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2024 (2) TMI 731 - HC - Money LaunderingDischarging the accused from the case upon allowing the petition u/s 227 of the Code of the Criminal Procedure, 1973 - fraudulent act of encashment of Railway Cheques - proceeds or crime - criminal activity relating to a scheduled offence - proceeds of crime and scheduled offence - parallel proceedings or not - benefit of Section 132 Evidence Act. - The accused was previously made an approver in a related CBI case. It is submitted by the petitioner that the Ld. Spl Court while passing the impugned order failed to consider that the two proceedings were independent of each other and dependent on two separate enquiry and complaint under two separate offence having separate effects and it has no binding with other proceedings. HELD THAT - Though the proceeds of crime may be an independent offence, the total case under Section 3 of the PLMA Act rests on the case registered in respect of a scheduled offence in which the opposite party turned approver. If the case for a scheduled offence fails, the case under PLMA Act also fails, as the case under PLMA Act has been prima facie made out of the materials and evidence on record in the case in respect of a scheduled offence (herein registered by the CBI). Without the evidence provided by the opposite party as an approver, the case under PLMA would have not been made out and thus the opposite party is entitled to the relief provided under the law to an approver, not only in the case registered in respect of a scheduled offence but also in respect of all cases which are dependent on the materials and evidence in the case registered in respect of a scheduled offence, in which the accused has turned approver. Admittedly, the opposite party herein turned an approver in the case registered by CBI in respect of scheduled offences and was examined by the Court under Section 306(4)(a) of Cr.P.C. as a witness. Thus keeping with the observation of the Supreme Court in VIJAY MADANLAL CHOUDHARY ORS. VERSUS UNION OF INDIA ORS. 2022 (7) TMI 1316 - SUPREME COURT and the materials on record in the present case, it is clear that the present case against the opposite party, under Section 3 of the PMLA 2002, Act is dependent on the process and activity in a scheduled offence (CBI) and thus directly connected. The total case under Section 3 of the PLMA Act rests on the case registered in respect of a scheduled offence in which the opposite party turned approver. If the case for a scheduled offence fails, the case under PLMA Act also fails, as the case under PLMA Act has been prima facie made out of the materials and evidence on record in the case in respect of a scheduled offence (herein registered by the CBI). In view of the fact that the two cases have a direct connection, the opposite party is entitled to the benefit of Section 132 Evidence Act and Section 307 of Cr.P.C. in the present case. The findings of the learned Trial Court in the order under revision being in accordance with law requires no interference - Revision dismissed.
Issues Involved:
1. Validity of the discharge of the accused under Section 227 of the Code of Criminal Procedure, 1973. 2. Applicability of Section 3 of the Prevention of Money Laundering Act (PMLA), 2002. 3. Impact of the accused being an approver in the CBI case on the PMLA proceedings. Summary: 1. Validity of the discharge of the accused under Section 227 of the Code of Criminal Procedure, 1973: The Enforcement Directorate challenged the order dated 03.10.2019 by the Spl Judge (C.B.I.) Court No. 3, Calcutta, which discharged the accused under Section 227 of the Code of Criminal Procedure, 1973. The accused, who was an approver in the CBI case, was discharged because the court found that implicating him in the PMLA case would be contradictory as he had helped the prosecution in the CBI case. 2. Applicability of Section 3 of the Prevention of Money Laundering Act (PMLA), 2002: The court examined whether the accused's actions constituted money laundering under Section 3 of PMLA, which defines the offense as involvement in any process or activity connected with the proceeds of crime. The court noted that the offense of money laundering is independent but directly connected to the criminal activity relating to a scheduled offense. 3. Impact of the accused being an approver in the CBI case on the PMLA proceedings: The court relied on precedents, including the Supreme Court judgment in Vijay Madanlal Choudhary & Ors. vs Union of India & Ors., which clarified that if a person is acquitted or discharged of the scheduled offense, there can be no offense of money laundering against them. The court found that since the accused had turned approver in the CBI case, his evidence was crucial for the prosecution, and thus, he should not be implicated in the PMLA case. The court also noted that the accused was entitled to the protections under Section 132 of the Evidence Act and Section 307 of Cr.P.C. Conclusion: The High Court upheld the order of the Special Judge, affirming the discharge of the accused in the PMLA case. The court concluded that the findings of the trial court were in accordance with the law and required no interference. The CRR 1453 of 2020 was dismissed, and all connected applications were disposed of. The interim order, if any, was vacated, and a copy of the judgment was directed to be sent to the learned Trial Court for necessary compliance.
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