On September 26th, 2024, in a Special Leave Petition (criminal), the Supreme Court bench of Justice Abhay Oka and Justice Augustine George Masih granted bail to former Minister of Tamil Nadu and current MLA, Senthil Balaji, who was arrested in a money laundering case stemming from a cash-for-jobs scam. The bench had reserved its judgment and flagged delay in trial on August 12, 2024.

The former Transport Minister of Tamil Nadu was accused of a cash-for-jobs money laundering scam during his tenure between 2011 and 2016. Balaji, along with his personal assistants and brother, has been accused of running a scheme where they collected money from job seekers in exchange for promises of employment in the Tamil Nadu Transport Department. Many candidates filed complaints after paying large sums  of money but not receiving the promised jobs. As a result of these allegations, the Enforcement Directorate (ED) registered an Enforcement Case Information Report (ECIR) and arrested him in June 2023 under the Prevention of Money laundering Act, 2002,(PMLA), on charges linked to this scam. The petitioner had applied for bail in Madras High Court but  it was rejected due to lack of substance. The court had observed that the ED's investigation was based on documents already available from the predicate offence and found no reason to suspect any tampering with the evidence and also ordered the Special Court to expedite the trial, considering the petitioner’s long incarceration.

Senior Advocates Mukul Rohatgi and Sidharth Luthra for the petitioner argued that the Rs. 1.34 crore cash deposited in his account between 2013 and 2021 came from his agricultural income and MLA salary, and the prosecution wrongly linked it to the alleged scam. The counsels also highlighted flaws in the search and seizure process, pointing out discrepancies in the hard disk evidence, where a Seagate hard disk was mentioned but an HP hard disk was recovered, and no incriminating files related to the alleged Rs. 67 crore scam were found in the seized pen drive and hard disk. They also further contended that the petitioner was in custody for over 13 months and had gone through a coronary bypass surgery during that time, and due to his health and delay in commencement of trial, he should be granted bail under Section  45 of PMLA, which permits bail in exceptional cases like illness.

The Solicitor General of India, Tushar Mehta and Advocate Zoheb Hossain for the ED rebutted the petitioner’s claim and contented that the cash deposit of Rs. 1.34 crore had no connection with the petitioner’s  MLA salary or his agriculture income since all MLA salaries are deposited directly into the bank. They claimed that an incriminating “csac.xlsx” file was found on the pen drive along with other documents and emails implicating the petitioner. The ED also argued that the petitioner was influencing witnesses and delaying the trial with the help of the Tamil Nadu government.

The Supreme Court questioned the feasibility of continuing the PMLA trial against Senthil Balaji without completing the trial for the predicate offense, which involves over two thousand accused. It also asked the ED to verify whether the incriminating "CSAC" file was found and sought clarification on whether the ED would rely on all three predicate offenses or drop one. The Court emphasized that splitting the trial would be ineffective.

Justice Oka, while pronouncing the verdict, said that stringent bail provisions and delay in trial cannot go together.

"We have referred to Najeeb and other judgements. What we have said is that stringent and higher threshold of bail and delay in prosecution cannot go together. And therefore we have slightly expanded the scope in Najeeb and bail granted but there are very onerous conditions put in the bail," Justice Oka said.

Advocate for the Petitioner: Senior Advocates Mukul Rohatgi and Sidharth Luthra

Advocate for the Respondent: Solicitor General Tushar Mehta and Advocate Zoheb Hossain

Case Details:  V. Senthil Balaji v. The Deputy Director, SLP (Crl) No. 3986/2024