The offence under Section 3 of the PMLA is independent of the predicate offence, allowing prosecution to continue against others involved in the proceeds of crime, even after the death of the sole accused.

ORDER

The challenge in this Crl.M.C is against Annexure A order of the Special Court for Trial of PMLA Cases, Ernakulam rejecting the petition filed in S.C.No.653 of 2018, seeking restoration of the properties attached under Section 5 of the Prevention of Money Laundering Act, 2002 ('the PMLA' for Short). Shorn of unnecessary details, the essential facts are as under;

During April-May, 2016, M/s. Trade International, Kochi, the proprietorship concern of one Jose George, and M/s.Zvezda AD, Bulgaria entered into four commercial agreements for the export of crude sunflower oil, refined sunflower oil and sugar. As per the terms of the agreements, the goods were to be exported by M/s.Trade International and payment for the goods thus exported was to be effected by M/s.Zvezda AD. The payment by M/s.Zvezda AD was guaranteed by UniCredit Bulbank, a Bulgarian entity, by issuing seven Standby Letters of Credit (SBLC) in favour of M/s.Trade International. The SBLCs covering the purchase amount were thus issued to the State Bank of India, the advising bank in the seller's country. A portion of the amount covered by the SBLCs was credited to the account of M/s.Trade International through the advising bank. The payments under the remaining SBLCs were withheld by the State Bank of India, since the documents produced by M/s.Trade International to prove shipment of the consignments were suspected to be forged. Subsequent enquiry revealed that M/s.Trade International had not shipped even a single consignment covered by the agreements to the buyer. Therefore, the Enforcement Officer in the Directorate of Enforcement lodged an FIR at the Harbour Police Station stating that approximately Rs.55 Crores was transferred by M/s.Zvezda AD to the State Bank of India, out of which Rs.25 crores was diverted to various bank accounts of Jose George and his relatives. Thereupon, Crime No.1343 of 2016 was registered at the Harbour Police Station against Jose George on 16.11.2016, alleging commission of offences punishable under Sections 420, 465, 468 and 471 of IPC. As the offences for which the crime was registered included scheduled offences under the PMLA, ECIR/KCZO/5/2016 was registered by the Enforcement Directorate ('ED' for short) on 29.12.2016. Thereafter, on 07.02.2017, an order under Section 5 of PMLA was issued by the Deputy Director of the Enforcement Directorate, provisionally attaching Rs.28,09,75,843.60 lying in the bank accounts of Jose George, his wife Beena Jose and daughter Ann Linda Jose. By the same order, another sum of USD 42,12,440/- (Approximately Rs.34.96 crores) lying with the State Bank of India was also attached. The provisional order was confirmed by the Adjudicating Authority on 18.07.2017, subject to the same becoming final by the order of confiscation issued by the Special Court under Sections 8 (5) or 8(7) of PMLA. While so, on 18.01.2018, Jose George, the sole accused in Crime No.1343 of 2016, died. Thereupon, the police submitted final report before the Judicial First Class Magistrate Court-I, Kochi on 01.02.2018, stating that the proceedings had abated by the death of the sole accused. Later, on 15.07.2018, the Enforcement Directorate filed a prosecution complaint against deceased Jose George, Beena Jose and Ann Linda Jose alleging commission of the offence under Section 3 punishable under Section 4 of the PMLA. In the meanwhile, insolvency proceedings had been initiated against M/s.Zvezda MD by the UniCredit Bulbank before the Pleven District Court in Bulgaria and an Order of Determination was passed by that court on 14.01.2021. Pursuant to the order, the assets of M/s.Zvezda were brought to sale on 22.02.2021 and an entity named M/s.Finlease Capital AD, which had bid BGN 8154 (approximately Rs.3,82,993) for the accounts receivable of M/s.Zvezda, was declared the purchaser by order dated 18.03.2021 of the Pleven District Court. Thereafter, on 27.04.2021, an agreement regarding transfer of receivables was executed between