2023 (4) TMI 479 - HC - Money Laundering

Court clarifies PMLA trial rules, stresses discretion over joint trials

Pankajini Sahu and Another, Daktar @ Doctor @ Jatindra Sahu and Another Versus Joint Director, Enforcement Directorate, Goi and Another

The Court held that the Prevention of Money Laundering Act does not mandate joint trials of PMLA offenses and scheduled offenses. It clarified that ... Money Laundering - scheduled offence - whether, it is mandatory for the PMLA authority to seek committal of the case related to the scheduled offence and in case such an option is exercised, if the Special court as a matter of course bound to allow it? - HELD THAT:- The legislative intent does not make the provision under Section 44(1)(c) of the PMLA obligatory on the authorized officer invariably to make an application for committal. Had it been so, there would have been no reason of any committal under Section 44(1)(c) of the PMLA which again depends on an application of the PMLA authority. If such was the object and purpose of the law, then it should have been expressly made clear about a joint trial of the offences under the PMLA and the Special Act. No doubt, Section 71 of the PMLA envisages an overriding effect which stipulates that the Act shall prevail upon anything which is inconsistent therewith contained in any other law for the time being force. However, on a closer reading of the provisions of the PMLA, it is clear and conspicuous that the scheme of the law beyond doubt does not contemplate an analogous trial of scheduled offences and the offence under the PMLA by the designated court in each and every case. In the case at hand, the authority under the PMLA has not moved the learned Special court at Bolangir for committal of the case in respect of the scheduled offence to the PMLA court at Bhubaneswar and therefore, it has been challenged by the petitioners since the PMLA court on receiving complaint has already summoned them. After having a detailed discussion, the conclusion is that if an application is moved by the competent authority under the PMLA after exercising its discretion for committal of a case in view of Section 44(1)(c) of the PMLA only in appropriate cases and in the interest of justice, in and under such circumstances, the Special court shall have to examine it and take a decision for committal of the case to the designated court under the PMLA and not otherwise. However, in the humble view of the Court, the PMLA authority should examine the plea of the petitioners applying its discretion and in the event found to be a fit case for committal may move the learned Special Judge, Vigilance, Bolangir for a judicious decision in terms of Section 44(1)(c) of the PMLA - Application disposed off. Issues involved:The judgment involves the interpretation of Section 44(1)(c) of the Prevention of Money Laundering Act, 2022 (PMLA) regarding the committal of cases related to scheduled offences to the designated court under the PMLA.Details of the judgment:Issue 1: Committal of cases under PMLA and scheduled offences:The petitioners sought the quashment of impugned notices issued by the PMLA court, arguing that the PMLA authority did not move the Vigilance court for committal of the case to the Special court as required by Section 44(1)(c) of the PMLA. They contended that joint trial of both cases is necessary, citing a Supreme Court decision. However, the ED argued that the PMLA court proceedings are independent and not mandatory for the PMLA authority to seek committal.Issue 2: Interpretation of Section 44(1)(c) of PMLA:The Court analyzed the provisions of the PMLA, emphasizing that the Act does not mandate a joint trial of PMLA offences and scheduled offences. It clarified that Section 44(1)(c) does not require the PMLA authority to seek committal in every case, but it is discretionary based on the circumstances. The Court highlighted that the Special court has the discretion to allow committal applications based on merit and judicial discretion.Conclusion:The Court concluded that since the PMLA authority did not seek committal of the case related to scheduled offences, the petitioners cannot demand such committal as a matter of right. The Court suggested that the PMLA authority should exercise its discretion and, if found appropriate, move the Vigilance court for committal in accordance with Section 44(1)(c) of the PMLA.Final Order:The Court disposed of the petitions, emphasizing the discretionary nature of seeking committal under the PMLA and the importance of applying judicial discretion in such matters.