Writ petition dismissed for lack of territorial jurisdiction; petitioner advised to seek relief elsewhere.

The High Court dismissed the writ petition due to lack of territorial jurisdiction, advising the petitioner to seek relief from the appropriate court. The court did not address the legality of the cognizance taken by the Principal Sessions Judge, Chennai, as it had already determined the jurisdictional issue.

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Issues Involved:
1. Territorial Jurisdiction of the High Court.
2. Legality of the Cognizance Taken by the Principal Sessions Judge, Chennai under the PMLA.

Issue-wise Analysis:

1. Territorial Jurisdiction of the High Court:

The primary issue was whether the Telangana High Court had the territorial jurisdiction to entertain the writ petition under Article 226(2) of the Constitution of India. The petitioner argued that part of the cause of action arose within the jurisdiction of the Telangana High Court because the Andhra Bank, part of the consortium of banks that sanctioned the loan, had its headquarters in Hyderabad. The petitioner also cited previous protection from arrest granted by the Telangana High Court in a related matter.

The respondent contended that the entire cause of action arose in Tamil Nadu, where the investigation was conducted, the final report was filed, and the company involved had its registered office. The respondent cited several Supreme Court judgments, including *ONGC v. Utpal Kumar Basu* and *Alchemist Ltd. v. State Bank of Sikkim*, emphasizing that the essential cause of action must arise within the jurisdiction of the court for it to entertain the writ petition.

The court examined the legal position and history behind Article 226(2), referencing key judgments that clarified the concept of "cause of action" and its relevance to territorial jurisdiction. The court noted that while a small part of the cause of action could confer jurisdiction, it must be a substantial and integral part of the cause of action. The court also considered the doctrine of forum conveniens, which allows a court to refuse jurisdiction if another forum is more appropriate for the case.

The court concluded that even though part of the cause of action arose in Telangana, the major part of the cause of action, including the investigation and cognizance of the offence, occurred in Tamil Nadu. Therefore, the Telangana High Court lacked the jurisdiction to entertain the writ petition.

2. Legality of the Cognizance Taken by the Principal Sessions Judge, Chennai under the PMLA:

The petitioner argued that the cognizance taken by the Principal Sessions Judge, Chennai, was contrary to law and violated the petitioner's fundamental rights. The petitioner contended that the allegations were civil in nature and did not constitute a criminal offence. The petitioner also argued that the proceedings under the PMLA were unwarranted and illegal, as there was no evidence of money laundering or proceeds of crime.

The respondent countered that the investigation revealed a criminal conspiracy to defraud the consortium of banks and that the petitioner was involved in the laundering of proceeds of crime. The respondent provided detailed evidence of the diversion of funds and the involvement of shell companies. The respondent also highlighted that the cognizance taken by the Principal Sessions Judge was based on substantial evidence gathered during the investigation.

Given that the court had already concluded that it lacked territorial jurisdiction, it did not delve into the merits of the petitioner's arguments regarding the legality of the cognizance taken by the Principal Sessions Judge, Chennai.

Conclusion:

The writ petition was dismissed on the grounds of lack of territorial jurisdiction. The petitioner was advised to approach the appropriate court for relief. The court did not address the merits of the case due to the jurisdictional issue.

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