A trial court has stayed an order allowing a Delhi-based businessman to travel to the United Kingdom and Dubai as he was allegedly involved in a Rs 1,300 crore money laundering case. Additional Sessions Judge Kamini Lau stayed the August 27 order of a magisterial court which had suspended till October 31 the Look Out Circular (LOC) issued against Vikas Chaudhary by the Income Tax Department.

Delhi Court order

Since there was no case pending against Chaudhary before the trial court, it erred by entertaining his application to travel abroad, the judge said. The Additional Director of the I-T department challenged the magisterial court's order saying that the additional chief metropolitan magistrate (ACMM) did not have the jurisdiction to allow the application of Chaudhary and claimed that he might tamper with evidence abroad. The sessions court said,

"The ACMM (special acts) casually brushed aside the objection (of the I-T) by observing that its court was the only court in Delhi for dealing with trial of complaints filed by the Income Tax Department in Delhi. "The ACMM (Special Acts) fell in error by failing to notice that on the date when the application filed by the respondent (Chaudhary) was being dealt with, no complaint had been filed by the Income Tax Department against the respondent and no trial was pending before it."

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The I-T official alleged that unaccounted income earned by Chaudhary ran into crores of rupees. Chaudhary was allegedly indulging in various criminal activities involving cognisable offences punishable under the provisions of Black Money Act, Prevention of Money Laundering Act and other Acts, the department alleged. It said investigation has revealed that Chaudhary was allegedly involved in trade based money laundering and cash transactions from Dubai in foreign currency, money laundering from Africa based companies to Dubai and transfer of funds from Dubai based dummy companies to India. The department claimed that the LOC had been issued on February 25, 2019, to restrain him from travelling abroad as he was not cooperating in the investigations and was intending to flee from the country.

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Other violations by Chaudhary

It further alleged that he was influencing his employees not to make statement before the Income Tax authorities despite service of summons. The department said investigation has revealed that a hawala operator had allegedly transferred Rs 20 crore from Dubai based dummy entities which were allegedly managed by Chaudhary and his family. He had also allegedly received more than Rs 250 crore from M/s Maximus International General trading LLC, a company controlled by Manoj Garg, a hawala operator who had been arrested by the CBI and the Directorate of Revenue Intelligence in other money laundering cases, the department told the court. It further alleged that Chaudhary had made total purchases of around Rs 1,200 crore in two years through his three businesses here but no physical invoices/ vouchers and supporting evidence was found during the investigation. The claim of bogus export incentives was around Rs 150 crore against fake export invoices and he had received a payment of Rs 259 crore against sales of Rs 358 crore from the company managed by Garg, it claimed.

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It said that unaccounted investments were made for purchase of foreign property in the name of Chaudhary's daughter. Chaudhary, in his application, had said he wanted to travel to Dubai to meet his daughter for her job purposes and to schedule interviews with employer. He further said that he wanted to travel to UK to meet certain clients for business and finalise deals. On August 27, the magisterial court had allowed him to travel to UK and Dubai by suspending the LOC issued by the Income Tax department till October 31, 2019. The Sessions court said in its order that the ACMM cannot allow the application filed by Chaudhary as the special court did not issue the LOC against him.

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