9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2024 (7) TMI 1171 - HC - Money LaunderingMoney Laundering - criminal conspiracy - taking illegal money to influence a public servant and for exercise of personal influence with public servant and abuse of official position by public servant against accused persons - constitutional vaidity of Section 50 (2) of Prevention of Money Laundering Act, 2002 - ultra vires and violative of Articles 14, 20 and 21 of Constitution of India and Section 132 of Indian Evidence Act, 1872 - HELD THAT - In the present case, during the course of investigation by ED, Satish Babu Sana and Pradeep Koneru in their respective statements recorded under Section 50 of PMLA, admitted having paid crores of rupees to Moin Akhtar Qureshi through his employee Sh. Aditya Sharma for obtaining illegal favor from govt. servant(s) after using his influence. Aditya Sharma was also confronted with the facts and evidences on record, who confirmed the monetary transactions received by him. The same were also found in tandem with the contents of BBM messages retrieved by forensics lab, CERT-In. These amounts were found to be sent for Hawala Transactions through Delhi based Hawala Operators which reflected in the BBM messages of Aditya Sharma and Ex. CBI Director AP Singh. Satish Babu Sana and Pradeep Koneru have, thus, prima facie committed offence of money laundering as defined in Section 3 of the PMLA, 2002 by directly or indirectly indulging in, knowingly assisting, knowingly a party and actually involved in all or any process or activity connected with the proceeds of crime including its concealment, possession, acquisition or use and projecting or claiming it as untainted property. The petitioners have challenged the constitutionality of Section 50 of PMLA, which has already been put to rest by the Hon ble Supreme Court in its Three Judge Bench decision in Vijay Madanlal Choudhary Vs. UOI 2022 (7) TMI 1316 - SUPREME COURT wherein it is held that ' We fail to understand as to how article 20 (3) would come into play in respect of process of recording statement pursuant to such summon which is only for the purpose of collecting information or evidence in respect of proceeding under this Act. Indeed, the person so summoned, is bound to attend in person or through authorised agent and to state truth upon any subject concerning which he is being examined or is expected to make statement and produce documents as may be required by virtue of sub-section (3) of section 50 of the 2002 Act. The criticism is essentially because of sub-section (4) which provides that every proceeding under sub-sections (2) and (3) shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 of the IPC. Even so, the fact remains that article 20 (3) or for that matter section 25 of the Evidence Act, would come into play only when the person so summoned is an accused of any offence at the relevant time and is being compelled to be a witness against himself. This position is well-established.' Admittedly, in the present case, the petitioners in the case registered by the CBI were arrayed as the witnesses to a case under scheduled offences. However, during the process of investigation, case under the provisions of PMLA has been registered wherein they have been arrayed as accused - The ratio of law laid down by the Hon ble Supreme Court in Vijay Madanlal, clearly spells out that it may happen in cases that a person who is witness in offences related to scheduled offences, during his interrogation, may put-forth some material which would indicate his involvement in the commission of offence under PMLA. This Court in a catena of decisions has already held that proceedings under the scheduled offences and PMLA are separate and distinct and have no binding upon each other. Having regard to the Supreme Court s decision in Vijay Madanlal Choudhary and the fact that the petitioners are involved in the case of money laundering, it is found that proceedings under PMLA have been rightly initiated against them. The petitioners have challenged their summoning, which in our opinion is just and proper to unearth the roots of the money trail - Finding no merit in the averments raised by the petitioners, these petitions and pending applications are accordingly dismissed.
Issues Involved:
1. Constitutionality of Section 50(2) of the Prevention of Money Laundering Act (PMLA), 2002. 2. Validity of summons issued under Section 50 of PMLA. 3. Legality of changing the status of individuals from witnesses to accused. 4. Issuance and validity of Look Out Circular (LOC). Detailed Analysis: 1. Constitutionality of Section 50(2) of the Prevention of Money Laundering Act (PMLA), 2002: The petitioners challenged the constitutionality of Section 50(2) of PMLA, arguing it violates Articles 14, 20(3), and 21 of the Constitution of India, and Section 132 of the Indian Evidence Act (IEA). The court referred to the Supreme Court's decision in Vijay Madanlal Choudhary v. Union of India, which upheld the validity of Section 50 of PMLA. The court reiterated that Section 50(2) empowers authorities to summon any person during an investigation, and such proceedings are deemed judicial under Sections 193 and 228 of the Indian Penal Code (IPC). The court found no merit in the petitioners' challenge to the constitutionality of Section 50(2) of PMLA. 2. Validity of Summons Issued Under Section 50 of PMLA: The petitioners argued that the repeated summons under Section 50 of PMLA were illegal, especially after they were initially cited as witnesses. The court noted that the investigation under PMLA is ongoing and new facts can emerge, necessitating further summoning. The court emphasized that Section 50(2) of PMLA allows authorities to summon any person whose attendance is necessary for the investigation. The court found that the issuance of summons was justified and within the legal framework. 3. Legality of Changing the Status of Individuals from Witnesses to Accused: The petitioners contended that changing their status from witnesses to accused was illegal and violated their rights. The court observed that during the investigation, if evidence indicates a person's involvement in money laundering, their status can be changed from a witness to an accused. The court cited the Supreme Court's ruling in Vijay Madanlal Choudhary, which clarified that proceedings under scheduled offenses and PMLA are separate and distinct. The court found that the change of status was legally permissible based on the evidence gathered during the investigation. 4. Issuance and Validity of Look Out Circular (LOC): Petitioner-Pradeep Koneru challenged the issuance of the LOC against him, arguing it was done without proper justification. The court noted that the LOC was issued based on apprehensions that the petitioner might flee the country. The court referred to the Office Memorandum (OM) dated 27.10.2010, which permits investigating agencies to issue LOCs in cognizable offenses. The court found that the issuance of the LOC was justified given the circumstances and the ongoing investigation. Conclusion: The court dismissed the petitions, finding no merit in the arguments presented by the petitioners. The court upheld the constitutionality of Section 50(2) of PMLA, validated the issuance of summons under PMLA, justified the change of status from witnesses to accused based on evidence, and found the issuance of the LOC to be legally sound. The interim protection granted to the petitioners was extended for two weeks.
|
