Vivo PMLA case: Delhi HC grants three-month interim bail to Lava’s MD Hariom Rai on health grounds

The Delhi High Court on Friday granted three months of interim bail to the Managing Director of Lava International, Hariom Rai on health grounds. Rai was recently arrested by the Enforcement Directorate in connection with a Prevention of Money Laundering Act (PMLA) case related to the Chinese mobile company Vivo.
The bench of Justice Swarna Kanta Sharma stated, “This Court is of the considered opinion that the applicant’s health condition is of such nature that it would fall within the category of sick under Section 45 of PMLA and he must be given an opportunity to get himself treated in the hospital of his choice.”
She further said that the delicate balance between life and death in cardiac emergencies underscores the importance of prioritising and requiring specialised care in such cases, to mitigate the profound risks posed by these medical conditions.
“Each passing moment in the face of cardiac distress is fraught with the peril of irreversible harm and in case of any eventuality that may occur in the applicant not getting proper and specialised treatment, this Court will have to bear the weight of regret,” she added.
The Delhi High Court further noted that the applicant aged about 57 years, is admittedly suffering from heart-related issues including angina and has been advised coronary angiography, and the same is clearly discernible from all the medical reports filed by the jail superintendent himself.
In this Court’s opinion, even otherwise, the life-threatening nature of coronary artery disease or cardiac-related issues cannot be equated with other categories of illnesses. Such medical conditions have the potential to precipitate life-threatening events at any moment, and thus, they stand unparalleled in their urgency and criticality, said the court.
Senior Advocate Vikas Pahwa, Senior Advocate with advocates Abhay Raj Varma, Arjun Rekhi, P. Rathi, Namisha and. Sanskriti S. Gupta appeared for the applicant, Hariom Rai, in the matter.
Earlier, the trial court, while denying interim bail to Hariom Rai stated, “In view of the medical reports received from the Jail superintendent, this court is of the opinion that the applicant is not suffering from any life-threatening condition or sickness or infirmity that involves danger to his life and for which treatment cannot be provided in jail. In fact, he has been provided treatment for each and every ailment about which he has complained during judicial custody.
The applicant neither falls in the category of “sick” nor “infirm” as per proviso to Section 45(1) PMLA. The plea for releasing the accused on medical grounds, as per the said provision, is accordingly dismissed, said the Court.
Earlier, Hariom Rai, through a plea, explained that since Vivo China wanted to enter India, the applicant met with Shen Wei, CEO of Vivo China, in 2013. At that time, Vivo and the applicant/LAVA were contemplating a joint venture where 25 percent of the shares would be held by the applicant/LAVA. However, this eventually never fructified and Vivo decided to independently conduct its business in India.
He further stated that negotiations and business talks between the applicant and the representatives of Vivo China failed and did not meet a fruitful end, due to which the applicant stopped pursuing the said opportunity and had nothing to do with Vivo China and/or its representatives after 2014. Merely because, over the years, the international relations between India and China have deteriorated, it would not mean that the applicant committed an offence at the relevant time when there were, in fact, friendly business relations between the two countries.
According to the ED, certain Chinese shareholders of Grand Prospect International Communication Private Ltd. incorporated the company on the basis of forged identification documents and a falsified address.
During the course of the inquiry, certain fraudulent activities were found by the Ministry of Corporate Affairs. The said company was not reported as a subsidiary of Vivo in the official records, whereas the said company publicly projects itself to be a subsidiary of Vivo, said ED.
ED further alleged that Director and Share Holder Zhang Jie used a false driving licence for applying for Director Identification Number (DIN) to give his Shillong address and also used his fake driving licence to open the bank account. With the allegations of cheating, an FIR in Police Station Kalkaji, South East Delhi registered under Section 417/120B/420 IPC and another FIR was also registered under Section 417/420/468/471/120B IPC by the Economic Offence Wing, Delhi Police, on the basis of a complaint filed by Manjit Singh, the then Deputy Registrar of Companies, Ministry of Corporate Affairs, NCT of Delhi.
ED further alleged that soon after the incorporation of M/s Vivo, India, 19 more companies, including M/s GPICPL, were incorporated across India, completely controlled by Chinese nationals. The accused, Bin Luo, was the founding/first Director of Vivo India, GPICPL and all other 18 entities at the time of their incorporation and the accused, Nitin Garg, had assisted in the incorporation of most of the companies of Vivo Group.
According to the Enforcement Directorate, raids were on the premises of the accused on October 9 and seized cash amounting to more than Rs 10 lakhs and arrested four accused, who have been identified as Guangwen Kyang, aka Andrew Kuang, the Chinese national, Hari Om Rai, the MD of Lava International, Rajan Malik, and Nitin Garg, a chartered accountant. The probe revealed that the PMLA investigation by ED was initiated by registering a money laundering case on February 3, 2022