Money laundering proceedings cannot survive once the scheduled offence is finally discharged, acquitted, or quashed.

Proceedings under the Prevention of Money Laundering Act cannot be sustained against a person once the scheduled offence is finally discharged, acquitted, or quashed by a competent court. The operative principle is that money-laundering liability depends on property derived from criminal activity relating to a scheduled offence; when that foundational prosecution ends in the person's favour, the link to the alleged proceeds of crime ceases. On that basis, continuation of PMLA proceedings against the person and the connected property is not permissible.

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Issues: Whether a person can be continued in proceedings under the Prevention of Money Laundering Act, 2002 after being finally discharged or exonerated in the scheduled offence.

Analysis: The controlling principle applied was that the offence of money laundering is linked to property derived or obtained from criminal activity relating to a scheduled offence. Where the person concerned is finally discharged, acquitted, or the scheduled criminal case is quashed by a competent court, the foundation for proceeding under the money-laundering law in relation to that person and the linked property ceases to exist. The decision relied on the settled interpretation of the definition of proceeds of crime and the scope of the offence under the money-laundering statute.

Conclusion: The petitioner could not be continued in the money-laundering proceedings after the scheduled offence had been finally resolved in his favour, and discharge from the PMLA charges followed.

Ratio Decidendi: Once the person alleged to have committed the scheduled offence is finally discharged, acquitted, or the scheduled case is quashed, proceedings for money laundering cannot survive against that person in relation to the linked property.

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