Delhi High Court grants bail to Former Lava MD Hari Om Rai in Money Laundering Case

The Delhi High Court has granted bail to Hari Om Rai, the former managing director of Lava International, in a money laundering case linked to smartphone company Vivo. Rai had been in custody since his arrest by the Enforcement Directorate (ED) in October last year.

Justice Manoj Kumar Ohri made the decision based on the time Rai had already spent in custody, the fact that other accused individuals in the case had been granted bail, and the early stage of the trial. The court allowed Rai bail on a personal bond of ₹1 lakh, with one surety of the same amount.

Court’s reasoning for bail

The court noted that the conditions for bail under Section 45 of the Prevention of Money Laundering Act (PMLA) were met in Rai’s case. It also emphasized that Section 45 should not be used as a tool for prolonged detention. The judge stated that money laundering cases differ from crimes like murder or dacoity, which carry harsher penalties.

Highlighting constitutional rights under Article 21, the court explained that when trials are expected to take a long time and the accused has already been in jail for an extended period, bail should be considered. In this case, the trial involves multiple accused, extensive evidence, and numerous witnesses, making a speedy conclusion unlikely.

The ED arrested Rai on allegations of money laundering linked to Vivo-India and its associates. A trial court had earlier denied Rai bail, citing insufficient grounds. The ED accused Vivo-India of transferring ₹62,476 crore to China illegally to evade taxes in India.

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Vivo denied these claims, stating that it adheres to ethical practices and legal compliance. The ED's investigation, which included raids on Vivo-India in July 2022, uncovered what it described as a major money laundering operation involving Chinese nationals and Indian companies.

While granting bail, the court reinforced that the legal system must balance stringent laws like the PMLA with individual rights, especially when trials are prolonged. Rai, represented by senior advocate Vikas Pahwa and lawyer Abhay Raj Varma, can now await his trial outside custody.