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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: (i) Whether the proceedings under the Prevention of Money Laundering Act, 2002 could be quashed on the ground that some of the alleged predicate offences related to a period prior to their inclusion in the Schedule or prior to the Act's operation. (ii) Whether the pendency of an appeal against attachment and the stay of connected CBI proceedings barred continuation of the PMLA proceedings.
Issue (i): Whether the proceedings under the Prevention of Money Laundering Act, 2002 could be quashed on the ground that some of the alleged predicate offences related to a period prior to their inclusion in the Schedule or prior to the Act's operation.
Analysis: The relevant enquiry was whether any of the alleged scheduled offences were available in the Schedule when the conduct occurred. The Court noted that Section 467 of the Indian Penal Code, 1860 was already covered when the Act came into force on 01.07.2005, and the alleged conduct extended up to 2006. It also distinguished the cited Madras decision on facts, observing that the present case was not confined to offences introduced into the Schedule only by later amendment. The Court further held that the argument based on Article 20(1) of the Constitution of India did not assist the applicant on the facts of the case.
Conclusion: The challenge on the ground of retrospectivity failed and the PMLA proceedings were held maintainable.
Issue (ii): Whether the pendency of an appeal against attachment and the stay of connected CBI proceedings barred continuation of the PMLA proceedings.
Analysis: The Court held that neither the pending appeal against attachment nor the stay order in the connected criminal revision created a legal bar to initiation or continuation of proceedings under the PMLA. Those circumstances did not require postponement of cognizance or quashing of the summoning order.
Conclusion: The pendency of related proceedings did not preclude the PMLA complaint or the summoning order.
Final Conclusion: The summoning order was upheld and the application under Section 482 of the Code of Criminal Procedure, 1973 was rejected.
Ratio Decidendi: A PMLA prosecution is maintainable if at least one alleged scheduled offence was within the Schedule when the conduct occurred, and parallel proceedings or an attachment appeal do not by themselves bar continuation of the complaint.
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