9911796707
TMI Blog2019 (10) TMI 1408X X X X Extracts X X X X X X X X Extracts X X X X ..... with clause (u) of Sub-section 1 of Section 2 of PMLA. It is beyond the pale of any doubt that offence of criminal conspiracy punishable under Section 120- B IPC is a stand alone offence and figures on top of Part A of the Schedule of PMLA. That being the position, it is difficult to accept the plea that unless the offence of criminal conspiracy is committed in conjunction with a scheduled offence, it cannot be taken to be a scheduled offence for the purpose of Section 3 read with clause (u) of Sub- section 1 of Section 2 of PMLA. Undoubtedly, the offence of money- laundering relates to the process or activity connected with the proceeds of the crime including its concealment possession, acquisition etcetra and proceeds of crime would mean any property derived or obtained directly or indirectly as a result of criminal activity relating to scheduled offence. Once Section 120- B is held to be a distinct, independent and stand alone offence and is one of the scheduled offences under PMLA, any property derived or obtained by any person directly or indirectly as a result of criminal activity relating to the offence of conspiracy would come within the definition of proceeds of cri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioners cannot be held amenable to jurisdiction of the respondents. The writ petition proceeds precisely on these two issues raised by learned counsel appearing for the petitioners. 3 Per contra, the respondents have contested the writ petition on the ground that Section 120-B of Ranbir Penal Code (RPC) is pari materia and corresponds to Section 120-B of the Indian Penal Code (IPC) and, therefore, when read with Sections 1(2) and 2(2) of PMLA would fall under Part A, Paragraph I of the schedule of offences under PMLA. It is submitted that the statements of co-accused recorded under Sections 52(2) and 52 (3) of PMLA during the course of investigation clearly revealed that the petitioners were involved in the act of money-laundering and siphoning of funds of J K Cricket Association in furtherance of conspiracy hatched between the petitioners and the co-accused. The respondents in their reply affidavit have given the account of evidences collected during the investigation of Enforcement Case Information Report No. ECIR/01/SRZO/2018 dated 28.12.2018 registered by the respondents in this regard. 4 Heard learned counsel for the parties and perused the record. Before proceedin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be punishable with rigorous imprisonment for a term which shall not be less than three years but which may extend to seven years and shall also be liable to fine. Provided that where the proceeds of crime involved in money-laundering relates to any offence specified under paragraph 2 of Part A of the Schedule, the provisions of this section shall have effect as if for the words which may extend to seven years , the words which may extend to ten years had been substituted . 7 From reading of Section 3 of PMLA, it clearly transpires that a person, who directly or indirectly attempts to indulge or knowingly assists or is a party or is actually involved in any process or activity connected with proceeds of crime including its concealment, possession, acquisition or use and projecting or claiming it as untainted property, shall be guilty of offence of money-laundering. It is, thus, evident that the activity or process with which the person accused could be charged for the offence of money- laundering must be connected with proceeds of crime . Proceeds of crime is, therefore, the genesis of offence of money-laundering. The proceeds of crime is defined under Section 2(1)( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th offences in that country corresponding to any of the scheduled offences. The clause aforesaid reads thus: Section 2(1)(ia)- corresponding law means any law of any foreign country corresponding to any of the provisions of this Act or dealing with offences in that country corresponding to any of the scheduled offences . 11 It is in the backdrop of aforesaid salient provisions of PMLA, learned counsel, appearing for the petitioners, has built up the edifice of his arguments that the investigation, set in motion by the respondents under the provisions of PMLA, is without jurisdiction and the offences with which the petitioners have been charged do not constitute the offence of money- laundering as defined under Section 3 of PMLA. 12 Before me, learned counsel for the petitioners raised two questions which, as per him, touch upon the jurisdiction of the respondents to initiate any investigation or action against the petitioners. To put the arguments of learned counsel for the petitioners in proper perspective and concretize the issues raised, it would be appropriate to succinctly draw up and formulate the questions for determination: 1. Whether the offence of criminal c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was also aimed to introduce the concept of reporting entity to include therein a banking company, financial institution, intermediary or a person carrying on a designated business or profession. To understand and appreciate the objects of the Amendment Act of 2013 in a better way, it would be necessary to refer to clauses 2 and 3 of the statement of objects and reasons given in the Amendment Act which are reproduced ad infra: 2.The problem of money-laundering is no longer restricted to the geo-political boundaries of any country. It is a global menace that cannot be contained by any nation alone. In view of this, India has become a member of the Financial Action Task Force and Asia Pacific Group on money-laundering, which are committed to the effective implementation and enforcement of internationally accepted standards against money-laundering and the financing of terrorism. Consequent to the submission of an action plan to the Financial Action Task Force to bring anti money-laundering legislation of India at par with the international standards and to obviate some of the deficiencies in the Act that have been experienced by the implementing agencies, the need to amend the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ences 17. From the perusal of different provisions of PMLA including those introduced by the amendment Act 2 of 2013 , it is abundantly clear that the reference to the corresponding law as used in Sub-section 2 of Section 2 of PMLA has nothing to do with the definition of corresponding law given in clause (ia) of Sub- section 1 of Section 2 which came to be inserted by Act of 2 of 2013 w.e.f 15.02.2013. This distinction is required to be borne in mind while interpreting the provisions of Sub-section 2 of Section 2 of PMLA which has been relied upon by the respondents strongly to make a point that Section 120-B RPC corresponds to Section 120-B IPC as the same is a corresponding law in operation in the State of J K to which the Indian Penal Code does not extend. 