PMLA prosecution requires material linking the accused to proceeds of crime; suspicion alone cannot sustain summoning or complaint.

Money-laundering prosecution under the PMLA failed where the record showed no material that the petitioners were involved in the scheduled offence, dealt with proceeds of crime, or projected any such property as untainted. The petitioners were only cited as witnesses in the CBI investigation, and the charge-sheet did not assign them any cognizable role in the predicate offence. Allegations about land purchase through companies and later sale of shareholding were unsupported by evidence of conspiracy, licence applications, or knowing participation in any process connected with proceeds of crime. The complaint, summoning order, and consequential proceedings were therefore liable to be quashed qua the petitioners.

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Issues: Whether the second supplementary prosecution complaint and the summoning order under the Prevention of Money Laundering Act, 2002 were liable to be quashed against the petitioners in the absence of material showing that they were involved in any scheduled offence, had dealt with proceeds of crime, or had projected any such property as untainted.

Analysis: The petitioners were cited as witnesses in the CBI investigation, and the CBI charge-sheet did not attribute any cognizable role to them in the predicate offence. The allegations in the impugned PMLA complaint were limited to purchase of land through companies and subsequent sale of shareholding, but the record disclosed no material that the petitioners had applied for any licence, acted in conspiracy with State functionaries, or knowingly participated in any process connected with proceeds of crime. The statutory ingredients of money-laundering require involvement in a process or activity connected with proceeds of crime arising from a scheduled offence, together with projection or claiming of such proceeds as untainted property. In the absence of evidence satisfying these ingredients, and in light of the consistent statements of the petitioners before the CBI and the Enforcement Directorate, the complaint rested only on suspicion and preponderance of probabilities, which was insufficient.

Conclusion: The prosecution under the Prevention of Money Laundering Act, 2002 was not made out against the petitioners, and the complaint, the summoning order, and the consequential proceedings were liable to be quashed qua them.

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