settled legal position that, at the stage of considering the prayer for bail, it is not necessary to weigh the material, but only form opinion on the basis of the material before it on broad probabilities.

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL  APPEAL NO.  578  OF  2019
(Arising out of SLP(Crl.) No.7857 of 2018)
National Investigation Agency      …..Appellant(s)
:Versus:
Zahoor Ahmad Shah Watali     ....Respondent(s)
J U D G M E N T
    A.M. K    hanwilkar, J.
1. Leave granted.
2. The respondent is named as Accused No.10 in the First
Information Report dated 30th  May, 2017, registered by the
Officer­in­charge   of   Police   Station,   NIA,   Delhi,   for   offences
punishable under Sections 120B, 121 and 121A of the Indian
Penal Code (“IPC”) and Sections 13,16,17,18,20,38,39 and 40
of the Unlawful Activities (Prevention) Act, 1967, (for short
“the   1967   Act”). The respondent (Accused No.10) filed an
application for bail before the District and Sessions Judge,
2
Special Court (NIA), New Delhi, which came to be rejected on
8
th  June, 2018. That order has been reversed by the High
Court of Delhi at New Delhi in Criminal Appeal No.768/2018
vide   order   dated   13th  September,   2018.   The   High   Court
directed release of the respondent on bail subject to certain
conditions. That decision is the subject matter of this appeal
filed by the prosecuting agency ­ the appellant herein. 
3. The   Designated   Court   opined   that   there   are   serious
allegations against the respondent Zahoor Ahmad Shah Watali
(Accused No.10) of being involved in unlawful acts and terror
funding in conspiracy with other accused persons; he had
acted as a conduit for transfer of funds received from terrorist
Accused   No.1   Hafiz   Muhammad   Saeed,   ISI,   Pakistan   High
Commission, New Delhi and also from a source in Dubai, to
Hurriyat   leaders/secessionists/terrorists;   and   had   helped
them   in   waging   war     against   the   Government   of   India   by
repeated   attacks   on   security   forces   and   Government
establishments and by damaging public property including by
burning schools etc. It then noted that the accusation against
3
the respondent (Accused No.10) was of being a part of a larger
conspiracy   to   systematically   upturn   the   establishment   to
cause secession of J & K from the Union of India.  Keeping in
mind the special provisions in Section 43D of the 1967 Act
and the exposition  in Hitendra Vishnu Thakur and Ors. Vs.
State  of  Maharashtra  and  Ors.,
1 Niranjan  Singh  Karam
Singh Punjabi, Advocate Vs. Jitendra Bhimraj Bijjaya and
Ors.2
,    Manohar   Lal   Sharma   Vs.   Union   of   India3
  and
Jayanta Kumar Ghosh and Ors. Vs. State of Assam and
Anr.4
,  it   proceeded   to   analyse   the   material   on   record   and
observed thus: 
“7.5 Let me now see whether on the basis of the material
on record, allegations against the accused are prima facie
made out or not. Mindful of the fact that this is not the stage
to examine and analyze the evidence placed on record in
detail,   let   me   refer   to   the   same.   Allegation   against   the
accused that certain businesses of his, were just a front/
sham for routing of funds received from abroad/ terrorist A1/ High Commission, Pakistan/ Dubai/other sources and
that   there   were,   unaccounted   financial   transactions,   is
prima facie borne out from statement of the witnesses PW1,
1
  (1994) 4 SCC 602
2
  (1990) 4 SCC  76
3
  (2017) 11 SCC 783
4
  (2010) 6 Gauhati Law Reports 727
4
PW28 and PW29 and documents including D­202 & D­214.
It has also come in the statements of PW38 & PW39, who
prepared   balance   sheets   of   accused’s   firms/companies
namely Trison Farms and Constructions Pvt. Limited, M/s
Trison International, M/s Yasir Enterprises, M/s 3Y, M/s
Kashmir   Veneer   Industries   &   M/s   Three   Star,   that   the
accused   never   produced   any   supporting   documents   with
respect to remittances received from NZ­International DubaiFZC, owned by him; and that he did not even inform about
the actual execution of business despite asking of PW39. The
fact that the balance sheets of M/s Trison International, M/s
3Y   were   forcefully   got   signed   from   the   protected   witness
PW43 without providing him any document, has come in his
statement. It has also come in the statement of PW44 that
the audit report of the aforesaid companies were got signed
from him without producing books for verification.”
Again in paragraph 7.8 to 7.10 the Court observed:
“7.8 The   fact   that   the   accused   received   money   from
abroad /A­1, chief of proscribed (terrorist) organization, HCP
(High Commission, Pakistan) and others and was passing on
the said funds to Hurriyat leaders, is prima facie borne out
from   D­152   read   with   statement   of   PW29   and   D­154
(Expert’s Report), as per which the signatures of the accused
on D­152 were compared with his admitted handwriting and
were verified and found to be similar. In view of the same,
the Ld. Defence counsel’s argument that the said document/
D­152 cannot be looked into at all even to form prima facie
opinion, cannot be accepted. Thus, the judgment of Hon’ble
Supreme   court   in  Manohar   Lal   Sharma’s   Case  (Supra),
relied upon Ld. Defence counsel is also of no assistance to
the accused.
7.9 Further,   the   association/proximity   of   Altaf   Ahmad
Shah @ Fantoosh (A­4), Farooq Ahmad Dar @ Bitta Karate
5
(A­6) with accused, is also prima facie borne out from the
statement of protected witness PW48. Accused’s links with
people who have role in governance of Pakistan and with
Hurriyat leaders has also prima facie come on record vide
statement of PW52, documents D­3, D­4 (e) etc. and other
material on record.
7.10 In   view   of   the   above   facts   and   circumstances,   the
statements   of   witnesses/material/documents   and   other
material placed on record by NIA, offences as alleged against
the accused are prima facie made out. Therefore, in view of
the   bar   under   proviso   to   Section   43D(5)   UA(P)   Act,  the
accused’s prayer for bail cannot be granted.”
Further the Court observed:
“8.1.1    Ld.   Special   PP,   NIA   also   submitted   that   the
applicant/accused is an influential person/ business man
and has a great clout in the valley, as has come in the
statement   of   PW48.   All   the   witnesses   are   known   to   the
applicant/   accused.   There   is   every   likelihood   of   the
applicant/accused   influencing/   intimidating   witnesses/
tempering with evidence, in the event of his release even on
interim bail.”
4. The   respondent   had   also   prayed   for   grant   of   bail   on
health grounds, which plea was duly considered and rejected
in the following words:
“8.2 I have duly considered the submissions made by both
the sides. Perusal of the record reveals that as and when
requested   by   the   accused,   he   was   provided   medical
treatment from time to time. Pursuant to the directions of
this court, the accused was taken to the premier medical
institute of India/AIIMS for necessary medical examination.
6
This   was   besides   being   provided   appropriate   medical
attention to Jail hospital and in­patient treatment at Dr.
RML   hospital   from   01.09.2017   to   05.09.2017.   As   per
medical status report dated 26.09.2017, the accused was
extensively evaluated at Dr. RML Hospital for chest pain and
cause of cardiac disease was ruled out. Even subsequently,
the   accused   was   reviewed   at   Central   Jail   Hospital   and
detailed blood investigation was carried out and medication
was provided. On his complaint of anxiety, severe low back
pain and bleeding per­rectum on 24.09.2017, the accused
was admitted to M.I. Room, Dispensary, Central Jail No. 8/9
from   24.09.2017   to   26.09.2017.   Vide   subsequent   report
dated 11.10.2017, Medical Officer I/c, Central Jail Tihar,
Dispensary   8/9,   reported   that   the   accused   was   getting
treatement under regular follow up of Medicine Specialist,
jail visiting SR surgery. It may further be mentioned that
accused was constantly reviewed at short intervals and was
provided all advised medication.
8.3 It has also come in order sheet dated 03.01.2018 that
as per medical report of accused received from AIIMS New
Delhi,   the   accused   was   evaluated   in   seven   speciality/
superspeciality OPDs but was not found to be suffering from
any specific ailment except for his known history of Type 2
diabetes mellitus, hypertension & hypothyroidism for which
requisite   medications   to  be   taken   regularly,   were  already
prescribed.   The   Colonoscopy   test   of   the   accused   was
scheduled for 15.01.2018. Medical status report of accused
Zahoor Ahmad Shah Watali received from the Medical Officer
Incharge,   Central   Jail   Dispensary,   Tihar,   New   Delhi,
mentioned that the accused despite being counseled several
times to continue his treatment at AIIMS Hospital, refused to
visit AIIMS for treatment/further management.
9.0 From   the   above,   it   is   evident   that   the   applicant/
accused   is   being   provided   necessary   medical   attention/
treatment as and when prayed for, not only inside the jail
but also at AIIMS and other Govt. Hospitals.  Thus, taking
into   account   the   law   as   laid   down   in   Redual   Hussain
Khan’s case (Supra), no ground for grant of interim bail
on health grounds is made out.
9.1 However,   Jail   Superintendent   is   directed   to
provide   proper   medical   care   and   treatment   to   the
applicant/ accused, as requested/ called for.”
7
5. The respondent carried the matter before the High Court
by way of Criminal Appeal No.768 of 2018 under Section 21(1)
read with Section 21(4) of the National Investigation Agency
Act,   2008.   The   High   Court   noticed   that   after   filing   of   the
charge­sheet,   accused   Nos.11   and   12   had   been   granted
regular bail, while accused Nos.1 and 2 had not been arrested.
Rest   of   the   accused,   including   the   respondent   (Accused
No.10),   were   in   judicial   custody.   The   respondent   (Accused
No.10) was arrested on 17th  August, 2017 and had been in
judicial   custody   since   then.   His   age,   as   indicated   in   the
charge­sheet,   was   about   70   years.   The   High   Court   then
adverted   to   paragraph   17.6.5   onwards   of   the   charge­sheet
[report under Section 173 of the Code of Criminal Procedure
(Cr.P.C.)] and summarized the allegations against respondent
(Accused No.10) as follows:
“18. Specific to the Appellant are the allegations made in
Paragraph   17.6.5   of   the   charge­sheet   which   is   subtitled
‘Hawala’.   This   being   the   principal   allegation   against   the
Appellant, requires to be summarized as under:
(i) The Appellant is one of the conduits to bring money from
off­shore  locations  of India  to  fuel anti­India  activities  in
8
Jammu and Kashmir. Reference is again made to the same
incriminating document i.e. D No.132 (a).
(ii) A­10 was bringing money from off­shore locations to India
“by layering it through the scores of firms and companies he
has opened”. Reference is made to an NRE account of the
Appellant at the J&K Bank where, from 2011 till 2013, he is
said to have received  Rs.93,  87, 639. 31 from ‘unknown
sources’.
(iii) The Appellant was showing foreign remittances under
‘other   income’  in   his   proprietorship   M/s   Trison
International, Srinagar. Foreign remittances in the sum of
Rs.2,26,87,639.31 were received by the Appellant in different
accounts   from   2011   to   2016.   It   is   repeated   that
Rs.93,87,639.31 was received in his NRE account from 2011
to 2013.
(iv) It is stated that Rs.14 lacs were remitted in the account
of a medical college in Jammu through NEFT on 9th April,
2013 against the fees deposited for his son (who incidentally
is a medical doctor and through whom the present appeal
has been filed). It is stated that Rs.60 lacs were remitted in
the current account of the Appellant in J&K Bank. Rs.5 lacs
were   remitted   in   the   account   of   M/s   Trison   Farms   and
Constructions   Pvt.   Limited   (‘TFCPL’).   It  is   stated   that   all
these foreign remittances “are from unknown sources”.
(v) On 7th November, 2014, one Nawal Kishore Kapoor (who
initially was a witness but has, since the filing of the chargesheet, been arrayed as an accused himself), a resident of
United Arab Emirates (‘UAE’) entered into an agreement with
TFCPL, whose Managing Director (‘MD’) is the Appellant to
take land measuring 20 kanals in Budgam in J&K on lease
in consideration of a sum of Rs.6 crores as premium and
Rs.1,000/­   annual   rent   for   an   initial   period   of   40   years
which could be extended through mutual agreement. In the
said agreement, TFCPL was declared as the absolute owner
of the land. Mr. Kapoor remitted a total sum of Rs.5.579
crores  in 22  instalments between  2013   and  2016  to the
Appellant.
(vi) During investigation it was revealed that no land exists in
the   name   of   TFCPL   as   per   the   balance   sheet   of   that
9
company. Further, it was ascertained that Rs.5,57,90,000
was mobilized by Mr. Kapoor from unknown sources and
remitted to Appellant to lease a piece of land which does not
even exist in the name of TFCPL and therefore the agreement
itself lacks legal sanctity. According to the NIA, this “proves
that   the   said   agreement   was   a   cover”   created   by   the
Appellant   “to   bring   foreign   remittances   from   unknown
sources to India”.
(vii) The Chartered Accountant (‘CA’) who signed the audited
balance sheet of M/s Trison International., TFCPL and M/s
Yasir Enterprises  for various years between 2013­14 and
2015­16 “did so without seeing any supporting documents”.
According   to   the   NIA,   the   balance   sheets   of   the   above
entities/companies were sent to the CA by Mustaq Mir, Cost
Accountant and Shabir Mir, CA from Wizkid Office, Srinagar
through email and he was asked to sign on them in Delhi
without showing any documents. According to the NIA, this
also clearly showed that the Appellant was remitting money
received from unknown sources to India.
(viii) TFCPL raised an unsecured loan of Rs.2,65,55,532/­
from the Directors of the company, i.e. the Appellant, his
wife, and his three sons in the Financial Year (‘FY’) 2010­11
in the form of both cash and cheque and this was used to
repay the secured loan of Rs.2,94,53,353/­ in the books of
J&K Bank. The source of money with the Directors could not
be explained satisfactorily by the Appellant.
(ix) The seizure from the house of the Appellant of a list of ISI
officials and a letter from Tariq Shafi, proprietor of Al Shafi
Group addressed to the PHC recommending grant of visa to
the   Appellant   “shows   his   proximity   with   Pakistani
Establishment”. It is stated that the name of Tariq Shafi
figures in the document of foreign contributions seized from
the   house   of   the   Appellant‟s   cashier­cum­accountant
Ghulam Mohd. Bhatt.”
6. The High Court also adverted to the accusations against
respondent (Accused No.10) in paragraphs 17.9 and 17.10 of
the charge­sheet, to the effect that CDRs relied upon by the
10
prosecution revealed that the accused persons were in contact
“with each other, with some militants/OGWs (Over Ground
Workers) and the hawala conduit” i.e. the respondent (Accused
No.10) and the other accused, that the respondent (Accused
No.10) was in constant contact on telephone with A­3, A­4, A5 and A­6 and that A­3 to A­12 were in contact with each
other, either directly or indirectly. In paragraph 17.10 of the
charge­sheet, it is stated that respondent (Accused No.10) was
a known hawala dealer and financer and a number of cases
were registered against him, which were being investigated by
the sister investigating agencies. The High Court, however,
noted that the charge­sheet neither gave details of the other
cases registered and being investigated against the respondent
nor revealed the details thereof to the Court. The High Court
also   noted   accusations against   the   respondent   (Accused
No.10) in paragraphs 18.10, 18.13 and 18.14, revealing the
linkage between A­3 to A­10 and indicating clear meeting of
minds   of   the   said   accused   in   hatching   the   conspiracy   in
11
support of A­1 and A­2 and other Hurriyat leaders and other
terrorist organizations in J & K.
