- 1 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21ST DAY OF SEPTEMBER, 2026 BEFORE THE HON'BLE MR. JUSTICE S VISHWAJITH SHETTY CRIMINAL PETITION NO. 12181 OF 2026 BETWEEN: RAVI YALLAPPA KURUBETT AGED ABOUT 34 YEARS, S/O RAMAPPA GOWDA, R/AT LIG 600, 7 STREET, 4CROSS, KHB COLONY VTC HIREMALLIGAWAD, CHIKKAMALLINGAWAD, DHARWAD - 580 007 …PETITIONER (BY SRI. SANDESH J. CHOUTA, SENIOR COUNSEL FOR SRI. SANPREETHI V., ADVOCATE) AND: DIRECTORATE OF ENFORCEMENT REPRESENTED BY DEPUTY DIRECTOR, BENGALURU ZONAL OFFICE, OFFICER SITUATED AT HMT MACHINE TOOLS COMPOUND, BANGALORE COMPLEX, JALAHALLI, BENGALURU - 560 013 …RESPONDENT (BY SRI. MADHU N. RAO, ADVOCATE) THIS CRL.P IS FILED U/S 439 CR.P.C. (FILED U/S 483 BNSS) BY THE ADVOCATE FOR THE PETITIONER PRAYING TO GRANT BAIL TO THE PETITIONER / ACCUSED NO.23 BASED ON THE ARREST CAUSE ON 08.07.2026 AND RELEASE HIM FROM Digitally signed by NANDINI M S Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 CUSTODY IN THE CASE REGISTERED BY THE RESPONDENT PENDING ON THE FILE OF THE III ADDL.DIST. AND SESSIONS JUDGE D.K. MANGALURU IN SPL.C.C.NO.233/2024 FOR THE OFFENCE P/U/S 3,4 OF PMLA. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S VISHWAJITH SHETTY ORAL ORDER Accused No.23 in Spl.C.No.233/2024, pending before the Court of III Additional District & Sessions Judge, D.K., Mangaluru, registered for offences punishable under Sections 3 and 4 of Prevention of Money Laundering Act, 2002 (in short 'the Act'), is before this Court in the successive bail application seeking regular bail. 2. Heard the learned counsel for the parties. 3. The material on record would go to show that Smt.Mamatha Hosagoudar, Special Land Acquisition Officer of KIADB, Hubballii-Dharwad, had submitted a complaint alleging that accused No.1-Vasanth Kumar Sajjan, retired Special Acquisition Officer, KIADB, with - 3 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 dishonest intention of gaining wrongful gain and causing wrongful loss to the Government Exchequer, had entered into a criminal conspiracy with other accused persons and had awarded compensation to the tune of Rs.19,99,55,000/- to the persons who were already granted compensation for the land that was acquired in the year 2011-12. 4. Based on such complaint, FIR was registered in Crime No.251/2022, on 20.12.2022 at Vidyagiri Police Station, Hubballi-Dharwad, for the offences punishable under Sections 406, 409, 420 read with Section 34 of IPC. Subsequently, similar other FIRs were registered with similar allegations and in the light of the scheduled offence in the FIR in Crime No. 251/2022 and other FIRs, the respondent had registered a case in ECIR/BG201 No.40/2023 on 30.11.2023, and after completing investigation had filed prosecution complaint in said case against 22 persons on 21.11.2024. - 4 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 5. During the course of further investigation in the aforesaid ECIR case, petitioner was arrested on 08.07.2025 and thereafter, a supplementary complaint was filed in the said case on 04.09.2025, against accused No.23 to 39. The petitioner is arrayed as accused No.23 in the said supplementary complaint. His bail application filed before the Trial Court was rejected and therefore, he had approached this Court in Crl.P.No.13026/2025 which was rejected on 26.11.2025. Subsequently, petitioner had filed fresh bail application before the trial Court in Spl.C.No.233/2024, which was rejected from 22.07.2026. It is under these circumstances, petitioner is before this Court in this successive bail application. 6. Learned Senior Counsel appearing for the petitioner submits that, except the petitioner herein, all the other 38 accused in the present case have been released. After the earlier bail application of the petitioner in Crl.P.No.13026/2025, was rejected on 26.11.2025, accused No.1 has been granted regular bail by the trial - 5 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 Court on 21.04.2026 and accused No.9 has been granted anticipatory bail by this Court in Crl.P.No.3485/2026, on 27.04.2026. He submits that the petitioner is not arrayed as accused in the cases registered for predicate offences. He is in custody in the present case for the last more than 14 months. Accordingly, prays to allow this petition. 7. Learned Senior Counsel further submits that under similar circumstances, the Hon'ble Supreme Court has granted bail to the accused, who were in custody for more than one year and has placed reliance on the following judgments: i) Prema Prakash v. Union of India through Directorate of Enforcement - (2024) INSC 637 ii) Arvind Dham v. Directorate of Enforcement - (2026) INSC 12 iii) Udhaw Singh v. Enforcement Directorate - (2025) INSC 247. 