PMLA quashing challenge rejected: predicate offence doubts, asset timing, and cognizance objections were left for trial.

PMLA proceedings were held not liable to be quashed merely because the predicate prosecution was said to be weak, certain properties or fixed deposits predated the alleged offence, or the cognizance order was said to lack application of mind. The complaint was founded on FIRs and the charge sheet in the predicate offences, and the date of acquisition was immaterial by itself because liability depends on whether proceeds of crime were projected as untainted property. Such factual disputes were held unsuitable for quashing and left for trial. At the cognizance stage, the order was assessed under the Section 204 CrPC standard of sufficient ground to proceed, not on the merits of evidence.

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Issues: Whether the proceedings under the Prevention of Money Laundering Act, 2002 were liable to be quashed on the grounds that the predicate prosecution was said to be weak, some properties and fixed deposits were acquired before the alleged predicate offence, and the cognizance order was said to reflect no application of mind.

Analysis: The complaint under the Prevention of Money Laundering Act was founded on FIRs and the charge sheet filed in the predicate offences, and not merely on an external report. The initiation of prosecution under the money-laundering statute was therefore not undermined by the non-disclosure or contest over that report. The purchase date of properties or creation of fixed deposits was held to be immaterial by itself, because liability under the statute turns on whether the alleged proceeds of crime were projected as untainted property. That factual controversy could not be examined in proceedings for quashing and was left for trial. On the challenge to cognizance, the order was tested against the standard applicable at the stage of summons under Section 204 of the Code of Criminal Procedure, 1973, where the Court is only concerned with sufficient ground for proceeding and is not required to evaluate the merits or sufficiency of evidence as at the charge stage. The reasoning in the cited authorities was applied only in that limited procedural context.

Conclusion: The challenge to the prosecution failed, and the petition for quashing was rejected.

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