2025 (1) TMI 13 - SCH - Money Laundering

Money Laundering - whether the High Court is justified in quashing the summons on the premise that the respondent has been discharged in the predicate offence? - HELD THAT - What has been issued to the respondent is merely a summons. Simply because he has been discharged in the predicate offence, a Court cannot quash the summons. The questions as to whether the respondent would be arrayed as an accused or not, is a matter which has to be decided at a later stage. In that eventuality, it is well open to the respondent to raise all relevant contentions for the aforesaid purpose including the submissions that since the predicate offence has been quashed, the subsequent action of the appellant arraying him as an accused in the PMLA proceedings would not be sustained in the eyes of law. The impugned order stands set aside and the appellant is at liberty to proceed in pursuance to the summons that had been issued. However, we make it clear that all issues are left open to the respondent, in the event of him being arrayed as an accused. - Appeal allowed.

Summary

In the Supreme Court case presided over by HON'BLE MR. JUSTICE M. M. SUNDRESH and HON'BLE MR. JUSTICE ARAVIND KUMAR, the primary legal issue was whether the High Court was justified in quashing the summons on the grounds that the respondent had been discharged in the predicate offence. The Court clarified that the issuance of a summons does not warrant quashing simply because the respondent was discharged in the predicate offence. The determination of whether the respondent should be arrayed as an accused is to be decided later, allowing the respondent to raise relevant contentions, including the argument that the quashing of the predicate offence should affect subsequent proceedings under the PMLA.

The Supreme Court set aside the impugned order, allowing the appellant to proceed with the summons. However, it was made clear that the respondent may not be arrested, provided he continues to cooperate with the investigation. The appeal was allowed, and any pending applications were disposed of.