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TMI Blog2024 (8) TMI 1108X X X X Extracts X X X X X X X X Extracts X X X X ..... sition or use of the proceeds of crime and projecting it as untainted property. Proceeds of crime is defined in Section 2 (1) (u) clearly means any property derived or obtained directly or indirectly by any person as a result of criminal activity relating to a scheduled offence. Coming to the charge-sheet presented by the CBI before the CJM, Srinagar, no scheduled offence is disclosed to have been committed. From a plain reading of Section 3 PMLA, it appears that offence under Section 3 PMLA can only be committed after a scheduled offence is committed. It is, thus, trite that commission of a scheduled offence is sine qua non for existence of proceeds of crime and commission of offence of money laundering under Section 3 of the PMLA Act. In the instant case, indisputably, the jurisdictional police, the CBI has not registered any case for commission of any scheduled offence. Enquiry by way of complaint before the CJM, Srinagar is also not in respect of any scheduled offence. In the absence of there being any case registered for commission of scheduled offence or any case pending enquiry or trial in respect of scheduled offence, authorities under PMLA have no jurisdiction to register ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under Section 2 (y) of PMLA. It is, thus, argued that commission of scheduled offence is a sine qua non for offence of money laundering and, therefore, in the absence of commission of schedules offence, there could be no proceeds of crime and no offence under PMLA. It is argued that the very basis of launching prosecution against the petitioner for commission of offence of money laundering defined under Section 3 and punishable under Section 4 of PMLA was that Section 120-B RPC is a scheduled offence and, therefore, in view of the law laid down by this Court in its judgment dated 15th October, 2019 passed in WP(C) No. 2780/2019 titled Ahsan Ahmad Mirza v. Enforcement Directorate and others, registration of case under PMLA was permissible. However, the legal position enunciated by a Single Bench of this Court is now no longer a good law in view of the issue having been decided by the Hon ble Supreme Court in Pavana Dibbur v. Directorate of Enforcement, AIR 2024 SC 117. In the said case, the Supreme Court has held as under:- 27. While we reject the first and second submissions canvassed by the learned senior counsel appearing for the appellant, the third submission must be upheld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charge-sheet, the scheduled offences under Sections 411 and 424 RPC are also made out and, therefore, there is no escape for the petitioner from facing prosecution under PMLA when he has been found to have indulged in activities connected with the proceeds of crime, an offence under Section 3 of PMLA and punishable under Section 4 of PMLA. 6. Having heard learned counsel for the parties and perused the material on record, the questions that call for determination in this petition are as under:- i) Whether for registration of a case for offence of money laundering defined under Section 3 and punishable under Section 4 of PMLA and launching of prosecution before the designated Special Court, registration of an FIR/case for scheduled offence is a condition precedent and a sine qua non? ii) Whether the Enforcement Directorate can examine the case registered or the charge-sheet filed by the investigating agency in respect of commission of various offenced under IPC/RPC and reach at an independent opinion that apart from the offence alleged, offence(s) scheduled under PMLA is/are also made out to assume jurisdiction to register ECIR and launch prosecution in respect of offence of money l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t offence under Section 3 PMLA can only be committed after a scheduled offence is committed. It is, thus, trite that commission of a scheduled offence is sine qua non for existence of proceeds of crime and commission of offence of money laundering under Section 3 of the PMLA Act. 11. In the case of Vijay Madal Lal Choudhary v. Union of India, (2022) SCC Online SC 929, Hon ble Supreme Court in paragraph No.253 has held thus:- 53. Tersely put, it is only such property which is derived or obtained, directly or indirectly, as a result of criminal activity relating to a scheduled offence can be regarded as proceeds of crime. The authorities under the 2002 Act cannot resort to action against any person for money-laundering on an assumption that the property recovered by them must be proceeds of crime and that a scheduled offence has been committed, unless the same is registered with the jurisdictional police or pending inquiry by way of complaint before the competent forum. For, the expression derived or obtained is indicative of criminal activity relating to a scheduled offence already accomplished. Similarly, in the event the person named in the criminal activity relating to a schedule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urisdiction to sit in appeal against the investigation made and the conclusion drawn by the later. The Enforcement Director being a parallel investigating agency in respect of crimes under PMLA must accept the investigation carried by another investigating agency and the conclusion drawn by the said agency in respect of commission of the offences other than the offences under PMLA. 15. The CBI has investigated the matter and presented charge-sheet before the Chief Judicial Magistrate, Srinagar for commission of offences, which are not specifically mentioned in the schedule. It is now for the Court of Chief Judicial Magistrate to consider the entire material collected during investigation and determine as to what offences are disclosed to have been made out against the accused arraigned therein. The Enforcement Directorate, if so permitted, may approach the Chief Judicial Magistrate and canvass before it that apart from the offences of Section 120-B, 406 and 409 RPC, scheduled offences like Section 411 and 424 RPC are also made out. If the Court of Chief Judicial Magistrate frames charges against the petitioner for any of the scheduled offences, it shall be open for the Enforcement ..... X X X X Extracts X X X X X X X X Extracts X X X X
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