18. It is not in dispute and is otherwise borne out from the provisions of PMLA and the Schedule appended thereto that offence of criminal conspiracy punishable under Section 120-B IPC is a scheduled offence and the offence of criminal conspiracy punishable under Section 120-B of the RPC does not specifically find mention in the Schedule of PMLA, but by operation of Sub-section 2 of Section 2 of PMLA, any reference i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovision is open to more than one interpretation the Court has to choose that interpretation which represents the true intention of the Legislature. This task very often raises the difficulties because of various reasons, inasmuch as the words used may not be scientific symbols having any precise or definite meaning and the language may be an imperfect medium to convey one s thought or that the assembly of Legislatures consisting of persons of various shades of opinion purport to convey a meaning which may be obscure . 20. Viewed thus, it is beyond the cavil of any debate that the offence of criminal conspiracy punishable under section 120- B RPC shall be deemed to be a scheduled offence corresponding to Section 120-B of IPC which figures on top of Part A of the Schedule appended to the PMLA. The argument of learned counsel for the petitioner that Section 120- RPC cannot be taken to be a scheduled offence is an argument in despair and, therefore, cannot be accepted. I am in agreement with the argument of learned ASGI that the definition of corresponding law inserted by Act 2 of 2013 cannot be used in aid of interpreting the expression corresponding law or the relevant provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the aforesaid offences cannot give rise to the commission of offence of money-laundering as defined under Section 3. It is, therefore, on this premise learned counsel for the petitioners submits that no case for initiating proceedings or investigation under PMLA has been made out and that being the position, the launching of investigation by the respondents followed by issuance of impugned summons is without jurisdiction. 24 Having given my thoughtful consideration to the rival contentions on the point, I am of the view that having regard to the settled legal position that the offence of criminal conspiracy as defined under Section 120- A and punishable under section 120-B of IPC/ RPC is an independent and stand alone offence and, therefore, even if the predicate offence is not a scheduled offence, it would still be a scheduled offence for the purpose of Section 3 read with clause (u) of Sub-section 1 of Section of PMLA. 25 In the case of Baldev Singh vs. State of Punjab, 2009 (3) Crimes 8 (SC), the Supreme Court has clearly held that an offence of criminal conspiracy is an independent offence and is punishable separately; its ingredients being:- (i) an agreement between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Principal Director of Income Tax (Investigation), who by the said impugned order dated 28.05.2019 had accorded sanction to initiate criminal prosecution against petitioner therein and the authority for granting such sanction being under challenge, has to be necessarily confined to the proceedings arising out of the Income Tax Act, 1961. Said order of interim stay of further proceedings arising out of IT Act cannot take within its sweep proceedings initiated or to be initiated under different enactments by different authorities. Though in the statement of objections filed by the Enforcement Authority at paragraph 4 it has been admitted that: The averments in the petition that this respondent had registered in ECIR for the offences under the provisions of the Prevention of Money Laundering Act, pursuant to private complaint filed by the first respondent on the basis of the scheduled offence under Section 120B of the Indian Penal Code is true and correct , The fact remains that Section 120B is a predicate offence by itself or in other words, it is a stand alone offence and as such said argument would not be of any avail to the petitioner to assail the summons issued und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 120- B IPC is a stand alone offence and figures on top of Part A of the Schedule of PMLA. That being the position, it is difficult to accept the plea that unless the offence of criminal conspiracy is committed in conjunction with a scheduled offence, it cannot be taken to be a scheduled offence for the purpose of Section 3 read with clause (u) of Sub- section 1 of Section 2 of PMLA. Undoubtedly, the offence of money- laundering relates to the process or activity connected with the proceeds of the crime including its concealment possession, acquisition etcetra and proceeds of crime would mean any property derived or obtained directly or indirectly as a result of criminal activity relating to scheduled offence. Once Section 120- B is held to be a distinct, independent and stand alone offence and is one of the scheduled offences under PMLA, any property derived or obtained by any person directly or indirectly as a result of criminal activity relating to the offence of conspiracy would come within the definition of proceeds of crime . A fortiori, any process or activity connected with proceeds of crime including its concealment, possession, acquisition etcetra as untainted ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
