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JAMMU AND KASHMIR HIGH COURT
Sanjay Dhar, J.
Anil Kumar Aggarwal – Appellant
versus
Enforcement Directorate Thr. Its Assistant Director – Respondent
WP(Crl) No.9 of 2024 and CM No.648 of 2024
Decided on 15.3.2024
(A) Constitution of India – Article 226 read with Section 482 of Criminal Procedure Code, 1973 – Prevention of Money Laundering Act, 2002 – Section 50 – Arrest – Petition seeking release from custody by way of interim relief – Both events viz., arrest of petitioner and his remand to custody of respondent have taken place within territorial jurisdiction of this Court – Petitioner has rightly approached this Court – Question whether High Court of Punjab and Haryana has jurisdiction to entertain challenge to proceedings initiated by respondent against petitioner and co-accused will have to be determined by that Court – However, cause of action for invoking jurisdiction of High Court of Punjab and Haryana and cause of action for invoking jurisdiction of this Court are separate from each other, inasmuch as, there are two different events that have taken place on different occasions, may be same are part of a single transaction – Merely because grounds of challenge raised before this Court are identical to grounds of challenge raised by petitioner in petition filed by him before High Court of Punjab and Haryana, does not disentitle him from invoking jurisdiction of this Court. (Paras 12 and 13)
(B) Prevention of Money Laundering Act, 2002 – Section 50 – Constitution of India – Article 226 read with Section 482 of Criminal Procedure Code, 1973 – Offence of money laundering – Though offences under PMLA are stand alone offences, yet their origin is Scheduled offences – Once Scheduled offence ceases to exist or is extinguished, accused cannot be proceeded against in respect of offences under PMLA – If a person is finally discharged/acquitted of scheduled offences or a criminal case against him is quashed, there cannot be any offence of money laundering against him – Petitioner directed to be released from custody in subject ECIR, provided he fulfils conditions as laid down. (Paras 17, 23 and 25)
Result: Petition allowed.
ORDER
CM No.648/2024
The petitioner has called in question the action taken by the respondent that has led to his arrest in a case arising out of Enforcement Case Information Report(ECIR) bearing No. ECIR/JMSZO/02/2023 dated 31.03.2023 registered by the respondent. Challenge has also been thrown to Arrest Memo dated 06.02.2024, Arrest Order dated 06.02.2024 and Remand Order dated 07.02.2024 passed by the learned Special Judge, (PMLA) Jammu, whereby the petitioner has been remanded to custody of the respondent. In this regard, the petitioner has invoked the jurisdiction of this Court under Article 226 of the Constitution of India read with section 482 of the Code of Criminal Procedure(Cr.P.C.). By way of interim relief, the petitioner has sought his release from the custody of the respondent.
2. It appears that on 11.02.2020, the State Bank of India, the Consortium Leader of the Banks from which M/s Bharat Paper Limited (hereinafter to be referred as the BPL), of which the petitioner was one of the directors, had obtained loan, filed a complaint before the Central Bureau of Investigation(CBI) against the BPL and its four directors including the petitioner herein. On the basis of this complaint, the Anti Corruption Bureau(ACB) CBI, Jammu registered an FIR bearing No. RC0042020A0001 dated 12.02.2020 for offences under Sections 5(1)(d) read with 5(2) of the J&K Prevention of Corruption Act, 2006 and Sections 120-B, 409 and 420 of J&K RPC.
3. It was alleged in the FIR that the accused persons have perpetrated bank loan fraud for an amount running into approximately Rs. 200 crores with the Consortium of Banks with lead bank as State Bank of India, the other banks being J&K Bank, Punjab National Bank and Karur Vyasya Bank. It appears that a writ petition bearing CWP No. 6507/2021 came to be filed by the BPL and its directors before the High Court of Punjab and Haryana, whereby besides challenging circular dated 01.07.2016 read with circular dated 03.07.2017 by virtue of which the account of BPL was declared as fraud, the petitioners therein also sought a direction that no coercive action should be taken against them. The petitioners therein further sought stay of proceedings in respect of FIR bearing No.RC0042020A0001 dated 12.02.2020 of Police Station, ACB, Jammu.
4. On 19.03.2021, the High Court of Punjab and Haryana passed an interim direction, whereby taking of coercive steps against the petitioners therein including the petitioner herein was stayed, however, it was provided that investigation in the FIR may go on. It appears that another order came to be passed by the High Court of Punjab and Haryana in the same writ petition on 18.11.2022, whereby arrest of the directors of the BPL including the petitioner herein in the aforesaid FIR was stayed. Yet another order came to be passed by the High Court of Punjab and Haryana on 23.11.2022, whereby investigation against the BPL and its directors, which includes the petitioner herein, in the aforesaid FIR was stayed.
5. On 31.03.2023, an ECIR was registered by the respondent and investigation in respect of offences under Prevention of Money Laundering Act (hereinafter to be referred as the PMLA) was set into motion. It is pertinent to mention here that the registration of ECIR regarding offences under PMLA is based upon the scheduled offences that are subject matter of aforesaid FIR registered with ACB Jammu.
6. It appears that during investigation relating to offences under PMLA, the respondent conducted search operations at different places where properties belonging to the BPL and its directors are located, whereupon seizure of cash and other items was effected. During the investigation, the respondent issued summons to the petitioner, pursuant whereto, the petitioner and the co-accused approached the High Court of Punjab and Haryana by way of another petition under Section 482 Cr.P.C. whereby investigation in relation to offences under PMLA arising out of ECIR dated 31.03.2023 hav
Though offences under PMLA are stand alone offences, yet their origin is Scheduled offences – Once Scheduled offence ceases to exist or is extinguished, accused cannot be proceeded against in respect....
Court cannot take cognizance and quash or stay criminal proceedings without having territorial jurisdiction.
The existence of jurisdictional fact is a condition precedent for the exercise of power by a Court of limited jurisdiction. The grant of stay of any particular proceedings would amount to eclipsing t....
The offence of money laundering under the Prevention of Money Laundering Act, 2002 is an independent offence regarding the process or activity connected with the proceeds of crime, which has nothing ....
Anticipatory bail under the PMLA requires clear evidence that the accused is not guilty and unlikely to commit further offences, which was not demonstrated in this case.
The court established that non-compliance with the mandatory requirements of Section 19 of the PMLA regarding informing the accused of the grounds for arrest and the court's duty to record reasons fo....
Prosecution under the Prevention of Money Laundering Act, 2002 is not sustainable without a registered scheduled offence, as established by the Supreme Court in Vijay Madanlal Choudhary.
The trial under the Prevention of Money Laundering Act is independent of any pending trial for the predicate offence, as affirmed by the court.
The court upheld the validity of the ECIR independent of the FIRs, affirming that non-bailable warrants were justified due to the petitioners' non-cooperation in the investigation.
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