The Directorate of Enforcement (ED) is empowered to investigate offences of money laundering under Prevention of Money Laundering Act, 2002 (PMLA) and to take actions/prosecute persons in cases where it is proved. With the reason to limit the arbitrary power of the ED, Supreme Court and various High courts have ruled against ED but there are various judgements in favour of the ED so as to curb the offences of money laundering and ensure that the offender does not move escort free.
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Supreme Court
PMLA | Supreme Court Shows Green Flag To ED And Dismisses TMC MP Abhishek Banerjee’s Appeal Challenging Summons
The Supreme Court has challenged the Summons issued to the TMC MP Abhishek Banerjee under Section 50 of the Prevention of Money Laundering Act (PMLA).
The bench of Justice Bela M. Trivedi and Justice Satish Chandra Sharma did not find any illegality in the summons issued by the respondent-ED summoning the Appellants to its Office at Delhi, which also has the territorial jurisdiction, a part of the offence having been allegedly committed by the accused persons as alleged in the complaint. The appellant being a Member of Parliament has also an official residence at Delhi.
Statements Recorded Under PMLA Deemed To Be Judicial Proceedings: Supreme Court
The Supreme Court has held that the statements recorded under Prevention of Money Laundering Act, 2002 (PMLA) during the inquiry are deemed to be judicial proceedings.
The bench of Justice Bela M. Trivedi has observed that statements recorded by the Authorities under Section 50 of PMLA are not hit by Article 20(3) or Article 21 of the Constitution, rather the statements recorded by the authority in the course of inquiry are deemed to be the Judicial proceedings in terms of Section 50(4), and are admissible in evidence. However, the statements made by any person to a Police Officer in the course of an investigation under Chapter XII of the Code of Criminal Procedure (Cr. PC) could not be used for any purpose, except for the purpose stated in the proviso to Section 162 of the Code.
Delhi High Court
Delhi High Court Refuses Bail To Person Accused Of Diversion Of Loan Funds, Round Tripping And Money Laundering
The Delhi High Court has refused to grant bail to the person accused of diversion of loan funds, round tripping and money laundering.
The bench of Justice Anoop Kumar Mendiratta has observed that apart from the statements of the witnesses recorded under Section 50 of PMLA, the data manifesting relationship of stock, turn over and borrowings by SBFL reflects that SBFL started taking loans from different banks with the help of inflated turn over and fictitious closing stocks.
Madras High Court
PMLA | Enforcement Directorate Need Not Establish Money Trail : Madras High Court
The Madras High Court has held that the enforcement directorate need not establish money trail.
The bench of Justice G.R.Swaminathan and Justice R.Poornima has observed that since concealment of the proceeds of crime is an offence, the accused can be held guilty of the same. The Enforcement Directorate need not demonstrate where the money eventually went. The accused after engineering a disappearing act cannot be heard to contend that they must be exonerated because proceeds of crime have not been identified.
Mere Possession Of Crime Proceeds Sufficient To Invoke PMLA Provisions: Madras High Court
The Madras High Court has held that mere possession of crime proceeds sufficient to invoke Prevention of Money Laundering Act (PMLA) provisions.
The bench of Justice S.M.Subramaniam and Justice A.D.Maria Clete has observed that in any proceeding relating to proceeds of crime under PMLA in a case of a person charged with offence of money laundering under Section 3, the authority or Court shall unless the contrary is proved presume that such proceeds of crime are involved in money laundering and in the case of any other person, the authority or Court may presume that such proceeds of crime involved in money laundering”.
PMLA | FIR Quashing Doesn’t Warrant Automatic Quashing Of ECIR: Madras High Court
The Madras High Court has held that First Information Report (FIR) quashing does not warrant automatic quashing of the Enforcement Case Information Report (ECIR) under Prevention of Money Laundering Act, 2002 (PMLA).
The bench of Justice S.M.Subramaniam and Justice V.Sivagnanam has observed that the FIR was quashed purely on this technical or procedural issue and not on substantive grounds and has not made any findings as to the offences or the prima facie allegations in the FIR. Therefore, the quashing of the FIR shall not warrant an automatic quashing of ECIR. All the more, the predicate offence under Section 447 of the Companies Act, 2013, which is also a scheduled offence under the PMLA still stands good and requires further investigation.
Allahabad High Court
Allahabad High Court Comes Down Heavily On Advocate Of PMLA Accused For Sending Emails To Enforcement Directorate
The Allahabad high court comes down heavily on advocate of accused involved in Prevention Of Money Laundering Act (PMLA) for sending emails to enforcement directorate (ED).
The bench of Justice Samit Gopal has observed that the action of counsel(s) for the applicant of sending emails directly to the Investigating Officer was not proper and cannot be appreciated. The investigating agency was duly represented by its Counsel/Standing Counsel right from the first day and were expected to comply with any direction(s) given by the Court.