7. After   noting   the   relevant   facts   emanating   from   the
charge­sheet   filed   against   the   respondent,   the   High   Court
adverted to the conclusions recorded by the Trial Court. It
then proceeded to analyse the relevant provisions of the 1967
Act and the principle underlying the decisions of this Court
concerning  the Terrorist and Disruptive Activities (Prevention)
Act, 1985 (“TADA”) and the Maharashtra Control of Organised
Crime   Act,   1999   (“MCOCA”),   in   light   of   the   exposition   in
Hitendra   Vishnu   Thakur  (supra)   and    Niranjan   Singh
Karam Singh Punjabi (supra), and posed a question to itself
as to whether the material gathered by the NIA in the present
case   could   have   enabled   the   Trial   Court   to   come   to   the
conclusion that there were reasonable grounds for believing
that the accusation against the respondent (Accused No.10)
was  prima  facie  true. After so noting, it observed that the
statements   of   the   proposed/prospective   witnesses   recorded
under   Section   161   Cr.P.C.   did   not   constitute   admissible
12
evidence. Those could only be used to confront the witnesses
who would subsequently appear at the trial. It noted that this
crucial aspect had to be kept in view while referring to such
statements at that stage. The High Court then noted that the
Investigating   Agency   had   recorded   the   statements   of   the
witnesses under Section 164 of Cr.P.C. but had kept the same
in a sealed cover enclosed to the charge­sheet. The High Court
noted that the statements at serial Nos.277 and 278 were of
protected witnesses “Charlie” and “Romeo” respectively, and
those at serial Nos.279 to 284 were described as statements of
protected   witnesses   “Romeo”,   “Alpha”,   “Gamma”,   “Pie”,
“Potter”, “Harry” and “xxx”. These statements were kept in a
sealed   cover   and   not   supplied   to   the   respondent   (Accused
No.10).   Further,   these   statements   were   presumably   not
perused   by   the   Designated   Court.   Notably,   the   application
moved by the Investigating Agency under Section 44 of the
1967 Act to accord protection to those witnesses remained
pending   before   the   Designated   Court.   Here,   it   may   be
mentioned that during the pendency of the present appeal
13
before this Court, the said application has been decided in
favour   of   the   Investigating   Agency   vide   order   dated   11th
January, 2019 passed by the Designated Court. We shall refer
to this a little later.
8. Reverting to the judgment of the High Court, it opined
that the said statements under Section 164 of Cr.P.C. could
not be considered, as copies thereof had not been provided to
the respondent. It then proceeded to hold that Section 44 of
the 1967 Act merely permitted the identity and address of
such witnesses to be kept secret by the Court. It held that it
was not possible to read Section 17 of the NIA or Section 44 of
the 1967 Act as an exception to Section 207 read with Section
173   Cr.P.C.,   which   mandates   that   the   accused   shall   be
supplied copies of the police report and other documents relied
upon by the prosecution in the charge­sheet, without delay
and free of cost. It then proceeded to analyse the interplay
between Sections 207, 161, 164 and 173 of Cr.P.C. and opined
that even in respect of statements recorded under Section 161
of   Cr.P.C.,   there   was   no   wholesale   exclusion   of   the   entire
14
document   from   being   provided   to   the   accused.   What   was
permitted was the redaction of such portion of the document
which could reveal the identity and address of the maker of
the statement.  Be it noted that the High Court did not think it
necessary to direct the Designated Court to first decide the
application filed by the Investigating Agency under Section 44
of the 1967 Act before proceeding with the hearing of the
appeal   filed   by   the   respondent.   Instead,   the   High   Court
preferred to exclude those statements kept in a sealed cover
from consideration. The High Court did not advert to Section
48  of   the   1967  Act,   which   makes  it   amply  clear  that  the
provisions   of   the   Act   shall   have   effect   notwithstanding
anything inconsistent therewith contained in any enactment
other than the said Act etc. The High Court then went on to
observe   that   the   charge­sheet   made   no   reference   to   the
statements recorded under Section 164 of the witnesses in
respect of whom protection was sought by the Investigating
Agency.   The   High   Court   distinguished   the   decision   of   this
Court   in  K.   Veeraswami   Vs.   Union   of   India   and   Ors.5
5
 (1991) 3 SCC 655
15
pressed into service by the Investigating Agency to buttress its
submission that it is not necessary that the charge­sheet must
contain detailed analysis of the evidence, and that the Trial
Court ought to consider not only the narration in the chargesheet but also all documents accompanying thereto. The  High
Court, however, opined that in the context of the relatively
high burden placed on the accused in terms of the proviso to
Section 43D(5) of the 1967 Act, of having to demonstrate that
the prosecution had not been able to show that there existed
reasonable grounds to show that the accusation against him
was prima facie true, the  absence of any reference in the
charge­sheet  to  the  statements  under  Section   164  Cr.P.C.,
which are of a higher probative value than the statements
under Section 161 Cr.P.C., was significant. It thus observed
that   such   statements   could   not   be   kept   back   from   the
accused.   Resultantly,   the   statements   of   the   protected
witnesses recorded under Section 164 Cr.P.C. were kept out of
consideration by the High Court, with liberty to the parties to
16
independently make submissions before the Trial Court at the
appropriate stage.
9. The High Court then straightaway proceeded to analyse
the efficacy of document D­132(a) forming part of the chargesheet. In light of the statement of Ghulam Mohammad Bhatt
from whom the same was recovered, it noted in paragraph 61
of   the   impugned   judgment   that   it   was   unlikely   that   the
document   D­132(a)   was   recovered   from   the   residence   of
Ghulam   Mohammad   Bhatt   till   16th  August,   2017,   and
thereafter proceeded to observe thus:
“62.   While   the   genuineness   and   the   evidentiary   value   of
Document 132 (a) is yet to be established by the NIA at the
trial, since this one document is being relied upon by the
NIA as being central to its case against the Appellant, it is
but inevitable that the trial Court and now this Court has to
discuss it in some detail for the purpose of deciding whether
the Appellant can be released on bail.
63. The question that arises is whether there is anything to
show with reference to each of the dates mentioned in the
above Document No. 132 (a) that the figures shown against
the entry on each date (purporting to be specific amounts of
money) was in fact received by the Appellant in his personal
accounts or in the accounts of any of his entities. Although
the case of the NIA is that the money has been received,
there is no document or statement, which forms part of the
charge sheet, which in fact indicates this.
64. The above document is also relied upon by the NIA as
providing   proof   of   the   linkages   of   the   Appellant   to   A­1,
through   the   entry   dated   3rd   May,   2015   and   with   the
17
Pakistan High Commission (PHC) through the entries dated
15th and 20th October, 2016. Yet none from the PHC has
been named, much less statement of such a person been
recorded to confirm that those figures represented money
that was received from the PHC.
65. The case of the NIA in the charge sheet is that the same
document   is   also   proof   of   the   fact   that   the   monies   so
received were passed on to the Hurriyat leaders. Reference is
made to the fourth column of the above document where the
names   of   some   of   the   Hurriyat   leaders   are   mentioned.
However,   there   is   nothing   to   show   that   the   money   was
received by the Appellant and then transmitted by him to
any of the named Hurriyat leaders. Nor have any of the
‘prospective   witnesses’   including   Mr   Bhatt   made   any
statement to that effect.
66. Mr. Luthra urged that the signature of the Appellant in
the right hand bottom corner of the document  has been
confirmed by the handwriting expert to match the specimen
signature of the Appellant. In reply it was pointed out by Mr.
Vikas Pahwa, learned Senior counsel for the Appellant, that
the mere fact that the Appellant’s signature appeared on the
document   did   not   mean   that   he   had   in   fact   signed   the
document   in   acceptance   of   the   truth   of   its   contents.
According to him, it is too early to speculate whether the
Appellant   when   he   signed   the   paper,   if   at   all,   put   his
signature on a blank green legal size paper which may be
have then been used for legal purposes for an affidavit etc.
67. It is indeed too early in the case to speculate whether the
Appellant in fact signed the document after it was typed out
and whether his signature amounts to accepting the truth of
its contents or for that matter whether the contents of the
document in question constitute conclusive proof of what the
NIA alleges the document to be.
68. In the circumstances, the Court is not satisfied that a
sheet of paper containing typed entries and in loose form,
not shown to form part of the books of accounts regularly
maintained by the Appellant or his business entities, can
constitute   material   to   even   ‘prima   facie’  connect   the
Appellant   with   the   crime   with   which   he   is  sought   to   be
charged.   The   conclusion   of   the   trial   Court   that   this
18
document shows the connection of the Appellant with the
other accused as regards terrorist funding does not logically
or legally flow from a plain reading of the document.”
10. The High Court then adverted to the other documents. It
analysed the concerned documents and concluded that the
entire bunch of documents did not reveal that the trading
activities undertaken by the respondent were geared towards
funding of terrorist activities, as alleged in the charge­sheet. It
may be apposite to reproduce the relevant extract from the
impugned judgment in this regard, which reads thus:
“69. Mr. Luthra then referred to the statements of Mustaq
Ahmad Mir and Shabbir Ahmad Mir, the reply of Mr Mustaq
Ahmad   Mir   (Ex.D­214),   the   CFSL   report   dated   6th
November, 2017 (document D­154); the seizure memo dated
3rd June, 2017 (document D­3) regarding the recovery being
made from the residence of the Appellant; the seizure memo
of the same date of the recoveries from the office of the
TFCPL (document D­4); and the bunch of papers seized from
the Appellant [D­4(e)] referred to by the trial Court.
70. Beginning with the last referred document, [D­4(e)], it is
actually a bunch of documents, the first of which is a letter
dated 28th June, 2016, written by the Prime Minister of
Pakistan   Mr   Mohammad   Nawaz   Sharif   to   the   Appellant
thanking him for the bouquet sent to him with wishes for his
good health and well being.
71. Then there is a letter dated 20th November, 2007 from
the President of the Azad Jammu and Kashmir, Chambers of
Commerce   and   Industry,   addressed   to   the   Appellant,
appointing the Appellant as an Honorary Trade Consultant
at   Srinagar.   It   notes   that   Pakistan   and   India   had
initiated/undertaken   a   number   of   Kashmir   related   CBMs
19
(confidence building measures) in the recent past to provide
respite to the Kashmiris on both sides of the LoC (Line of
Control):
‘1.Pakistan   and   India   have   initiated/undertaken   a
number   of   Kashmir   related   CBMs   in   recent   past   to
provide respite to the Kashmiris on both sides of the
LoC. One such CBM which is under active consideration
is   commencement   of   trade   between   both   parts   of
Kashmir. Necessary modalities including the items to be
traded are being worked out.’
72. The other documents reflect the correspondence carried
out   in   the   regular   course   of   business   between   the
Appellant’s business entities and other entities including the
Al­Shafi Group of companies, headquartered at Lahore. A
business invitation was extended to the Appellant on 7th
February, 2014 by Mohd. Tariq Shafi, the director of Al­Shafi
Group of companies to visit them for business negotiations.
There is a letter of the same date addressed by Mr. Mohd.
Tariq Shafi to the PHC in New Delhi for grant of Pakistan
Business Visa to the Appellant.
73. It must be noticed at this stage that the NIA does not
dispute   that   the   Appellant   is   a   leading   businessman   in
Kashmir. He runs a conglomerate of business entities and
has been active in the context of the Indo­Pakistan trade.
Nothing has been shown to this Court from the entire bunch
of documents which would suggest that these trade activities
were geared toward funding of terrorist activities, as alleged
in the charge­sheet.”
11. The   High   Court   then   adverted   to   the   statements   of
Mustaq Ahmad Mir and Shabbir Ahmad Mir and noted that
the same had no evidentiary value since they were merely
statements under Section 161 Cr.P.C. and even if taken at
their face value, they would only indicate that some of the
entries in the accounts and, in particular, the source of credit
20
entries were not explained properly. Further, the accounts of
the entities of the respondent were regularly audited and it
was not possible to prima facie conclude that these unknown
sources were, in fact, connected to the other accused and that
remittances were received from Pakistan or UAE for terrorist
activities. The Court noted that there must be something more
substantial than mere audited accounts that may have entries
that require explanation to the Income Tax Authorities. As a
result, the High Court concluded that the documents relied
upon by the Investigating Agency did not persuade the Court
to prima facie conclude that the respondent received money
from A­1 or Pakistan High Commission or others and was
passing on the said funds to the Hurriyat leaders for funding
terrorist  activities  and  stone­pelting.   The  High  Court  also
adverted to the statement of the ‘protected witness’   W­48
about the proximity of the respondent (Accused No.10) with A4 and A­6 and opined that the same could not be construed as
material   that   would   enable   the   prosecution   to   show   that
accusation against the respondent about his funding terrorist
21
activities was  prima facie  true.   Lastly, the High Court dealt
with transaction of lease involving Naval Kishore Kapoor and
noted thus:
“77. Turing to the transaction of lease involving Mr. Naval
Kishore Kapoor, it is explained on behalf of the Appellant
that   only   individuals   domiciled   in   Kashmir   can   hold
properties there. There was no declaration of ‘ownership’ of
lands by the companies and in any event it was a lease. The
lease itself has not been shown to be a sham transaction. As
regards the NRE account, it is pointed out that it has since
been closed and the fine amount was also paid. As regards
the   CDRs,   it   is   pointed   out   that   there   may   have   been
exchange of calls between the Appellant and A­6 but not
between the Appellant and A­3, A­4 or A­5. This cannot at
this stage be said to constitute material to show that the
accusation of a criminal conspiracy between the Appellant
and A­6 for commission of terrorist offences is prima facie
true. It also emerged during the course of the hearing of this
appeal that neither the APHC nor any of its 26 constituent
organisations are ‘banned’ organisations within the meaning
of the UAPA.”
12. Having said thus, the High Court proceeded to conclude
that the order passed by the Designated Court was cryptic and
unsustainable both on facts and in law. It then went on to
observe   that   there   was   nothing   on   record   to   indicate   the
previous criminal involvement of the respondent in any offence
or   the  possibility  of   the   respondent   fleeing  from   justice,   if
released   on   bail.   Further,   the   respondent   who   was   a
septuagenarian   and   was   suffering   from   various   medical
22
ailments, was in judicial custody for more than a year and had
not tampered with the evidence or interfered with any of the
‘prospective/protected’ witnesses. The High Court then went
on to rely on the dictum in  Davender  Gupta  Vs.  National
Investigating   Agency6
  and  Sanjay   Chandra   Vs.   CBI 7
.
Finally, the High Court directed the release of respondent on
bail and issued directions in that regard subject to conditions
stated in the concluding part of the impugned judgment which
reads thus:
“Conclusion
82. The impugned order dated 8th June, 2018 of the trial
Court is accordingly set aside. The Appellant is directed to be
released on bail subject to his furnishing a personal bond in
the sum of Rs.2 lakhs with two sureties of like amount to the
satisfaction of the trial Court, and further subject to the
following conditions:
(i) The Appellant shall report to the IO in charge of the
case as and when required. He shall provide to the IO as
well as the trial Court the mobile phone on which he
can be contacted and his current address where he will
be available. He will keep both the IO and the trial Court
informed promptly if there is any change in either.
(ii)   He   will   not   influence   or   intimidate   the
proposed/prospective   Crl.A.768/2018   Page   40   of   40
prosecution witnesses or tamper with the evidence of
the prosecution in any manner.
(iii) The Appellant will surrender his passport before the
trial Court at the time of execution of the bail bonds. He
will   not   travel   out   of   the   country   without   prior
permission of the trial Court.
6
  (2014) SCC Online AP 192
7
  AIR 2012 SC 830
23
(iv) If there is any breach of the above conditions, it will
be   open   to   the   NIA   to   apply   to   the   trial   Court   for
cancellation of bail.
83. It is clarified that the observations of this Court in this
order  both  on  facts  and  law   are  based   on  the  materials
forming  part   of  the  charge   sheet  and   are  prima   facie   in
nature and for the limited purpose of considering the case of
the Appellant for grant of bail. They are not intended to
influence the decisions of the trial Court at any stage of the
case hereafter.
