2023 (1) TMI 808 - HC - Money Laundering

Money Laundering - proceeds of crime - when a juristic person has been arrayed as an accused in a prosecution, who should have to represent such a legal persona? - HELD THAT - A12 has volunteered to represent the juristic person A13. In view of the same, the juristic entity has nominated a person to represent it in the prosecution and as a result, the petitioner can be discharged from the complaint. This Criminal Revision Case stands allowed.

Summary

Issues:
1. Discharge petition filed by A13 company's representative.
2. Representation of a juristic person in a criminal prosecution.
3. Nomination of a person to represent a juristic entity in legal proceedings.

Issue 1: Discharge petition filed by A13 company's representative

The petitioner, A13 company, represented by its Director, filed a discharge petition on the grounds of lack of allegations or material against the petitioner. The complaint under the Prevention of Money Laundering Act, 2002 (PMLA) alleged acquisition and concealment of proceeds of crime by the company. The petitioner sought to be dropped as the Director of the company. The Court below dismissed the petition, leading to the filing of a Criminal Revision before the High Court.

Issue 2: Representation of a juristic person in a criminal prosecution

The High Court deliberated on the question of who should represent a juristic entity when it is accused in a prosecution. Citing a previous judgment, the Court emphasized that a juristic entity must nominate a person to represent its prosecution. In this case, A12 volunteered to represent A13 company and submitted an affidavit to that effect. The Court acknowledged this nomination and concluded that the juristic entity had nominated a representative, allowing for the discharge of the petitioner from the complaint.

Issue 3: Nomination of a person to represent a juristic entity in legal proceedings

The affidavit filed by A12 stated his willingness to represent A13 company and requested the Court to replace the previous Director with his name as the representative. The Court accepted this nomination, highlighting the importance of a juristic entity nominating a representative for legal proceedings. Consequently, the High Court allowed the Criminal Revision, setting aside the order of the Court below and directing A12 to file a petition under Section 305 of the Criminal Procedure Code with an affidavit to represent A13 company in the ongoing complaint.

In conclusion, the High Court's judgment addressed the issues of a discharge petition filed by a company's representative, the representation of a juristic person in a criminal prosecution, and the nomination of a person to represent a juristic entity in legal proceedings. The Court emphasized the importance of a juristic entity nominating a representative and accepted A12's volunteering to represent A13 company, leading to the allowance of the Criminal Revision and the setting aside of the lower court's order.