2022 (10) TMI 1080 - HC - Money Laundering

Money Laundering - scheduled offences - submission of documents of properties with existing encumbrance as collateral security for the loan - Section 420 IPC - Sections 48 and 49 of the PMLA r/w Notification vide G.S.R.441(E), dated 01.07.2005 as amended by G.S.R.579(E), dated 29.08.2013, S.O.1275(E) dated 13th September 2005 - HELD THAT - Section 48 (c) ibid., clearly classifies the Assistant Director as an authority for the purposes of this Act . Thus, when the statute itself classifies the Assistant Director as an authority, we are afraid no further authorisation is required for him to file a complaint for the Special Court to take cognizance of the offence u/s.44(b) of the PMLA. It is true that Section 420 IPC was not a scheduled offence under the PMLA on 25.09.2008 when the case was registered by the CBI and that it was included in the statute only with effect from 01.06.2009. In this case, the Enforcement Directorate has registered the case only after 01.06.2009, viz. , on 23.11.2010 - irrespective of the fact as to when the scheduled offence was committed, if the proceeds of crime that is generated from the commission of a scheduled offence is laundered after the coming into force of the PMLA, 2002, then one can be prosecuted u/s.3 r/w 4 of the PMLA. Manjula cannot claim prejudice for non-identification by any witness during trial. If Anuraag Jain and Manjula were not arrested and released on bail or if they are not on anticipatory bail, the trial Judge shall obtain a bond u/s.88 Cr.P.C. for Rs.25,000/- with two sureties each from them, if not already obtained - Petition dismissed.

Summary

Issues:
1. Quashing of proceedings in a case under the Prevention of Money Laundering Act, 2002.
2. Competency of the Assistant Director to file a complaint without special authorization.
3. Inclusion of Section 420 IPC as a scheduled offence under the PMLA.
4. Presence of the accused during trial proceedings.

Analysis:
1. The petition sought to quash proceedings in a case under the Prevention of Money Laundering Act, 2002. The case involved allegations of granting huge loans leading to NPA status. The Enforcement Directorate filed a complaint against the accused for money laundering. Both sides agreed that the trial was ready to proceed.

2. The first contention was regarding the competency of the Assistant Director to file the complaint without special authorization. The court referred to relevant sections of the PMLA and notifications by the Central Government. It was concluded that the Assistant Director was classified as an authority under the Act, hence no further authorization was necessary.

3. The second issue raised was the non-inclusion of Section 420 IPC as a scheduled offence under the PMLA at the time of registration of the case by the CBI. The Enforcement Directorate registered the case after the inclusion of Section 420 IPC. A Supreme Court judgment highlighted that money laundering can be prosecuted irrespective of the date of the scheduled offence if the proceeds of crime are laundered after the PMLA came into force.

4. The court addressed the presence of the accused during trial proceedings. The petitioners requested the absence of one accused due to being a housewife. The court allowed her absence for most hearings but specified her presence for certain proceedings. The court also outlined conditions for the accused who were not arrested or on bail.

In conclusion, the petition was dismissed, and specific directions were given regarding the presence of the accused during trial proceedings.