84. The appeal is allowed in the above terms.”
13. The view so taken by the High Court has been assailed by
the Investigating Agency – the appellant herein, on diverse
counts.   According   to   the   appellant,   the   High   Court   has
virtually   conducted   a   mini   trial   and   even   questioned   the
genuineness of the documents relied upon by the Investigating
Agency. In that, the High Court adopted a curious approach in
finding fault with the Investigating Agency for not naming any
official from the High Commission of Pakistan as accused or
recording   their   statements   as   witnesses,   for   inexplicable
reasons.   In so observing, the High Court clearly overlooked
the fact that the officials of the High Commission are accorded
diplomatic   immunity.   Not   only   that,   while   considering   the
statements   of   witnesses   recorded   under   Section   161   of
24
Cr.P.C., the High Court went on to observe that the same were
inadmissible in evidence and discarded it from consideration
for forming opinion as to whether the accusations against the
respondent (Accused No.10) were prima facie true. The Court,
however, was obliged to consider all the statements recorded
under   Section   161   of   Cr.P.C.   in   light   of   the   exposition   in
Salim   Khan   Vs.   Sanjai   Singh   and   Anr. 8
  Similarly,   the
statements recorded under Section 164, which were produced
in   a   sealed   cover,   had   been   completely   discarded.   The
approach of the High Court, to say the least, contends the
learned Attorney General, was tenuous and not permissible at
the stage of consideration of prayer for bail. The analysis done
by the High Court is bordering on being perverse as it has
virtually conducted a mini trial at the stage of consideration of
the prayer for bail. According to the appellant, the chargesheet   filed   against   the   respondent   was   accompanied   by
documentary   evidence,   statements   of   prospective   witnesses
and   other   evidence   which   indicated   complicity   of   the
respondent   and   reinforced  the   aspect   that   the   accusations
8
  (2002) 9 SCC 670
25
made against him were prima facie true. It is submitted that at
the stage of consideration of bail, the totality of the evidence
available against the respondent must be reckoned and ought
to be taken into account as it is, without anything more. The
question of admissibility of such evidence would be a matter
for trial. The sufficiency or insufficiency of the evidence cannot
be the basis to answer the prayer for grant of bail.   It is
contended that after considering the statements of protected
witnesses recorded under Section 164 of the Code, the same
reinforces   the   accusations   made   against   the   respondent
(Accused No.10) as being  prima facie  true. Accordingly, it is
submitted that the High Court order be set aside and the
application   for   bail   preferred   by   the   respondent   (Accused
No.10) be rejected.
14. Learned counsel for the respondent, on the other hand,
submits   that   the   High   Court   justly   came   to   hold   that   no
evidence was  forthcoming  to  indicate  the complicity of  the
respondent in the commission of the alleged offences and that
the documents and evidence relied upon by the Investigating
26
Agency were not enough to sustain the accusations,   much
less   as   being  prima   facie  true.   It   is   submitted   that   the
accusations made against the respondent in the charge­sheet
do not fall under Chapters IV and VI of the 1967 Act.  Further,
the pivotal document D­132(a) was not sufficient to fasten any
criminal liability upon the respondent.  As a matter of fact, the
said document is a loose sheet of paper and cannot be looked
at in view of the mandate of Section 34 of the Evidence Act. To
buttress this submission, reliance has been placed on Central
Bureau of Investigation Vs. V.C. Shukla and Ors.9
  In any
case, the said document itself cannot and does not prima facie
suggest that the funds, as shown, were received and disbursed
in the manner described in the document.  Further, there is
no   independent   corroboration   forthcoming   much   less   to
establish the complicity of the respondent in attracting the
imperatives of Section 17 of 1967 Act. It is submitted that
even if the contents of the said document were taken as it is,
with   the   exception   of   accused   No.4   (Altaf   Ahmad   Shah   @
9
  (1998) 3 SCC 410
27
Fantoosh), no other person to whom the amount was paid or
from whom the amount was received, has been arrayed as an
accused   in   the   charge­sheet.   The   statements   of   witnesses
recorded under Section 161 or Section 164 of Cr.P.C. do not
mention anything about the involvement of the respondent in
commission of the stated offences. The statements of the coaccused cannot be considered as admissions, much less used
against  the  respondent.  Further, there was no  evidence to
indicate   the   involvement   of   the   respondent   in   the   larger
conspiracy   much   less   regarding   terrorist   activity.   It   is
submitted that the High Court was justified in analysing the
materials   on   record   to   satisfy   itself   as   to   whether   the
accusations made against the respondent were prima facie
true. That enquiry was permissible in terms of the exposition
in  Ranjitsing   Brahmajeetsing   Sharma   Vs.   State   of
Maharashtra  and  Anr.10   and  Chenna  Boyanna  Krishna
Yadav  Vs. State of Maharashtra and Anr.11   According to
the respondent, no fault can be found with the High Court and
10
  (2005) 5 SCC 294
11
  (2007) 1 SCC 242
28
the view taken by the High Court, being a possible view, did
not require any interference in exercise of the power under
Article 136 of the Constitution of India. It is finally submitted
that   this   Court,   if   it   so   desires,   may   impose   additional
conditions whilst upholding the order of bail passed by the
High Court.
15. Before we proceed to analyse the rival submissions, it is
apposite to restate the settled legal position about matters to
be considered for deciding an   application for bail,   to   wit,
(i) whether there is any prima facie or reasonable ground to
believe that the accused had committed the offence; (ii) nature
and gravity of the charge; (iii) severity of the punishment in the
event of conviction; (iv) danger of the accused absconding or
fleeing, if released on bail; (v) character, behaviour, means,
position and standing of the accused; (vi) likelihood of the
offence being repeated; (vii) reasonable apprehension of the
witnesses being tampered with; and (viii) danger, of course, of
29
justice being thwarted by grant of bail. (State of U.P. through
CBI Vs. Amarmani Tripathi12).
16. When   it   comes   to   offences   punishable   under   special
enactments, such as the 1967 Act, something more is required
to be kept in mind in view of the special provisions contained
in Section 43D of the 1967 Act, inserted by Act 35 of 2008
w.e.f.   31st  December,   2008.     Sub­sections   (5),   (6)   and   (7)
thereof read thus:
“43D.  Modified   application  of   certain  provisions  of   the
Code.­    xxx xxx xxx xxx
(5)   Notwithstanding   anything   contained   in   the   Code,   no
person accused of an offence punishable under Chapters IV
and VI of this Act shall, if in custody, be released on bail or
on  his own  bond  unless  the Public  Prosecutor has  been
given an opportunity of being heard on the application for
such release:
Provided that such accused person shall not be released on
bail or on his own bond if the Court, on a perusal of the case
diary or the report made under section 173 of the Code is of
the opinion that there are reasonable grounds for believing
that the accusation against such person is prima facie true.
(6)   The   restrictions   on   granting   of   bail   specified   in   subsection (5) is in addition to the restrictions under the Code or
any other law for the time being in force on granting of bail.
(7) Notwithstanding anything contained in sub­sections (5)
and (6), no bail shall be granted to a person accused of an
offence punishable under this Act, if he is not an Indian
citizen   and   has   entered   the   country   unauthorisedly   or
illegally except  in very exceptional  circumstances  and for
reasons to be recorded in writing.”
12
  (2005) 8 SCC 21 (para 18)
30
17. By virtue of the proviso to sub­section (5), it is the duty of
the Court to be satisfied that there are reasonable grounds for
believing that the accusation against the accused is  prima
facie  true   or   otherwise.   Our   attention   was   invited   to   the
decisions of this Court, which has had an occasion to deal
with   similar   special   provisions   in   TADA   and   MCOCA.   The
principle underlying those decisions may have some bearing
while considering the prayer for bail in relation to offences
under   the   1967   Act   as   well.   Notably,   under   the   special
enactments such as TADA, MCOCA and the Narcotic Drugs
and Psychotropic Substances Act, 1985, the Court is required
to record   its opinion that there are reasonable grounds for
believing that the accused is “not guilty” of the alleged offence.
There is degree of difference between the satisfaction to be
recorded by the Court that there are reasonable grounds for
believing that the accused is “not guilty” of such offence and
the satisfaction to be recorded for the purposes of the 1967
Act that there are reasonable grounds for believing that the
accusation against such person is “prima facie”  true. By its
31
very nature, the expression “prima facie true” would mean that
the materials/evidence collated by the Investigating Agency in
reference to the accusation against the concerned accused in
the first information report, must prevail until contradicted
and overcome or disproved by other evidence, and on the face
of it, shows the complicity of such accused in the commission
of the stated offence. It must be good and sufficient on its face
to establish a given fact or the chain of facts constituting the
stated offence, unless rebutted or contradicted.  In one sense,
the degree of satisfaction is lighter when the Court has to
opine that the accusation is “prima facie true”, as compared to
the   opinion     of     accused   “not   guilty”   of   such   offence   as
required under the other special enactments. In any case, the
degree of satisfaction to be recorded by the Court for opining
that   there   are   reasonable   grounds   for   believing   that   the
accusation against the accused is prima facie true, is lighter
than the degree of satisfaction to be recorded for considering a
discharge   application   or   framing   of   charges   in   relation   to
offences   under   the   1967   Act.   Nevertheless,   we   may   take
32
guidance   from   the   exposition   in   the   case   of  Ranjitsing
Brahmajeetsing   Sharma  (supra),   wherein   a   three­Judge
Bench of this Court was called upon to consider the scope of
power of the Court to grant bail. In paragraphs 36 to 38, the
Court observed thus:
“36.  Does   this   statute   require   that   before   a   person   is
released on bail, the court, albeit prima facie, must come to
the conclusion that he is not guilty of such offence? Is it
necessary for the court  to record such a finding?  Would
there be any machinery available to the court to ascertain
that once the accused is enlarged on bail, he would not
commit any offence whatsoever?
37.  Such findings are required to be recorded only for the
purpose of arriving at an objective finding on the basis of
materials on record only for grant of bail and for no other
purpose.
38. We are furthermore of the opinion that the restrictions
on the power of the court to grant bail should not be pushed
too far. If the court, having regard to the materials brought
on record, is satisfied that in all probability he may not be
ultimately convicted, an order granting bail may be passed.
The satisfaction of the court as regards his likelihood of not
committing an offence while on bail must be construed to
mean   an   offence   under   the   Act   and   not   any   offence
whatsoever be it a minor or major offence. … What would
further be necessary on the part of the court is to see the
culpability   of   the   accused   and   his   involvement   in   the
commission   of   an   organised   crime   either   directly   or
indirectly.   The   court   at   the   time   of   considering   the
application for grant of bail shall consider the question from
the angle as to whether he was possessed of the requisite
mens rea….”
And again in paragraphs 44 to 48, the Court observed:   
33
“44. The wording of Section 21(4), in our opinion, does not
lead   to   the   conclusion   that   the   court   must   arrive   at   a
positive finding that the applicant for bail has not committed
an offence under the Act. If such a construction is placed,
the court intending to grant bail must arrive at a finding that
the applicant has not committed such an offence. In such an
event, it will be impossible for the prosecution to obtain a
judgment of conviction of the applicant. Such cannot be the
intention   of   the   legislature.   Section   21(4)   of   MCOCA,
therefore,   must   be   construed   reasonably.   It   must   be   so
construed   that   the   court   is   able   to   maintain   a   delicate
balance between a judgment of acquittal and conviction and
an order granting bail much before commencement of trial.
Similarly, the court will be required to record a finding as to
the possibility of his committing a crime after grant of bail.
However, such an offence in futuro must be an offence under
the Act and not any other offence. Since it is difficult to
predict the future conduct of an accused, the court must
necessarily consider this aspect of the matter having regard
to the antecedents of the accused, his propensities and the
nature and manner in which he is alleged to have committed
the offence.
45.  It   is,   furthermore,   trite   that   for   the   purpose   of
considering an application for grant of bail, although detailed
reasons are not necessary to be assigned, the order granting
bail must demonstrate application of mind at least in serious
cases as to why the applicant has been granted or denied the
privilege of bail.
46.  The duty of the court at this stage is not to weigh the
evidence meticulously but to arrive at a finding on the basis
of broad probabilities. However, while dealing with a special
statute   like   MCOCA   having   regard   to   the   provisions
contained in sub­section (4) of Section 21 of the Act, the
court may have to probe into the matter deeper so as to
enable it to arrive at a finding that the materials collected
against the accused during the investigation may not justify
a judgment of conviction. The findings recorded by the court
while   granting   or   refusing   bail   undoubtedly   would   be
tentative in nature, which may not have any bearing on the
merit of the case and the trial court would, thus, be free to
decide the case on the basis of evidence adduced at the trial,
without in any manner being prejudiced thereby.
34
47. In Kalyan Chandra Sarkar v. Rajesh Ranjan13 this Court
observed: (SCC pp. 537­38, para 18)
‘18. We agree that a conclusive finding in regard to the
points urged by both the sides is not expected of the
court considering a bail application. Still one should not
forget, as observed by this Court in the case  Puran  v.
Rambilas14 : (SCC p. 344, para 8)
‘Giving reasons is different from discussing merits or
demerits.   At   the   stage   of   granting   bail   a   detailed
examination of evidence and elaborate documentation of
the merits of the case has not to be undertaken. … That
did not mean that whilst granting bail some reasons for
prima facie concluding why bail was being granted did
not have to be indicated.’
We   respectfully   agree   with   the   above   dictum   of   this
Court. We also feel that such expression of prima facie
reasons   for   granting  bail   is   a   requirement   of   law   in
cases   where   such   orders   on   bail   application   are
appealable,   more   so   because   of   the   fact   that   the
appellate court has every right to know the basis for
granting the bail. Therefore, we are not in agreement
with the argument addressed by the learned counsel for
the accused that the High Court was not expected even
to indicate a prima facie finding on all points urged
before it while granting bail, more so in the background
of the facts of this case where on facts it is established
that a large number of witnesses who were examined
after the respondent was enlarged on bail had turned
hostile and there are complaints made to the court as to
the   threats   administered   by   the   respondent   or   his
supporters   to   witnesses   in   the   case.   In   such
circumstances, the Court was duty­bound to apply its
mind to the allegations put forth by the investigating
agency and ought to have given at least a prima facie
finding in regard to these allegations because they go to
the very root of the right of the accused to seek bail. The
non­consideration   of   these   vital   facts   as   to   the
allegations   of   threat   or   inducement   made   to   the
witnesses by the respondent during the period he was
on bail has vitiated the conclusions arrived at by the
High Court while granting bail to the respondent. The
other ground apart  from the ground of  incarceration
13
  (2004) 7 SCC 528
14
  (2001) 6 SCC 338
35
which appealed to the High Court to grant bail was the
fact   that   a   large   number   of   witnesses   are   yet   to  be
examined and there is no likelihood of the trial coming
to an end in the near future. As stated hereinabove, this
ground on the facts of this case is also not sufficient
either   individually   or   coupled   with   the   period   of
incarceration to release the respondent on bail because
of   the   serious   allegations   of   tampering   with   the
witnesses made against the respondent.’
48. In Jayendra Saraswathi Swamigal v. State of T.N.15  this
Court observed: (SCC pp. 21­22, para 16)
‘16. … The considerations which normally weigh with
the court in granting bail in non­bailable offences have
been explained by this Court in  State  v.  Capt. Jagjit
Singh16   and  Gurcharan Singh  v.  State (Delhi Admn.)17
and basically they are — the nature and seriousness of
the   offence;   the   character   of   the   evidence;
circumstances   which   are   peculiar   to   the   accused;   a
reasonable possibility of the presence of the accused not
being secured at the trial; reasonable apprehension of
witnesses being tampered with; the larger interest of the
public or the State and other similar factors which may
be relevant in the facts and circumstances of the case.’ ”
18. A priori, the exercise to be undertaken by the Court at
this stage ­ of giving reasons for grant or non­grant of bail ­ is
markedly different from discussing merits or demerits of the
evidence.   The   elaborate   examination   or   dissection   of   the
evidence is not required to be done at this stage. The Court is
merely expected to record a finding on  the basis of broad
15
  (2005) 2 SCC  13
16
  (1962) 3 SCR 622
17
  (1978) 1 SCC 118
36
probabilities regarding the involvement of the accused in the
commission   of   the   stated   offence   or   otherwise.   From   the
analysis of the impugned judgment, it appears to us that the
High Court has ventured into an area of examining the merits
and demerits of the evidence.  For, it noted that the evidence
in the form of statements of witnesses under Section 161 are
not admissible. Further, the documents pressed into service
by the Investigating Agency were not admissible in evidence. It
also noted that it was unlikely that the document had been
recovered from the residence of Ghulam Mohammad Bhatt till
16th August, 2017 (paragraph 61 of the impugned judgment).