8. Per contra, learned counsel appearing on behalf of the respondent who has filed statement of objections - 6 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 opposing the prayer made by the petitioner submits that, the petitioner is the mastermind in the present case and he has not only misappropriated huge amount in the present case, but also has acquired properties illegally out of the proceeds of the crime. He submits that, having regard to the twin conditions under Section 45 of the Act, petitioner's prayer for grant of regular bail is to be rejected considering the material available on record. Accordingly, prays to dismiss the petition. 9. A reading of the prosecution complaint would indicate that the allegation against the accused persons in the present case is with regard to claiming and awarding of compensation fraudulently and thereby mis-appropriating totally an amount of Rs.64.01 crores. The details of the transaction where the petitioner has been involved are as under: "(i) Fraudulent compensation amounting to Rs.5,22,60,000/- was sanctioned in the case of Smt. Seetha Patil (A-5). It has been revealed from the evidence gathered during the course of search that Shri Ravi Kurbett withdrew the cash (Proceeds of Crime) from - 7 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 IDBI Bank, Hubli in collusion with Smt. Seetha Patil and Shri. Iranna Gouda Patil (A-18). (ii) Smt. Kallavva Ramappa Kamdoli (A-31) received fraudulent compensation to Rs.1,42,98,047/- on 08.02.2022 against land at Sy.No.623/A/2, Plot No.32 admeasuring 0-17-01.5 in Unakal village and Rs.1,14,76,025/- on 07.03.2022 against land at Sy.No.623/A/2, Plot No.21, 23, 25, 27 in Unakal Village from KIADB. The above land was acquired by KIADB vide final notification No.CI 201 SPQ 2008 dated 28.08.2008 in the year 2010." 10. The reading of paragraph No.6 of the statement of objection filed by the respondent would indicate that the petitioner allegedly has misappropriated nearly Rs.1.36 cores and it is also stated that he has utilized the proceeds of crime for purchasing about 10 properties. It is not in dispute that the properties purchased by the petitioner through proceeds of crime have been attached under the provisional attachment order dated 26.03.2025, bearing Order No.8/2025. 11. The material on record would go to show that in the present case, initially complaint was filed against 22 persons and all the 22 accused have been already granted bail. - 8 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 12. During the course of further investigation of the case, petitioner was arrested on 08.07.2025 and thereafter, supplementary complaint was filed against accused No.23 to 39. It is not in dispute that accused Nos.24 to 39 in supplementary complaint are all granted bail in the present case. Therefore, it is apparent that, except the petitioner herein, all the other accused persons in this case have been granted bail. Petitioner's earlier bail application was rejected by the Co-ordinate bench of this Court in Crl.P.No.13026/25 on 26.11.2025. Subsequently accused No.1 has been granted regular bail by the trial Court in Spl.C.C.No.233/2025 on 21.04.2026 and accused No.9 has been granted anticipatory bail by the Co-ordinate bench of this Court in Crl.P.No.3485/2026 on 27.04.2026. 13. The Hon'ble Supreme Court in the case of Prem Praksh's case (cited supra), wherein the accused was in custody for a period of one year and the trial was yet to commence, has granted regular bail to the accused. In - 9 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 paragraph No.11 of the said order, it is observed as follows: "11. Considering that the present is a bail application for the offence under Section 45 of PMLA, the twin conditions mentioned thereof become relevant. Section 45(1) of PMLA reads as under:- “45. Offences to be cognizable and non-bailable. (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), no person accused of an offence [under this Act] shall be released on bail or on his own bond unless- (i) the Public Prosecutor has been given an opportunity to oppose the application for such release; and (ii) where the Public Prosecutor opposes the application, the court is satisfied that there are reasonable grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail: Provided that a person, who, is under the age of sixteen years, or is a woman or is sick or infirm or is accused either on his own or along with other co-accused of money-laundering a sum of less than one crore rupees, may be released on bail, if the Special Court so directs: Provided further that the Special Court shall not take cognizance of any offence punishable under Section 4 except upon a complaint in writing made by- (i) the Director; or (ii) any officer of the Central Government or a State Government authorised in writing in this behalf by the Central Government by a general or special order made in this behalf by that Government.” In Vijay Madanlal Choudhary and Ors. Vs Union of India and Ors.reported in (2022) SCC OnLine SC 929, this Court categorically held that while Section 45 of PMLA restricts the right of the accused to grant of bail, it could not be said that the - 10 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 conditions provided under Section 45 impose absolute