Seized cash was paid by 3 for a project, Jayachandra tells ED

Order on tainted official's bail plea on January 7

A CBI special court on Wednesday posted for orders on the regular bail petition filed by S C Jayachandra, suspended chief project officer of State Highway Development Project, in the money laundering case filed by the Enforcement Directorate (ED). The special court heard the arguments from counsel appearing for Jayachandra and the ED and posted the matter for orders to January 7.

Senior counsel C V Nagesh, appearing for the accused official, argued that the ED had kept Jayachandra in illegal detention. He contended that possession of demonetised notes as well as new currency would not amount to an offence. He cited various judgments of high courts and the Supreme Court on the issue of granting bail to those arrested under the Prevention of Money Laundering Act.

Jayachandra’s counsel also said that the bank officials concerned should be held responsible for dispensing new currency in violation of the notification issued by the Reserve Bank of India. The prosecutor, appearing for the ED, in the objection stated that the officer possessed 26 apartments besides other assets and, that they were proceeds of the crime. The ED stated that the cash, both demonetised and the new currency were part of the probe.

However, Nagesh contended that though documents pertaining to the flats were recovered, the ED has so far not established that they are registered in the names of either Jayachandra or members of his family. The advocate also stated that Jayachandra has given a statement to the ED saying that the cash found in the house was part of advance money paid by three persons for a construction project.

The CBI court judge Pradeep S Balekai posted the matter for orders. Jayachandra's judicial custody was extended till January 7. The CBI court had granted interim bail to Jayachandra on December 15, 2016. The ED had moved the high court seeking cancellation of the bail. The high court had directed the ED to file its objections before the CBI court in the regular bail application.