Similarly,   the   approach   of   the   High   Court   in   completely
discarding the statements of the protected witnesses recorded
under Section 164 of Cr.P.C., on the specious ground that the
same was kept in a sealed cover and was not even perused by
the   Designated   Court   and   also   because   reference   to   such
statements having been recorded was not found in the chargesheet already filed against the respondent  is, in our opinion,
in complete disregard of the duty of the Court to record its
37
opinion   that   the   accusation   made   against   the   concerned
accused is prima facie true or otherwise.  That opinion must
be   reached   by   the   Court   not   only   in   reference   to   the
accusation in the FIR but also in reference to the contents of
the case diary and including the charge­sheet (report under
Section 173 of Cr.P.C.) and other material gathered by the
Investigating Agency during investigation. Be it noted that the
special provision, Section 43D of the 1967 Act, applies right
from   the   stage   of   registration   of   FIR   for   offences   under
Chapters IV and VI of the 1967 Act until the conclusion of the
trial thereof. To wit, soon after the arrest of the accused on the
basis of the FIR registered against him, but before filing of the
charge­sheet by the Investigating Agency; after filing of the
first charge­sheet and before the filing of the supplementary or
final charge­sheet consequent to further investigation under
Section 173(8) Cr.P.C., until framing of the charges or after
framing of the charges by the Court and recording of evidence
of key witnesses etc. However, once charges are framed, it
would be safe to assume that a very strong suspicion was
38
founded upon the materials before the Court, which prompted
the Court to form a presumptive opinion as to the  existence of
the factual ingredients constituting the offence alleged against
the accused, to justify the framing of charge. In that situation,
the accused may have to undertake an arduous task to satisfy
the court that despite the framing of charge, the materials
presented along with the charge­sheet (report under Section
173   of   Cr.P.C.),   do   not   make   out   reasonable   grounds   for
believing that the accusation against him is prima facie true.
Similar opinion is required to be formed by the Court whilst
considering the prayer for bail, made after filing of the first
report made under Section 173 of the Code, as in the present
case.
19. For   that,   the   totality   of   the   material   gathered   by   the
Investigating Agency and presented along with the report and
including the case diary, is required to be reckoned and not by
analysing   individual pieces of evidence or circumstance. In
any case, the question of discarding the document at this
stage, on the ground of being inadmissible in evidence, is not
permissible.   For,   the   issue   of   admissibility   of   the
39
document/evidence would be a matter for trial. The Court
must look at the contents of the document and take such
document into account as it is. 
20. The question is whether there are reasonable grounds for
believing that the accusations made against the respondent
(Accused No.10) are  prima  facie  true. That will have to be
answered keeping in mind the totality of materials including
the one presented along with the police report. Be it noted that
the prosecution is relying on several documents forming part
of the first charge­sheet (pending further investigation) filed
against the respondent (Accused No.10) allegedly showing his
involvement   in   the   commission   of   the   stated   offences.
Reference has been made to some of the crucial documents
mentioned   in   the   chart   handed   over   to   the   Court   by   the
appellant. The same, inter alia, read thus:
NIA CASE NO.RC­10/2017/NIA/DLI
TERROR FUNDING IN JAMMU & KASHMIR
EVIDENCES FILED WITH CHARGE­SHEET
(Excluding Supplementary Charge sheet)
Against Accused Zahoor Ahmed Shah Watali (A­10)
Exhibit Details of Documents
D­1 Order no.11011/26/2017­IS.IV, dated 30.05.2017 of Sh. N.S.
40
Bisht, Under Secretary, GOI, MHA, New Delhi.
D­2 FIR No.RC­10/2017/NIA/DLI dated 30.05.2017, PS NIA New
Delhi.
D­3 Seizure   memo   dated   03.06.2017   in   respect   of   search   and
recovery  of articles/documents  seized from the premises  of
accused Zahoor Ahmed Shah Watali (A­10).
D­3a Income Tax Returns of Three Star Enterprises seized from the
premises of accused Zahoor Ahmed Shah Watali (A­10) dated
03.06.2017.
D­3b Income Tax Returns of Trisons Farms and Construction Pvt.
Ltd. seized from the premises of accused Zahoor Ahmed Shah
Watali (A­10) dated 03.06.2017.
D­3c Acknowledgment ITR­4 of Yamin Zahoor Shah seized from the
premises of accused Zahoor Ahmed Shah Watali (A­10) dated
03.06.2017.
D­3d Acknowledgment ITR­4 of Yawar Zahoor Shah seized from the
premises of accused Zahoor Ahmed Shah Watali (A­10) dated
03.06.2017.
D­3e Income Tax Returns of M/s Three Y seized from the premises
of   accused   Zahoor   Ahmed   Shah   Watali   (A­10)   dated
03.06.2017.
D­3f Income Tax Returns in respect of Yasir Enterprises seized from
the premises of accused Zahoor Ahmed Shah Watali (A­10)
dated 03.06.2017.
D­3g One blue colour small pocket diary seized from the premises of
accused Zahoor Ahmed Shah Watali (A­10) dated 03.06.2017.
D­3h One blue booklet containing I.D.D Codes and Phone numbers
seized   from   the   premises   of   accused   Zahoor   Ahmed   Shah
Watali (A­10) dated 03.06.2017.
D­3i A bunch of papers related to Pakistan Steel Mill Corp. Ltd.
seized   from   the   premises   of   accused   Zahoor   Ahmed   Shah
41
Watali (A­10) dated 03.06.2017.
D­3j A   bunch   of   papers   containing   Court   documents   related   to
Zahoor   Ahmad   Shah   Watali   seized   from   the   premises   of
accused Zahoor Ahmed Shah Watali (A­10) dated 03.06.2017.
D­3k A   bunch   of   papers   containing   Misc.   documents   related   to
Zahoor   Ahmed   Shah   seized   from   the   premises   of   accused
Zahoor Ahmed Shah Watali (A­10) dated 03.06.2017.
D­3l A bunch of papers containing various letter heads related to
Zahoor Ahmad seized from the premises of accused Zahoor
Ahmed Shah Watali (A­10) dated 03.06.2017.
D­4 Production cum Seizure Memo dated 03.06.2017 regarding the
seizure   of   documents/articles   from   the   office   of   accused
Zahoor   Ahmad   Shah   Watali   (A­10)   i.e.   Trison   Farms   and
Construction Pvt. Ltd.
D­4a Copies   of   documents   related   to   N.Z.   International,   Yasir
Enterprises,   Trison   Farms   &   Construction,   Trison
International, Trison Power Pvt. Ltd., M/s 3Y, Kashmir Veneer
Industry along with Passport details of Zahoor Ahmad Shah
Watali (A­10) and his family members seized from the office of
accused Zahoor Ahmad Shah Watali i.e. Trison Farms and
Construction Pvt. Ltd.
D­4b Copy of order number DMS/PSA/37/2011 dated 28.09.2011
issued by District Magistrate Srinagar regarding detention of
one Tariq Ahmad Khan @ SanjMolvi seized from the office of
accused Zahoor Ahmed Shah Watali (A­10) i.e. Trison Farms
and Construction Pvt. Ltd.
D­6c One blue Colour Diary “Evergreen Traders” seized from the
premises of accused Altaf Ahmad Shah @ Fantoosh (A­4) on
03.06.17.
D­6e A   press   Note   containing   anti   India   talks   seized   from   the
premises of accused Altaf Ahmad Shah @ Fantoosh (A­4) on
03.06.17.
42
D­6f A program issued on 04.08.2016 under the signature of Syed
Ali  Shah  Geelani,  Chairman, All  Party  Hurriyat  Conference
seized   from   the   premises   of   accused   Altaf   Ahmad   Shah  @
Fantoosh (A­4) on 03.06.17.
D­6g One   paper   containing   details   of   amount   received   from
chairman and others showing an amount of Rs.1,15,45,000/­
seized   from   the   premises   of   accused   Altaf   Ahmad   Shah  @
Fantoosh (A­4) on 03.06.17.
D­7a Two letters dated 10.03.2006 and 17.03.2006) written by the
Area   Commander   of   Hizbul   Mujahideen   (HM)   to   accused
Nayeem Khan (A­5) seized from the house of accused nayeem
Khan dated 03.06.2017.
D­7b Letter   heads   of   proscribed   terrorist   organization   Lashkar   e
Toiba   (LeT),   Jammu   &   Kashmir   seized   from   the   house   of
accused Nayeem Khan (A­5) dated 03.06.2017.
D­7c Letter written to Pakistan Embassy by accused Nayeem Khan
(A­5) for recommending Visa to visit Pakistan seized from the
house of accused Nayeem Khan dated 03.06.2017.
D­7d Letter heads of National Front containing pro Pak and antiIndia talks in urdu seized from the house of accused Nayeem
Khan (A­5) dated 03.06.2017.
D­7e One letter head of Mujahidin Jammu & Kashmir seized from
the house of accused Nayeem Khan (A­5) dated 03.06.2017.
D­7g A   bunch   of   hand   written   and   printed   papers   containing
recommendation Letters written to Pakistan Embassy for Visa
for students etc. seized from the house of accused Nayeem
Khan (A­5) dated 03.06.2017.
D­9a Hand written (Urdu) letters from LeT on the letter head titled
as   “Lashkar­e­Tuibah   Jammu   Kashmir   Head   Office
Muzafarabad.” seized from the house of accused Shahid­ulIslam @ AftabHilali Shah (A­3) on 03.06.2017.
D­9b A photograph of Aftab Hilali Shah @ Shahid­ul­Islam holding
43
AK­47   with   other   cadres   seized   from   the   residence   of
AftabHilali Shah @ Shahid­Ul­Islam (A­3) on 03.06.2017.
D­9c Phograph of Aftab Hilali Shah @ Shahid­ul­Islam (A­3) with
Proscribed terrorist organization Hizbul Mujahiddin Chief Syed
Salahuddin (A­2) seized from the residence of AftabHilali Shah
@ Shahid­Ul­Islam (A­3) on 03.06.2017.
D­9d 04  hand written loose  papers  seized   from  the  residence  of
AftabHilali Shah @ Shahid­Ul­Islam (A­3) on 03.06.2017.
D­9e One letter head in respect of All Parties Hurriyat Conference
addressed to Deputy High Commissioner, High Commission of
Pakistan   New   Delhi   from   Media   advisor   APHC,   Advocate
Shahidul Islam for issuing the Visa seized from the residence
of Aftab Hilali Shah @ Shahid­Ul­Islam (A­3) on 03.06.2017.
D­9g List of active militants (year 2016­17) of different outfits in the
valley seized from the residence of Aftab Hilali Shah @ ShahidUl­Islam (A­3) on 03.06.2017.
D­11d The photocopy of the hand written letter written by Afzal Guru
to   SAS   Geelani   seized   from   the   premises   of   Mohd.   Akbar
Khandey @ Ayaz Akbar (A­7) on 04.06.17.
D­19 Letter   no.22/NIA/CIV/CR/17/6547   dated   12.07.2017   from
Sh. Kulbir Singh, AIG (CIV), PHQ, J&K Srinagar in reply NIA
Letter   No.   RC­10/2017/NIA   providing   details   pertaining   to
case RC­10/2017 to CIO NIA.
D­20 Scrutiny report of Inspector Vinay Kumar related to 07 CDs
received   vide   letter   no.   22/NIA/CIV/CR/17/6547   dated
12.07.2017 from PHQ, J&K Srinagar along with photo album.
D­42 Letter dated 27.06.2017 from TV Today Network Ltd. India
Today Group Mediaplex, Film City, Sector 16A, Noida to CIO,
NIA   forwarding   exact,   true   and   correct   copy   of   India
Television’s raw footage.
D­43 Letter   no.   RC­10/2017/NIA/DLI/7831   dated   14.06.2017   to
DG, BSF, Lodhi Road, New Delhi for providing details of stonepelting, burning of schools & college buildings and damage to
44
Govt. property as reported in Kashmir Valley since July, 2016.
D­44 Letter   no.   26/Kmr/Ops(B)W/BSF/17/18758   dated   2/3
August 2017 from Director General, BSF (Ops Directorate),
New   Delhi   to   CIO,   NIA   details   of   stone­pelting,   burning  of
schools & college buildings and damage to Govt. property as
reported in Kashmir Valley since July, 2016.
D­63 Letter   dated   28.08.2017   from   Nodal   Officer   Vodafone,   New
Delhi to CIO NIA forwarding certified copies of CDR, CAF and
65B   Certificate   in   respect   of   mobile   Nos.   9796158864   &
9811813796.
D­65 Letter   dated   01.12.2017   from   Nodal   Officer,   Reliance   Jio
Infocomm. Ltd., Delhi to CIO, NIA forwarding certified copies of
CDR,   CAF   and   65B   Certificate   in   respect   of   mobile   nos.
7006046476, 7006208314 & 7889521803.
D­70 The transcripts of the audio­video of sting operation by the
reporters  of India Today related  to accused Mohd.  Nayeem
Khan (A­5).
D­71 The transcripts of the audio­video of sting operation by the
reporters of India Today related to accused Farooq Ahmad Dar
@ Bitta Karate (A­6).
D­75 Letter No. 22/NIA­III/CIV/CR/17/10275­76 dated 23.09.2017
from Sh. Kulbir Singh AIG (CIV), J&K PHQ, Srinagar to CIO
NIA forwarding details of accused persons of the case.
D­127 Letter   No.   I&O/IMS/T­ACT/3/2015   NIA/10011   dated
03.08.2017 from Sh. Vishwas Kumar Singh, (W­196), ASP,
I&O, NIA New Delhi to CIO, NIA.
D­130 Seizure   memo   dated   16.08.2017   in   respect   of   search   and
seizure   of   articles/documents   found   from   the   premises   of
Ghulam Mohd. Rather@Gulla (W­29).
D­132 Seizure   memo   dated   16.08.2017   in   respect   of   search   and
seizure   of   articles/documents   found   from   the   premises   of
Ghulam Mohd. Bhatt (W­29).
D­132a Various   miscellaneous   papers   related   financial   transactions
seized from the premises of Ghulam Mohd. Bhatt (W­29) on
45
16.08.2017.
D­132b One  small  diary title  Arun  (11) Notes  Pad seized  from the
premises of Ghulam Mohd. Bhatt (W­29) on 16.08.2017.
D­132c One green colour diary of 2009 seized from the premises of
Ghulam Mohd. Bhatt (W­29) on 16.08.2017.
D­132e One brown colour diary of 2010 seized from the premises of
Ghulam Mohd. Bhatt (W­29) on 16.08.2017.
D­132f One dark brown colour diary mark Frankford (A division of
Ultramark group) seized from the premises of Ghulam Mohd.
Bhatt (W­29) on 16.08.2017.
D­133 Seizure   memo   dated   16.08.2017   in   respect   of   search   and
seizure   of   articles/documents   found   from   the   premises   of
Ghulam Mohd. Bhatt@Mohd. Akbar (W­29).
D­135 Seizure   memo   dated   16.08.2017   in   respect   of   search   and
seizure of articles/documents found from the premises of Dr.
Peerzada Kaiser Habeeb Hakeem.
D­135a One transparent file folder of Trison International group of
companies seized from the premises of Dr. Peerzada Kaiser
Habeeb Hakeem on 16.08.2017.
D­135b One   orange   colour  file   folder   of   account   statement   of   M/s
Three Star Enterprises for the year of 2005­06 seized from the
premises   of   Dr.   Peerzada   Kaiser   Habeeb   Hakeem   on
16.08.2017.
D­135c One Khaki colour folder of Johar Enterprises stamp paper file
no.47/P   seized   from   the   premises   of   Dr.   Peerzada   Kaiser
Habeeb Hakeem on 16.08.2017.
D­137 Seizure   memo   dated   26.08.2017   in   respect   of   search   and
seizure of articles/documents found from the office of Zahoor
Ahmad Shah Watali (A­10) i.e. Trison Farms and Construction
Pvt. Ltd.
D­137a One ledger and cash book of Trison Farms and construction
Pvt. Ltd. Baba Dharam Das Complex, Khayam Srinagar for the
46
year   2010­11   seized   from   the   office   of   Trison   farms   and
construction private Limited on 26.08.2017.
D­137b One ledger and cash book of M/S Yasir Enterprises, Baghat
Barzullah,   Sanat   Nagar,   Srinagar   for   the   year   of   2010­11
seized from the office of Trison farms and construction private
Limited on 26.08.2017.
