PMLA proceedings need not await finality of the predicate offence; custody may be sought to aid inquiry and prosecution.

Proceedings under the Prevention of Money-laundering Act, 2002 need not await final adjudication of the scheduled offence. The statutory scheme in Sections 19(3), 45, 46, 65 and 71, read with paragraph 324 of Vijay Madanlal Choudhary, recognises the authority to conduct inquiry, collect evidence and seek custody where warranted in aid of PMLA proceedings. On that basis, the Special Court's recall of the production warrant and refusal of custody to the Enforcement Directorate was legally unsustainable and was set aside, with the accused directed to be produced for consideration of the custody prayer.

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Issues: Whether the Special Court was justified in recalling the production warrant and refusing custody to the Enforcement Directorate on the premise that the ECIR could not be acted upon until finality in the predicate criminal proceedings was reached.

Analysis: The order of the Special Court proceeded on an inapposite reading of the Supreme Court's discussion in Vijay Madanlal Choudhary. The relevant passages did not lay down that an ECIR or proceedings under the Prevention of Money-laundering Act, 2002 can be initiated only after final adjudication of the scheduled offence. The statutory scheme under Sections 19(3), 45, 46, 65 and 71 of the Prevention of Money-laundering Act, 2002, read with the Supreme Court's discussion in paragraph 324 of Vijay Madanlal Choudhary, recognises the power of the authorities to conduct inquiry, collect evidence and, where warranted, seek custody in aid of proceedings under the Act. The Special Court's foundation for recalling the production warrant and rejecting custody was therefore legally unsustainable.

Conclusion: The Special Court's order was held to be bad in law and was set aside; the Enforcement Directorate's prayer succeeded.

Final Conclusion: The revisional court upheld the authority of the Enforcement Directorate to proceed with custody for purposes of the money-laundering inquiry and directed that the accused persons be produced before the Special Court for consideration of custody prayers.

Ratio Decidendi: Proceedings under the Prevention of Money-laundering Act, 2002 need not await finality of the scheduled offence, and the authorised authority may seek custody in aid of inquiry and prosecution under the Act in accordance with the statutory scheme.

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