We are now at a significant moment in the ongoing political slugfest between the BJP at the Centre and the ruling TRS in Telangana.
After raiding, questioning and even arresting those supposedly close to the upper echelons of the TRS, the central agencies probing the so-called Delhi liquor scam have arrived at the door of Chief Minister K Chandrashekar Rao.
First there was a mention of TRS MLC and KCR’s daughter K Kavitha deep down in the remand report the Enforcement Directorate (ED) filed in the Rouse Avenue Court in Delhi on 29 November, in connection with the arrest of businessman Amit Arora.
Apart from Kavitha, the report also named YSRCP MP Magunta Srinivasul Reddy, and Aurobindo Pharma MD Sarath Reddy as people controlling what the ED called the “South Group”, which allegedly paid ₹100 crore to the AAP’s Vijay Nair in the form of kickbacks.
On 2 December, the CBI followed this up with a notice under section 160 of the CrPC asking her to appear before it either in Hyderabad or in Delhi at 11 am on 6 December.
There is much confusion in the media over what the mention in the ED’s remand report and the subsequent CBI notice actually mean for Kavitha and the ongoing probe.
South First seeks to provide answers to some frequently asked questions.
Can the CBI issue a notice to Kavitha under 160 CrPC at a time general consent to the agency stands withdrawn by the Telangana government?
Telangana issued Government Order (GO) No 51 of 30 August withdrawing the general consent given to the CBI. This GO came to light only in October when Telangana High Court was hearing a petition on the “Cash for MLAs” case. However, the GO had been marked to the CBI director as well as the Union Home Ministry.
In the Delhi liquor scam case, the CBI registered an FIR on 18 August naming 15 persons/entities directly, and other unknown persons, 12 days before the general consent was withdrawn.
Related: 3 from Hyderabad in CBI Delhi liquor scam charge sheet
The Supreme Court has held that the CBI cannot enter any state without the consent of the concerned government. However, it also held that the CBI can enter any state without any hindrance in case an FIR was already registered and the cognizance of the said offence had been taken by the competent court.
The CBI court in New Delhi had already remanded several accused to police/judicial custody.
The Kolkata, Delhi and various other high courts have time and again held that consent of a state is not needed when the FIR was not registered by the CBI in that state.
Even after Telangana withdrew general consent, the CBI summoned several persons from the state, such as auditor Buchi Babu, businessman Abhishek Boinpally and media baron Mootha Gautam.
Going by various judgements, the CBI appears to be well within its rights to issue a notice to Kavitha under 160 CrPC even if there is no general consent.
Can CBI call a witness under 160 CrPC when the witness does not reside in the territorial jurisdiction of CBI, which is Delhi?
Some Legal experts have deemed the 160 CrPC notice to be “illegal” as she is not a resident of Delhi. They are factually right. Under Section 160 CrPC, summons cannot be issued to a person beyond the territorial jurisdiction of the police officer. The Supreme Court, too, has clearly held that territorial jurisdiction will apply even to a CBI investigation.
Going by this legal position, the notice to Kavitha is prima facie illegal.
However, we understand from informed sources that the CBI did not intend to issue a notice to Kavitha. The agency had requested her for an oral enquiry, but Kavitha agreed to depose before CBI only if a 160 CrPC notice is issued.
This could be the reason why Kavitha agreed to depose before the CBI at her residence at Hyderabad. And this is the reason she is unlikely to challenge the notice in the Telangana High Court.
Has any leverage been given to Kavitha by CBI while recording her statement in Hyderabad?
There are reports suggesting that Kavitha may have been given leverage by CBI to record her statement in Hyderabad because she comes from a politically influential family.
A plain reading of 160 CrPC reveals that a male person under 15 years of age and a woman of any age can only be asked to give her statement to the investigating officer in a place where he/she resides.
CBI gave her the option to depose either in Delhi or Hyderabad due to this legal provision, and not because of her political background.
What is the difference between a 160 CrPC and a 41 CrPC notice?
It is interesting that, even after more than three months of investigation, the CBI has not issued a notice to Kavitha under Section 41 of the CrPC.
