PMLA proceedings continue despite closure of the predicate offence, with judicial custody extended during ongoing investigation.

Closure of the scheduled offence was held not to extinguish PMLA proceedings, because money-laundering under Section 3 is treated as a distinct and continuing offence linked to the proceeds of crime and their concealment, possession, acquisition, use, or projection as untainted property. On that basis, acceptance of the closure report did not defeat the remand jurisdiction or bar continuation of investigation. The Court also found that investigation remained in progress, sufficient grounds existed to extend judicial custody under Section 167 CrPC, and the accused's request for release on bond was refused at that stage.

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Issues: (i) Whether acceptance of the closure report in the scheduled offence extinguished the foundation for proceedings under the Prevention of Money-laundering Act, 2002 and prevented further custody of the accused. (ii) Whether judicial custody of the accused could be extended and their request for release on bond could be refused.

Issue (i): Whether acceptance of the closure report in the scheduled offence extinguished the foundation for proceedings under the Prevention of Money-laundering Act, 2002 and prevented further custody of the accused.

Analysis: The scheduled offence was accepted as closed, but the Court held that money-laundering under Section 3 is a distinct offence and proceeds on the basis of proceeds of crime, concealment, possession, acquisition, use, or projection of such property as untainted. The Court further treated the offence as a continuing activity so long as the proceeds of crime are enjoyed in any of the statutorily described forms. On that reasoning, closure of the predicate offence did not automatically nullify the basis of the PMLA proceedings at the stage of investigation and custody.

Conclusion: The closure of the scheduled offence did not bar continuation of the money-laundering proceedings or defeat the remand jurisdiction.

Issue (ii): Whether judicial custody of the accused could be extended and their request for release on bond could be refused.

Analysis: The Court found that investigation was still in progress and that further custodial detention was justified for the purposes of the PMLA inquiry. It held that sufficient grounds existed to extend judicial custody under Section 167 of the Code of Criminal Procedure, 1973, and that the request for release on bond could not be granted at that stage.

Conclusion: Judicial custody was extended and the request for release on bond was rejected.

Final Conclusion: The order maintained the accused in judicial custody for a further period and sustained the continuation of the PMLA proceedings notwithstanding closure of the scheduled offence.

Ratio Decidendi: Closure of the scheduled offence does not, by itself, extinguish proceedings for money-laundering where the alleged proceeds of crime and the continuing nature of the offence under the PMLA remain under investigation.

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