Petition u/s 227 of Criminal Procedure Code for discharge ...

Shareholders face trial if linked to money laundering, indirect involvement suffices.

Case Laws     Money Laundering

September 6, 2024

Petition u/s 227 of Criminal Procedure Code for discharge dismissed. Allegations in complaint constitute offence of money laundering u/s 3 of PMLA. Prosecution of shareholders permissible if evidence links them to commission of crime. Section 3 covers indirect attempts, assistance or involvement in money laundering. Mere concealment, possession or use sufficient for prosecution. Direct link unnecessary, indirect involvement and connecting link suffice. Discharge u/s 227 in PMLA cases differs from general criminal cases. Material evidence against petitioner regarding consent as major shareholder for borrowing, offering collateral security to be proved at trial. Section 70 of PMLA on presumption of culpable mental state to be read with Section 3. Shareholder liability principle under general law inapplicable to PMLA. Petitioner, holding 86% shares, to prove lack of knowledge of money laundering during trial. Complaint contains material evidence for prosecution, petitioner to prove innocence at trial. No infirmity in impugned order, revision dismissed.

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