restraint on the grant of bail. Para 131 is extracted hereinbelow:- “131. It is important to note that the twin conditions provided under Section 45 of the 2002 Act, though restrict the right of the accused to grant of bail, but it cannot be said that the conditions provided under Section 45 impose absolute restraint on the grant of bail. The discretion vests in the court, which is not arbitrary or irrational but judicial, guided by the principles of law as provided under Section 45 of the 2002 Act. …” These observations are significant and if read in the context of the recent pronouncement of this Court dated 09.08.2024 in Criminal Appeal No. 3295 of 2024 [Manish Sisodia (II) Vs. Directorate of Enforcement], it will be amply clear that even under PMLA the governing principle is that “Bail is the Rule and Jail is the Exception”. In para 53 of [Manish Sisodia (II), this Court observed as under:- “53…..From our experience, we can say that it appears that the trial courts and the High Courts attempt to play safe in matters of grant of bail. The principle that bail is a rule and refusal is an exception is, at times, followed in breach. On account of non-grant of bail even in straight forward open and shut cases, this Court is flooded with huge number of bail petitions thereby adding to the huge pendency. It is high time that the trial courts and the High Courts should recognize the principle that “bail is rule and jail is exception.” All that Section 45 of PMLA mentions is that certain conditions are to be satisfied. The principle that, “bail is the rule and jail is the exception” is only a paraphrasing of Article 21 of the Constitution of India, which states that no person shall be deprived of his life or personal liberty except according to the procedure established by law. Liberty of the individual is always a Rule and deprivation is the exception. Deprivation can only be by the procedure established bylaw, which has to be a valid and reasonable procedure. Section 45 of PMLA by imposing twin conditions does not re-write this principle to mean that deprivation is the norm and liberty is the exception. As set out earlier, all that is required is that in cases where bail is subject to the satisfaction of twin conditions, those conditions must be satisfied." - 11 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 14. In the case of Arvind Dham's case (cited supra), the accused who was in custody for about 17 months was granted bail by Hon'ble Supreme Court. In the said case in paragraph No.19, it is observed as follows: "19. ................ The maximum sentence which can be imposed on the appellant is seven years. The appellant is in custody for past around 16 months and 20 days. It is pertinent to note that various Benches of this Court, while taking into account the period of incarceration which ranges from 3 months to 17 months in several cases have granted bail to the appellants therein 10. In the instant case, no cognizance has been taken on the prosecution complaint and the proceeding is at the stage of scrutiny of documents. No material has been placed on record to show the fate of the application filed by the ED on 27.09.2025 seeking day-to- day hearing even after period of approximately three months has expired. There are 210 witnesses to be examined in the proceeding. There is no likelihood of trial commencing in the near future. The continued incarceration in such circumstances, particularly where the evidence which is primarily documentary in nature, is already in custody of the prosecution, violates the right of the appellant to speedy trial under Article 21 of the Constitution of India." 15. In the case of Udhaw Singh's case (cited supra), in para No.4 and 5, the Hon'ble Supreme Court has observed as follows: "4. In this case, the appellant has undergone incarceration for a period of 1 year and 2 months. There are 225 witnesses cited, out of which only 1 has been examined. Therefore, the trial is not likely - 12 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 to be concluded within few years. Hence, a decision of this Court in the case of V. Senthil Balaji v. Deputy Director, Directorate of Enforcement1 will apply. Paragraphs 27 and 29 of the said decision read thus: “27. Under the Statutes like PMLA, the minimum sentence is three years, and the maximum is seven years. The minimum sentence is higher when the scheduled offence is under the NDPS Act. When the trial of the complaint under PMLA is likely to prolong beyond reasonable limits, the Constitutional Courts will have to consider exercising their powers to grant bail. The reason is that Section 45(1)(ii) does not confer power on the State to detain an accused for an unreasonably long time, especially when there is no possibility of trial concluding within a reasonable time. What a reasonable time is will depend on the provisions under which the accused is being tried and other factors. One of the most relevant factor is the duration of the minimum and maximum sentence for the