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IN THE HIGH COURT OF JUDICATURE AT MADRAS
S.M.Subramaniam, V.Sivagnanam
Vijayraj Surana – Appellant
Versus
Assistant Director, Enforcement Directorate – Respondent
ORDER :
S.M. SUBRAMANIAM, J.
| Table of Contents | ||
| I. | FACTUAL MATRIX | |
| II. | CONTENTIONS OF THE PETITIONER | |
| III. | REPLY BY RESPONDENT | |
| IV. | DISCUSSIONS | |
| A) | LEGAL GROUNDS ON WHICH FIR PERTAINING TO THE SCHEDULED OFFENCE WAS QUASHED | |
| B) | SCHEDULED OFFENCE OF SECTION 447 OF THE COMPANIES ACT, 2013 IS STILL PENDING AGAINST THE PETITIONER | |
| C) | PMLA IS A SUI-GENERIS LEGISLATION | |
| D) | SECTION 3 OF PMLA IS A STANDALONE PROVISION | |
| E) | ECIR CANNOT BE EQUATED WITH FIR | |
| F) | DELIBERATIONS ON THE PRINCIPLE OF AUTOMATIC QUASHING OF ECIR ONCE FIR STANDS QUASHED | |
| G) | IMPLICATIONS OF AUTOMATIC QUASHING OF ECIR BASED ON FIR QUASH | |
| V. | CONCLUSION | |
Under assail are the proceedings of the Enforcement Directorate in ECIR Nos.CEZO-I/05/2019 dated 27.12.2019, CEZO-I/37/2020-dated 25.09.2020 and CEZO-I/42/2020 dated 24.12.2020.
I. FACTUAL MATRIX:
2. The crux of the allegations against the petitioner under Prevention of Money Laundering Act, 2002, [hereinafter referred as 'PMLA'] complaint are that they have obtained loans from IDBI Bank to the tune of Rs.1301.76 Crores and Rs.1495.76 Crores from the same IDBI Bank and from the SBI Bank, Rs.1188.56 Crores. The loan borrowed by the said companies have facilitated mis-appropriation, manipulation of books of accounts
A quashed FIR does not automatically invalidate an ECIR; the ECIR is independent and requires substantive grounds for quashing based on the merits of the predicate offence under PMLA.
FIR and ECIR become two different documents and both tend to take shape on its own, independent of each other.
The court established that the offense of money laundering under PMLA cannot exist independently of a scheduled offense.
The presence of a scheduled offence legitimizes the existence of an ECIR and allows the department to continue the investigation. However, the settlement or quashing of scheduled offences in FIRs pro....
Money laundering proceedings under the Prevention of Money Laundering Act cannot be sustained without a validly registered predicate offense; if the predicate offense is quashed, so are the related m....
Section 66(1) of the PMLA prescribes the obligations of Enforcement Directorate (ED) to provide or facilitate the provision of pertinent information to designated government entities when such inform....
The Prevention of Money Laundering Act proceedings cannot survive if the predicate offences linked to them are closed by the court, indicating the non-existence of 'proceeds of crime'.
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.
Without a predicate offense, proceedings under the Prevention of Money Laundering Act cannot be sustained, as established by the Supreme Court.
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