Delhi High Court Quashes ED Summons Over Non-Compliance with Section 223 BNSS

Mandatory Notice Before Cognizance: A Procedural Victory for Accused in Money Laundering Case

In a significant procedural ruling, the Delhi High Court has quashed summons issued by the Directorate of Enforcement (ED) in a money laundering case after finding that the trial court had failed to comply with the mandatory notice requirement under Section 223 of the Bharatiya Nagarik Suraksha Sanhita (BNSS). Justice Girish Kathpalia, presiding over a batch of three connected petitions, set aside the cognizance order dated September 25, 2024, and directed the trial court to re-hear the matter.

The Case: Three Petitions, One Core Flaw

The petitions—filed by Naresh Aggarwal, M/s Compact Capital Limited, and M/s Kalptaru Fincap Limited—all arose from the same Enforcement Case Information Report (ECIR) and challenged the same trial court order. The common grievance was that the learned trial court took cognizance of the offense without issuing any prior notice to the proposed accused, as mandated by the proviso to Section 223 BNSS.

Concession from the ED: “Order Not Sustainable”

During the hearing, senior counsel for the petitioners, Mr. Avi Singh, and counsel for the other petitioners argued that the non-compliance with Section 223 BNSS rendered the cognizance order void ab initio. Notably, the ED’s counsel, Mr. Vivek Gurnani and Special Counsel Mr. Anupam S. Sharrma, conceded that “in view of the legal position as it stands today, the impugned order is not sustainable on account of non-compliance with proviso to Section 223 BNSS.” However, they clarified that this concession did not extend to the merits of the case regarding the validity of the underlying allegations.

Legal Analysis: The Purpose of Notice Under Section 223 BNSS

Section 223 BNSS governs the procedure for taking cognizance of offenses by a magistrate. The proviso to this section explicitly requires that before taking cognizance, the magistrate must issue notice to the accused and give them an opportunity of being heard. This safeguard ensures that accused persons are not taken by surprise and can present their case at the earliest stage.

Justice Kathpalia noted that the admitted position was that the trial court had passed the cognizance order without issuing such notice. Relying on judicial precedents cited by the petitioners, the court held that this procedural lapse was fatal to the order.

The Court’s Decision: Set Aside and Re-hear

With the consent of both sides, the court disposed of the petitions by setting aside the impugned orders and the consequent summons. The petitioners were directed to appear before the trial court on June 10, 2026—the date already fixed—and the requirement for formal notice under Section 223 BNSS was dispensed with by mutual agreement. The trial court was instructed to fix a fresh date for hearing on cognizance and then pass a fresh order.

Key Observations from the Judgment

  • “The learned trial court passed cognizance order without issuing notice to the present petitioners (proposed accused therein).”
  • “The impugned order is not sustainable on account of non-compliance with proviso to Section 223 BNSS.”
  • “After some discussion, with consent of both sides, these petitions are disposed of by setting aside the impugned orders dated 25.09.2024… and directing the present petitioners to appear before the learned trial court on 10.06.2026.”

Implications for Future Cases

This ruling reinforces the importance of procedural compliance in criminal proceedings. Even in cases involving serious economic offenses like money laundering, courts must adhere to the notice requirements under the BNSS before taking cognizance. The decision serves as a reminder that technical violations can lead to the quashing of orders, irrespective of the strength of the underlying allegations.