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2023 (1) TMI 1299 - HC - Indian LawsMoney Laundering - proceeds of crime - under-reporting of money transferred abroad which does not generate proceeds of crime which is sine qua non for proceedings under the Prevention of Money Laundering Act (PMLA) - HELD THAT - The petitioner is seeking quashing of ECIR and according to the Supreme Court in Kirit Shrimankar vs U.O.I 2014 (12) TMI 150 - SUPREME COURT has held that a writ remedy on account of issuance of summons at the stage of investigation/enquiry is highly premature. There is no violation of any fundamental right or even legal right of the petitioner warranting interference of this Hon ble Court at the stage of summons - In addition there are allegations in the complaint u/s 51 regarding evasion of tax. The allegations are being investigated. Whether there is generation of proceeds of crime or not is being investigated and for the aforesaid reasons the petition as of today is premature. The prayer for quashing of LoC at this stage again will be premature and hence is rejected. However the petitioner has travelled in the past and needs to travel for his work. The liberty of the petitioner to travel abroad for the purpose of business cannot be curtailed. Petition dismissed.
Issues Involved:
Petition seeking writ to quash ECIR, notices, and stay investigation; Allegations of under-reporting money transferred abroad; Quashing of LoC; Prematurity of the petition; Compliance with legal procedures; Liberty to travel abroad for work. Detailed Analysis: 1. Petition to Quash ECIR, Notices, and Stay Investigation: The petitioner sought a writ to quash the ECIR initiated by the respondent, along with notices issued by the Investigating Officer. The petitioner argued that the money sent through bank accounts for property purchase in London did not involve tax evasion or proceeds of crime. The petitioner contended that any under-reporting of money transferred abroad did not generate proceeds of crime necessary for proceedings under the Prevention of Money Laundering Act. The petitioner also sought quashing of the LoC issued against them, citing a relevant judgment to support their case. 2. Allegations of Under-reporting Money Transferred Abroad: The respondent alleged that the petitioner under-reported investments in a London property, indicating potential tax evasion. The respondent highlighted discrepancies in the declared value of investments in the property and raised concerns about undisclosed income sources. The respondent argued that the petitioner's actions amounted to willful tax evasion under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015. 3. Prematurity of the Petition: The court deemed the petition premature, citing a Supreme Court judgment that a writ remedy at the investigation/enquiry stage is premature. The court emphasized that there was no violation of fundamental or legal rights warranting intervention at the summons stage. The court referred to a case where extraordinary constitutional remedies were considered premature based on flimsy grounds, emphasizing the need for a substantive basis for apprehension of arrest. 4. Compliance with Legal Procedures: The court emphasized that the powers of investigating agencies, including summoning individuals for examination, are integral to effective investigations. The court clarified that being summoned for investigation does not automatically make a person an accused. The court reiterated that premature interference with investigating agencies' powers is not warranted, especially when allegations of tax evasion are under investigation. 5. Liberty to Travel Abroad for Work: While rejecting the quashing of the LoC at the current stage as premature, the court acknowledged the petitioner's need to travel abroad for work. The court granted the petitioner the liberty to file applications with supporting documents for travel abroad, ensuring consideration in accordance with the law. In conclusion, the court dismissed the petition as premature, rejected the quashing of the ECIR and LoC, and granted the petitioner liberty to travel abroad for work, subject to legal procedures. The court's decision was based on the ongoing investigation into allegations of tax evasion and the need for compliance with legal processes.
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