2023 (11) TMI 1033 - HC - Money Laundering

Special Designated Court must try both money laundering and related scheduled offences under Section 44 PMLA

Ranjit Singh Kothari & Anr. Versus The State of West Bengal & Anr.

The HC affirmed a Metropolitan Magistrate's order directing transfer of a scheduled offence case to the Special Designated Court under PMLA, 2002. The ... Money Laundering - interpretation of statute - Certainty of the Special Designated Court to try the scheduled offence - provisions of Section 44(1)(c) of PMLA, 2002 - language of the statute mandatorily direct that the transfer of the case under the schedule offence to the Special Court is automatic or not - HELD THAT:- A conjoint reading of Section 44(1)(a), Section 44(1)(c) along with Explanations (i) to the Section 44(1) makes it abundantly clear that the legislative intention was that one and same Court would try both the offences and the Special Designated Court being vested with the Sessions power for dealing with offences under PMLA would try such offence. Further the subject matter of transactions being same along with the factual foundation and the outcome in trial of the Scheduled offence having an impact in respect of the offences relating to money laundering, a harmonious construction of the provisions would lead to one and only conclusion that the Special Designated Court for trying offences under PMLA would be the Court which would try the Scheduled offences in the factual circumstances of the present case. As such the order dated March 24, 2021 passed by the learned Metropolitan Magistrate, 4th Court, Calcutta, do not call for any interference and the said order is hereby affirmed. Application disposed off. Issues Involved:1. Whether the case relating to the scheduled offence should be committed to the Special Court designated under PMLA, 2002.2. Interpretation of Section 44(1)(c) of PMLA, 2002 regarding the transfer of cases to the Special Court.Summary:Issue 1: Commitment of Scheduled Offence to Special CourtThe petitioners challenged the order dated March 24, 2021, by the Learned Metropolitan Magistrate, which directed the appearance of all accused persons for committing the case to the Special Designated Court under Section 44(1)(c) of PMLA, 2002. The Enforcement Directorate (ED) had filed multiple FIRs and charge sheets against the accused under various sections of the IPC and PMLA for offences including criminal conspiracy, cheating, and forgery. The ED argued that the scheduled offences under IPC are connected to the offence of money laundering under PMLA, and hence, should be tried by the same Special Court.Issue 2: Interpretation of Section 44(1)(c) of PMLA, 2002The petitioners contended that the amended provisions of Section 44(1)(c) do not mandate the automatic transfer of cases to the Special Court. They argued that the word 'shall' in Section 44(1)(c) should be interpreted as 'may,' giving discretion to the regular court. They relied on the judgment of the Hon'ble Supreme Court in Vijay Madanlal Choudhary & Ors. v. Union of India & Ors., which emphasized that the provisions under Section 44 of PMLA are enabling and discretionary.The ED countered that the legislative intent behind Section 44(1)(c) is to ensure that both the scheduled offences and the offence of money laundering are tried by the same Special Court. They cited the Supreme Court's decision in Rana Ayyub v. Directorate of Enforcement, which clarified that the trial of the scheduled offence should follow the trial of the offence of money laundering, and not vice versa.Judgment:The Court held that the legislative intention behind Section 44(1)(c) is clear and mandates that the same Special Designated Court should try both the scheduled offences and the offences under PMLA. The word 'shall' in Section 44(1)(c) leaves no room for alternate interpretations. The Court affirmed the order dated March 24, 2021, passed by the Learned Metropolitan Magistrate, and dismissed the revisional application. The Court emphasized that a harmonious construction of the provisions leads to the conclusion that the Special Designated Court for trying offences under PMLA would also try the scheduled offences in the present case.