Businessman Sathish Sana evasive in statements, ED tells HC

New Delhi, Nov 28 (PTI) The Enforcement Directorate (ED) has claimed in the Delhi High Court that businessman Sathish Babu Sana, facing prosecution in a money laundering case allegedly involving meat exporter Moin Qureshi, was evasive in his statements.

The probe agency said Sana was unable to justify a payment of Rs l.5 crore made to main accused, Qureshi, as a bona fide business expense and thus custodial interrogation was required.

The ED filed its affidavit in response to a petition by Sana seeking quashing of the money laundering case.

Sana, a Hyderabad-based businessman, was arrested by the ED and later granted bail by a trial court in a case relating to purported purchase of shares worth Rs 50 lakh of a company linked to Qureshi.

A bench of Chief Justice D N Patel and C Hari Shankar listed the matter for further hearing on January 28 next year.

As an interim relief, the court had on October 14 stayed the summons issued to him.

The ED, in its affidavit filed through central government standing counsel Amit Mahajan, said: 'The present investigation under the Prevention of Money Laundering Act, is ongoing and is distinct from that conducted from the CBI. Further the statements of the accused (Sana) recorded were found to be evasive.

'The petitioner was unable to justify a payment of Rs 1.5 crore made to the main accused as a bona fide business expense and thus custodial interrogation was required. The Petitioner was arrested in accordance to the mandate of Section 19 and by no stretch of imagination have the actions been violative of the mandate of the Constitution.' The probe agency said the investigation in respect of source of these funds which are nothing but proceeds of crime is still underway.

'Its backward acquisition, manner of transfer and subsequent utilisation thereof is being investigated so that the entire trail of the proceeds of crime can be unearthed,' it said.

Sana, in his plea, has also sought quashing of summons issued by the ED under section 50 of the Prevention of Money Laundering Act (PMLA) on July 18 and 25, alleging them to be illegal and violative of the provision of Indian Evidence Act and the Constitution.

The petition, filed through advocates Mohd Wasay khan and Shaikh Bakhtiyar, said earlier that Sana was named as a witness in the case and appearing before the ED in pursuance to the summons, he was arrested on July 26 on the ground that there were contradictions in his statements.

The ED's case was lodged on the basis of an FIR by the CBI in the matter.

The plea sought to declare Section 50(2) of the PMLA unconstitutional and violative of Section 132 of the Evidence Act and Article 20(3) so far as it is applied to a witness.

He also sought to declare that the change of status of Sana from a witness to an accused and his prosecution is illegal and unconstitutional.

He said one of the accused in the CBI FIR has filed a petition in the high court challenging the contradiction in his status in the two investigations for the same cause of action as he had been shown as accused in one and a witness in the other one for the same offence leading to two probes under two different statues.

The CBI's special probe team, under the then Special Director Rakesh Asthana, had recommended Sana's arrest in its own case against Qureshi and others.

However, in October last year, the Alok Kumar Verma-led agency registered a case of alleged corruption against Asthana and his subordinates, based on Sana's complaint. Sana alleged that he had paid a bribe to get relief in the case.

Officials close to Asthana levelled similar allegations against Verma. The matter reached the Central Vigilance Commission, which initiated an inquiry into the charges and counter-charges.  Eventually, both Verma and Asthana were divested of their powers. PTI SKV HMP SA