offence. Another important consideration is the higher threshold or stringent conditions which a statute provides for the grant of bail. Even an outer limit provided by the relevant law for the completion of the trial, if any, is also a factor to be considered. The extraordinary powers, as held in the case of K.A. Najeeb3, can only be exercised by the Constitutional Courts. The Judges of the Constitutional Courts have vast experience. Based on the facts on record, if the Judges conclude that there is no possibility of a trial concluding in a reasonable time, the power of granting bail can always be exercised by the Constitutional Courts on the grounds of violation of Part III of the Constitution of India notwithstanding the statutory provisions. The Constitutional Courts can always exercise its jurisdiction under Article 32 or Article 226, as the case may be. The Constitutional Courts have to bear in mind while dealing with the cases under the PMLA that, except in a few exceptional cases, the maximum sentence can be of seven years. The Constitutional Courts cannot allow provisions like Section 45(1)(ii) to become instruments in the hands of the ED to - 13 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 continue incarceration for a long time when there is no possibility of a trial of the scheduled offence and the PMLA offence concluding within a reasonable time. If the Constitutional Courts do not exercise their jurisdiction in such cases, the rights of the undertrials under Article 21 of the Constitution of India will be defeated. In a given case, if an undue delay in the disposal of the trial of scheduled offences or disposal of trial under the PMLA can be substantially attributed to the accused, the Constitutional Courts can always decline to exercise jurisdiction to issue prerogative writs. An exception will also be in a case where, considering the antecedents of the accused, there is every possibility of the accused becoming a real threat to society if enlarged on bail. The jurisdiction to issue prerogative writs is always discretionary. XXXX XXXX 29. As stated earlier, the appellant has been incarcerated for 15 months or more for the offence punishable under the PMLA. In the facts of the case, the trial of the scheduled offences and, consequently, the PMLA offence is not likely to be completed in three to four years or even more. If the appellant's detention is continued, it will amount to an infringement of his fundamental right under Article 21 of the Constitution of India of speedy trial.” 5. Our attention is invited to a decision of a coordinate Bench in the case of Union of India through the Assistant Director v. Kanhaiya Prasad2. After having perused the judgment, we find that this was a case where the decisions of this Court in the case of Union of India v. K.A. Najeeb3 and in the case of V. Senthil Balaji1 were not applicable on facts. Perhaps that is the reason why these decisions were not placed before the coordinate Bench. The respondent-accused therein was arrested on 18th September, 2023 and the High Court granted him bail on 6th May, 2024. He was in custody for less than 7 months before he was granted bail. There was no fining recorded that the trial is not likely to be concluded in a reasonable time. In the facts of the case, this Court cancelled the bail granted by the High Court. Therefore, there was no - 14 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 departure made from the law laid down in the case of Union of India v. K.A. Najeeb3 and V. Senthil Balaji1." 16. The present case before the trial Court is at the stage of pre cognizance hearing Therefore, the chances of the trial commencing in the near soon is very remote. Considering the aforesaid aspects of the matter, I am of the opinion that the prayer made by the petitioner for grant of regular bail is to be answered in affirmative . Accordingly, the following: ORDER (i) The petition is allowed. The petitioner/accused No.23 is directed to be enlarged on bail in Spl.C.No.233/2024, pending before the Court of III Additional District & Sessions Judge D.K., Mangaluru, registered for offences punishable under Sections 3 and 4 of Prevention of Money Laundering Act, 2002, subject to the following conditions: a) Petitioner shall execute personal bond for a sum of Rs.1,00,000/- with two sureties for - 15 - HC-KAR CNR: KAHC010551872026 NC: 2026:KHC:51699 CRL.P No. 12181 of 2026 the likesum, to the satisfaction of the jurisdictional Court; b) The petitioner shall appear regularly on all the dates of hearing before the Trial Court unless the Trial Court exempts his appearance for valid reasons; c) The petitioner shall not directly or indirectly threaten or tamper with the prosecution witnesses; d) The petitioner shall not involve in similar offences in future; e) The petitioner shall not leave the jurisdiction of the Trial Court without permission of the said Court until the case registered against him is disposed off. Sd/- (S VISHWAJITH SHETTY) JUDGE PSJ List No.: 1 Sl No.: 63