2024 (3) TMI 582 - HC - Money Laundering

Money Laundering - existence of a predicate/ scheduled offence - sine qua non for proceeding upon the offence of money laundering as defined under Section 3 of the Act - accused discharged or acquitted of the scheduled offences - HELD THAT - The Apex Court in the case of Vijay Madanlal Choudhary 2022 (7) TMI 1316 - SUPREME COURT has already settled the controversy that if a person is finally discharged or acquitted of the scheduled offences or the criminal case against him is quashed by the Court of competent jurisdiction, there can be no offence of money laundering against him or any one claiming such property being the property linked to stated scheduled offence through him. The impugned order dated 10.06.2023 passed by the Special Judge, Prevention of Money Laundering Act, 2002 in Special Case No. 47/2015 is set-aside and the present petitioner be discharged from the charges framed under PMLA and all further proceedings emanating therefrom against the petitioner. Criminal revision allowed.

Summary

Issues Involved:
1. Validity of charges under the Prevention of Corruption Act, 1988.
2. Proceedings under the Prevention of Money Laundering Act, 2002.
3. Applicability of the Supreme Court's decision in Vijay Madanlal Choudhary vs. Union of India.
4. Discharge application under Section 245(2) of the Cr.P.C., 1973.

Summary:

1. Validity of Charges under the Prevention of Corruption Act, 1988:
An FIR No. 57/2010 was registered by the Lokayukt Police, Indore against the petitioner and others under Section 13(1)(d) and 13(2) of the Prevention of Corruption Act, 1988. The chargesheet No. 48/2013 was produced before the Special Court under the PML Act. The co-accused was discharged by the High Court in CRR No. 1011/2016, which led to the petitioner's case being reconsidered. The trial Court eventually concluded that no unlawful gain or loss was caused, leading to the discharge of the petitioner from the PC Act charges.

2. Proceedings under the Prevention of Money Laundering Act, 2002:
Following the registration of the case under the PC Act, proceedings under the PMLA were initiated against the petitioner based solely on the PC Act offence. The petitioner's application for discharge under Section 245(2) of the Cr.P.C. was dismissed by the Special Judge under the PMLA, leading to the current criminal revision.

3. Applicability of the Supreme Court's Decision in Vijay Madanlal Choudhary vs. Union of India:
The petitioner argued that the Supreme Court's decision in Vijay Madanlal Choudhary vs. Union of India (2022:INSC:757) mandates the existence of a predicate/scheduled offence for proceeding under the PMLA. The discharge from the PC Act charges should automatically end the PMLA proceedings. The Supreme Court affirmed that if a person is discharged or acquitted of the scheduled offences, there can be no offence of money laundering against them.

4. Discharge Application under Section 245(2) of the Cr.P.C., 1973:
The petitioner contended that the trial Court's dismissal of the discharge application under Section 245(2) was contrary to the High Court's direction to consider the order in CRR No. 1011/2016. The respondent argued that the petitioner's case differed from the co-accused's case. However, the High Court found that the Apex Court's ruling in Vijay Madanlal Choudhary applied, necessitating the discharge of the petitioner from PMLA charges.

Conclusion:
The High Court set aside the Special Judge's order dated 10.06.2023, discharging the petitioner from the charges framed under the PMLA and all further proceedings emanating therefrom. The Criminal Revision was allowed with no order as to costs.