PMLA Jurisdiction confirmed: ECIR retained but measures tied to stayed predicate FIRs suspended; NBWs set aside.

PMLA jurisdiction requires proceeds of crime derived from a scheduled offence; an ECIR is an internal investigative record not ordinarily quashable at the initial stage, but investigative or coercive measures directly referable to predicate FIRs that are judicially stayed must be suspended. The ED may lawfully add independent FIRs containing scheduled offences to the ECIR by addendum and continue investigation on that basis. Challenges to search and seizure under Section 17 are premature where statutory remedies exist. Non-bailable warrants issued during investigation were disproportionate and are cancelled; petitioner directed to cooperate on prior written intimation.

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Issues: (i) Whether the ECIR registering an investigation under the Prevention of Money Laundering Act, 2002 (PMLA) can be quashed or its investigation continued where the predicate consolidated FIRs stand stayed and cognizance survives only under a non-scheduled offence; (ii) Whether the ED was entitled to expand the ECIR by addendums to include additional FIRs (including those relating to a distinct project) and whether such clubbing/addendums are legally permissible; (iii) Whether the search and seizure conducted under Section 17 PMLA is amenable to interference in writ jurisdiction; (iv) Whether the non-bailable warrants (NBWs) issued during the investigatory stage are valid and whether they should be cancelled.

Issue (i): Whether the ECIR may be quashed or investigation continued when predicate consolidated FIRs are stayed and cognizance in those proceedings is limited to a non-scheduled offence.

Analysis: Section 2(1)(u) and Section 3 PMLA together make the existence of proceeds of crime derived from a scheduled offence a jurisdictional foundation for money laundering proceedings. An ECIR is an internal investigative record; ordinarily it is not equated with an FIR and is not routinely quashable at the initial investigation stage. Judicial authority recognises that ECIR-based inquiry may be scrutinised where demonstrable jurisdictional defects exist (for example, absence of any scheduled offence). A stay of the predicate criminal proceedings suspends their operation and, insofar as those consolidated FIRs are the basis of ED action, investigative measures directly referable to the stayed consolidated FIRs risk circumventing the stay. At the same time, where independent FIRs containing scheduled offences exist and legitimately feed the ECIR, the ECIR cannot be entirely quashed on account of the stay of other predicate proceedings.

Conclusion: The ECIR is not quashed in its entirety. Investigation and coercive measures qua the consolidated Grand Venice FIRs (principal FIR No. 353/2015) are stayed until final adjudication of Criminal Misc. Application No. 25724/2022 or framing of charges in Case No. 1559/2019 or any final order by the competent court, whichever is earliest. The petitioner obtains protection from further ED action insofar as it is referable to the stayed consolidated FIRs.

Issue (ii): Whether ED was entitled to issue addendums to the ECIR to bring in additional FIRs (including Mist Project FIRs) and whether such clubbing/addendums are impermissible.

Analysis: The ECIR is an internal investigative document not governed by CrPC formalities; where additional material or independent FIRs containing scheduled offences come to the ED's notice, the ED may incorporate them into its investigative record by addendum. Consolidation orders under criminal procedure serve administrative purposes and do not per se extinguish the statutory character of independently registered scheduled offences for the purpose of special statutes. Where independent FIRs (distinct projects) contain scheduled offences and name the same accused, they form legitimate predicate material for PMLA investigation.

Conclusion: The addendums bringing the Mist Project FIRs and other FIRs into the ECIR are not impermissible as a matter of law; the ED may investigate on the basis of independent FIRs that contain scheduled offences. The petitioner's challenge to inclusion of those FIRs is rejected.

Issue (iii): Whether the search and seizure under Section 17 PMLA can be interfered with in writ jurisdiction.

Analysis: Section 17 requires recorded reasons and provides for statutory remedies before the Adjudicating Authority to test validity of searches, seizures and freezing. Where an efficacious statutory remedy exists under the PMLA (for example under Section 17(4) and related provisions), premature interference by writ is constrained; allegations of factual misconduct during search also raise disputed questions of fact more suitably addressed by the statutory forums.

Conclusion: The petitioner's prayer to declare the search and seizure illegal is rejected as premature and because an efficacious statutory remedy exists before the Adjudicating Authority; factual claims of misconduct are not adjudicated in this writ.

Issue (iv): Whether the non-bailable warrants dated 11.04.2025 issued by the Special Court during the investigatory stage were justified and whether they should be cancelled.

Analysis: NBWs are coercive measures requiring a clear showing of evasion or that summons/bailable warrants would be ineffective; principles set out in Inder Mohan Goswami and related authorities constrain mechanical issuance of NBWs at the investigatory stage. The record showed the petitioner had engaged with the investigation over an extended period, furnished documents, and had plausible reasons (including alleged illegal detention) for nonappearance at certain points. ED did not place adequate contemporaneous material demonstrating persistent evasion; the prolonged multi year investigation without demonstrable need for renewed coercive process factors into the proportionality analysis.

Conclusion: The NBWs issued on 11.04.2025 are cancelled. The petitioner is directed to cooperate with investigation upon prior written intimation by the ED.

Final Conclusion: The writ petition is partly allowed. The ECIR is not quashed in toto; investigative measures and coercive actions by ED that are referable to the consolidated Grand Venice FIRs (principal FIR No. 353/2015) are stayed until final adjudication of Criminal Misc. Application No. 25724/2022 or framing of charges in Case No. 1559/2019 or any final order by the competent court, whichever is earliest. The ED remains free to continue investigation insofar as it relates to independent FIRs containing scheduled offences. The NBWs dated 11.04.2025 are set aside and the petitioner is directed to cooperate with investigation on prior written intimation.

Ratio Decidendi: An ECIR is an internal investigative record not ordinarily quashable at the initial stage, but PMLA investigative jurisdiction depends on the existence of proceeds of crime derived from a subsisting scheduled offence; where predicate proceedings forming the basis of ED action are judicially stayed, investigative and coercive measures directly referable to those stayed predicate FIRs must be suspended until final adjudication, while the ED may continue investigation based on independent FIRs that validly constitute scheduled offences.

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