Introduction:

The Delhi High Court recently took cognizance of a plea filed by the Enforcement Directorate (ED) contesting a trial court’s order directing the release of three accused individuals, including a Chinese national, in a money laundering case linked to smartphone manufacturer Vivo. The vacation bench led by Justice Tushar Rao Gedela issued notices to the accused—Hong Xuquan, Harender Dahiya, and Hemant Kumar Munjal—acknowledging the gravity of the case as presented by the ED.

Arguments of Both Sides:

The ED challenged a trial court’s decision, which deemed the arrests of the three accused as illegal and released them on bail. Despite the release, no interim orders could be issued due to the individuals already being released as per the trial court’s directive. The urgency of the matter prompted the court to list the case for expedited hearing before the roster bench the following day. The trial court, while releasing the accused, imposed a condition that they must report to the ED’s office daily until January 3, considering the ED’s apprehensions.

Court’s Judgement:

The ED contested a vacation judge’s order from Patiala House Courts, claiming the arrests were lawful and not a breach of protocol. The trial court had found the custody of the accused as illegal due to their alleged delay in being presented before the court within 24 hours of their arrest. The ED’s allegations revolve around a money laundering operation involving Chinese nationals and Indian companies, claiming that Vivo India illicitly transferred a significant sum to China, evading tax payment in India.