Delhi Police had alleged that Sukesh Chandrashekhar and others used hawala routes for illegal activity.
The Delhi High Court has upheld an order granting permission to the Enforcement Directorate (ED) to sell 26 high-end luxury cars allegedly purchased from the proceeds of crime generated out of the criminal activities of alleged conman Sukesh Chandrashekhar.
The high court, which opined vehicles are inherently subject to natural decay and depreciation over a period of time that impacts their value and functionality, directed the ED to keep the entire amount generated from sale of these cars in an 'interest bearing' fixed deposit.
Justice Swarana Kanta Sharma dismissed a plea filed by Chandrashekhar's wife Leena Paulose, arrested in a Rs 200 crore extortion case, challenging a trial court's order by which the ED was granted the possession of 26 vehicles for disposal in accordance with the law.
The trial court had said a representative of the Delhi Police or Economic Offences Wing can also participate in the auction process of those vehicles.
The high court said storing a vehicle in a container warehouse for a long time results in decay since if a car is left stationary for years, several issues can compromise its condition.
"Environmental factors such as weather conditions also contribute to this decay, causing issues such as rust and corrosion. Rust, in particular, can severely damage a vehicle's structure and all other components.
"Mechanical components of a vehicle also suffer from decay, requiring frequent and expensive maintenance to keep it operational, especially in the present case, where the vehicles involved are 26 high-end luxury cars such as Rolls Royce, Ferrari, Range Rover etc. The upkeep and maintenance of the same is also expensive," it said.
Depreciation of vehicles is also a well-recognised phenomenon in the automobile industry, the court said, adding the relevant rules of Prevention of Money Laundering Act (PMLA) allow sale of seized vehicles and depositing the proceeds into a fixed deposit addresses the issues.
"For the accused, if the trial concludes in his favour after several years, he would receive the monetary value rather than a decayed, non-operational, rusted vehicle, almost reduced to junk. This ensures the accused does not suffer any financial loss due to the prolonged judicial process. For the investigating agency, this approach ensures that the value of the seized properties will be available to the investigating agency if the trial concludes in their favour," it said.
In this manner, both the right of an accused as well as that of the investigating agency is protected since a piece of junk or scrap is of no use to either of them, the court said.
Paulose's counsel submitted that she was suffering from depression with memory loss after prolonged isolated life in jail for more than 16 months and she was able to remember the registration numbers of only two cars -- Rolls Royce Ghost and Brabus.
She said these two cars were purchased in 2018, which was much prior to the date of the alleged offence and by no stretch of imagination, these cars can come under the ambit and scope of proceeds of crime.
She further claimed that she has been implicated in the case only for the reason that she was the wife of Chandrashekhar and added that she was having an independent business of buying and selling cars and most of the cars are taken on legally valid loan agreements.
The ED's counsel argued that the petition has become infructuous since in view of the trial court's two orders of 2022 and 2023, 17 out of 26 cars have already been auctioned after following the due process.
The high court noted certain contradictions in the statements of Paulose, who claimed to be a model, actor, dentist and successful businesswoman.
The court said on one breath Paulose claimed to be suffering from depression with memory loss due to prolonged incarceration and does not remember any details of the cars except five of them.
On the other hand, she stated that most of the cars were taken on loans, based on legally valid loan agreements and she was paying the EMIs for the same without fail and the vehicles are essential for continuing with her business activities.
"A reasonable human being, who is able to purchase 26 luxurious cars, would have not only the documents and the details qua her own income, but all the details of expenditure incurred on purchasing/ maintaining such luxury cars. Mrs Paulose, however, has placed no documents before this court to support her claims over the cars in question.
"Further, she cannot be allowed to take shelter under the pretext that her incarceration in the jail is responsible for distress and depression leading to memory loss, moreso when there is no medical evidence to support her claim," Justice Sharma said.
The Delhi Police had earlier registered an FIR against Chandrashekhar for allegedly duping the spouses of former promoters of Ranbaxy, Shivinder Singh and Malvinder Singh, of Rs 200 crore besides ongoing investigations against him in several cases across the country.
Chandrashekhar and Paulose, who are also facing proceedings in a money laundering case registered by the ED, were earlier arrested by the Delhi Police, along with others.
The police has also invoked the Maharashtra Control of Organised Crime Act (MCOCA) in the case.
The Delhi Police had alleged that Paulose and Chandrashekhar along with others used hawala routes, created shell companies to park the money earned from proceeds of crime.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)