The Enforcement Directorate cannot act without predicate offences; absence of these renders related proceedings invalid.

ORDER :

M. NAGAPRASANNA, J.

The petitioners, in these cases, raise a common challenge to the proceedings instituted by the Enforcement Directorate in ECIR/MGSZO/01/2024 under the Prevention of Money Laundering Act, 2002 (‘the Act’ for short). A consequent mandamus is sought to declare that the proceeds of crime traceable to original complaints in P.C.R. Nos.73, 74, 75 & 76 of 2022 cannot be gone into, in the light of quashment of crime itself by this Court.

2. Heard Sri M.V. Sheshachala, learned senior counsel appearing for the petitioners and Sri Madhukar Deshpande, learned counsel appearing for the respondents.

3. Facts, in brief, germane are as follows:-

The proceedings impugned in the case at hand are an offshoot of registration of private complaints in P.C.R. Nos.73, 74, 75 & 76 of 2022 and several other private complaints registered. The aforesaid private complaints along with several other complaints against these petitioners become the subject matter of challenge before this Court in Criminal Petition Nos. 8067, 8072, 8075, 8076, 8079, 8068, 8070, 8074, 8077 and 8078 of 2023. The Enforcement Directorate is nowhere in the picture till this point. This Court, exercising its jurisdiction under Section 482 of the Cr.P.C., obliterates the very reference order under Section 156(3) of the Cr.P.C., Therefore, it would suffice if the facts obtaining in Crl.P.No.8076 of 2023 are paraphrased to capture the facts necessary for consideration of the subject cases. The facts are as follows:

“…. …. ….

The 1^st respondent is the complainant. The complainant claims to have purchased land bearing Sy.No.35/A totally measuring 10 acres in Gavarala Village, Kukunoor Taluk, Koppal District including 2 guntas of kharab land. The complainant purchases the said property on 23-12- 2002. The averment is that he has purchased the said land from out of his own earnings and claims to be in possession of the said land of 10 acres in total since then. It is alleged that accused 3 to 6 are the relatives of the complainant and accused 5 and 6, are husband and wife and accused No.4 is the son of accused 5 and 6. Accused 5 and 6 are said to be partners of M/s Sree Raghavendra Enterprises and M/s Indian Minerals and Granite Company and accused Nos. 1 and 2 are said to be employees in the said partnership firm.

3. The complainant avers that he stayed in the residence of the accused while he was pursuing his Engineering degree in the years 1993 to 1997. Subsequent upon completion of graduation, the complainant shifts to United States of America to pursue his further studies. On coming back to India, the complainant is said to have assisted the management and administrative work of the business affairs of both the afore-mentioned partnership firms from 2002 to 2006. The narration is taken a little further and the narration turns into allegations. The complainant is said to have asked accused No.5 to return the documents concerning the schedule property on the decision of the complainant to quit of assisting and serving accused No.5 in the partnership firms. It is then accused No.5 misrepresents and lies about the sale deed dated 23-12-2002 and other property papers missing and assured the complainant that if the documents were traced, he would return the same to the complainant immediately. This is in the year 2005-2006.

4. In the year 2019, the firms and the houses of accused Nos. 4 to 6 were searched by the Income Tax officials and search led to seizure. The seizure was of several documents in possession of accused Nos. 4 to 6. The property papers which belonged to the complainant also became a subject matter of seizure. It is then a notice comes to be issued by the Income Tax Department to the complainant and he was summoned with regard to the affairs and business of the aforesaid partnership firms. It is then the complaint avers that the complainant realized that accused 4 to 6 along with others have played fraud upon the complainant. The fraud is that accused 4 to