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2021 (6) TMI 583 - HC - Money LaunderingPetition pertains to the stage prior to completion of investigation and filing of complaint by Respondent - Summons issued pertaining to the same ECIR, in respect of which present petition is filed - HELD THAT - An arguable issue arises in the present case, which needs consideration. There is no dispute about the fact that petitioner nos. 1 to 3 are already enjoying an order of interim protection given by the Supreme Court in the pending writ petition. It is only the petitioner no. 4 who is presently apprehending coercive action in pursuance to summons issued by respondent no. 2. Further investigation undertaken by respondent no. 2 can proceed, subject to the result of the present writ petition - issue notice to respondents, returnable on 30.04.2021.
Issues involved:
1. Jurisdiction of the Designated Court for further investigation under PMLA. 2. Legality of summons issued by respondent no. 2 under PMLA. 3. Requirement of leave for further investigation by respondent no. 2. 4. Cooperation of petitioners with respondent no. 2 in the investigation. Analysis: 1. Jurisdiction of the Designated Court: The petitioners contended that the investigation and summons issued against them were malicious and unsustainable. They argued that the matters from about 8 years ago were being revived under the Prevention of Money-Laundering Act (PMLA). The petitioners pointed out that they had not been named as accused in the complaint filed by respondent no. 2 before the Designated Court. The Designated Court did not grant express permission for further investigation in the case, as highlighted by the petitioners. 2. Legality of Summons under PMLA: The petitioners challenged the legality of the summons issued by respondent no. 2 under the PMLA. They argued that since the Designated Court did not grant permission for further investigation, the summons issued to the petitioners were unsustainable. The petitioners sought relief from the High Court to stay further investigation against them and prevent any coercive action. 3. Requirement of Leave for Further Investigation: The petitioners relied on the Supreme Court judgment in the case of Vinubhai Haribhai to argue that without express permission from the Designated Court, respondent no. 2 could not conduct further investigation. They emphasized that the power for further investigation was subject to the Magistrate's nod under Section 173(8) of the Criminal Procedure Code. The petitioners sought protection from the High Court against any coercive steps by respondent no. 2. 4. Cooperation of Petitioners with Investigation: The respondent no. 2 opposed the petitioners' claim of non-cooperation, citing responses from petitioners 2 and 4 assuring cooperation. The respondent argued that the petitioners' claim of the investigation being unsustainable was contradictory to their earlier assurances of cooperation. The High Court considered the contentions of both parties and found that there was an arguable issue in the case. In conclusion, the High Court allowed further investigation by respondent no. 2 to proceed, subject to the outcome of the writ petition. The court granted limited protection to petitioner no. 4 against coercive action, provided the petitioner cooperated with respondent no. 2. The matter was scheduled for further hearing, and no coercive action was to be taken against petitioner no. 4 until the next hearing date.
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