D­137c One   ledger   and   cash   book   of   M/S   Three   Y,   Sanat   Nagar,
Srinagar for the year 2010­11 seized from the office of Trison
farms and construction private Limited on 26.08.2017.
D­137d One ledger and cash book of M/S Tirson International for the
year   2010­11   seized   from   the   office   of   Trison   farms   and
construction private Limited on 26.08.2017.
D­137f A   bunch   of   documents   related   to   Enforcement   Directorate
seized from the office of Trison farms and construction private
Limited on 26.08.2017.
D­154 Letter report no. CFSL­2017/D­993/3953 dated 06.11.2017
from   CFSL,   (CBI),   Lodhi   Road,   New   Delhi   to   CIO   NIA
containing handwriting examination report alonwith original
seizure   seized   from   the   house   of   Ghulam   Mohd.   Bhat   r/o
Tarahama.
D­167 Memoramdum for specimen voice sample in respect of accused
Mohd. Nayeem Khan (A­5) dated 31.07.2017.
D­168 Memorandum for specimen voice smaple in respect of accused
Farooq Ahmed Dar @ Bitta Karate (A­6) dated 31.07.2017.
D­169 Letter No. I&O/IMS/DE/33/2017/NIA dated 29.11.2017 from,
Inspector,   IMS,   NIA   New   Delhi   to   CIO   NIA   alongwith
transcripts of conversation and videos.
D­183 Technical analysis report in respect of accused Farooq Ahmad
Dar   @   Bitta   Karate   (A­6)   forwarded   vide   Inter   office   note
No.RC­10/2017/NIA/DLI/reports/1351 dated 10.12.2017.
D­184 Report on Protest calendar taken out from the open source
alongwith source path forwarded vide Inter office note No.RC10/2017/NIA/DLI/reports/1351 dated 10.12.2017.
D­197 Letter No.D.III.a/2017­Ops (NIA) dated 25.07.2017 from 2 I/C
47
(Ops/Int.),   Office   of   Inspector   General   CRPF,   Brein   Nishat,
Srinagar, J&K to CIO NIA.
D­204 Original agreement documents between M/s Trison Farms and
Mr. Nawal Kishore Kapoor dated 07.11.2014.
D­205 Notice under section 43 (F) UA(P) Act dated 30.11.2017 to
Nawal   Kishore   Kapoor   (W­28)   for   furnishing
information/document from Insp T TBhutia, NIa, New Delhi.
D­206 Reply dated 4.12.201of Notice under section 43(f) of UA(P) Act
dated 30.11.2017 from Nawal Kishore Kapoor (W­28).
D­207 Notice to witness under Section Cr.P.C.& 43 (F) of UA (P) Act
dated   07.11.2017   to   CVO,   SBI,   Mumbai   to   provide   bank
account details of account no.274724019 of Nawal Kishore
Kapoor (W­28) from Sh Jyotiraditya, DC.
D­208 Letter   No.   Gen/2017­18/46   dated   18.11.2017   from   Asst.
General   Manager,   SBI   NRI   Branch,   Jalandhar,   Punjab
forwarding   certified   copies   of   account   opening   form   and
account statement of account number 20074724019 of Nawal
Kishore Kapoor (W­28).
D­211 Letter   No.   F.No.   ITO/W­3(4)   Antg/2017­18/3540   dated
20.10.2017/11.12.2017   from   Income   Tax   Officer,   Anantnag
containing   income   tax   return   details   for   last   six   years   in
respect of accused Zahoor Ahmad Shah Watali (A­10).
D­212 Production   cum   receipt   memo   dated   17.11.2017   related   to
documents produced by Naval Kishore Kapoor (W­28) along
with documents.
D­220 Production cum Receipt  Memo dated 14.12.2017 related to
production of copy of text audit reports and audit financial
statements of Ms. Trison Farms and Construction Pvt. Ltd.
Etc. along with received documents.
D­222 Inter   office   Note   No.I&O/IMS/DE/33/2017/NIA/722   dated
17.01.2017   from   Inspector   S.K.   Tyagi,   IMS   to   CIO   NIA
forwarding 03 video clips Indentifying the voice of Hafiz Saeed
48
along certificate 65 B of IEA.
D­224 Letter No.F. No. T­3/1/FE/SRZO/2013 dated 12.12.17 from
Sh. Sharad Kumar, (W­1) Assistant Director, Directorate of
Enforcement,  Government  of  India,  Durani  House  Rajbagh,
Srinagar   to   Sh.   Ajeet   Singh,   SP   NIA   (W­229)   forwarding
alongwith   enclosures   therein   proceedings   against   accused
Zahoor Ahmed Shah Watali (A­10) under the FEMA Act.
D­248 Letter No. RC­10/2017/NIA/DLI/354 dated 11.01.2018 from
Sh. Rajesh Kumar, Inspector NIA (W­209) to CIO forwarding of
report on international linkage, India Hit report and report on
Pakistani   based   Hurriyat   representative   along   with   65­B
Certificate.
D­252 No.   RC­10/2017/NIA/DLI/646   dated   15.01.2018   received
from SI Sangram Singh, NIA (W­220) pertaining to transcripts
of downloaded videos.
D­256 Letter   No.   RC­10/2017/NIA/DLI/5706   dated   26.12.2017   to
GM (CM), Nodal Officer, BSNL, 4th Floor, Telephone Exchange,
Trikuta Nagar, Near RBI Jammu, J&K from CIO NIA to provide
CDRs, CAF and 65 Certificate of mobile nos. mentioned in the
letter.
D­257 Certified   copies   of   CDRs,   CAF   and   Form   65   B   of   mobile
numbers   9419011561,   9419504376,   9419075468,
9419547999,   9419006355,   9419008421,   9419001097   &
9469037774 (BSNL J&K) received from BSNL, J&K.
D­259 Letter of Nodal Officer Bharti Airtel Ltd. Forwarding certified
copies   of   CDR,   CAF   of   mobile   numbers   9596070530,
9906519595, 8494071470 & 8491001561 alongwith certificate
u/s 65B of Indian Evidence Act.”
(emphasis supplied in italics and bold)
21. During the hearing, emphasis was placed by the learned
Attorney General on documents D­132, D­132(a)/23, D­3/6,
49
D­3g/20, D­3h/28, D­3j to D­3j/5, D­9b, D­9c, D­154 and D185/10.   Besides   these   documents,   our   attention   was   also
invited to the statements of Ghulam Mohammad Bhatt (W­29)
dated 30th August, 2017, and 23rd November, 2017, as well as
the   redacted   statements   of   protected   witnesses   (“Charlie”,
“Romeo”, “Alpha”, “Gamma”, “Pie”, “Potter”, “Harry” and “xxx”)
recorded under Section 164, which have now been taken on
record by the Designated Court in terms of order dated 11th
January, 2019.  Notably, the order passed by the Designated
Court permitting redaction of those statements has not been
assailed by the respondent. In our opinion, the High Court,
having noticed that the Designated Court had not looked at
the stated statements presented in a sealed cover, coupled
with the fact that the application under Section 44 filed by the
Investigating Agency was pending before the Designated Court,
and   before   finally   answering   the   prayer   for   grant   of   bail,
should have directed the Designated Court to first decide the
said   application   and   if   allowed,   consider   the   redacted
statements,   to   form   its   opinion   as   to   whether   there   are
50
reasonable   grounds for believing that the accusation made
against the respondent is prima facie true or otherwise. For, in
terms of Section 43D, it is the bounden duty of the Court to
peruse the case diary and/or the report made under Section
173   of   the   Code   and   all   other   relevant   material/evidence
produced   by   the   Investigating   Agency,   for   recording   its
opinion. We could have relegated the parties before the High
Court   but   the   counsel   appearing   for   the   respondent,   on
instructions, stated that the respondent would prefer to await
the decision of the Designated Court and, depending on the
outcome of the application under Section 44 of the Act, would
contest the proceedings before this Court itself. Accordingly, at
the request of the respondent, we kept the present appeal
pending.  Since the Designated Court has finally disposed of
the   application   preferred   by   the   Investigating   Agency   vide
order dated 11th January, 2019, the correctness whereof has
not   been   challenged   by   the   respondent,   the   redacted
statements of the concerned protected witnesses have been
taken on record.
51
22. Accordingly, we have analysed the matter not only in
light of the accusations in the FIR and the charge­sheet or the
police   report   made   under   Section   173,   but   also   the
documentary   evidence   and   statements   of   the   prospective
witnesses recorded under Sections 161 and 164, including the
redacted statements of the protected witnesses, for considering
the prayer for bail.
23. As   regards   the   redacted   statements,   objection   of   the
respondent was that the certificate given by the competent
authority is not in conformity with the certificate required to
be given in terms of Section 164(4) of Cr.P.C.  This objection
has been justly countered by the learned Attorney General
with the argument that the objection borders on the issue of
admissibility   of   the   said   statements.   We   find   force   in   the
submission   that   the   issue   regarding   admissibility   of   the
statements   and   efficacy   of   the   certificates   given   by   the
competent   authority,   appended   to   the   redacted   statements
would be a matter for trial and subject to the evidence in
reference to Section 463 of Cr.P.C. and cannot be overlooked
52
at   this   stage.   Viewed   thus,   the   exposition   in   the   case   of
Ramchandra   Keshav   Adke   (dead)   by   LRs.   and   Ors.   Vs.
Govind   Joti   Chavare   and   Ors.18,  in   paragraph  25  of   the
reported judgment will be of no avail to the respondent.
24. After having analyzed the documents and the statements
forming   part   of   the   charge­sheet   as   well   as   the   redacted
statements   now   taken   on   record,   we   disagree   with   the
conclusion recorded by the High Court. In our opinion, taking
into account the totality of the report made under Section 173
of   the   Code   and   the   accompanying   documents   and   the
evidence/material already presented to the Court, including
the redacted statements of the protected witnesses recorded
under Section 164 of the Code, there are reasonable grounds
to believe that the accusations made against the respondent
are  prima facie  true. Be it noted, further investigation is in
progress.  We may observe that since the prayer for bail is to
be  rejected, it  may  not  be  appropriate  for  us  to  dilate  on
matters   which   may   eventually   prejudice   the   respondent
18
  (1975) 1 SCC 559 = AIR 1975 SC 915
53
(Accused No.10) in any manner in the course of the trial.
Suffice   it   to   observe   that   the   material   produced   by   the
Investigating Agency thus far (pending further investigation)
shows the linkage of the respondent (Accused No.10) with A­3,
A­4,   A­5   and   A­6   and,   likewise,   linkages   between   the
respondent (Accused No.10) and A­3 to A­12, as revealed from
the CDR analysis. The Chart A showing the inter­linkages of
the named accused inter se and  Chart B  showing the interlinkages of the named accused with others and the frequency
of their interaction on phone during the relevant period are as
under:
54
55
56
25. The summing up of the outcome of the investigation done
until filing of the first report is noted in paragraph 17.10,
which reads thus:
“17.10 SUMMING UP:
Hence,   as   has   been   discussed   above,   the   investigation   has
established that:­
1. The terrorist and Hurriyat leaders have a close nexus with the
active militants, OGWs and stone­pelters in Kashmir Valley.
They are closely coordinating with each other and have formed
a terrorist gang to achieve their common goal of secession
from the Union of India by way of an armed rebellion.
2. To fuel the secessionist activities, Pakistan is providing funds
to the Hurriyat leaders and the same are channelized through
Hawala, LoC trade and other means. Sometimes, the funds
are provided directly by Pakistan High Commission in India.
3. Hurriyat has convenor/representative(s) in Pakistan who liaise
with Pakistan agencies and also with the Kashmir Cell of the
ISI, the United Jehad Council and the Jamaat­Ud­Dawah.
4. The benefits  drawn out of the LoC trade are reaching the
Hurriyat leaders for fuelling the unrest in the Valley.
5. Funds are raised locally by way of collecting donations from
the common people in the name of Zakat and Betul Maal.
6. The   Hurriyat   leaders   are   working   in   a   systematic   and
organized manner as per the instructions of their Pakistani
handlers by setting up a network of their cadres at village
level, block level and District level.
7. The  High Commission of Pakistan organizes functions  and
meetings in New Delhi, to which the Hurriyat leaders from
Kashmir are invited and they are given instructions and funds
so that the unrest in the Valley can be fuelled in an organized
manner.
57
8. The   Hurriyat   leaders   are   raising   funds   from   the   Pakistani
establishments/agencies   in  the  name  of  helping   the  youth
injured/killed during the action of security forces.
9. The families of the active militants and killed militants are
supported by the Hurriyat leaders financially, socially as well
as by arranging for the higher education of their wards in
Pakistan.
10. The Hurriyat leaders attend the funeral of killed militants,
eulogise them as ‘martyrs’, hail their anti­India activities as
‘gallant’ and deliver speeches against the Government of India
and motivate the youth of Kashmir to join militancy for the socalled freedom of Kashmir by way of an armed struggle. They
misguide the common man by spreading  false propaganda
against the Government of India.
11. To   further   this   conspiracy,   the   Hurriyat   leaders,   the
terrorists/terror organizations and stone­pelters are working
in tandem and they are getting financial and logistic support
from Pakistan.”
26. The   accusation   and   charge   against   the   accused,
including the respondent, is in paragraph 18 of the report
which reads thus:
“18.     CHARGE:
18.1 In the instant case, there is sufficient evidence in the
form of incriminating documents, statements of witnesses
and digital evidence that establishes beyond any reasonable
doubt that the accused persons i.e. the Hurriyat leaders,
terrorists and stone­pelters have been orchestrating violence
and unrest in Jammu & Kashmir as a part of well­planned
conspiracy under the overall patronage and financial support
of Pakistani Establishment and agencies and that all the
accused persons were acting in pursuance of their common
goal   i.e.   to   achieve   secession   of   the   State   of   Jammu   &
Kashmir from the Union of India by waging a war against the
Government of India.
58
18.2 The   documentary   evidences   seized   during   various
searches   such   as   letters   of   the   banned   terrorist
organizations seeking financial assistance from the Hurriyat
leaders,   blank   letterheads   of   terror   organisations,
conversations between Hafiz Saeed @ Burhan Wani, Hafiz
Saeed and Asiya Andrabi, support extended by Hafiz Saeed
and Syed Salahuddin to the protest calendars issued by the
Hurriyat leaders, all these show that Hurriyat and terror
organizations   are   working   hand   in   glove.   Their   common
objective is to attain secession of Jammu & Kashmir from
the Union of India and to achieve this objective, they have
established a network of cadres throughout Kashmir Valley
who motivate and incite the youth to attack all symbols of
Indian authority, especially Indian security forces who have
been deployed there for the maintenance of law and order.
To achieve their objective, they are mobilizing funds from all
possible sources. They are getting funds from Pakistani
Establishment through the Pakistan High Commission;
the   funds   are   being   remitted   to   India   from   offshore
locations   through   hawala   and   accused   A­10   Zahoor
Ahmad   Shah  Watali   is   an   important   conduit   for   the
same. They are raising funds through local donations such
as Zakaat & Betulmaal, etc. They are generating funds by
resorting   to   illegalities   and   irregularities   such   as   underinvoicing   and   cash­dealings   in  LoC  barter   trade.   All   this
money is used to fund stone­pelting, to support the families
of killed and active militants and to help pellet victims and to
fuel   terrorism   in   Jammu   &   Kashmir   with   the   ultimate
objective   of   breaking   Jammu   &   Kashmir   away   from   the
Union of India.
18.3 They are all working in sync to achieve their greater
goal. The nexus between the Pakistani agencies, Hurriyat
leaders and terror organizations is amply substantiated by
the chats retrieved from their email accounts, WhatsApp,
Facebook   profiles   and   Websites   and   also   from   the
statements of the protected witnesses.  Their  nexus  with
hawala conduit, Zahoor Watali is also substantiated by
the documentary and digital evidence.
18.4 Though the Constitution of Jammu & Kashmir, 1957,
declares the State of Jammu & Kashmir to be an integral
part of India, and the said pronouncement is irrevocable, the
59
accused persons have been incessantly engaged in violence
and carrying out subversive  and secessionist  activities in
Jammu & Kashmir by waging a war against the Government
of India.
