Predicate offence requirement under money-laundering law: ECIR cannot survive once the underlying scheduled offence is finally closed.

Proceedings under the Prevention of Money Laundering Act, 2002 depend on a surviving predicate scheduled offence. Here, the ECIR was registered solely on an FIR alleging scheduled offences, but the FIR was later closed by a C Summary report, the protest petition was rejected, and that closure attained finality. The Court applied the settled principle that where the accused is finally absolved of the scheduled offence by discharge, acquittal, or quashing, money-laundering prosecution in relation to that alleged criminal activity cannot continue. With the foundational offence no longer surviving, the ECIR had no independent basis and was liable to be quashed.

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Issues: Whether the ECIR and the consequential money-laundering investigation could survive after the predicate scheduled offence had been finally closed by judicial orders.

Analysis: The ECIR was registered solely on the basis of the FIR alleging scheduled offences under the Prevention of Money Laundering Act, 2002. The FIR was later closed by a C Summary report, the protest petition was rejected, and the closure attained finality. The Court applied the settled principle that proceedings under the Prevention of Money Laundering Act, 2002 are contingent upon the existence of a predicate scheduled offence and that, where the person concerned is finally absolved of that offence by discharge, acquittal, or quashing, no prosecution for money laundering can continue in relation to that alleged criminal activity. Since the foundational scheduled offence no longer survived, the ECIR had no independent basis.

Conclusion: The ECIR could not survive and was liable to be quashed.

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