FINAL ORDER

13.11.2025

This Order disposes of the Appeal No. FPA-PMLA-3175/DLI/2019 filed by the Punjab National Bank, against the Order dated 29.07.2019 (Impugned Order) passed by the Director, Financial Intelligence Unit- India (FIU) under Section 13 of the Prevention of Money Laundering Act, 2002 (PMLA). Total penalty of Rs. 15,62,90,000/- has been imposed on the Appellant Bank vide the Impugned Order.

2. Ld. Counsel for the Appellant submitted that a notice was issued by the Respondent on 15.12.2017 to cause an inquiry with regard to the compliance by the Appellant Bank with respect to various obligations as reporting entity, under PMLA read with Prevention of Money Laundering Rules 2005. Thereafter, inspection was conducted on 02.01.2018 and 05.01.2018 of the Appellant Bank for the review period from 01.04.2016 to 30.11.2017. The Respondent sought for information from the Appellant vide its letters dated 05.03.2018 and 04.04.2018. The Appellant responded to these letters and sought guidance from the Respondent as to bring about restructuring of the Anti-Money Laundering Setup of the Appellant Bank. Further correspondence was made in respect of Non-Profit Organisation Transactions (NTR) Reports. A Show Cause Notice (SCN) No. 25-3/Compl/FIU-IND/2018 was issued by the Respondent to the Appellant Bank on 09.11.2018, calling upon the Bank as to why suitable directions including direction of imposition of penalty should not be passed under Section 13 read with Section 12 of PMLA, further read with Rules 3, 7, 8 and 9 of the Rules 2005.

3. Ld. Counsel for the Appellant stated that the Bank is a Public Sector Undertaking and its Officers have neither intentionally nor knowingly indulged in non-compliance of the statutory provisions. In fact, the Bank and its employees have fully co-operated with the Respondent in the review and the inquiry. The Respondent have failed to give reasons as to why other actions mentioned in clauses (a) to (c) of Sub-Section 2 of Section 13 of PMLA could not meet ends of justice, and why was it necessary to impose such heavy penalty. There have been frequent technical errors on the reporting site maintained by the Respondent, which obstructed and delayed online submission of the report. Ld. Counsel submitted that the NTRs were submitted every month yet these were rejected. However, the same NTRs files when re- uploaded were accepted. Similarly, many STRs with similar ground of suspicion were accepted but for 343 STRs refiling was asked with sufficient ground of suspicion. Ld. Counsel for the Appellant prayed for liberty to argue on the specific grounds given for the imposition of penalty in each case of non-compliance. She pleaded for allowing the Appeal.

4. Ld. Counsel for the Respondent stated that the FIU IND was setup by the Government of India as the Central National Agency responsible for receiving, processing, analysing and disseminating information to the relevant institutions/law enforcement agencies of the Government. He stated that the Respondent is also responsible for coordinating and strengthening efforts of national and international intelligence, investigation and enforcement agencies in pursing the global efforts against money laundering and related crimes. Section 12(1)(b) of the Act, obligates every reporting entity (viz., a banking company, financial institution, intermediary or a person carrying on a designated business or profession) to maintain a record of all transactions in such a manner as to enable it to reconstruct individual transactions; to furnish to the Director within such time as may be prescribed, information relating to such transactions, whether attempted or executed, the nature and value of which may be prescribed; to verify the identity of its clients in such manner and subject to such conditions, as may be prescribed; to identify the beneficial owner, if any, of such of its clients, as may be prescribed and to maintain record of documents evidencing identity of its cl