Bidyanand
Singh and Vijay Kumar in the proportion of 65-35. A cheque of
Rs. 2,00,000/- in the name of Sundari Devi from the bank
account of Rinki Sinha is also found in the file. Vijay Kumar in
his statement recorded under Section 50 of the PMLA, 2002
stated that the claimants had received a total of Rs. 4,70,300/- as
compensation from RCT, out of which, as per the instructions of
Bidyanand Singh (the petitioner), Rs. 2,30,000/- was given to
the claimants. From this amount, Rs. 2,00,000/- was transferred
to Sundari Devi’s Punjab National Bank account through
Cheque from Kumari Rinki Sinha’s Punjab National Bank
account and Rs. 30,000/- was given in cash. Out of the
remaining Rs. 2,40,300/-, after deducting Rs. 5,000/- from a
previous account, Rs. 2,35,000/- remained. 35% of this amount
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i.e., Rs. 82,355/- was given to Vijay Kumar by Bidyanand Singh
and remaining amount was kept by Bidyanand Singh. During
the search conducted at the residential premises of Vijay Kumar,
a blue color diary was seized. In this diary, it was found that the
amount siphoned off from the bank accounts of claimants was
distributed between Vijay Kumar and Bidyanand Singh in the
proportion of 35% and 65% respectively. Therefore, Bidyanand
Singh along with Parmanand Singh received 65% of the amount
siphoned off from the claimants which amounts to Rs. 6.67
Crore which is nothing but the part of proceeds of crime. As
such, it has been submitted that Bidyanand Singh was involved
in defrauding the claimants and the government. He generated
proceeds of crime and was involved in layering and laundering
of the same. Thus, he is found to be directly involved in
concealing the proceeds of crime generated from the activities
related with the scheduled offence, hence, he is guilty of money
laundering.
15. Learned counsel for the ED has placed reliance on
the judgments passed in the case of Tarun Kumar vs. Assistant
Directorate of Enforcement and the judgments passed by the
learned coordinate Bench of this court in Cr. Misc. Nos. 47285
of 2025 and 63110 of 2025 respectively.
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16. Before considering the merit of the allegations
made against the petitioner, I would like to refer Section 3 of the
PMLA.
17. Section 3 of the PMLA which pertains to the
offence of money laundering reads as under:-
“3. Offence of money-laundering. -
Whosoever directly or indirectly
attempts to indulge or knowingly
assists or knowingly is a party or is
actually involved in any process or
activity connected with the proceeds of
crime including its concealment,
possession, acquisition or use and
projecting or claiming it as untainted
property shall be guilty of offence of
money-laundering.
Explanation. -For the removal of
doubts, it is hereby clarified that,
(i) a person shall be guilty of offence of
money-laundering if such person is
found to have directly or indirectly
attempted to indulge or knowingly
assisted or knowingly is a party or is
actually involved in one or more of the
following processes or activities
connected with proceeds of crime,
namely: -
(a) concealment; or
(b) possession; or
(c) acquisition; or
(d) use; or
(e) projecting as untainted property; or
Patna High Court CR. MISC. No.54140 of 2025(7) dt.29-01-2026
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(f) claiming as untainted property,
in any manner whatsoever;
(ii) the process or activity connected
with proceeds of crime is a continuing
activity and continues till such time a
person is directly or indirectly enjoying
the proceeds of crime by its
concealment or possession or
acquisition or use or projecting it as
untainted property or claiming it as
untainted property in any manner
whatsoever."
18. Section 45 of the said Act being relevant for the
purposes of disposing of this bail application is reproduced
hereunder for ready reference:-
"45. Offences to be cognizable and
non-bailable.- (1) Notwithstanding
anything contained in the Code of
Criminal Procedure, 1973 (2 of 1974),
no person accused of an offence [under
this Act] shall be released on bail or on
his own bond unless
(i) the Public Prosecutor has been given
an opportunity to oppose the
application for such release; and
(ii) where the Public Prosecutor
opposes the application, the court is
satisfied that there are reasonable
grounds for believing that he is not
guilty of such offence and that he is not
likely to commit any offence while on
bail:
Provided that a person, who, is under
Patna High Court CR. MISC. No.54140 of 2025(7) dt.29-01-2026
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the age of sixteen years, or is a woman
or is sick or infirm, or is accused either
on his own or along with other co-
accused of money-laundering a sum of
less than one crore rupees may be
released on bail, if the Special Court so
directs:
Provided further that the Special Court
shall not take cognizance of any offence
punishable undersection 4 except upon
a complaint in writing made by-
(i) the Director; or
(ii) any officer of the Central
Government or a State Government
authorised in writing in this behalf by
the Central Government by a general or
special order made in this behalf by that
Government.