18.5 Hence,   as   discussed   in   the   foregoing   paras,   the
evidence   collected   during   investigation,   prima   facie,
establishes   a   case   against   all   the   accused   persons   for
conspiring to wage war against the Government of India by
way of establishing a network of cadres of banned terrorist
organizations LeT & HM as well as cadres in the garb of socalled political front viz., the All Parties Hurriyat Conference.
18.6 The   scrutiny  of  the  documents  and  the   recovery
from the digital devices have provided a large data of
incriminating material in which the above accused A­3
to A­12 are a part of a gang who with the help of A­1 &
A­2  and   others   collaborate  and   coordinate  with   each
other   to   form   strategies   and   action   plan   to   launch
massive   violent   protests,   hartaals,   bandhs,   strikes,
processions, demonstrations during which stone pelting
is   organised   on   security   forces   and   government
establishments.  These   documents   and   digital   evidences
clearly indicates an action plan to instigate general public to
observe   strikes,   hold   anti­India   protests   through   press
releases, social media and use of Immams and mosques. The
recovery of protest calendars from A­4 and the direct impact
of such orchestrated protests have led to enormous loss of
life and property which have been explained in detail.
18.7 The   investigation   have   revealed   linkage   of   A­1
and  A­2  with  A­3  to  A­12  in  a  web  of  directions  being
passed   through   e­mails,   SMSs,  WhatsApp,   videos  and
other  means  of   communication  to   form  a  clear  nexus
between the above accused and the leaders of Hurriyat
Conference.  The   recovery   of   a   number   of   incriminating
videos   in   which   the   separatists   leaders   and   accused   are
exhorting   the   general   public,   sympathizing   with   the
militants,   seeking   support   and   donations   to   carry   out
militant activities and instigating general public, especially
youth to raise a revolt and launch violence against security
forces   and   wage   a   war   against   Government   of   India,   is
clearly established.
60
18.8 The   secessionists,   especially   the   leaders   of   the
Hurriyat   Conference   and   the   accused   are   a   part   of   the
terrorist designs to raise funds to propagate their ideology
and   agenda   of   secessionism   and   subversive   activities
prejudicial to the law of the land. The investigations have
clearly brought out that the Hurriyat has formed a welldeveloped network of cadres with district presidents, block
level leaders and workers who collect donations from public,
businessmen, apple growers and draw gains from profits of
unregulated LoC trade.  The  money   is   routed   through  a
complex system of hawala transfers and cash couriers
using  conduits  such  as  A­10  who  gathers  money  from
Pakistan  High   Commission   in  New  Delhi  and   through
fake   and   bogus   companies   floated   in   UAE   and   other
countries   and   delivers   the   funds   to   the   Hurriyat
leadership for subversive activities.
The documents recovered and statements of witnesses
to that effect also clearly establish the mechanism of funding
and complicity of the accused in generating funds for its
further use in organizing violent protests, assistance to the
militants and creating an atmosphere of terror, chaos and
uncertainty.
18.9 During the investigation about the past conduct of the
accused,   it   is   ascertained   that   as   A­1   is   a   designated
terrorist   being   the   head   of   proscribed   terror  organisation
Lashker­e­Toiba, A­2 is the head of proscribed organisation
Hizb­Ul­Mujahideen. A­3, A­4, A­5, A­6, A­8, A­9 are former
militants with various cases of terrorism against them and
have   been   detained   under   the   Public   Safety   Act   on
numerous occasions. A­10 is a known hawala dealer and
financer and has a number of cases against him which
are being investigated by sister investigation agencies.
18.10 The   CDR   Linkages   and   technical   analysis   of
social media clearly establish that the accused A­3 to A10 are in constant communication with each other and
there is a clear meeting of minds of the above accused
in hatching the conspiracy with the support of A­1 and
A­2 as well as other secessionist leaders of the Hurriyat
61
Conference and other proscribed terrorist organizations
of Jammu & Kashmir.
18.11  This case is a terror conspiracy case in which the
terrorist act is not a single act of terror like an incident or
series of incidents. It is a terrorist act as defined under UA
(P) Act­1967 wherein the intention is to threaten the unity,
integrity and sovereignty of India by striking terror in the
people or any section of people in India by overawing by
means of criminal force or show of criminal force causing
death of any public functionary or attempts to cause death
of any public functionary. The terrorist gang of the accused
above,   have   also   committed   terrorist   act   as   they   have
disrupted the essential services and daily life of the citizenry
of   Jammu   &   Kashmir   and   have   caused   damage   and
destruction   of   property   in   India   intended   to   be   used   in
connection with any other purpose of the Government  of
India, any State Government or any of their agencies.
18.12  The analysis of documentary evidences seized during
the   searches,   the   statement   of   witnesses   and   the
incriminating   material   recovered   from   the   digital   media
seized from the accused clearly bring out the fact that with
the   active   support   and   connivance   of   Pakistani
establishments,   Pakistani   agencies,   terrorist   groups
operating   from   Pakistani   soil,   the   above   accused   have
hatched  a  criminal   conspiracy   to   engage   in   violence   and
carry out subversive and secessionist activities in Jammu &
Kashmir and to achieve their objectives, have established a
network   of   cadres   who   are   funded   through   Pakistani
agencies   via   hawala   dealers,   local   conduits   and   also   by
raising   funds   through   local   donations   and   by   generating
illegal profits through the barter LoC trade. The  accused
have used these funds for organised stone pelting through a
set charter of protests and demonstrations which are issued
in the form of “protest calendars” on regular basis resulting
in an atmosphere of chaos, terror, uncertainty and fear in
the State of Jammu & Kashmir. The main aim and objective
of this entire conspiracy is to secede the State of Jammu &
Kashmir, which is an integral part of India, from the Union
of India and wage war against the Government of India to
meet the objectives.
62
18.13 Hence, the accused persons are liable for prosecution
under the following sections of law:­
63
Accuse
d
Name of
Accused
Liable for prosecution under sections
of law
A­1 Hafiz
Muhammad
Saeed
section 120B, 121, 121A &124A of IPC,
section 13, 16, 17, 18, 20, 38, 39 & 40
of Unlawful Activities (Prevention) Act,
1967.
A­2 Mohd. Yusuf
Shah @ Syed
Salahuddin
section 120B, 121, 121A & 124A of IPC,
section 13, 16, 17, 18, 20, 38, 39 & 40
of Unlawful Activities (Prevention) Act,
1967. 
A­3 Aftab Ahmad
Shah @
Aftab Hilali
Shah @
Shahid­ulIslam
section 120B, 121, 121A & 124A of IPC,
section 13, 16, 17, 18, 20, 39 & 40 of
Unlawful Activities (Prevention) Act,
1967. 
A­4 Altaf Ahmad
Shah @
Fantoosh
section 120B, 121, 121A & 124A of IPC,
section 13, 16, 17, 18, 20, 39 & 40 of
Unlawful Activities (Prevention) Act,
1967. 
A­5 Nayeem
Ahmad Khan
section 120B, 121, 121A & 124A of IPC,
section 13, 16, 17, 18, 20, 39 & 40 of
Unlawful Activities (Prevention) Act,
1967. 
A­6 Farooq
Ahmad Dar
@ Bitta
Karate
section 120B, 121, 121A & 124A of IPC,
section 13, 16, 17, 18, 20, 39 & 40 of
Unlawful Activities (Prevention) Act,
1967. 
A­7 Md. Akbar
Khanday
section 120B, 121, 121A & 124A of IPC,
section 13, 16, 17, 18, 20, 39 & 40 of
Unlawful Activities (Prevention) Act,
1967. 
A­8 Raja
Mehrajuddin
Kalwal
section 120B, 121, 121A & 124A of IPC,
section 13, 16, 17, 18, 20, 39 & 40 of
Unlawful Activities (Prevention) Act,
1967. 
A­9 Bashir
Ahmad Bhat
@ Peer
Saifullah
section 120B, 121, 121A & 124A of IPC,
section 13, 16, 17, 18, 20, 39 & 40 of
Unlawful Activities (Prevention) Act,
1967. 
A­10 Zahoor
Ahmad Shah
Watali
section 120B, 121, 121A & 124A of IPC,
section 13, 16, 17, 18, 20, 39 & 40 of
Unlawful Activities(Prevention) Act,1967.
A­11 Kamran
Yusuf
section 120B, 121 & 121A  of IPC,
section 13, 16, 18 & 20 of Unlawful
Activities (Prevention) Act, 1967. 
A­12 Javed
Ahmad Bhat
section 120B, 121 & 121A  of IPC,
section 13, 16, 18 & 20 of Unlawful
64
18.14   The sanction for prosecution under section 45(1)(i)(ii)
of the UA (P) Act in respect of the accused persons for the
offences under section 13, 16, 17, 18, 20, 38, 39 and 40 of
the UA (P) Act and under section 196 CrPC for the offences
under section 121, 121A and 124A of IPC has been accorded
by the Ministry of Home Affairs, Government of India vide
order No.11011/26/2017/IS­IV dated 16th  January, 2018.
The sanction for prosecution under section 188 CrPC has
also   been   accorded   by   Government   of   India   vide   order
No.11011/26/2017/IS­IV dated 16th  January, 2018 for the
offences committed outside of India.
18.15 It is therefore, prayed that, the Hon’ble Court may
please take cognizance of the offences under sections 120B,
121, 121A & 124A of the IPC, sections 13, 16, 17, 18, 20,
38, 39 & 40 of the Unlawful Activities (Prevention) Act, 1967
in respect of the accused A­1 to A­12 (As per the mentioned
in para 18.13), issue process to the accused persons and try
the   aforesaid   accused   persons   and   punish   them   in
accordance with law.”
(emphasis supplied in italics and bold)
27. The charge against respondent is not limited to Section
17 of the 1967 Act regarding raising funds for terrorist acts
but also in  reference to Sections 13,16,18,20,38,39 and 40 of
the 1967 Act.  Section 13 is in Chapter II of the 1967 Act. The
special   provisions   regarding   bail   under   Section   43D(5),
however, are attracted in respect of the offences punishable
under Chapters IV and VI, such as Sections 16,17,18,20,38,39
and 40 of the 1967 Act. Sections 39 and 40 form part of
Chapter VI, whereas other sections (except Section 13) form
65
part of Chapter IV to which the subject bail provisions are
applicable,   mandating   the   recording   of   satisfaction   by   the
Court that there are reasonable grounds for believing that the
accusation against such person is prima facie true. 
28. Reverting to the documents  on which emphasis has been
placed, document D­132 is the Seizure Memo of properties
seized from the premises of Ghulam Mohammad Bhatt (W­29),
the   then   Munshi/Accountant   of   the   respondent   (Accused
No.10).     Document   D­132(a)   is   the   green   page   document,
seized   during   the   search   of   the   residence   of   said   Ghulam
Mohammad   Bhatt,   containing   information   about   foreign
contributions  and expenditures of the respondent (Accused
No.10)   during   2015/2016.   Whether   this   document   is
admissible in evidence would be a matter for trial. Be that as it
may, besides the said document, the statement of Ghulam
Mohammad Bhatt (W­29) has been recorded on 30th  August,
2017 and 1st  November, 2017. Whether the credibility of the
said witness should be accepted cannot be put in issue at this
stage.   The   statement   does   make   reference   to   the   diaries
66
recovered from his residence showing transfer of substantial
cash amounts to different parties, which he has explained by
stating   that   cash   transactions   were   looked   after   by   the
respondent (Accused No.10) himself.   He had admitted the
recovery of the green colour document  from his residence,
bearing   signature   of   the   respondent   (Accused   No.10)   and
mentioning about the cash amounts received and disbursed
during   the   relevant   period   between   2015   and   2016.   The
accusation   against   the   respondent   (Accused   No.10)   is   that
accused   A­3  to   A­10   are     part  of  the   All   Parties   Hurriyat
Conference which calls itself a political front, whereas their
agenda is to create an atmosphere conducive to the goal of
cessation of J & K from the Union of India. The role attributed
to the respondent (Accused No.10) is that of being part of the
larger conspiracy and to act as a fund raiser and finance
conduit.   Ample   material   has   been   collected   to   show   the
linkages   between   the   Hurriyat   leaders   of   the   J   &   K   and
terrorists/terrorist   organizations   and   their   continuous
activities to wage war against Government of India. Regarding
67
the funding of terrorist activities in J & K and, in particular,
the   involvement   of   the   respondent   (Accused   No.10),   the
charge­sheet mentions as under:
“17.6 Funding of Secessionist and Terrorist Activities in
Jammu & Kashmir:
If publicity and propaganda is oxygen for the terror groups,
terror financing is its life­blood. Terror financing provides
funds   for   recruitment,   operationalization   of   training   and
training   camps,   procurement   of   arms   and   ammunition,
operational cost of planning and resources for terrorist acts,
running   of   underground   networks,   well­planned   stone
pelting, school burnings, targeted attacks, provision of legal
support   for   terrorists   and   over­ground   workers   facing
judicial   process,   ex­gratia   payment   for   militants   killed   in
terrorist   operations,   regular   payments   to   the   families   of
terrorists   and   militants   killed   or   convicted,   funds   for
propaganda to clergy as well as relief measures for civilian
population   and   also   in   case   of   natural   disasters.   The
investigation in the case has revealed that the secessionists
are mobilizing funds from all possible sources to fuel unrest
and support the on­going secessionist and terrorist activities
in Jammu & Kashmir.
17.6.1 Funding from Pakistan:
i) The Hurriyat leaders are receiving funds from Pakistan
through   conduits   and   also   from   the   Pakistan   High
Commission   directly. It   was   substantiated   by   an
incriminating   document   seized   from   the   house   of
Ghulam   Mohd.   Bhatt   druing   search.   Ghulam   Mohd.
Bhatt   worked   as   the   cashier­cum­accountant   with
accused   A­10   Zahoor   Ahmad   Shah   Watali,   a   known
Hawala   conduit.     The   document   clearly   shows   that
accused A­10 Zahoor Ahmad Shah Watali was receiving
money from Accused A­1 Hafiz Saeed (Head of Jamaatud­Dawa),   from   the   ISI,   from   the   Pakistan   High
Commission at New Delhi and also from a source based
in Dubai. Accused A­10 was remitting the same to the
Hurriyat   leaders,   separatists   and   stone­pelters   of
Jammu   &   Kashmir.   The   said   document   has   been
68
maintained   in   regular   course   of   his   business   and   is
signed   by   accused   Zahoor   Watali   himself.   This
document   clearly   shows   that   Hurriyat   leaders   were
receiving  funds from  Pakistan  through the officials of
Pakistan  High   Commission  and   through  accused  A­10
Zahoor Watali.
The signature of Accused A­10 Zahoor Watali has
also   been   verified   and   as   per   the   expert   report,   his
signature on the questioned document matches with his
specimen   handwriting   as   well   as   his   admitted
handwriting.
ii) Further, the role of Pakistan in funding secessionist
activities   also   surfaced   in   the   scrutiny   of   the  un­edited
version of the audio/video  furnished by the office of India
Today   T.V.   News   Channel   wherein   accused   A­5   Nayeem
Khan   admits   that   the   secessionists   and   terrorists   of   the
Valley are receiving  financial   support   from  Pakistan  and
would have received approximately Rs.200 crores to organise
anti­India protests and agitations after the killing of Burhan
Wani, the Commander of the proscribed terror organisation
Hizb­ul­Mujahiddin. He further speaks about funds reaching
them from Saudi Arabia/Dubai through  Hawala  via Delhi
(Balimaran/Chandni Chowk). He admits that S.A.S. Geelani
(Chairman, APHC­G), Mirwaiz Umar Farooq (APHC­M) and
Yasin Malik (JKLF) are receiving funds from Pakistan. He
further admits the pivotal role played by the Pakistan High
Commission  to   convey   and   receive   instructions   from
Pakistan. Nayeem Khan also stated that the accused  Hafiz
Mohd   Saeed  has   supported   S.A.S.   Geelani,   Chairman,
APHC­G by paying at least 10­12 crores during anti­India
agitation   after   killing   of   Burhan   Wani.   Accused   Nayeem
Khan further admitted that, if funded, he can fuel unrest in
the Valley any time.
iii) Similarly, the scrutiny of the audio/video of the sting
operation   also   reveals   accused  A­6   Farooq   Ahmad   Dar
Bitta  Karate  admitted that the  funds  are  being  sent by
Pakistan   to   the   secessionists   and   terrorists   in   the
Kashmir   Valley  including   him   for   organizing   forcible
closures,   anti­India   protests   and   processions   and   stonepelting on the security forces. He further claimed that he has
69
his cadres in every part of Kashmir who can act on his call
at any given point of time and fuel unrest in the Valley.
