TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Join Channel
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: (i) Whether proceedings under the Prevention of Money-Laundering Act, 2002 can continue when the predicate offence has ended in discharge or acquittal; (ii) Whether the ECIR and all consequential proceedings arising from it deserve to be closed under the Court's inherent jurisdiction.
Issue (i): Whether proceedings under the Prevention of Money-Laundering Act, 2002 can continue when the predicate offence has ended in discharge or acquittal.
Analysis: The foundation of an offence under Section 3 of the Prevention of Money-Laundering Act, 2002 is the existence of a scheduled offence and the resulting proceeds of crime. The Court applied the settled principle that where the predicate offence ends in discharge, acquittal, or complete quashing, the basis for alleging money-laundering disappears for the concerned accused. The reasoning treats the scheduled offence as the necessary foundation for proceedings under the Act, while recognising that a separate accused may still be proceeded against only so long as the scheduled offence survives.
Conclusion: Yes. Once the predicate offence had resulted in discharge or acquittal, the money-laundering proceedings could not validly continue against the petitioners.
Issue (ii): Whether the ECIR and all consequential proceedings arising from it deserve to be closed under the Court's inherent jurisdiction.
Analysis: The Court distinguished between a mere challenge to an ECIR and a broader challenge to the downstream actions founded upon it. It held that, even if ECIR is an internal administrative record, the Court is not precluded from examining consequential proceedings where the very foundation of those proceedings has failed. Since the petitioners stood discharged or acquitted in the predicate case, the summons, notice, communication, and further action under the money-laundering proceedings lacked a surviving basis. The Court also preserved liberty to revive proceedings if the predicate foundation is later restored.
Conclusion: Yes. The ECIR-linked proceedings were ordered to be closed, with liberty to revive if the predicate offence order is reversed.
Final Conclusion: The petitioners were granted relief because the money-laundering proceedings could not survive after the collapse of the predicate offence foundation, and the consequential action was brought to an end with a limited liberty of revival in appropriate future circumstances.
Ratio Decidendi: For a prosecution under the Prevention of Money-Laundering Act, 2002, the existence of a scheduled offence and proceeds of crime is a condition precedent; if the predicate offence ends in discharge or acquittal, the consequential PMLA proceedings against the concerned accused cannot survive, though revival remains possible if the predicate foundation is later restored.
TaxTMI 