(1A) Notwithstanding anything
contained in the Code of Criminal
Procedure, 1973 (2 of 1974), or any
other provision of this Act, no police
officer shall investigate into an offence
under this Act unless specifically
authorised, by the Central Government
by a general or special order, and,
subject to such conditions as may be
prescribed.
(2) The limitation on granting of bail
specified in sub-section (1) is in
addition to the limitations under the
Code of Criminal Procedure, 1973 (2 of
1974) or any other law for the time
being in force on granting of bail.
Explanation. -For the removal of
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doubts, it is clarified that the expression
"Offences to be cognizable and non-
bailable" shall mean and shall be
deemed to have always meant that all
offences under this Act shall be
cognizable offences and non-bailable
offences notwithstanding anything to
the contrary contained in the Code of
Criminal Procedure, 1973 (2 of 1974),
and accordingly the officers authorised
under this Act are empowered to arrest
an accused without warrant, subject to
the fulfillment of conditions under
section 19 and subject to the conditions
enshrined under this section.”
19. In the case of Vijay Madan Lal Choudhary &
Others vs. Union of India reported in 2022 SCC Online SC
Page 929. A three judge bench of the Apex Court has considered
a provisions of PMLA in detail.
20. After considering the submissions of the learned
counsel for the parties, with regard to the interpretation of
Section 3 of the said Act, it was held therein as under:-
"269. From the bare language of
Section 3 of the 2002 Act, it is amply
clear that the offence of money-
laundering is an independent offence
regarding the process or activity
connected with the proceeds of crime
which had been derived or obtained as
a result of criminal activity relating to
or in relation to a scheduled offence.
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The process or activity can be in any
form be it one of concealment,
possession, acquisition, use of proceeds
of crime as much as projecting it as
untainted property or claiming it to be
so. Thus, involvement in any one of such
process or activity connected with the
proceeds of crime would constitute
offence of money-laundering. This
offence otherwise has nothing to do
with the criminal activity relating to a
scheduled offence except the proceeds
of crime derived or obtained as a result
of that crime.
270. Needless to mention that such
process or activity can be indulged in
only after the property is derived or
obtained as a result of criminal activity
(a scheduled offence). It would be an
offence of money-laundering to indulge
in or to assist or being party to the
process or activity connected with the
proceeds of crime; and such process or
activity in a given fact situation may be
a continuing offence, irrespective of the
date and time of commission of the
scheduled offence. In other words, the
criminal activity may have been
committed before the same had been
notified as scheduled offence for the
purpose of the 2002 Act, but if a person
has indulged in or continues to indulge
directly or indirectly in dealing with
proceeds of crime, derived or obtained
from such criminal activity even after it
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has been notified as scheduled offence,
may be liable to be prosecuted for
offence of money-laundering under the
2002 Act-for continuing to possess or
conceal the proceeds of crime (fully or
in part) or retaining possession thereof
or uses it in trenches until fully
exhausted. The offence of money-
laundering is not dependent on or
linked to the date on which the
scheduled offence or if we may say so
the predicate offence has been
committed. The relevant date is the date
on which the person indulges in the
process or activity connected with such
proceeds of crime. These ingredients
are intrinsic in the original provision
(Section 3, as amended until 2013 and
were in force till 31.7.2019); and the
same has been merely explained and
clarified by way of Explanation vide
Finance (No. 2) Act, 2019. Thus
understood, inclusion of Clause (ii) in
Explanation inserted in 2019 is of no
consequence as it does not alter or
enlarge the scope of Section 3 at all.”
21. Now coming back to the facts of this case. In this
case, there is allegation and material against the petitioner that
he has siphoned off Rs. 6.67 crore being the decretal amount of
the claimants by defrauding them. Considering the above facts
and circumstances of the case and prima facie reading of the
material placed on record and considering the parameters of
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Section 46 of PMLA as well as gravity of the offence, it appears
that the petitioner is involved in the alleged concealment
possession and using the properties acquired out of proceeds of
crime and projected the same as untainted, as such, this Court is
not inclined to grant bail to the petitioner, accordingly the
prayer for bail of the petitioner is hereby rejected.
22. The learned trial court is directed to expedite the
trial and conclude the same as soon as possible.
23. If the trial is not concluded within a period of six
months from the date of receipt/production of the order, the
petitioner will be at liberty to renew his prayer for bail in the
court below itself.
24. However, the above observations are only
tentative and only for the purpose of disposal of the bail
application.
(Ashok Kumar Pandey, J)
Sudhanshu/-
AFR/NAFR NAFR
CAV DATE 08.01.2026
Uploading Date 29.01.2026
Transmission Date 29.01.2026
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