When   given   an   offer   of   financial   support,   accused   Bitta
Karate put forth a demand of Rs.70 crores for fuelling unrest
upto six months.
The  voice   samples  of   Nayeem   Khan   and   Farooq
Ahmad Dar @ Bitta Karate have been forensically examined
and the CFSL report has confirmed the match with their
voices.
iv) Further, the investigation has revealed that the seniormost officials of the High Commission of Pakistan were in
regular   contact   with   the   Hurriyat   leaders.   The   High
Commission   of   Pakistan   in   New   Delhi   used   to   organise
functions and meetings in New Delhi, to which the Hurriyat
leaders   from   Kashmir   were   invited   and   they   were   given
instructions  and  funds  on  a regular basis.  These   funds
were   given   to   various  allied   groups   of   the   APHC  and
investigation have revealed that a First Secretary level
officer   of   Pakistan   High   Commission   in   New   Delhi
would act as a channel and A­10 Zahoor Ahmed Shah
Watali  would  act  as  a  courier  to  deliver  the  funds  to
the   Hurriyat   leadership.   These   funds   as   explained
above   were   used   to   foment   the   secessionist   and
separatist   activities   and   unrest   in   the   valley   in   an
organized   manner. One   such   invitation   card   from   the
Pakistan High Commission was seized from the house of A­6
Farooq Ahmad Dar @ Bitta Karate:­
On the occasion of the National Day
Pakistan High Commissioner and
Mrs. Salman Bashir
Request the pleasure of the company of
Mr. Farooq Ahmed Dar
At a Reception
on Friday, 22 March 2013 from 1930 to 2100 hrs.
Venue:                        R.S.V.P.
2/50­G, Shantipath, Tel.               011­24121819
Chanakyapuri, New Dehli           Fax 011­26872339
             
Dress: National/Lounge Suit/Uniform  E­mail:pakhcnd@gmail.com
70
(Please bring this card with you)
Investigation has also established that the accused A­4 was
in direct contact with the High Commissioner of Pakistan in
New Delhi and would apprise him about the situation in
Jammu & Kashmir.
17.6.2  Funding   from   Terrorist   Organisations   based   in
Pakistan:
During the course of investigation, it is also ascertained that
the separatists and secessionists of Jammu & Kashmir were
also   receiving   money   from   the   terrorists   and   terrorist
organizations   operating   out   of   Pakistan/PoK.  The
incriminating   document   seized   from   the   house   of
Ghulam   Mohd.   Bhatt   who   worked   as   a   cashier­cumaccountant   with   accused   A­10   Zahoor   Watali   shows
that  Zahoor  Watali   received  money   from  accused   A­1
Hafiz Saeed, Head of JuD and Chief of proscribed terror
organisation   Lashkar­e­Toiba   and   remitted   it   to   the
Hurriyat   leaders   espousing   the   cause   of   secession   of
Jammu & Kashmir from the Union of India.
17.6.3 Local Donations/Zakat/Baitulmal:
During the course of investigation, it is established that the
Hurriyat  has   its  network   of  cadres   at  districts   and   local
levels. There are District Presidents and block level leaders
who   have   the   responsibility   to   raise   the   funds   through
donation   during   the   religious   festivals   and   month   of
Ramzan. In a well­established system, the receipt books are
printed   and   funds   are   collected   from   shopkeepers,
businessmen and residents of Kashmir. The money is also
collected  to  become  a  member of  the Tehreek­e­Hurriyat.
Selected members are made as Rukuns and are tasked to
propagate the separatist ideology of Hurriyat. These Rukuns
act as foot soldiers and ensure that bandhs and hartaals are
successful. They also lead the processions and participate in
stone pelting.
Investigation   also   established   that   various   District
Presidents collect Rs.5 to 10 Lac per district as Baitulmal.
Funds   are   also   collected   from   apple­growers   and
businessmen   who   are   compelled   to   donate   to   Hurriyat
71
central office.  This  money is used  for administrative and
operational purposes of organizing protests and strikes as
well as for aid to militants and their families.
The   seizure   of   unaccounted   receipts   of   an   amount   of
Rs.1,15,45,000/­   from   accused   A­4   Altaf   Ahmad   Shah
Fantoosh also shows that money is being raised by way of
donations. Similarly, records pertaining to the collection of
funds   were   also   seized   from   the   house   of   accused   A­8
Mehrajuddin Kalwal, who was also the District President of
Tehreek­e­Hurriyat for Srinagar and Ganderbal.
Further,   during   the   course   of   investigation,   it   is   also
established   that   the   Hurriyat   leadership   appeals   to   the
public to contribute money generously by way of donations
for   their   so­called   freedom   movement.   This   is   clearly
reflected   in   the  Website  of   the   Hurriyat   Conference   viz.
www.huriyatconference.com, which shows a message from
S.A.S.   Geelani  “Help   the   families   of   martyrs   and
prisoners…..  people  should  come   forward   for  donations
in   the   month   of   Ramadan   as   the   number   of   people
affected by this movement is large”.
This substantiates that Hurriyat is raising funds through
donations and using the same to fuel secessionist activities
and to support the families of killed and jailed terrorists.
17.6.4 LOC Trade:
During the course of investigation, it has been established
that the secessionist and separatist leaders are raising funds
through LoC trade by way of directing the Kashmiri traders
to   do   under­invoicing   of   the   goods   which   were   imported
through LoC barter trade. They sell the goods to the traders
in Delhi and a part of the profit of the same is shared with
the Hurriyat leaders and other separatists, which in turn is
used on anti­India propaganda, for mobilizing the public to
organise protests and stone­pelting and to support families
of   killed/jailed   militants.   The   hawala   operators   based   in
Srinagar,   New   Delhi   and   other   parts   of   the  country  and
abroad are being used to transfer the funds so generated.
The investigation has revealed that the funds are generated
by resorting to sale of third­party goods, under­weighing,
under­invoicing, large­scale dealings in cash and committing
irregularities   in   maintenance   of   records.   This   modus­
72
operandi leads to generation of huge cash surpluses on the
Indian   side   which   are   then   channelized   through   several
formal   banking   channels   as   well   as   cash   couriers   and
hawala dealers to the separatists and secessionists active in
Jammu & Kashmir.
Investigation   has   revealed   that   a   significant   number   of
traders engaged in cross LoC trade have relatives across the
border   who   are   closely   associated   with   banned   terrorist
organizations,   especially   Hizb­Ul­Mujahideen.   Investigation
has also revealed that certain ex­militants and their family
members are using proxy companies and are registered as
traders. During the course of investigation, use of LoC trade
route for smuggling of contraband and weapons has also
come to light. A separate investigation is underway regarding
the irregularities in the LoC trade.
17.6.5 Hawala:
Apart from the above mentioned sources and channels, the
secessionists   depend   heavily   on   the   hawala   network   and
conduits to bring money from off­shore locations to India to
fuel­anti­India activities in Jammu & Kashmir.
i) During  the  course  of  investigation,   it  was  ascertained
that  accused  A­10  Zahoor  Ahmad  Shah  Watali   is  one
such   conduit.   The   seizure   of   the   incriminating
document from the house of his cashier­cum­accountant
viz.   Ghulam   Mohd.   Bhatt   regarding   the   foreign
contributions   received  by  Zahoor  Ahmad   Shah  Watali
from Paskistani establishment and terror organizations
and   their   further   remittance   to   the   Hurriyat   leaders
and  secessionists of  Jammu  &  Kashmir clearly  shows
that he was an active channel to transmit funds from
abroad   to   India   to   fuel   secessionist   activities   and   to
wage a war against the Government of India.
ii) During  the  course  of   investigation,   it   is   revealed  that
accused A­10 Zahoor Ahmad Shah Watali was bringing
money  from  off­shore   locations  to  India  by  layering   it
through   the   scores   of   firms   and   companies   he   has
opened.   It  was  ascertained   that  Zahoor   Ahmad   Shah
Watali has an NRE A/c No.0252040200000505 in J&K
73
Bank and he received foreign remittances to the tune of
Rs.93,87,639.31/­  in  this  account  from  2011  till  2013
from unknown sources.
iii) During   the   course   of   investigation,   it   was   also
ascertained   that   the   accused   Zahoor   Ahmad   Shah
Watali  was   showing   foreign   remittances  under   ‘other
income’  in   his   proprietorship   firm   viz.   Trison
International, Srinagar. From the analysis of his bank
accounts,   it   has   been   ascertained   that   foreign
remittances   to   the   tune   of   Rs.2,26,87,639.31   were
received by the accused Zahoor Ahmad Shah Watali in
different   accounts   from   the   year   2011   to   2016.   An
amount   of  Rs.93,87,639.31/­   came   in   Zahoor   Ahmad
Shah   Watali   A/c   No.NRE­0252040200000505   in   J&K
Bank from 2011 to 2013. An amount of Rs.14 lakh was
remitted   in   the   account   of   Acharya   Shri   Chander
College  of  Medical  Sciences  (ASCOMs),  Jammu  account
No.1213040100000229   on   09.04.2013   through   NEFT
against   fee  deposited   for   his   son,   viz.,  Yawar  Zahoor
Shah Watali. An amount of Rs.60 lakh was remitted in
current account of accused Zahoor Ahmad Shah Watali
in J&K  Bank A/c No.CD4508. An  amount of  Rs.5  lakh
was   remitted   in   the   account   of   Trison   Farms   &
Constructions   Pvt.   Ltd.   A/c   OTN­10162.   The
investigation   has   revealed   that   all   these   foreign
remittances are from unknown sources.
iv) During the course of investigation, it was also revealed
that on 07.11.2014, one Naval Kishore Kapoor, son of
Om Prakash Kapoor, resident of P.O. Box­8669, Aman,
U.A.E.   entered   into   an   agreement   with   Trison   Farms
and   Constructions   Pvt.   Ltd.   through   its   Managing
Director Zahoor Ahmad Shah Watali to take a piece of
land measuring 20 Kanals in Sozeith Goripora Nagbal,
Budgam on lease in consideration of an amount of Rs.6
crore   as   premium   and   Rs.1000/­   annual   rent   for   an
initial   period   of   40   years   extendable   as   may   be
mutually agreed between the parties. In the agreement,
M/s   Trison   Farms   and   Constructions   Pvt.   Ltd.   was
74
declared to be the absolute owner of the piece of land in
question.   Mr.   Naval   Kishore   Kapoor   remitted   a   total
amount  of  Rs.5.579  crores   in  22   instalments  between
2013   and   2016   to   the   accused   Zahoor   Ahmad   Shah
Watali.
v) During  the  course  of  investigation,   it  was  ascertained
that  no   land  exists   in   the  name  of  M/s  Trison  Farms
and Constructions Pvt. Ltd. as per the balance sheets of
the said company. (AY 2011­12 to 2016­17). It was also
ascertained   that   the   large   sum   of   money   i.e.
Rs.5,57,90,000 was mobilized by Naval Kishore Kapoor
from   unkown   sources   and   remitted   to   the   accused
Zahoor Ahmad Shah Watali over a period of 2 years to
lease a piece of land which is not even existing in the
name  of  the  company  mentioned  as  first  party   in  the
agreement   and   the   agreement   itself   lacks   legal
sanctity.   This   proves   that   the   said   agreement  was   a
‘cover’   created   by   the   accused   Zahoor   Ahmad   Shah
Watali   to   bring   foreign   remittances   from   unknown
sources to India.
vi) During   the   course   of   investigation,   it   is   also
ascertained that the Chartered Accountant, who signed
the audited balance sheets of the firms belonging to the
accused   A­10   Zahoor   Ahmad   Shah   Watali   viz.   M/s
Trison   International   (2013­14   and   2015­16),   Trison
Farms & Constructions Pvt. Ltd. (2013­14 and 2015­16),
M/s  3Y  (2012­13,  2013­14  and  2015­16)  and  M/s  Yasir
Enterprises   (2013­14   and   2015­16)   did   so   without
seeing  any   supporting  documents.  The  balance   sheets
of these companies were sent to him by one Mustaq Mir,
Cost Accountant and Shabir Mir, Chartered Accountant
from Wizkid Office, Srinagar through email and he was
asked   to   sign  on   them   in  Delhi  without   showing  any
documents.
This   clearly   shows   that  Zahoor  Watali  was   remitting
money received from unknown sources to India.
75
vii) The investigation has also revealed that in the FY 2010­
11,   a   firm   belonging   to   accused   A­10   Zahoor   Ahmad
Shah Watali and his family members viz., Trison Farms
and   Constructions   Pvt.   Ltd.   raised  unsecured   loan   of
Rs.2,65,55,532/­ from the Directors of the company, i.e.
the   accused   Zahoor   Ahmad   Shah   Watali,   his   wife
Sarwa Begum and his sons Yassir Gaffar Shah, Yawar
Zahoor & Yamin Zahoor in the form of both cash and
cheque  and  the  same  was  used  towards  repayment  of
secured   loan  of  Rs.2,94,53,353/­   in  the  books  of  J&K
Bank. The source of money with the Directors could not
be   explained   satisfactorily   by   the   accused   Zahoor
Ahmad Shah Watali.
viii) The   seizure   from   the   house   of   accused   A­10   Zahoor
Ahmad   Shah  Watali,   of   a   list   of   ISI   officials   and   a
letter   from   Tariq   Shafi,   proprietor   of   AI   Shafi   group
addressed to Pakistan High Commission recommending
grant of visa to Zahoor Watali shows his proximity with
Pakistani establishment. It is pertinent to mention here
that the name of Tariq Shafi figures in the document of
foreign  contributions  seized  from  the  house  of  Zahoor
Watali’s   cashier­cum­accountant   viz.,   Ghulam   Mohd.
Bhatt.” 
(emphasis supplied in italics and bold)
29. In  reference to these accusations, the entry in the diaries
and the green­colour document, recovered from the residence
of   Ghulam   Mohammad   Bhatt,   is   significant.   Further,   the
seizure memo described as document D­3/6, in respect of
search   and   seizure   of   articles/documents   seized   from   the
premises of the respondent (Accused No.10) dated 3rd  June,
2017, would unravel the activities of the respondent, including
76
regarding   his   financial   deals.   Another   crucial   document
described   as   D­3g/20   is   a   contact   diary   seized   from   the
respondent   vide   Memo   D­3,   which   contains     the   Pakistan
National   name   and   contact   “Tariq   Shafi   0092425765022…
26A”  whose name figures in document D­132(a)/23. The Code
“0092” pertains to Pakistan. Another contact diary was seized
from the respondent vide Memo D­3, which, at page D­3h/28
contains the same name and contact, namely, “Tariq Shafi
00923008459775/ 0092425765022”. The documents D­3j to
D­3j/5   also   indicate   the   involvement   of   the   respondent   in
terrorist activities, including that three cases of TADA have
been registered against him in the past and investigated and
one case of J & K PSA, 1978. The High Court erroneously
proceeded on  the premise that  the charge­sheet makes no
reference to any other criminal case against the respondent.
Additionally, the charge­sheet is accompanied with documents
D­9b and D­9c, which are photographs of ex­militant Aftab
Hilali Shah @ Shahid­ul­Islam (A­3) holding AK­47, seen with
other   terrorists.   These   photographs   were   seized   from   the
77
residence   of   the   said   ex­militant   on   3rd  June,   2017.   The
prosecution case is that the respondent (Accused No.10) was
in constant touch with the said ex­militant Aftab Hilali Shah @
Shahid­ul­Islam (A­3), as noticed from the inter­linkage chart
depicted   above.   That   fact   is   backed   by   the   CDR   analysis
report, also part of the charge­sheet. The charge­sheet also
contains   document   D­185/10,   which   is   a   contact   list   of
accused   Nayeem   Khan   (A­5)   retrieved   through   forensic
analysis, having mobile numbers of persons associated with
Hurriyat party;  and of one Mudasir Cheema Pak who is none
other than the First Secretary of Pakistan High Commission.
