Appeals allowed, attachments released for late charge-sheet filing. Scheduled offence proceedings to continue. No costs awarded.

The appeals were allowed, and the attachments were released due to the failure to file the charge-sheet within the prescribed period. The proceedings under the scheduled offence will continue independently. No costs were awarded.

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Issues Involved:
1. Scheduled Offence
2. Registration of ECIR
3. PMLA Investigation
4. Case of the Appellants
5. Reply by the Respondent
6. Applicability of Police Investigation
7. Jurisdictional Issue and Timeliness of Filing Charge-sheet

Detailed Analysis:

Scheduled Offence:
The Superintendent of Police, CBI, Cochin, forwarded a consolidated Final Report under Section 173(2) Cr. PC, detailing multiple FIRs against several accused for offences under Sections 120B, 420 IPC, and various provisions of the Lotteries (Regulation) Act, 1988, and Lotteries (Regulation) Rules, 2010. The charges involved non-remittance of sale proceeds and prize money to the Sikkim Government, printing lottery tickets from a non-security press, and manipulating unsold prize-winning tickets to claim money from the Sikkim Government.

Registration of ECIR:
Based on the information, an Enforcement Case Information Report (ECIR) was registered on 19.08.2014 under Section 3 of PMLA. The investigation targeted several individuals and entities, including Future Gaming Solutions India Pvt. Ltd. and its representatives. Additional suspects were later included in the investigation.

PMLA Investigation:
The Directorate of Enforcement initiated an investigation under PMLA, 2002. A provisional attachment order was issued on 31.03.2016, which was challenged by the appellants in the Kerala High Court. The High Court permitted the continuation of proceedings but restrained further actions under Section 8(4) of PMLA until further orders. The prosecution complaint was eventually filed on 11.06.2018.

Case of the Appellants:
The appellants argued that the FIRs filed in Kerala were unconstitutional and aimed at banning Sikkim lotteries while promoting Kerala's own lotteries. They contended that the offences under the Lotteries Regulation Act are not scheduled offences under PMLA. They also highlighted that the State of Sikkim had issued No Dues Certificates, indicating no financial loss. The appellants further argued that the lack of a complaint from Sikkim negates the charges under Section 420 IPC.

Reply by the Respondent:
The respondent argued that the lack of a complaint from Sikkim is irrelevant to PMLA proceedings, which were based on a CBI charge sheet indicating wrongful loss to the Sikkim Government. They contended that the investigation revealed manipulation of prize-winning tickets and that the proceeds of crime were calculated based on average principles. They also emphasized that the PMLA investigation is independent of the scheduled offence and does not require all offences to be scheduled offences.

Applicability of Police Investigation:
The court clarified that PMLA proceedings are independent and have their own mechanism. The enforcement of PMLA does not rely on the outcomes of investigations under other laws, such as the Cr.P.C. The court also referenced a Delhi High Court judgment, which stated that PMLA proceedings must be conducted within the framework of the Act, and the powers under Cr.P.C. do not apply to PMLA investigations.

Jurisdictional Issue and Timeliness of Filing Charge-sheet:
The appellants argued that the attachment orders lapsed because the charge-sheet was not filed within the prescribed period. The court noted that various amendments to Section 8(3)(a) of PMLA extended the period for filing the charge-sheet. However, since the charge-sheet was filed more than a year and eight months after the confirmation order, the attachment orders were deemed to have lapsed. Consequently, the court ordered the release of the attached properties.

Conclusion:
The appeals were allowed, and the attachments were released due to the failure to file the charge-sheet within the prescribed period. The proceedings under the scheduled offence will continue independently. No costs were awarded.

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