HC rejects bail of Iqbal Mirchi’s aide in money laundering case

Bombay HC rejects bail plea of Iqbal Mirchi's aide Humayun Merchant in ED money laundering case. Merchant to remain in custody.

MUMBAI: The Bombay High Court recently rejected the bail plea of gangster Iqbal Mirchi’s alleged aide Humayun Merchant in a money laundering case registered by the Enforcement Directorate (ED). Merchant was arrested by the ED in October 2019 for his alleged involvement in illegal dealings of Mirchi’s properties amounting to ₹200 crore.

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A single-judge bench of justice Bharati H Dangre passed the order on February 9 on a plea by Merchant. This is the third time a court in Mumbai has rejected a similar bail application filed by Merchant. Similar applications were rejected in September 2020 and November 2022.

The central agency claimed that Mirchi had given power of attorney to Merchant, who then contacted builders and arranged meetings between Mirchi and his family in Dubai. Merchant has been in Taloja jail since his arrest.

Merchant’s lawyer, senior advocate Aabad Ponda, argued that his client had been in custody for three years and nine months without trial, exceeding the halfway mark of the maximum sentence for the offence specified under the Prevention of Money Laundering Act (PMLA), 2002. He contended that it was the state’s constitutional obligation to ensure speedy trials and that Merchant should be released on bail accordingly.

Ponda further argued that there was no nexus between the alleged proceeds of crime and the scheduled offences outlined in the PMLA complaint. He emphasised that the complaint failed to establish a connection between Merchant and the scheduled offences or the proceeds of crime generated from them.

In response, Additional Solicitor General Devang Vyas representing the ED argued that Merchant had not yet served half of the maximum sentence specified under the PMLA, which could extend up to ten years in cases involving offences under the Narcotic Drugs and Psychotropic Substances Act (NDPS Act), 1985.

The ASG stressed the seriousness of economic offences like money laundering and their impact on the national economy, urging the court to prioritise the case accordingly.

The court, in its ruling, cited Section 436-A of the Criminal Procedure Code (CrPC) and noted that the provision allows for the continued detention of an accused beyond the halfway mark of the maximum sentence if the offence is deemed serious and if releasing the accused on bail would be harmful to society. The court found sufficient justification to continue Merchant’s detention based on the seriousness of the offence and his alleged role in the illegal dealings of Mirchi’s properties.

With the rejection of his bail plea, Humayun Merchant will remain in custody pending further proceedings in the money laundering case.