A 41 CrPC notice is issued to a person against whom a reasonable complaint has been made, or credible information has been received, or a reasonable suspicion exists that he/she has committed a cognizable offence, to appear before the police officer at a place as may be specified in the notice.
A notice issued to Kavitha under 41 CrPC would suggest that the CBI already has credible information on her role. Also, unlike a 160 CrPC notice, she could be summoned anywhere under 41 CrPC.
It is worth noting that the CBI did not take this route, and opted for a mere 160 CrPC notice — that too at Kavitha’s request.
As per Section 160 of the CrPC, a police officer investigating a case has the power to require attendance of witnesses in the case. A reasonable assumption can be made that CBI needs further investigation to name her as an accused. As of now, Kavitha is required by CBI as a witness in the case filed by them.
It is anybody’s guess why CBI chose to issue a 160 CrPC notice and why Kavitha agreed to depose under this section when she could have easily got it quashed by the Telangana High Court.
What the ED’s remand report in the Amit Arora arrest case said.
While seeking remand of Amit Arora, the ED filed a remand report. The report suggested that there is a “South Lobby” which was guiding the liquor policy of Delhi. Kavitha is named as one of the three persons in the “South Lobby”.
The ED said this was as per inputs given to the agency by Amit Arora. It did not furnish any evidence to this effect.
It may be noted that a statement of an accused is not allowed as credible evidence by a court of law. Unless the ED proves her involvement in money laundering as part of the “South Lobby”, the allegation made in the remand report will not stand the scrutiny of law.
What about the alleged destruction of phones?
The ED remand report has a reference to the destruction of mobile phones by 36 persons, including Kavitha.
ED said that Kavitha used different phones and also provided the International Mobile Equipment Identity (IMEI) numbers of the phones to substantiate its charge. The ED claimed Kavitha changed six phones with the intention of destroying evidence
Assuming, without conceding that Kavitha changed phones to destroy evidence, the action attracts provisions of Section 204 of IPC, which deals with secreting or destroying any document/electronic evidence to prevent production of the same as evidence.
A non-cognizable and a bailable offence, it attracts up to two years’ imprisonment or a fine, or both. The ED can never arrest anyone for this reason.
The remand report stated that the ED could recover vital information from 17 of 158 destroyed phones. No mention is made whether they could recover any information pointing to Kavitha’s role in money laundering.
Can the ED still arrest Kavitha?
Purely on the merits of the case, the arrest of Kavitha looks a distant possibility.
But there is a catch. The recent judgement of the Supreme Court bench headed by Justice Khanwilkar on 27 July opens up this possibility. This judgement has only empowered ED further. As per this judgement:
• ED has the right to make arrests and seize assets’
• It need not supply Enforcement Case Information Report (ECIR) to the accused at the time of arrest. It is sufficient if they state the ground for arrest.
• CrPC provisions are not applicable to ECIRs. Therefore, the conditions set out by Supreme Court for arrest in cases where punishment is for a term less than seven years are not applicable to the cases filed by the ED.
• A time limit of 60 days is given to ED to file a prosecution complaint. Till such time, the accused cannot even seek bail.
Going by this judgement, it is still possible for ED to initiate coercive steps against Kavitha.
Recently, the ED took similar steps against Sanjay Raut of the Shiv Sena. Raut was, however, released on bail by the court which passed severe strictures against the ED.
But even in a case where ED could not produce the slightest evidence, they could keep Raut in jail for two months.
Of course, the political fallout of such coercive action will be weighed by the agencies before they set in motion the process of arrest.
Whether ED would arrest her based on her alleged role in the “South Lobby” and based on the alleged destruction of evidence by using its power under the provisions of PMLA would be difficult to answer.
Only political equations would decide this; but from a legal perspective, Kavitha is in a safe horizon as of now.
Can ED take action suo moto and act independently?
The ED cannot take action on its own and cannot proceed in the absence of an FIR. The ED is seeking independent power to register cases.
During the tenure of its earlier chief, Karnal Singh, the ED requested the government in April 2017 to “empower” it to independently register and pursue anti-money laundering cases even after courts quash the first FIR registered by any the other investigating authority.
This request has not been conceded even by the incumbent government at the Centre which is known to let loose its agencies against political rivals.