The Jharkhand High Court has ruled that there is no requirement of an “arithmetical correspondence” between the amount quantified in proceedings relating to a scheduled offence and the value of property alleged to constitute proceeds of crime under the Prevention of Money Laundering Act, 2002 (PMLA). The decision came in a petition filed by former Jharkhand Chief Minister Madhu Koda, who had sought alteration of the money-laundering charge framed against him, arguing that the amounts involved were vastly disproportionate.

A single-judge bench of Justice Sujit Narayan Prasad dismissed Koda’s petition under Section 482 of the Code of Criminal Procedure (CrPC), holding that the special judge had correctly refused to alter the charge at this stage. The court left all evidentiary questions concerning the alleged proceeds of crime to be determined during trial.

No Right to Demand Alteration of Charge

Koda is facing trial under Sections 3 and 4 of the PMLA. He had moved an application under Section 216 CrPC, which empowers a court to alter or add to any charge at any time before judgment. The former chief minister contended that the amount forming the basis of the PMLA charge—approximately ₹3,554.65 crore and US$24,29,990—had no corresponding foundation in the predicate-offence proceedings. The proceedings concerning the scheduled offences had involved amounts ranging from about ₹1.40 crore in the initial vigilance charge-sheet to sums cited by the CBI, including alleged illegal gratification of ₹13 crore and disproportionate assets of approximately ₹8.42 crore.

The special judge declined to alter the charge, observing that any modification could be considered at the appropriate stage of trial. Upholding that order, the High Court examined the scheme of Section 216 CrPC and noted that the provision does not confer a right upon an accused to demand alteration of a charge. The court emphasised that the decision to alter a charge lies within the discretion of the trial court, which must be exercised judicially.

PMLA vs Predicate Offence Amounts

The core legal issue revolved around the definition of “proceeds of crime” under Section 2(1)(u) of the PMLA and the offence of money-laundering under Section 3. Koda’s counsel argued that since the predicate-offence charge-sheets referred to significantly smaller amounts, the PMLA charge could not legitimately rely on the far larger valuation attributed to the alleged proceeds of crime. The court, however, rejected this submission.

Referring to the Supreme Court’s decision in Vijay Madanlal Choudhary v. Union of India , Justice Prasad observed that there is nothing in that judgment that requires an arithmetical match between the value quantified in a charge-sheet relating to the scheduled offence and the value of property alleged to be involved in money-laundering. The court noted that determining the correctness of the amount alleged as proceeds of crime would require a thorough examination of properties, transactions, and evidence connecting them with the scheduled offences. Such questions were matters for trial and could not be finally determined at the stage of an application for alteration of charge.

The High Court also highlighted that the scheduled-offence proceedings were still pending and that Koda had neither been discharged nor acquitted in those proceedings. Consequently, there was no basis to hold that the PMLA charge must be confined to an amount numerically matching that stated in the predicate-offence charge-sheet.

Trial to Determine Proceeds of Crime

After finding no manifest illegality, abuse of process, or miscarriage of justice warranting interference under Section 482 CrPC, the court dismissed Koda’s petition. The ruling leaves the evidentiary questions concerning the alleged proceeds of crime to be considered during the ongoing trial.

The judgment clarifies an important aspect of money-laundering law: the valuation of alleged proceeds of crime under the PMLA is not mechanically tied to the sums mentioned in the predicate-offence proceedings. The prosecution is permitted to present a broader picture of the financial transactions and assets that it alleges constitute laundered money, even if the initial charge-sheets in the scheduled offences mention smaller amounts.

Legal experts note that the decision provides guidance on the scope of charges under the PMLA and reinforces the principle that the trial court retains discretion to examine the full extent of alleged money-laundering activities. The ruling also underscores that an accused cannot compel the alteration of a charge simply because the numbers differ between predicate and PMLA proceedings.

For Madhu Koda, the petition’s dismissal means he will continue to face trial on the PMLA charge as framed. The trial court will now proceed to evaluate the evidence regarding the quantum and nature of the alleged proceeds of crime, without being restricted by the amounts previously cited in the predicate-offence investigation.

The petitioner was represented by Advocate Navin Kr. Singh, while the opposite party was represented by Senior Advocate Amit Kumar Das and Advocate Saurav Kumar.