2021 (1) TMI 259 - HC - Money Laundering

Petition filed challenging the summon issued - anticipation of threat and coercion during appearance - seeking direction to respondents to abstain from harassing, threatening or coercing the petitioners during questioning - seeking permission of presence of a legal practitioner - seeking to to limit the questioning time between 9.30 a.m and 4.30 p.m - seeking direction to respondents to provide copies of the statements taken from them. HELD THAT - The question regarding maintainability of writ petition against a summons under Section 50 and the entitlement to have the presence of a legal practitioner during questioning was considered and negated by this Court in C.M. RAVEENDRAN VERSUS UNION OF INDIA ASST. DIRECTOR, ENFORCEMENT DIRECTORATE 2020 (12) TMI 703 - KERALA HIGH COURT . Therein, reliance was placed on the judgments of the Apex Court in KIRIT SHRIMANKAR VERSUS UNION OF INDIA AND OTHERS 2014 (12) TMI 150 - SUPREME COURT and UNION OF INDIA AND ANOTHER VERSUS KUNISETTY SATYANARAYANA 2006 (11) TMI 543 - SUPREME COURT - In Kirit Shrimankar, the petitioner had approached the Apex Court after the Customs officials conducted a search in the residential premises of his former wife. The petitioner alleged that he was threatened with arrest and incarceration if he did not submit to the dictates of the Customs Officials. The Apex Court observed that it was highly premature for the petitioner to seek remedy under Article 32 of the Constitution of India based on such flimsy averments, which cannot form the basis for a prima facie apprehension. Thereupon, the petitioner withdrew the writ petition. In Kunisetty Satyanarayana, the appellant had approached the court on being served with a show cause notice by his employer as to the genuineness of his caste certificate. The decision of the High Court of Delhi in VIRBHADRA SINGH ANOTHER VERSUS ENFORCEMENT DIRECTORATE ANOTHER, CHUNNI LAL CHAUHAN VERSUS ASSISTANT DIRECTOR, ENFORCEMENT DIRECTORATE ANOTHER, VIKRAMADITYA SINGH VERSUS ASSISTANT DIRECTOR, ENFORCEMENT DIRECTORATE AND PICHESWAR GADDE VERSUS ENFORCEMENT DIRECTORATE MINISTRY OF FINANCE OTHERS 2017 (7) TMI 109 - DELHI HIGH COURT , is to the effect that, no person is entitled in law to evade the command of the summons issued under Section 50 of the Act on the ground of a possibility of such person being prosecuted in future. Hence, the legal position is that a person issued with summons under Section 50(2) of the Act is bound to appear in person or through authorised agents, as the case may be and to state the truth upon any subject respecting which he is examined and that, no cause of action arises merely for reason of a person being thus summoned - As held by the Apex Court in DUKHISHYAM BENUPANI VERSUS ARUN KUMAR BAJORIA 1997 (11) TMI 428 - SUPREME COURT , it is not for this Court to monitor the investigation and to decide the venue, the timings, the questions and the manner of questioning. Petition dismissed.

Summary

Issues:
1. Maintainability of writ petition against summons under Section 50 of the Prevention of Money Laundering Act, 2002.
2. Entitlement to have the presence of a legal practitioner during questioning.
3. Allegations of harassment, threat, and coercion during questioning.
4. Amendment seeking guidelines for the procedure when summoned under Section 50.
5. Legal precedent regarding writ petitions against show cause notices or charge sheets.
6. Legal position on appearance in response to summons under Section 50.

Issue 1: Maintainability of Writ Petition:
The writ petition challenged the summons issued under Section 50 of the Prevention of Money Laundering Act, 2002. The Court referred to previous judgments and held that a writ petition against such summons is not maintainable. Citing cases like Kirit Shrimankar v. Union of India and Kunisetty Satyanarayana v. Union of India, the Court emphasized that a mere summons does not give rise to a cause of action for a writ petition.

Issue 2: Entitlement to Legal Practitioner:
The petitioners sought permission for the presence of a legal practitioner during questioning, which was denied by the Court. Relying on legal precedents, the Court stated that the presence of legal practitioners during questioning cannot be permitted. The judgment highlighted that the entitlement to have legal representation during such proceedings was not recognized.

Issue 3: Allegations of Harassment:
Allegations of harassment, threat, and coercion during questioning were raised by the petitioners. The fourth respondent refuted these claims in a counter affidavit, stating that the apprehensions of the petitioners were misplaced. The Court noted the conflicting accounts but ultimately dismissed the allegations of coercion and harassment during questioning.

Issue 4: Amendment Seeking Guidelines:
The petitioners sought to amend the writ petition to include a prayer for laying down guidelines on the procedure for persons summoned under Section 50. However, the Court did not entertain this request and maintained its stance on the maintainability of the writ petition against the summons.

Issue 5: Legal Precedents on Writ Petitions:
The judgment discussed legal precedents such as Kunisetty Satyanarayana and Kirit Shrimankar cases to establish that writ petitions against mere show cause notices or charge sheets are generally considered premature. The Court emphasized that a writ petition requires a violation of rights, which is not triggered by the issuance of a summons alone.

Issue 6: Legal Position on Appearance in Response to Summons:
The Court clarified that a person summoned under Section 50 of the Act is obligated to appear and state the truth, with no cause of action arising solely from the summons. Referring to legal precedents, the Court highlighted that interference by courts in the investigation process, including deciding on venue, timings, and questioning methods, is not within their purview.

In conclusion, the Court dismissed the writ petition based on the legal positions established through various judgments and precedents, emphasizing that monitoring investigations and deciding on procedural aspects during questioning are not within the court's jurisdiction.