ED’s case faces setback as Court grants bail to Himachal Mining businessman Gyan Chand
Photo source: Internet
Shimla, Nov 19,
A development has unfolded in a long-running money-laundering case involving Himachal Pradesh businessman and Congress leader Gyan Chand (also spelt “Gian Chand”), whose arrest in November 2024 triggered a sustained political confrontation in the state. The Special Court (Anti-Corruption, CBI) in Ghaziabad has now granted him regular bail under the Prevention of Money Laundering Act (PMLA), reviving political debate that has simmered for over a year.
Case background
According to publicly reported filings, the Enforcement Directorate (ED) arrested Gyan Chand and co-accused Sanjay Dhiman in November 2024. The agency had alleged large-scale illegal sand and mineral mining in the Beas River in Himachal Pradesh and the Yamuna River basin in Uttar Pradesh, with “proceeds of crime” running into several crores. Based on these allegations, the ED filed an Enforcement Case Information Report (ECIR) and launched a PMLA investigation by invoking multiple predicate offences.
However, the court’s bail order has now cast serious doubt on the foundation of the case.
Court’s bail order & key legal observations
The detailed order dated 3 July 2025, issued by Special Judge Arvind Misra, contains several critical findings. The court noted that Gyan Chand, around 62 years old, has been in custody since 18 November 2024 and that trial commencement “does not appear likely in the near future.”
Crucially, the court found that the very predicate offences underlying the ED’s case did not legally survive when the ECIR was filed. The judge recorded:
“All the scheduled offences… are closed/cancelled and cancellation reports have been accepted by the concerned court, which in turn shows that the ECIR has no existence.”
The court further observed that the ED filed the ECIR despite the fact that several FIRs had ended years earlier. Out of the six original predicate FIRs, four had closure reports accepted well before the ECIR date, and the remaining two had closure reports filed prior to the ED’s complaint.
Calling out the investigation, the court said, “It shows mechanical and unprofessional approach of the ED… the ED is a department dedicated exclusively to money-laundering investigations.”
On arrest procedure, the court found violations of Section 19 of the PMLA, stating that the agency failed to meet the statutory threshold:
“The ED has failed to establish that arrest was inevitable as per Section 19… none of the reasons mentioned by the ED is covered under the reasons of arrest listed by the Hon’ble Supreme Court.”
The court also held that exculpatory material was ignored, “Only inculpatory material has been collected but exculpatory material has not been collected.”
On these grounds, the court ordered that the Director, ED must take action, “A copy of this order be sent to the Director, ED for taking necessary action against the I.O./concerned authority… and against complainant for filing complaint without verifying facts.”
Political dimension and local fallout
The order has reignited the political tussle between the ruling Congress and the opposition BJP. Last year, the BJP had projected Gyan Chand as a “close aide” of the Chief Minister, while Congress countered that he backed a BJP leader in Lok Sabha polls. Each side alternately distanced itself from or accused the other depending on political expediency.
The strong judicial remarks are likely to intensify political narratives around misuse of investigative agencies, mining regulation, and patronage networks in Himachal Pradesh.
What remains to be seen
The ED continues to hold the money-laundering investigation and may challenge the bail order or file supplementary complaints. Bail does not equate to exoneration. Co-accused Sanjay Dhiman remains in judicial custody with no clarity on his bail plea.
The order’s findings could, however, trigger broader scrutiny of how predicate offences are vetted before invoking PMLA. The court’s observation that “proceeds of crime… cannot be prima facie established” from the Himachal cases may also weaken the prosecution’s narrative as the case moves forward.
Beyond the courtroom, the case carries broader implications for illegal sand and mineral mining in Himachal, regulatory oversight, and the political-administrative nexus that has historically shaped the sector.
Legal analyst view
Experts say the order underscores a recurring issue in PMLA investigations: the requirement that a scheduled offence must be “live” when ED invokes money-laundering charges. If FIRs are already closed, the PMLA mechanism cannot be triggered. The court’s finding that the ECIR itself “had no existence in law” without a pending predicate offence marks a significant legal stance that may influence future enforcement actions.
The order also reinforces Supreme Court directions that arrests under PMLA must meet a higher threshold than ordinary criminal law, with written “reasons to believe” backed by material on record — a safeguard the court found missing in this case.
About the Author
The HimachalScape Bureau comprises seasoned journalists from Himachal Pradesh with over 25 years of experience in leading media conglomerates such as The Times of India and United News of India. Known for their in-depth regional insights, the team brings credible, research-driven, and balanced reportage on Himachal’s socio-political and developmental landscape.