Law & Justice
Delhi Court Frames Money Laundering Charges Against Lalu Prasad, Family in IRCTC Hotel Scam Case
A special court in Delhi has ordered the framing of money laundering charges against former railway minister Lalu Prasad Yadav, his wife Rabri Devi, son Tejashwi Yadav, and six others in connection with the Enforcement Directorate's case involving the alleged IRCTC hotel scam. According to news agency reports on September 10, Special Judge Vishal Gogne discharged seven of the 16 accused while framing charges against nine.
Delivering the substantive portions of his order orally, Judge Gogne stated that at this stage, the court did not need to apply the exacting standard of establishing criminal intent, or mens rea, but only needed to determine whether there was strong suspicion against the accused. The court had earlier framed corruption charges against Lalu Prasad and 11 others in October last year in a related CBI case concerning the same alleged scam.
The judge rejected arguments from Lalu Prasad's counsel that the case was politically motivated, stating that the nature, timing, and course of the investigation did not support such a claim. He remarked that special courts dealing with CBI and PMLA cases involving lawmakers exist specifically to uncover concealed and indirect deals that exploit public trust for personal benefit.
According to the court, the ED's allegations—covering the period from 2005 to 2014—strongly suggest that under Lalu Prasad's tenure as railway minister, a tender process was manipulated by railway officials to award the lease of hotels in Ranchi and Puri to Sujata Hotels. In return, the court said, Sujata Hotels' directors, Vinay Kochhar and Vijay Kochhar, transferred prime land in Patna at undervalued rates to a company called DMCPL, which was controlled by Prem Chand (PC) Gupta and his wife Sarla Gupta, described as close associates of Lalu Prasad.
The court further noted that Sarla Gupta and others later transferred shares of DMCPL to Rabri Devi and Tejashwi Yadav at a nominal price. The land is now controlled by an entity called Lara Projects LLP. The judge observed that there was strong suspicion that Lalu Prasad's alleged abuse of office generated proceeds of crime that benefited his wife and son, who continued to use the land situated in a prime commercial area of Patna.
The court concluded that the Patna land constitutes proceeds of crime and ruled that money laundering charges should be framed against Lara Projects, Rabri Devi, Tejashwi Yadav, Lalu Prasad, PC Gupta, Sarla Gupta, Vijay Kochhar, and Vinay Kochhar. However, it found insufficient grounds to charge Gaurav Gupta, Nath Mal Kakrania, Rahul Yadav, Vijay Tripathi, Deoki Nandan Tulshyan, Rajiv Kumar Relan, and Abhishek Finance Private Limited.
"Nine accused are being charged; seven are discharged," the court said, directing that charges be framed under Section 3 (offence of money laundering) read with Section 4 (punishment for money laundering) of the Prevention of Money Laundering Act (PMLA). The matter has been scheduled for October 3 for the formal framing of charges.
Before pronouncing the order, Judge Gogne quoted a passage from Rabindranath Tagore: "Whenever power removes all checks from its path to make its career easy, it triumphantly writes into its ultimate crash of death, its moral break becomes slacker every day, without its knowing it, and its slippery path of ease becomes its path of doom." The judge noted that Tagore had served as a moral compass during India's freedom movement, often providing clarity during times of uncertainty. Tagore, a Bengali poet, author, and philosopher central to the Bengal Renaissance, became the first non-European recipient of the Nobel Prize in Literature in 1913.
The court said it needed to assess whether all checks on power had indeed been removed by the former railway minister to project the deal as legitimate. Dismissing defense arguments that the charge sheet lacked evidence, the court pointed to strong suspicion arising from cited witnesses and documents, including evidence related to the sale of the Patna land, the incorporation of DMCPL, a loan of two crore rupees from Abhishek Finance to DMCPL, its repayment, the issuance of preference shares, changes in DMCPL's shareholding pattern in 2005, the status of various directors, and the transfer of shares to Rabri Devi and Tejashwi Yadav.