His   name   also   figures   in   document   D­132(a)/23.   The
Designated   Court,   besides   adverting   to   the   aforementioned
documents,   also   adverted   to   other   documents   and   the
statements of the prospective witnesses (Ws­1, 28, 29, 38, 39,
43, 44, 48 and 52). The High Court has not appreciated the
said material which found favour with the Designated Court to
record   its     opinion   that   there   are   reasonable   grounds   for
believing that the accusation against the respondent is prima
78
facie  true.   The view so expressed by the Designated Court
commends to us. Suffice it to observe that the High Court
adopted   a   tenuous   approach   ­   by   first   discarding   the
document   D­132(a)   and   then   discarding   the   statement   of
witnesses recorded under Section 161 and also the statements
recorded under Section 164, presented by the Investigating
Agency in a sealed cover. As aforesaid, the High Court ought to
have taken into account the totality of the materials/evidences
which   depicted   the   involvement   of   the   respondent   in   the
commission of the stated offences and being a member of a
larger conspiracy, besides the offence under Section 17 for
raising funds for terrorist activities.
30. In the case of  Niranjan  Singh  Karam  Singh  Punjabi
(supra), the Court essentially considered the scope and ambit
of the enquiry by the Trial Court at the stage of “discharge”. In
that context, the Court made observations in paragraphs 6
and   8   of   the   said   judgment   which   must   be   understood
accordingly. In the present case, however, we are called upon
to consider the prayer for bail  in the context of the purport of
79
the proviso to Section 43D(5) of the 1967 Act which mandates
that the accused person involved in the commission of offence
referable to Chapters IV and VI of the 1967 Act shall not be
released on bail or on bond. However, the Court may release
such accused on bail only if it is of the opinion, on perusal of
the case diary and/or the report made under Section 173 of
Cr.P.C. that there are “no reasonable grounds” for believing
that the accusation against such person is  prima facie  true.
Conversely, if in the opinion of the Court, there are reasonable
grounds for believing that the accusation against such person
is  prima facie  true, the question of granting bail would not
arise as the bar under the first part of the proviso of no bail in
such cases would operate.
31. The fact that there is a high burden on the accused in
terms of the special provisions contained in Section 43D(5) to
demonstrate that the prosecution has not been able to show
that   there   exists   reasonable   grounds   to   show   that   the
accusation against him is prima facie true, does not alter the
legal position expounded in  K.  Veeraswami  (supra), to the
80
effect that the charge­sheet need not contain detailed analysis
of the evidence. It is for the Court considering the application
for   bail   to   assess   the   material/evidence   presented   by   the
Investigating Agency along with the report under Section 173
of Cr.P.C.   in its entirety, to form its opinion as to whether
there are reasonable grounds for believing that the accusation
against the named accused is prima facie true or otherwise.
32. In the case of  Hitendra  Vishnu  Thakur   (supra), the
Court was called upon to consider the following questions as
noted in the opening paragraph of the judgment, viz.: 
“In this batch of criminal appeals and special leave petitions
(criminal) the three meaningful questions which require our
consideration are: (1) When can the provisions of Section
3(1) of the Terrorist  and Disruptive Activities (Prevention)
Act, 1987 (hereinafter referred to as the TADA) be attracted?
(2) Is the 1993 Amendment, amending Section 167(2) of the
Code of Criminal Procedure by modifying Section 20(4)(b)
and adding a new provision as 20(4)(bb), applicable to the
pending cases i.e. is it retrospective in operation? and (3)
What   is   the   true   ambit   and   scope   of   Section   20(4)   and
Section 20(8) of TADA in the matter of grant of bail to an
accused brought before the Designated Court and the factors
which   the   Designated   Court   has   to   keep   in   view   while
dealing with an application for grant of bail under Section
20(4) and for grant of extension of time to the prosecution for
further investigation under clause (bb) of Section 20(4) and
incidentally   whether   the   conditions   contained   in   Section
20(8) TADA control the grant of bail under Section 20(4) of
the   Act   also?   We   shall   take   up   for   consideration   these
questions in seriatim”
81
The focus essentially was on matters relevant for consideration
of application for bail on the ground of default in filing the
charge­sheet within the statutory period. Indeed, one of the
questions was about the scope of the provisions relating to
grant of bail in respect of offence punishable under special
enactment TADA. That has been discussed in paragraphs 13
and 14 of the reported judgment, which reads thus:
“13. We would, therefore, at this stage like to administer a
word of caution to the Designated Courts regarding invoking
the   provisions   of   TADA   merely   because   the   investigating
officer at some stage of the investigation chooses to add an
offence under same (sic some) provisions of TADA against an
accused person, more often than not while opposing grant of
bail,   anticipatory   or   otherwise.   The   Designated   Courts
should always consider carefully the material available on
the   record   and   apply   their   mind   to   see   whether   the
provisions of TADA are even prima facie attracted.
14.  The Act provides for the constitution of one or more
Designated Courts either by the Central Government or the
State Government by notification in the Official Gazette to try
specified cases or class or group of cases under the Act. The
Act makes every offence punishable under the Act or any
rule made thereunder to be a cognizable offence within the
meaning   of   Section   2(c)   of   the   CrPC.   The   Act   vests
jurisdiction in the Designated Court to try all such offences
under the Act by giving precedence over the trial of any other
case against an accused in any other court (not being a
Designated   Court)   notwithstanding   anything   contained   in
the Code or any other law for the time being in force. The
conferment of power on the Designated Courts to try the
offences triable by them, punishable with imprisonment for a
term not exceeding three years or with fine or with both, in a
summary   manner   in   accordance   with   the   procedure
prescribed in the CrPC notwithstanding anything contained
82
in Section 260(1) or 262 CrPC by applying the provisions of
Sections 263­265 of the Act is a marked departure. The right
of   appeal   straight   to   the   Supreme   Court   against   any
judgment, sentence or order not being an interlocutory order
vide Section 19(1) of the Act demonstrates the seriousness
with which Parliament has treated the offences under TADA.
An onerous duty is therefore cast on the Designated Courts
to take extra care to scrutinise the material on the record
and   apply   their   mind   to   the   evidence   and   documents
available   with   the   investigating   agency   before   chargesheeting   an   accused   for   an   offence   under   TADA.   The
stringent provisions of the Act coupled with the enhanced
punishment prescribed for the offences under the Act make
the   task   of   the   Designated   Court   even   more   onerous,
because the graver the offence, greater should be the care
taken to see that the offence must strictly fall within the four
corners   of   the   Act   before   a   charge   is   framed   against   an
accused   person.   Where   the   Designated   Court   without   as
much as even finding a prima facie case on the basis of the
material on the record, proceeds to charge­sheet an accused
under   any   of   the   provisions   of   TADA,   merely   on   the
statement of the investigating agency, it acts merely as a
post office of the investigating agency and does more harm to
meet   the   challenge   arising   out   of   the   ‘terrorist’   activities
rather than deterring terrorist activities. The remedy in such
cases would be worse than the disease itself and the charge
against the State of misusing the provisions of TADA would
gain acceptability, which would be bad both for the criminal
and   the   society.   Therefore,   it   is   the   obligation   of   the
investigating agency to satisfy the Designated Court from the
material collected   by it during the investigation,  and not
merely by the  opinion  formed by the investigating agency,
that   the   activity   of   the   ‘terrorist’   falls   strictly   within   the
parameters   of   the   provisions   of   TADA   before   seeking   to
charge­sheet an accused under TADA. The Designated Court
must record its satisfaction about the existence of a prima
facie case on the basis of the material on the record before it
proceeds  to frame a charge­sheet  against an accused for
offences covered by TADA. Even after an accused has been
charge­sheeted   for   an   offence   under   TADA   and   the
prosecution leads evidence in the case, it is an obligation of
the   Designated   Court   to   take   extra   care   to   examine   the
evidence with a view to find out whether the provisions of the
Act   apply   or   not.   The   Designated   Court   is,   therefore,
83
expected   to   carefully   examine   the   evidence   and   after
analysing   the   same   come   to   a   firm   conclusion   that   the
evidence led by the prosecution has established that the case
of the accused falls strictly within the four corners of the Act
before   recording   a   conviction   against   an   accused   under
TADA.”
Again,   in   paragraph   22   of   the   said   judgment,   the   Court
observed thus:
“22.  ….The   two   provisions   operate   in   different   and
independent fields. The basis for grant of bail under Section
20(4),   as   already   noticed,   is   entirely   different   from   the
grounds on which bail may be granted under Section 20(8) of
the Act. It would be advantageous at this stage to notice the
provisions of Section 20(8) and (9) of the Act.
‘(8) Notwithstanding anything contained in the Code, no
person accused of an offence punishable under this Act
or any rule made thereunder shall, if in custody, be
released on bail or on his own bond unless—
(a) the Public Prosecutor has been given an opportunity
to oppose the application for such release, and
(b) 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.
(9) The limitations on granting of bail specified in subsection (8) are in addition to the limitations under the
Code or any other law for the time being in force on
granting of bail.’
As would be seen from the plain phraseology of sub­section
(8) of Section 20, it commences with a non obstante clause
and in its operation imposes a ban on release of a person
accused of an offence punishable under TADA or any rule
made   thereunder   on   bail   unless   the   twin   conditions
contained in clauses (a) and (b) thereof are satisfied. No bail
can be granted under Section 20(8) unless the Designated
Court is satisfied after notice to the public prosecutor that
there are reasonable grounds for believing that the accused
is not guilty of such an offence and that he is not likely to
commit any offence while on bail. Sub­section (9) qualifies
84
sub­section   (8)   to   the   extent   that   the   two   conditions
contained   in   clauses   (a)   and   (b)   are  in   addition  to   the
limitations prescribed under the Code of Criminal Procedure
or any other law for the time being in force relating to the
grant of bail. Strictly speaking Section 20(8) is not the source
of power of the Designated Court to grant bail but it places
further limitations on the exercise of its power to grant bail
in   cases   under   TADA,   as   is   amply   clear   from   the   plain
language of Section 20(9). The Constitution Bench in Kartar
Singh case19 while dealing with the ambit and scope of subsections (8) and (9) of Section 20 of the Act quoted with
approval the following observations from Usmanbhai case20:
(SCC p. 704, para 344)
‘Though   there   is   no   express   provision   excluding   the
applicability of Section 439 of the Code similar to the
one contained in Section 20(7) of the Act in relation to a
case involving the arrest of any person on an accusation
of having committed an offence punishable under the
Act or any rule made thereunder, but that result must,
by   necessary   implication,   follow.   It   is   true   that   the
source of power of a Designated Court to grant bail is
not Section 20(8) of the Act as it only places limitations
on such power. This is made explicit by Section 20(9)
which enacts that the limitations on granting of bail
specified   in   Section   20(8)   are   ‘in   addition   to   the
limitations under the Code or any other law for the time
being in force’. But it does not necessarily follow that
the   power   of   a   Designated   Court   to   grant   bail   is
relatable   to   Section   439   of   the   Code.   It   cannot   be
doubted that a Designated Court is ‘a court other than
the   High   Court   or   the   Court   of   Session’   within   the
meaning of Section 437 of the Code. The exercise of the
power to grant bail by a Designated Court is not only
subject to the limitations contained therein, but is also
subject to the limitations placed by Section 20(8) of the
Act.’
and went on to add: (SCC p. 704, para 345)
‘Reverting to Section 20(8), if either of the two conditions
mentioned therein is not satisfied, the ban operates and
the accused person cannot be released on bail but of
course it is subject to Section 167(2) as modified by
19
  (1994) 3 SCC 569
20
  (1988) 2 SCC 271
85
Section 20(4) of the TADA Act in relation to a case under
the provisions of TADA.’
Thus, the ambit and scope of Section 20(8) of TADA is no
longer  res integra  and from the above discussion it follows
that both the provisions i.e. Section 20(4) and 20(8) of TADA
operate in different situations and are controlled and guided
by different considerations.”
33. We fail to understand as to how this decision will be of
any avail to the respondent.  In our opinion, the Designated
Court had rightly rejected the bail application after adverting
to the relevant material/evidence indicative of the fact that
there are reasonable grounds for believing that the accusation
against the respondent is prima facie true.
34. With reference to the document D­132(a), the High Court
was   impressed   by   the   argument   that   the   same   would   be
inadmissible. To buttress that opinion of the High Court, the
respondent would rely on the decision of this Court in  V.C.
Shukla    (supra).   Further, it was submitted that in light of
Section 34 of the Evidence Act, the said document could not
be admitted in evidence, since it was not an entry in the books
of account regularly kept in the course of business. In any
case, that document by itself would not be sufficient in the
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absence   of   any   independent   evidence.   Learned   Attorney
General,   relying   on   the   underlying   principle   in  Khoday
Distilleries   Ltd.   and   Ors.   Vs.   State   of   Karnataka   and
Ors.21
, would contend that there cannot be business in crime
and, as such, Section 34 of the Evidence Act will have no
application. He further submits that the prosecution may use
the facts noted in the said document and prove the same
against the respondent by other evidence. This argument need
not   detain   us.   For,   we   find   force   in   the   argument   of   the
learned Attorney General that the issue of admissibility and
credibility   of   the   material   and   evidence   presented   by   the
Investigating Officer would be a matter for trial. Furthermore,
indubitably,   the   prosecution   is   not   solely   relying   on   the
document D­132(a) recovered from the residence of Ghulam
Mohammad Bhatt  (W­29). There are also other incriminatory
documents recovered from respondent (Accused No.10) himself
during   the   search,   including   other   independent   evidence,
which, indeed, will have to be proved during the trial.
21
  (1995) 1 SCC 574 (para 60)
87
35. The   appellant   has   relied   on   the   exposition   in  Salim
Khan  (supra), to contend that in cases where the High Court
adopted a totally erroneous approach, as in the present case,
discarding the crucial material/evidence which is referred to in
the report under Section 173 Cr.P.C. and presented before the
Designated Court, then the order granting bail by the High
Court   cannot   be   countenanced.   The   argument   of   the
respondent is that the said decision would make no difference
as it is concerning an application for cancellation of bail made
by the informant. However, we find force in the argument of
the appellant that the High Court, in the present case, adopted
an inappropriate approach whilst considering the prayer for
grant of bail. The High Court ought to have taken into account
the totality of the material and evidence on record as it is and
ought not to have discarded it as being inadmissible. The High
Court clearly overlooked the settled legal position that, at the
stage of considering the prayer for bail, it is not necessary to
weigh the material, but only form opinion on the basis of the
material before it on broad probabilities. The Court is expected
88
to apply its mind to ascertain whether the accusations against
the accused  are  prima face true. Indeed, in the present case,
we are not called upon to consider the prayer for cancellation
of bail as such but to examine the correctness of the approach
of the High Court in granting bail to the accused despite the
materials   and   evidence   indicating   that   accusations   made
against him are prima facie true.
36. In a decision of this Court in Chenna Boyanna Krishna
Yadav  (supra), to which reference has been made, the Court
has   re­stated   the   twin   conditions   to   be   considered   by   the
Court before grant of bail in relation to MCOCA offences. We
are of the view that in the present case, the Designated Court
rightly opined that there are reasonable grounds for believing
that the accusation against the respondent is prima facie true.
As we are not inclined to accept the prayer for bail, in our
opinion,   it   is   not   necessary   to   dilate   on   other   aspects   to
obviate prolixity.
37. A fortiori, we deem it proper to reverse the order passed
by the High Court granting bail to the respondent. Instead, we
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agree with the conclusion recorded by the Designated Court
that in the facts of the present case, the respondent is not
entitled to grant of bail in connection with the stated offences,
particularly   those falling under Chapters IV and VI of the
1967 Act.
38. Accordingly,   this   appeal   succeeds.   The   impugned
judgment and order is set aside and, instead, the order passed
by the Designated Court rejecting the application for grant of
bail made by the respondent herein, is affirmed.
39. All pending applications are also disposed of.
…………………………..….J.
        (A.M. Khanwilkar)
…………………………..….J.
       (Ajay Rastogi)
New Delhi;
April 02, 2019.